Fiset et Associés Syndic inc (Syndic Autorisé en Insolvabilité-SAI)

Licensed Insolvency Trustee

 phone :  418-781-2120

Proposal in Bankruptcy

Let the professionals at Fiset et Associés Syndic Inc. help you with your proposal in bankruptcy in Quebec.

Bankruptcy and Insolvency Act

Who Is Eligible to Make a Proposal?

  • Corporations - insolvent companies (companies)
  • Partnerships (SENC)
  • Insolvent individuals
  • The liquidators of the property of an insolvent person
  • A receiver within the meaning of section 243 (2) of the BIA
  • A bankrupt
  • The Licensed Insolvency Trustee of a Bankrupt's Assets.

The proposal is a legal procedure that allows an insolvent person or company to make an offer of settlement of debt to creditors. To the extent that the offer is accepted by the creditors, the insolvent person or company will be able to keep their assets and continue operations in the normal course of business. The proposal is generally aimed at unsecured creditors but in some cases offers may be made to secured creditors. In general, the proposal is used by insolvent persons or companies who are profitable or have the capacity to become profitable in the short or medium term.

Who Is Authorized to Act as the Administrator of a Proposal?

A Licensed Insolvency Trustee.

What is the Duration of a Proposal?

The duration of a proposal is variable. The BIA does not impose a maximum period of time to finalize a proposal. The duration is part of the proposal itself to be accepted by the creditors when voting on the proposal.

What Are the Criteria for Acceptance of a Proposal by Creditors?

Proposed settlements are submitted for approval to creditors at a meeting of creditors. The meeting of creditors generally takes place within 21 days of the formal filing of the proposal with the Office of the Superintendent of Bankruptcy.

To be accepted, a proposal must receive the approval of a majority in number of creditors, and a 2/3 majority in terms of dollars, that have filed evidence of formal claims.

Example: A company has 10 creditors with total debts of $200,000. The trustee receives, before the beginning of the meeting of creditors, 5 proofs of claims totaling $100,000 with proper voting forms. The proposal will be accepted if there are 3 of the 5 creditors who vote in favour and the 3 votes in favor represent $66,666 of the debt.

What Kind of Circumstances Lead to the Filing of a Proposal?

  • A finding that the company is insolvent, i.e., unable to meet its obligations coming due and lack of liquidity.
  • Inadequate financing jeopardizing the future operations of the company.
  • Late filing and payment of tax returns (DAS-TPS-TVQ-taxes) and seizure of bank accounts and accounts receivable by tax authorities.
  • Notice of the exercise of a mortgage remedy by your secured creditor including a 10-day notice provided under section 244 of the Bankruptcy and Insolvency Act.
  • Court proceedings and/or seizures by creditors.
  • Losses due to bad debts.
  • Problems with production or starting up a new production system that has led to financial losses.
  • Large customer losses and/or decreased turnover.
  • Problems controlling operating costs.
  • Negative events beyond the control of the insolvent person.
  • Investments that have not yielded the expected results.
  • Illness striking managers or key personnel.

Advantages: Proposal in Bankruptcy

  • The legal remedies of secured and unsecured creditors are legally suspended, which prevents seizures of assets, seizure of wages and other recovery measures by creditors.
  • Recourse by secured creditors is suspended in accordance with the provisions of the Act.
  • Insolvent persons retain their assets and continue their operations in the normal course of business without pressure by creditors.
  • Insolvent persons may obtain temporary funding approved by the Court.
  • Unprofitable business contracts can be terminated.
  • Unsuccessful commercial leases can be terminated.
  • Categories of creditors can be created.
  • The proposal may be used to settle the personal liability of corporate directors.
  • The meeting of creditors may be adjourned with the consent of the creditors.
  • Some claims must be paid in full under the BIA.
  • The Court approves the proposal accepted by the creditors.
  • The payments provided for by the proposal are given to the syndic who ensures the proper management of the file and the distribution of the sums to the creditors.
  • Bankruptcy is avoided.

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Call our insolvency professionals today.

Fiset et Associés Syndic inc (Syndic Autorisé en Insolvabilité-SAI)  

455 Grande Allée Est, OFFICE 100

QuEbec, QC G1R 2J5





Monday - Friday 08:30 AM - 05:00 PM

Emergency appointments available


  • Quebec
  • Montréal
  • Laval
  • Bas-du-fleuve
  • Gaspésie
  • Chaudière-Appalaches
  • Centre-du-Québec
  • Beauce

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