Toronto Insolvency Lawyer Helping Clients Facing Financial Hurdles
If you are dealing with unmanageable debt personally or in your business, there may be several debt relief options available to help you get your finances back under control. But when all else fails, you may consider filing for insolvency or bankruptcy. Through this process, most unsecured debts can be eliminated and you can put a stop to collection calls from creditors. Having an insolvency litigation lawyer on your side may be fundamental to getting through this process while receiving fair treatment.
What Is the Insolvency Process in Ontario?
The insolvency process is a legal procedure that allows a consumer or business to declare that they have exhausted all possibilities and cannot repay their debt. There are a few steps to be taken, and working with an insolvency lawyer is extremely important.
In most cases, an individual or business can initiate an insolvency filing by having their lawyer prepare all the necessary forms and documents, including a detailed list of assets, liabilities, income, and expenses. Your documents will then be filed with the court. Once the court accepts your filing, your bankruptcy begins and you are protected from further legal or collection actions from creditors.
What Is the Difference Between the BIA and the CCAA?
If you are a business owner facing insolvency, the Companies’ Creditors Arrangement Act (CCAA) and the Bankruptcy and Insolvency Act (BIA) are some of the main statutes that govern formal restructuring of a business. If your company owes $5 million dollars or more to its creditors, you may be eligible for restructuring under the CCAA, otherwise, most small and medium-sized businesses will fall under the BIA when dealing with insolvency.
Generally speaking, the BIA requires a business to complete an insolvency process within 6 months of filing. For some businesses with complex debt profiles, completing the restructuring process within that timeframe may not be possible, so they may choose to file plans under the CCAA instead. Your lawyer can better advise you on your options for dealing with business insolvency and the statute that you should plan under.
Are There Other Alternatives to an Insolvency Filing?
If you are a consumer struggling to repay your debts, it is highly recommended you explore other options before resorting to an insolvency filing. The BIA also addresses consumer insolvency and allows for an individual to enter a process called consumer proposal, in which you may be allowed to only repay part of your debt. Other options include consolidating your debts by making an additional loan with lower interest, entering into a debt management program or getting your creditors to agree to a debt settlement.
If you own a business that is not doing well financially, you may also explore other options before filing for bankruptcy. One of these options is called an Assignment for Benefit of Creditors. This is a device that allows a business owner to liquidate their business assets to creditors. Creditors will then sell the assets and apply the money necessary to satisfy any debts, and any proceeds left are sent to business owners and any shareholders.
How Can an Insolvency Litigation Lawyer Help Me?
Dealing with insurmountable debt is extremely overwhelming and draining, no matter if you are a business owner or an individual consumer. When everything you own and work for is on the line, you need a skilled insolvency litigation lawyer on your side. At Financial Litigation Law firm we have the knowledge and track record to help you successfully navigate an insolvency situation. We can advise you on the best solution for your situation and help you through the filing process if necessary. There is absolutely no need to try and figure out all the legislation, statutes, and paperwork on your own. Reach out to our Toronto office at 416-769-4107 and let us work together to help you get a clean slate and get back on track. We look forward to assisting you.