Best Restructuring & Insolvency Lawyers in Calgary

About Restructuring & Insolvency Law in Calgary, Canada

Restructuring and insolvency law in Calgary, Canada, is focused on assisting businesses and individuals who are facing financial distress or insolvency. This branch of law outlines the rights and obligations of all parties when a debtor is unable to meet their financial obligations, providing processes for restructuring debts, liquidating assets, or otherwise resolving financial difficulties. Calgary, as a major economic center in Alberta, sees many businesses and individuals who may face financial challenges due to market conditions, commodity prices, or other economic factors. The law is designed to balance the interests of creditors, debtors, employees, and other stakeholders, and to offer potential solutions to avoid bankruptcy or minimize losses.

Why You May Need a Lawyer

There are several situations where legal assistance in restructuring and insolvency becomes vital. Some of the most common scenarios include:

• As a business owner, you are facing mounting debts and require advice on whether restructuring, creditor negotiation, or bankruptcy is the best option.
• You are an individual unable to pay your bills, being harassed by creditors, or facing wage garnishment or asset seizure.
• Your lender or supplier is in financial distress, and you need to understand your rights as a creditor.
• You have been served with bankruptcy or receivership documents, or must attend insolvency proceedings.
• You are considering a formal restructuring under the Companies’ Creditors Arrangement Act (CCAA) or a proposal under the Bankruptcy and Insolvency Act (BIA).
• You must protect your business by enforcing securities or collecting debts from insolvent parties.
• As an employee, you want to know your rights and entitlements if your employer enters restructuring or files for bankruptcy.

A lawyer can help you understand complex legal concepts, navigate court procedures, negotiate with creditors or debtors, and strategize to protect your interests during financial distress.

Local Laws Overview

Restructuring and insolvency in Calgary is governed by Canadian federal statutes, mainly the Bankruptcy and Insolvency Act (BIA) and the Companies’ Creditors Arrangement Act (CCAA). Provincial laws and local courts in Alberta, including Calgary, also play important roles. Key aspects include:

• Bankruptcy: Both individuals and businesses can file for bankruptcy under the BIA, surrendering their assets (with some exemptions) in exchange for relief from most debts.
• Proposals & Arrangements: The BIA and CCAA allow debtors to propose repayment arrangements to creditors, potentially avoiding bankruptcy and continuing operations.
• Receiverships: In some cases, creditors can appoint a receiver to manage or liquidate specific assets.
• Priority of Claims: Local rules specify which creditors get paid first, including secured lenders, employees for unpaid wages, and government claims.
• Provincial Exemptions: Alberta’s civil enforcement laws provide exemptions for certain property in personal bankruptcies (such as some equity in a home or vehicle).
• Alberta Courts: The Court of King’s Bench of Alberta in Calgary administers insolvency proceedings, including bankruptcies, proposals, and CCAA cases.

Insolvency law is complex and outcomes depend highly on individual circumstances, making local legal advice crucial.

Frequently Asked Questions

What is the difference between restructuring and bankruptcy?

Restructuring refers to the process of reorganizing finances or making arrangements with creditors to resolve debts and avoid bankruptcy. Bankruptcy is a legal process where a debtor surrenders non-exempt assets for relief from most debts. Restructuring is often seen as a way to keep a business or individual viable, while bankruptcy may result in liquidation of assets.

Can I keep my house or vehicle if I declare bankruptcy in Calgary?

Alberta law provides exemptions that may allow you to retain certain assets, such as a portion of your home equity and a vehicle up to a specified value. The specifics depend on your situation and the type of debt you owe.

What is a consumer proposal?

A consumer proposal is a formal offer made by an individual (with less than 250,000 CAD in unsecured debt) to creditors to pay a portion of the debt over time, often with reduced payments. If accepted, it can avoid bankruptcy and its consequences.

How does a business file for restructuring under the CCAA?

Businesses with debts over 5 million CAD can apply under the Companies’ Creditors Arrangement Act to develop a plan of arrangement with creditors. The process involves court approval and is more complex than bankruptcy or BIA proposals.

What are the consequences of bankruptcy?

Consequences may include loss of non-exempt assets, negative impact on credit rating, restrictions on obtaining future credit, and potential employment limitations in certain fields. However, bankruptcy also provides relief from most debts and a chance for a financial fresh start.

Can creditors seize my wages or bank accounts?

If a court judgment is obtained, creditors may be able to garnish your wages or bank accounts. Legal processes apply, and exemptions exist on the amounts that can be taken. Bankruptcy or a proposal stops most collection actions.

How long does bankruptcy last in Alberta?

For a first-time bankruptcy, discharge can occur after nine months if all duties are performed and there is no opposition. It may take longer if there is surplus income or prior bankruptcies.

What are the trustee’s and lawyer’s roles in insolvency?

A Licensed Insolvency Trustee is a federally regulated professional who administers bankruptcies and proposals. Lawyers provide legal advice, representation in court, and help protect your rights throughout the process.

Can a business continue to operate during insolvency proceedings?

In many cases, businesses can continue to operate while restructuring or making proposals, particularly under the CCAA or BIA proposals, pending court or creditor approval.

How can secured creditors enforce their rights in Calgary?

Secured creditors may appoint a receiver or pursue foreclosure, depending on the terms of their security agreement and legal requirements. Enforcement is subject to both federal and Alberta law.

Additional Resources

If you are facing financial difficulties in Calgary, the following resources may be helpful:

• Licensed Insolvency Trustees (LIT): Regulated professionals who can administer bankruptcies and proposals, offering consumer-focused advice on debt relief.
• Alberta Courts: The Court of King’s Bench in Calgary handles most restructuring and insolvency matters.
• The Office of the Superintendent of Bankruptcy (OSB) Canada: Federal body regulating insolvency processes and LITs.
• Legal Aid Alberta: Offers assistance for eligible individuals needing legal aid in bankruptcy or financial distress situations.
• Credit Counselling Services: Non-profit organizations provide advice on budgeting, credit, and debt management.
• INSOLVENCY PRACTICE GROUPS: Many Calgary law firms have specialized teams in insolvency, restructuring, and bankruptcy law.

Next Steps

If you are considering restructuring or insolvency solutions in Calgary, here are steps to guide you:

• Gather all relevant documents about your financial situation, including debts, assets, income, and any legal notices received.
• Consult with a Licensed Insolvency Trustee for a free initial assessment of your options.
• If your situation is complex or involves legal disputes, contact a Calgary-based lawyer experienced in restructuring and insolvency law.
• Explore whether you may qualify for legal aid or free community legal clinics if affordability is a concern.
• Act promptly to protect your rights and consider all options, including informal negotiations, proposals, and formal legal processes.
• Attend all required meetings, court hearings, and fulfill all obligations under any insolvency process to ensure the best possible outcome.

Early legal guidance can help you avoid costly errors and increase your chances of achieving a positive resolution to your financial challenges.