Directive No. 17
Coming into force September 18, 2009

Retention of Documents by the Trustee

Issued: August 14, 2009

(Supersedes Directive No. 7 issued on July 23, 1993, on the same topic)

Interpretation

1. In this Directive,

• "Act" means the Bankruptcy and Insolvency Act;
• "OSB" means the Office of the Superintendent of Bankruptcy;
• "Rules" means the Bankruptcy and Insolvency General Rules.

Authority and Purpose

2. This Directive is issued pursuant to the authority of paragraphs 5(4)(b) and (c) of the Act.
3. The purpose of this directive is to specify (without limiting) the types of documents to retain and the period of retention as provided in the Act and the Rules.

Types of Documents to Retain

Documents of the bankrupt

4.  

   (1) The deeds, books, records and documents of the bankrupt referred to in subsection 16(3) of the Act are the documents generated by and attesting to the commercial and legal activities and operations of the debtor prior to the bankruptcy.

   (2) If the bankruptcy involves a business concern, these documents will generally include, but are not limited to:

   (a) salary records;

   (b) accounting records;

   (c) sale and purchase invoices;

   (d) correspondence;

   (e) banking records;

   (f) contracts;

   (g) letters patent;

   (h) shareholders' register; and

   (i) book of minutes of a corporation.

   Documents relating to the administration of the estate

5. (1) The books, records and documents relating to the administration of the estate referred to in subsection 26(2) of the Act are the documents generated for or by the trustee reflecting the trustee's decisions and actions in the administration.

   (2) These documents will generally include, but are not limited to:

   (a) proofs of claim;

   (b) various notices to creditors;

   (c) reports to creditors, the Court and the Superintendent;

   (d) correspondence,;

   (e) time sheets;

   (f) applications and court orders;

   (g) all minutes of meetings;

   (h) the banking records and accounting records showing receipts and disbursements of funds; and

   (i) supporting documents for various disbursements.

6. In view of section 22 of the Act, which limits the obligation to make any return that the bankrupt was required to make to one year prior to the commencement of the calendar year, the trustee could limit the taking of possession of documents to the period necessary to prepare these reports. In practical terms, this could involve a period of approximately two years depending on the date of the bankruptcy except for those records that, in the opinion of the trustee, would not be required.

Retention of Documents

7. (1) Subject to other statutes, section 68 of the Rules requires that a trustee retain, for a period of four (4) years after the trustee's discharge, the books, records and documents that relate to the administration of the estate.

   (2) A trustee should extend the retention period of documents where other statutes require documents to be kept for a longer time period (e.g., the Income Tax Act(R.S.C. 1985, c.1 (5th Supp.)) requires the retention of documents for a period of six (6) years).

8. The trustee is not required to retain deeds or documents if a copy of these documents was filed with the Court or is held by the provincial registry office.
9. If the trustee has a waiver of notification (Appendix A), the trustee may dispose of the documents relating to the commercial and legal activities prior to the bankruptcy immediately after the discharge of the trustee.
10. Where the administration will be prolonged as a result of specific litigation, and:

    (a) all of the assets have generally been realized;

    (b) the trustee has received a waiver of notification from the bankrupt; and

    (c) the trustee has allowed a reasonable delay for any government agency to make a routine audit,

    the trustee may dispose of the secondary documents as if the administration had been completed while retaining the documents relating to the litigation.

11. Despite sections 9 and 10 above, in a commercial bankruptcy the trustee should retain for a period of four (4) years with the administration file the documentation pertaining to wages, the letters patent, the shareholder's register and the minutes of the corporation.
12. The trustee shall not dispose of documents that should be available because of investigation or possible litigation.

Coming into Force

13. This Directive comes into force on September 18, 2009.

Enquiries

14. For any questions pertaining to this Directive, please contact your local OSB office.

James Callon
Superintendent of Bankruptcy

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Appendix A

Disposal of Books, Records and Documents

Authorization of Bankrupt to Trustee Pursuant to
Subsection 68(2) of the Bankruptcy and Insolvency General Rules

I, the undersigned, the bankrupt debtor (or an officer of the bankrupt corporation), hereby waive delivery by the trustee of the books, records and documents covered by subsection 68(2) of the Rules and authorize the said trustee to dispose of such books, records and documents after the trustee has been discharged.