Assignments and Preferences Act, R.S.O. 1990, c. A.33

CONTENTS 1. Definition 2. If judge disqualified 3. Nullity of certain confessions of judgment, etc. 4. Nullity of gifts, transfers, etc., made with intent to defeat or prejudice creditors 5. Assignments for benefit of creditors and good faith sales, etc., protected 6. Residence of assignee 7. Form of assignment for general benefit of creditors 8. All assignments for general benefit of creditors to be subject to this Act 9. How claims are to rank where different estates 10. Appointment of substituted assignee 11. Rights of assignee 12. Following proceeds of property fraudulently transferred 13. Assignments take precedence over attachments, etc. 14. Waiver of claims by Crown 15. Amendment by judge 16. Publishing notice of assignment 17. Penalty for neglecting publication or registration 18. Compelling publication and registration 19. Omission to publish, etc. 20. Duty to call meeting of creditors 21. Appointment of inspectors 22. Meeting of creditors by request of majority thereof 23. Voting at meeting 24. Scale of votes 25. Proof of claim 26. Contestation of claim 27. Procedure where assignee is satisfied but assignor desires to dispute 28. Retention of assets in Ontario and deposit of money 29. Accounts to be kept accessible 30. Set-off 31. Dividends, when to be paid 32. Notice of dividend sheet 33. Distributing money and determining claims 34. Remuneration of assignee 35. Where remuneration not fixed before the final dividend 36. Remuneration of inspectors 37. Examination of assignor or employees 38. Examination of persons having custody of property of assignor 39. When assignor does not attend or refuses to answer questions 40. Compelling attendance and production of books Definition 1 In this Act, “judges” means a judge of the Superior Court of Justice. R.S.O. 1990, c. A.33, s. 1; 2001, c. 9, Sched. D, s. 14. Section Amendments with date in force (d/m/y) 2001, c. 9, Sched. D, s. 14 - 29/06/2001 If judge disqualified 2 If a judge is disqualified to act in a matter under this Act, another judge may do so. R.S.O. 1990, c. A.33, s. 2. Nullity of certain confessions of judgment, etc. 3 Every confession of judgment, cognovit actionem or warrant of attorney to confess judgment given by a person, being at the time in insolvent circumstances or unable to pay his, her or its debts in full or knowing himself, herself or itself to be on the eve of insolvency, voluntarily or by collusion with a creditor with intent thereby to defeat, hinder, delay or prejudice creditors wholly or in part, or to give one or more creditors a preference over other creditors or over any one or more of them, is void as against the creditors of the person giving the same and is ineffectual to support any judgment or execution. R.S.O. 1990, c. A.33, s. 3. Nullity of gifts, transfers, etc., made with intent to defeat or prejudice creditors 4 (1) Subject to section 5, every gift, conveyance, assignment or transfer, delivery over or payment of goods, chattels or effects, or of bills, bonds, notes or securities, or of shares, dividends, premiums or bonus in any bank, company or corporation, or of any other property, real or personal, made by a person when insolvent or unable to pay the person’s debts in full or when the person knows that he, she or it is on the eve of insolvency, with intent to defeat, hinder, delay or prejudice creditors, or any one or more of them, is void as against the creditor or creditors injured, delayed or prejudiced. R.S.O. 1990, c. A.33, s. 4 (1). Unjust preferences (2) Subject to section 5, every such gift, conveyance, assignment or transfer, delivery over or payment made by a person being at the time in insolvent circumstances, or unable to pay his, her or its debts in full, or knowing himself, herself or itself to be on the eve of insolvency, to or for a creditor with the intent to give such creditor an unjust preference over other creditors or over any one or more of them is void as against the creditor or creditors injured, delayed, prejudiced or postponed. R.S.O. 1990, c. A.33, s. 4 (2). When there is presumption of intention if transaction has effect of unjust preference (3) Subject to section 5, if such a transaction with or for a creditor has the effect of giving that creditor a preference over the other creditors of the debtor or over any one or more of them, it shall, in and with respect to any action or proceeding that, within sixty days thereafter, is brought, had or taken to impeach or set aside such transaction, be presumed, in the absence of evidence to the contrary, to have been made with the intent mentioned in subsection (2), and to be an unjust preference within the meaning of this Act whether it be made voluntarily or under pressure. R.S.O. 1990, c. A.33, s. 4 (3). Idem (4) Subject to section 5, if such a transaction with or for a creditor has the effect of giving that creditor a preference over the other creditors of the debtor or over any one or more of them, it shall, if the debtor within sixty days after the transaction makes an assignment for the benefit of the creditors, be presumed, in the absence of evidence to the contrary, to have been made with the intent mentioned in subsection (2), and to be an unjust preference within the meaning of this Act whether it be made voluntarily or under pressure. R.S.O. 1990, c. A.33, s. 4 (4); 1993, c. 27, Sched. “Creditor” for certain purposes to include surety and endorser (5) The word “creditor” when used in the singular in subsections (2), (3) and (4) includes any surety and the endorser of any promissory note or bill of exchange who would upon paying the debt, promissory note or bill of exchange, in respect of which the suretyship was entered into or the endorsement was given, become a creditor of the person giving the preference within the meaning of those subsections. R.S.O. 1990, c. A.33, s. 4 (5). Section Amendments with date in force (d/m/y) 1993, c. 27, Sched. - 31/12/1991 Assignments for benefit of creditors and good faith sales, etc., protected 5 (1) Nothing in section 4 applies to an assignment made to the sheriff for the area in which the debtor resides or carries on business or, with the consent of a majority of the creditors having claims of $100 and upwards computed according