The general rule in bankruptcy is that a debtor receives a “fresh start” and is discharged from prior debts, but this is subject to certain exceptions. Subsection 178(1) of the Bankruptcy and Insolvency Act (BIA) sets out eight classes of debts that are not released by an order of discharge including an exception for debts that arise out of fraud. In Poonian v. British Columbia (Securities Commission) the Supreme Court of Canada adopted a narrower interpretation of whether a claim…

In Peace River Hydro Partners v. Petrowest Corp., the Supreme Court of Canada (SCC) refused to stay a receiver’s civil lawsuit in favour of multiple arbitration proceedings, finding the arbitration agreements were made inoperative by court order to facilitate an orderly and single insolvency process. This case helps resolve a tension between the expedience of a single insolvency process and the presumptive enforceability of arbitration agreements. Background Peace River subcontracted various Petrowest entities to work…