Doing Business With A Bankrupt Company

2009-09-21

The Office of the Superintendent in Bankruptcy is the "keeper of the public record" of all bankruptcies.  Searches can be done on their website, for an applicable fee.  Their site ishttp://www.ic.gc.ca/eic/site/bsf-osb.nsf/Intro. If a limited company is bankrupt, however, it wouldn't likely be operating.  The Trustee in Bankruptcy will generally have shut this company down.  A limited company may more likely be operating while in Receivership.  In which case, the Receiver would let you know if they are applying for any credit that it is their credit application, not the company's. If a sole proprietor is operating while in bankruptcy, the bankruptcy would be registered in their personal name, not the trade name.  And then yes.....they may still be carrying on in business.  However, one of their duties in the Act is to disclose to you the fact that they are bankrupt, especially if they are applying for credit greater than $1,000.  If you are extending credit, your credit application should ask the question "are you currently, or have you been, in bankruptcy." Keep in mind that bankruptcy was a difficult decision for that individual.  And re-starting their lives is important.....although not necessarily on credit.  They shouldn't be applying for credit with you especially if they are still in bankruptcy, or just recently finished. Donna Carson, CGA, CIRP, Trustee 1.877.500.0792          [email protected]