Consumer Proposal – Creditor Voting

Table of Contents

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, call us at 1-844-962-9200 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. 

Share This!

Great experience i was in financial trouble and someone of my friends recommended this company. Cori is a wonderful and welcoming person she did a very good job and came up with a smooth and flexible monthly payment after the reduction. i highly recommend this company. Thank you David sklar and special thanks to Cori.❤️🙏🏻
Jasmine Joseph
22:08 13 Jan 23
Met up with Mr. Jason Sklar to discuss more in person, very thorough and clear. He is very kind and thoughtful, I will be referring anyone with the same situation to David Sklar & Associates.
Ariel Domingo
02:33 29 Dec 22
I was a reck talking yo Jason Sklar was easy comfortable he explained everything and put my mind at ease I would recommend the team od sklar to everyone. I have already talked to my ci workers about them
kevin mcweeney
01:13 22 Dec 22
The team at David Sklar & Associates is fantastic.I worked with Jerry whom not only made - what seemed like intimidating process to initiate at first - comfortable.He made everything transparent and took the time to explain the process every step of the way.He was kind, attentive, and professional. Everything was made straightforward and stress free and we found a solution together that worked.Thanks to Jerry and the team.
Jordie Angiolillo
18:22 21 Dec 22
From day one till the end which is today😁 DavidSklar gave me a 5star service and treatment. And I will 100% recommend him and his Associates. This is the best Christmas present ever! Thank you David! More business to come! Merry Christmas and a Happy New Year!!!
barbee diaz
16:37 16 Dec 22
I FOUND DAVID SKLAR & ASSOCIATES BY GOOGLING "BANKRUPTCY" (EARLY NOV. 2021). ON NOV.4, 2021 I HAD A MEETING WITH CORI NARON AT HER OFFICE AT ST CLAIR ANDBATHURST. HER POSITIVE APPROACH TURNED ASTRESSFUL SITUATION INTO A STEP BY STEP UNDERSTANDABLE PROCESSON SEPT. 23, 2022 I OBTAINED MY AUTOMATICDISCHARGE FROM BANKRUPTCY AND MY CERTIFICATE OFDISCHARGE.THANK YOU CORIBRUCE BURGESS
bruce burg
21:35 02 Dec 22
Jerry was wonderful and provided superb service. He is very knowledgeable, trustworthy, and made an intimidating and shame filled time in my life stress free. I hesitated for a long time to take the next step, but Jerry answered all questions, was patient and made the process effortless. I am eternally grateful, and highly recommend Jerry’s services.
M J
18:41 01 Dec 22
Jerry was professional and was easy to deal with
Debbie Asquith
00:09 29 Nov 22
I was quite nervous and a little embarrassed that I needed financial advice. I met with Jerry Janiec and he was very helpful. He made me feel comfortable and explained everything in easy to understand terms so that I understood what my options were. I would recommend David Sklar & Associates for anyone in my position.
Melissa Blackburn
19:53 17 Nov 22
I was fortunate enough to be referred to David Sklar & Associates Inc. by a family member. Now in the10th month of a Consumer Proposal process, I am very impressed with the organization, professionalism and impeccable customer representation that I have experienced. To this effect, I amparticularly thankful to Jerry Janiec and Rhoda Lewis for their excellent work.
Suzanna Vaclavik
12:21 16 Nov 22
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