April 5, 1932 (17th Parliament, 3rd Session)


Hugh Guthrie (Minister of Justice and Attorney General of Canada)

Conservative (1867-1942)


The Bankruptcy Act, as it appears on the statute books of Canada today, was originally passed in this house in the session of 1921, and we have now had ten or eleven years' experience of the operation of that legislation. As the years have passed, many suggestions have been made in regard to amendments to the act in very many respects, and from time to time certain amendments have been made with the idea of improving the machinery which is available under the Bankruptcy Act in respect to the estates of insolvent persons. Recently the whole subject of our bankruptcy legislation was considered at a meeting of the Canadian Bar Association, and a committee of the members of that association, who are considered to be experts on the subject of our bankruptcy law, was appointed for the purpose of considering whether certain further amendments should not be made to render the act more workable and less expensive in its operation. I have had submitted to me a recommendation of the committee which was appointed by the Canadian Bar Association, and that association also submitted a draft bill on the subject. That report and the bill then submitted have been very fully investigated by
the law officers of the Department of Justice, and it was decided that it would be in the interests of the whole community if certain of the proposals contained in that report were adopted as amendments to the present Bankruptcy Act. The whole draft bill as submitted has not been adopted, but in addition to that various suggestions have come to the department from every province in Canada in regard to amendments to very many of the clauses of the present act. These suggestions have come from very responsible bodies: from wholesale dealers' associations, from retail dealers' associations, from some farmers' organizations, from chartered accountants, from lawyers, from judges, and, in fact, from almost all classes of our community. I shall have placed at the disposal of a committee which I will propose shortly a very large number of these suggestions in order that they may be fully considered, because a great many of them have not been included in the measure which has been drafted pursuant to the resolution now under discussion.
Briefly, may I state that the most important provision in connection with the present resolution is the one for the appointment of a superintendent in bankruptcy. It is by reason of that proposed amendment that the matter is now brought before the house by way of resolution. It will involve some charge on the public fund, and for that reason it has to be introduced into this parliament by means of resolution.
The proposal to appoint a superintendent in bankruptcy is a new departure. It has been considered by many associations, including the Canadian Bar Association's committee, and has been very seriously recommended. It is thought that we should have some controlling power attached to the Department of Finance, as proposed in the bill, in order that all the machinery involved in the Bankruptcy Act may come within the purview of a superintendent who will have full power to deal with the trustees who are appointed in various parts of the Dominion of Canada in regard to the winding up of insolvent estates. The chief complaint which is made against the present law is the expense attendant upon its operation. Complaints come in from time to time that in many cases there is nothing left for the creditors because of the expenses of winding up, that the fees paid to trustees, to lawyers and to inspectors eat up the whole available estate so there is nothing left for the creditors.
That is a situation, of course, which we should remedy if it is possible to do so, and
Bankruptcy Act

it has been considered that if someone had a commanding position in control of the whole machinery, having jurisdiction throughout the whole of Canada, much of the expense now involved in the winding up of estates might be done away with. I believe that proposal has been very well received in all the trading communities of Canada. This resolution mentions the appointment of a superintendent, and the bill will provide for the appointment of a superintendent with very wide powers.
It is my intention, if this resolution passes and the bill is introduced, to submit the bill to a special committee of this house-I would suggest a fairly large committee-in order that not only the proposals contained in the bill may be considered but that other proposals from responsible bodies, corporations and individuals in every part of Canada who have submitted proposed amendments, may be considered as well. I think the time has come when we should have a very full discussion of the question of amending the Bankruptcy Act, and if the bill is given second reading I will ask that it be referred to a special committee in order that these proposals may receive the fullest study and consideration and that an effective amending bill may be submitted to the house as a result. I submit the present bill more as a basis for discussion. The government is not wedded to all the proposals it contains, though we have gone over the bill very carefully and we think the proposals contained in it will considerably improve the present measure. It may be, however, that there are other amendments just as necessary as those we have suggested in the bill, and we will welcome those suggestions from any quarter whatever.

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