TWO GST OPINIONS of utilizing the GST refunds held by the trustee for the purposes of meeting the bankrupt's financial obligations to the estate. She was also of the opinion that the use of GST refunds in this manner would require a change to the Bankruptcy and Insolvency Act (BIA). Specifically, Registrar Mills relied on the language of the BIA: “Paragraph 67(1) (b.1) of the Bankruptcy and Insolvency Act (“BIA”), that states that the property of the bankrupt divisible among the creditors shall not comprise goods and services tax credit payments made in prescribed circumstances.” Registrar Mills further relied on Section 67 of the Financial Administration Act which states that crown debts are not assignable. In Re: Glasgow, the opposition to the transfer of GST refunds was initiated by the Office of the Superintendent of Bankruptcy (OSB) by way of the issuance of negative comment letters for the three estates before the Court. The Canadian LIT community now has two different answers as to whether or not GST refunds (determined to be exempt property of the bankrupt) can be transferred “within” the estate trust account to allow the bankrupt to meet their financial obligations to the estate so as to complete the bankruptcy administration. As every LIT who administers summary bankruptcy administrations knows, the reason that the bankrupt would consider utilizing GST refunds collected by the trustee, where there is an expected dividend and OSB levy to be paid (making some or all of the GST refunds held in the estate exempt property), would be so as to allow them to obtain their bankruptcy discharge in a more expeditious fashion. If you look at the facts presented to these two Registrars, they are very similar, yet their written decisions took different approaches to come up with two different answers. The trustee community will have to wait for further direction from the Courts as there is no clear answer at this particular point in time. Some of the questions that may require an answer include: •  Is a Crown debt, once paid, no longer a Crown debt? Is the issuance of the GST cheque a fulfilment of debt obligation? • The BIA has often been called a businessman's Act. As such, do strong considerations have to be given to facilitating and streamlining administration functions? •  The BIA permits the assignment of GST refunds to the estate (no levy or dividend), Why the prohibition for a levy and/or dividend scenario? •  What other possibilities exist for more functional workarounds to the current practice, that being the issuance of funds by the trustee and payment by the bankrupt? •  What might the OSB require in order to not issue negative comment letters? •  Once funds held by the estate are determined to be held for the benefit of the bankrupt (Rule 59), can they not be used at the discretion of the bankrupt? Stay tuned because this does not appear to be a resolved issue at this point in time. RS Secureyourclientsa bettercreditrating HOME TRUST MORTGAGES | CREDIT CARDS | RETAIL CREDIT | DEPOSITS hometrust.ca/securedvisa The foundation of personal finance is a good credit rating. A Home Trust Secured Visa* card can help build that foundation. *VisaInt./HomeTrustCompany,licenseduserofmark. FormoreinformationaboutourSecuredVisacard: Visithometrust.ca/securedvisa Email visa@hometrust.ca Call 1-888-281-7793 MondaytoFriday,8a.m.to 8p.m.ET 5.26.2015_Visa_PrintL_ENG-CAIRP_Visa ad_4.6250 x 7.indd 1 5/26/2015 11:50:36 AM Volume 19 Issue 1 Rebuilding Success 49