Consumer Proposal – Creditor Voting

Creditor Voting on Consumer Proposals

A consumer proposal is a legally-binding agreement between an insolvent person who is unable to repay all of their unsecured debts and their unsecured creditors. It is governed by the Bankruptcy and Insolvency Act and enables insolvents to repay a portion of their eligible unsecured debts over a period of up to 5 years. Upon the successful completion of their proposal, the insolvent is released from the debts covered in their proposal.

In Ontario, proposals can only be filed and administered by federally-licensed trustees in bankruptcy, such as David Sklar & Associates.

How does Creditor Voting Work?

After your trustee has determined that you are insolvent and that you are able and willing to successfully complete a consumer proposal, you and your trustee will work together to create your proposal.

Your trustee will then file your proposal with the Office of the Superintendent of Bankruptcy (OSB) and submit it to your unsecured creditors for approval. Your creditors have 45 days to accept or reject your proposal.

During those 45 days, you will be protected from the unsecured creditors included in your proposal, who are required, by law, to:

  • stop charging interest,
  • stop all collection efforts,
  • stop wage garnishees,
  • stop collection calls, and
  • stop all legal actions.

Also, during this time, you will not make any direct payments to those creditors in your proposal.

What Happens if there are no Objections from Creditors?

If after 45 days, none of your creditors have requested a meeting, your consumer proposal will be considered accepted. 15 days later, if no request for a review of your proposal has been received, the Court will deem your proposal accepted by the Court.

It should be noted that in the vast majority of cases, proposals submitted by David Sklar & Associates are accepted by creditors. This is due, in part, to the great care we take while working with our clients and our commitment to finding the best solution for everyone involved in a proposal.

As officers of the court, we are licensed by the federal government to protect your rights and to ensure a fair proposal.

What Happens if there is an Objection?

If during the 45 day period, one or more creditors (who hold more than 25% of your unsecured debt) call for a meeting, then a meeting will be held for all your proposal creditors to attend (or vote by prearranged proxy). The OSB can also call a creditor meeting.

In order for your proposal to be rejected, creditors representing more than 50% of the dollar value of the debt covered in your proposal, must specifically vote to reject the proposal during the meeting, otherwise it will be considered accepted.

If there are no calls for a review of the proposal, then 15 days after the proposal is accepted at a meeting, the Court will approve the proposal. Note: both the OSB and the Court have the right to reject your proposal.

When a proposal is accepted by the Court, it becomes a binding agreement on you and all of the creditors in the proposal, including any creditor who may have voted against it.

What Happens if the Consumer Proposal is Rejected?

If a proposal is rejected you may work with your trustee to modify your proposal and resubmit it – or file for bankruptcy if you have no other reasonable options – or find another way to pay your unsecured debts.

In our experience, proposals that are fair and offer the unsecured creditors more money than they would get if you filed bankruptcy – are generally accepted.

What Happens After the Court has Accepted a Consumer Proposal?

You will then:

  • make all the agreed upon payments (usually monthly) to your trustee for disbursement to your proposal creditors,
  • attend two credit counselling sessions, and
  • honour all the terms of your proposal.

When you have successfully completed your proposal, you will be released from the debts covered by your proposal. You will have earned a fresh financial start and learned the skills to ensure a brighter financial future for you and your family.

Are You Eligible for a Consumer Proposal?

If you are in serious financial trouble, and are unable to repay your debts in a reasonable period of time – you might qualify for a consumer proposal.

If you live in the Toronto area, you are welcome to call us for a free, no-obligation consultation, where we will review your finances in detail and discuss all of your options for getting out of debt. If we can find a way for you to get out of debt without declaring insolvency, we will share the information with you. Call us at 416-498-9200 to book an appointment at one of our 6 Toronto Area offices.

If you live outside of the Toronto area – visit the Office of the Superintendent of Bankruptcy’s website for a complete list of licensed trustees in bankruptcy in your area.

 

Take Your First Step Towards A Debt Free Life

If you are overwhelmed by debt and live in the Toronto area, call us at 416-498-9200 to book a FREE, confidential appointment. We will review your financial situation in detail and discuss all of your options with you. Alternatively, you can fill out the form below and our team will reach out to you. 

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Ready to live debt free?

I cannot emphasize enough how thankful I am for Jackie Stanley's help with filing for bankruptcy.All of us dread being put in this position and we have a million questions about the process but trust me Jackie makes it so easy for you that you don't have to do anything yourself!She is very kind and friendly and puts you at ease right away. She emphasizes with you and let's you know it's not your fault.Most importantly when you leave that first meeting you will not believe the load that is taken off your shoulders. You can actually feel it!You are a godsend Jackie and I can't thank you enough!!I hope you are highly valued there as much as you are by me!
Sue Murray
18:45 05 Dec 21
Putting together and executing a Consumer Proposal can be daunting, that is unless you work with Cori Naron at David Sklar & Associates Inc. Cori's advice and support has been instrumental over the past five years. Thank you Cori!!
Barry Kuntz
20:37 01 Dec 21
I’m very happy with the services I received for Jackie Stanley who helped me get my finances in order. It was a quick and easy process & all of my questions were answered.
Amanda Frappier
01:18 19 Nov 21
I have had the privilege of being supported by Jackie at David Sklar Associate. She was very helpful, very professional and very friendly. She gave me the help I need. Thank you Jackie for your help.
Alex Taylor
22:03 17 Nov 21
Got my probe solved, great service
arny raposo
17:02 11 Nov 21
Jackie at Daivid Sklar and Associates is such a pleasure to work with. She explained everything in great detail and is always there when I have a question or concern. She really cares about her clients.
Steve Medica
09:33 10 Nov 21
I filed a proposal with another group, which came in as a referral from one of my brokers. My experience went from ok to bad to worse, due to lack of communication and education on the process I was to embark on. I worked with Cori Naron in the past, and I came to her now for help on literally doing the work that the other group should have done. Cori stepped in, educated me, advised on rights, responsibilities, how the process works and what potential outcomes may happen. I do not have enough words of recognition and gratitude for what she did - she alleviated stress, anxiety, dead-end thoughts and she made me live again. Congrats to DSklar for hiring her and retaining such talent.
Giani Kokolakis
18:45 25 Oct 21
Very professional service. Before contacting David Sklar & Associates i contacted bunch of other firms they seemed fishy. After I spoke with Jason Sklar at Hamilton Office I discovered professionalism with hope. I was explained every step of my situation with solution professionally. Thank you David Sklar & Associates.
Wajay Awan
07:29 12 Oct 21
I met David a few months ago and i am glad I did. He has helped me all the way through my bankruptcy with good advice and explained every step of the process. David is a very down to earth and very professional. Anytime I've had a question I was able to reach out to David by phone or email and he always got back to me. If your struggling with your bills and need a way to get help, I strongly recommend David Sklar &Associates to help you. My experience with them on 1-5scale would be a 5;; My life is so much better now, thanks to David Sklar.
Bruce Locke
16:13 08 Oct 21
I have had the privilege of being supported by Jackie S, at David Sklar n Associate.She was helpful, professional and friendly. I was able to get the help I needed at a difficult time in my life. I would recommend anyone who needs support with working out their debts to ask for Jackie, she will be waiting to assist however she can to help you through your debts. She works with a team who is always ready and responsive.Thank you Jackie and your team:)
Denise Simpson
15:17 09 Sep 21
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