Quebec has a lot of rules that are slightly different that the rest of Canada, largely because Quebec operates under Civil Law while the rest of the country operates under Common Law. As a result, Quebec has some variations on the bankruptcy laws that the rest of Canada falls under.
1. Everything Is Not Immediately Counted as Assets in the Eyes of Creditors
The first main difference is that, in Quebec, everything that you own is not immediately counted as an asset in the eyes of the creditors waiting to collect their payment. The courts will start to decide how much your personal possessions are worth, but if they add up all of your personal possessions and find that their total worth is less than $6,000, then all of these items are allowed to be declared exempt and you get to keep them, rather than sell them off to pay creditors.
2. Your Tax Refund Will Not Count As an Asset
When you file your taxes for the year that you declared bankruptcy, any refund that you might receive will be counted as an asset and will go directly to the creditors. In Quebec, however, this refund does not count as an asset and you will be able to keep it.
3. You Might Lose Your Vehicle or Tools
In some of the other provinces in Canada, there are special rules and regulations that state that certain items that you own will be exempt from bankruptcy assets automatically. These items could include one of your cars, if you need it to get to work every day, as well as the tools that you might need to perform your job as a carpenter, plumber, or photographer. The reason for these exemptions is that you will need these items to make sure that you are able to rebuild your life.
In Quebec, you will need to apply for each of these exemptions individually with the courts. You will have to prove that these items are absolutely essential to your life and you will not be able to continue to work and earn money without them. There is no blanket, automatic exemption written into the bankruptcy rules of Quebec.
4. You Won’t Lose Your Life Insurance
As long as you can prove that the person to whom the life insurance would pay out is a person that is directly related to you and is moving the bloodline forward, such as a child or a grandchild, then you won’t lose any money that you’ve put into your life insurance.
For more information, talk to a bankruptcy lawyer in Quebec.