What Is A Trustee In Bankruptcy?

“A bankruptcy trustee is the most highly educated debt consultant you can talk to in Canada. A professional trustee will explain all your debt relief options, not just bankruptcy.”


In Canada, we are fortunate in that our insolvency laws have been written in such a way as to minimize the use of lawyers and the Court for the majority of the individuals that file personal bankruptcy. In Canada you file bankruptcy with a licensed trustee in bankruptcy – the court only gets involved in highly contentious matters or when someone fails to comply with all of the requirements of the law.

About Bankruptcy Trustees

Quite simply, a bankruptcy trustee is a professional who is licensed by the Government of Canada to administer your bankruptcy or consumer proposal. Only a licensed trustee in bankruptcy or licensed insolvency trustee can file a bankruptcy or proposal for you. If you need to confirm that the person you are dealing with is a trustee, you can find all bankruptcy trustees in Canada listed on the Superintendent of Bankruptcy website. You file for bankruptcy with the assistance of a trustee, who is then assigned to administer your bankruptcy under the Bankruptcy and Insolvency Act and manage assets held in trust.

The best way to think of a trustee is as a referee. They don’t work for you, or against you, they administer the rules of the process and see that everyone complies with their duties and responsibilities under the law.

Trustees are bankruptcy specialists and they are the only persons that may administer bankruptcies and proposals in Canada. This is an important distinction because in recent years, a new industry has developed in Canada that calls itself “debt consultants”. These debt relief agencies charge you a fee to advise you on how to deal with your debts. Once the fee has been paid they refer you to a licensed trustee to actually do all of the work.  Debt consultants are not breaking any laws, but since most trustees will meet with people for free to help them sort out their financial problems, you should never have to pay a referral fee to see a trustee in bankruptcy in Canada.

All our Local Bankruptcy Trustees offer a free, no charge, confidential consultation. Their sole objective is to help you deal with your debts.  They are members of our site because of their reputation for providing the best service in their communities. Since they do not charge a fee for a consultation, there is no cost so you have nothing to lose by contacting one of our trustees and asking questions.

bankruptcy trustee

Why do I need a Bankruptcy Trustee?

Filing a bankruptcy or consumer proposal is a complicated legal process. In Canada, you need to file a proposal or make an assignment in bankruptcy with a licensed trustee. A personal bankruptcy trustee in Canada completes a rigorous education program that includes a period of practical experience in debt management. This program runs from 2 to 5 years or more, depending on the individual. Once candidates have passed the educational and experience requirements they sit an Oral Board of Examiners in order to be granted a trustee licence.  This Board sits once a year and the pass rate is generally about 50%. It is quite a personal achievement to obtain a trustee in bankruptcy licence in Canada.

This means that a personal bankruptcy trustee is a highly trained debt expert and the most qualified person you can talk to concerning your debts. An professional trustee will not just “talk you into filing bankruptcy”.  In fact, they are obligated by a strict code of conduct to explain all of your debt relief options.

Did you know that in fact 4 out of 5 people that contact a trustee in bankruptcy do not need to declare bankruptcy and are advised of another solution? Often this is a consumer proposal, a legal arrangement that you can make with your creditors through a Consumer Proposal Administrator, who is also a trustee.

The best thing you can do if you are considering filing for bankruptcy, or are looking at any debt relief option, is to contact a Local Bankruptcy Trustee in your community.  They will assess your personal situation and help you decide if a bankruptcy or a consumer proposal is the best solution for you and if not, they will recommend what you should do to help you deal with your debts.

Let Us Help

Our Local Bankruptcy Trustees will provide a free, no-obligation assessment to answer all of your questions and help you decide what debt relief option is best for you.

Contact a Local Bankruptcy Trustee near you.

From Our Canada Bankruptcy Trustee blog: