HOW DOES A PERSON DECLARE BANKRUPTCY IN ALBERTA?
Before a person can declare bankruptcy in Alberta, the person must meet certain financial conditions and meet the definition of being an insolvent person.
The Bankruptcy and Insolvency Act provides a definition of an insolvent person and sets out the conditions which must exist before a person can declare bankruptcy in Alberta or Canada. The conditions that must exist, or the threshold that must be met, before a person can declare bankruptcy in Alberta are not that stringent and for the most part are easily met by people in financial difficulty.
In order to declare bankruptcy in Alberta or Canada, a person must:
- Be able to show that their proven debts exceed one thousand dollars.
- Reside or have resided in or carried on business or have property in Canada; and,
- Not already be bankrupt;
They must also:
- Be unable to meet their financial obligations as they generally become due;
- Have ceased paying their current obligations in the ordinary course of business as they generally become due; or
- The total value of their property is not sufficient, or if disposed of at a fairly conducted sale, under legal process, would not be sufficient to enable payment of all their debts or financial obligations.
If a person meets these requirements they are eligible to declare bankruptcy, and they may wish to meet with an Alberta Bankruptcy Trustee, who can help them make a decision as to whether their situation is serious enough for them to declare bankruptcy.
In most cases, people do not declare bankruptcy for as little as one thousand dollars. Each person’s threshold as to when it makes sense for them to declare bankruptcy in Alberta is different, and for the most part, depends on how much they make, how many debts they have, how long it will take to pay their debts off and if that is even possible for them to do.
An Alberta Bankruptcy Trustee can meet with you on a confidential, no obligation basis, to discuss your personal situation and the steps which need to be taken to declare bankruptcy in Alberta.