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Insolvency (BIA) - Bankruptcy Applications. Aquino (Re)
In Aquino (Re) (Ont CA, 2026) the Ontario Court of Appeal dismissed a BIA insolvency appeal, this brought against two orders: the first "adjudging the appellant bankrupt and appointing [a] trustee of his bankrupt estate" and the second "determining that a pre-existing Mareva injunction, granted in litigation that resulted in a substantial judgment against the appellant (the “TUV litigation”), remained and continued in full effect until further order of the court (the “Mareva Order”).
Here the court considers the discretion of bankruptcy judges to dismiss a bankruptcy application [BIA 43(7)], or the stay it under BIA 43(10):[37] The appellant argues that the bankruptcy judge should have exercised her discretion to dismiss the application under s. 43(7) of the BIA[3]. Section 43(7) provides:If the court is not satisfied with the proof of the facts alleged in the application or of the service of the application or is satisfied by the debtor that the debtor is able to pay their debts, or that for other sufficient cause no order ought to be made, it shall dismiss the application. [38] Alternatively, he argues that the application should have been stayed under s. 43(10) which provided:If the debtor appears at the hearing of the application and denies the truth of the facts alleged in the application, the court may, instead of dismissing the application, stay all proceedings on the application on any terms that it may see fit to impose on the applicant as to costs or on the debtor to prevent alienation of the debtor’s property and for any period of time that may be required for trial of the issue relating to the disputed facts. ....
[44] ... A bankruptcy order is to be granted where the debtor has committed an act of bankruptcy: BIA, s. 43(1). An act of bankruptcy unquestionably occurred by the appellant’s failure to pay his debts as they generally became due: s. 42(j). Nothing in s. 43(7) requires that a bankruptcy application predicated on a person’s act of bankruptcy should be dismissed because their assets might, in an uncertain future, be realized on.
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