to section 24, to another assignee resident in Ontario, for the purpose of paying rateably and proportionately and without preference or priority all the creditors of the debtor their just debts, nor to any sale or payment made in good faith in the ordinary course of trade or calling to an innocent purchaser or person, nor to any payment of money to a creditor, nor to any conveyance, assignment, transfer or delivery over of any goods or property of any kind, that is made in good faith in consideration of a present actual payment in money, or by way of security for a present actual advance of money, or that is made in consideration of a present actual sale or delivery of goods or other property where the money paid or the goods or other property sold or delivered bear a fair and reasonable relative value to the consideration therefor. R.S.O. 1990, c. A.33, s. 5 (1). Transfer to creditor of consideration for sale invalid (2) In case of a valid sale of goods or other property and payment or transfer of the consideration or part thereof by the purchaser to a creditor of the vendor under circumstances that would render void such a payment or transfer by the debtor personally and directly, the payment or transfer, even though valid as respects the purchaser, is void as respects the creditor to whom it is made. R.S.O. 1990, c. A.33, s. 5 (2). Effect of assignment not in accordance with Act (3) Every assignment for the general benefit of creditors that is not void under section 4, but is not made to the sheriff nor to any other person with the prescribed consent of creditors, is void as against a subsequent assignment that is in conformity with this Act, and is subject in other respects to the provisions thereof until and unless a subsequent assignment is executed in accordance therewith. R.S.O. 1990, c. A.33, s. 5 (3). Security given up upon void payment to be returned (4) Where a payment has been made that is void under this Act and any valuable security was given up in consideration of the payment, the creditor is entitled to have the security restored or its value made good to him before, or as a condition of, the return of the payment. R.S.O. 1990, c. A.33, s. 5 (4). Exceptions: (5) Nothing in this Act, wages (a) affects the Wages Act or prevents a debtor providing for payment of wages due by him or her in accordance with that Act; surrender of securities (b) affects any payment of money to a creditor where the creditor, by reason or on account of the payment, has lost or been deprived of, or has in good faith given up, any valid security held for the payment of the debt so paid unless the security is restored or its value made good to the creditor; exchange of securities (c) applies to the substitution in good faith of one security for another security for the same debt so far as the debtor’s estate is not thereby lessened in value to the other creditors; or certain securities to be valid (d) invalidates a security given to a creditor for a pre-existing debt where, by reason or on account of the giving of the security, an advance in money is made to the debtor by the creditor in the belief that the advance will enable the debtor to continue the debtor’s trade or business and to pay the debts in full. R.S.O. 1990, c. A.33, s. 5 (5). Residence of assignee 6 No person, other than a permanent resident of Ontario, shall be assignee under an assignment within this Act, nor shall any assignee delegate the duties as assignee to or appoint as deputy any person who is not a permanent resident of Ontario, and no charge shall be made or recoverable against the assignor or his estate for any services or other expenses of any such assignee, deputy or delegate of any assignee who is not a permanent resident of Ontario. R.S.O. 1990, c. A.33, s. 6. Form of assignment for general benefit of creditors 7 Every assignment made under this Act for the general benefit of creditors, if the property is described in the words “all my personal property that may be seized and sold under execution and all my real estate, credits and effects”, or in words to the like effect, vests in the assignee all the real and personal estate, rights, property, credits and effects, whether vested or contingent, belonging to the assignor at the time of the assignment, except such as are by law exempt from seizure or sale under execution, subject, however, as regards land, to the Registry Act and the Land Titles Act. R.S.O. 1990, c. A.33, s. 7. All assignments for general benefit of creditors to be subject to this Act 8 Every assignment for the general benefit of creditors, whether it is or is not expressed to be made under or in pursuance of this Act and whether the assignment does or does not include all the real and personal estate of the assignor, vests the estate, whether real or personal or partly real and partly personal, thereby assigned in the assignee therein named for the general benefit of creditors, and the assignment and the property thereby assigned is subject to all the provisions of this Act, and the same applies to the assignee named in the assignment. R.S.O. 1990, c. A.33, s. 8. How claims are to rank where different estates 9 If an assignor executing an assignment under this Act for the general benefit of creditors owes debts both individually and as a member of a partnership or as a member of different partnerships, the claims rank first upon the estate by which the debts they represent were contracted and only rank upon the other or others after all the creditors of such other estate or estates have been paid in full. R.S.O. 1990, c. A.33, s. 9. Appointment of substituted assignee 10 (1) A majority in number and value of the creditors who have proved claims to the amount of $100 or upwards may substitute for the sheriff, or for an assignee under an assignment to which subsection 5 (3) applies, a person residing in the area in which the assignor resided or carried on business at the time of the assignment. R.S.O. 1990, c. A.33, s. 10 (1). Removal, substitution or addition (2) An assignee may be removed and another substituted or an additional assignee appointed by the judge. R.S.O. 1990, c. A.33, s. 10 (2). Death of assignee (3) Where an assignee dies, a new assignee may be appointed in the manner provided by subsection (2). R.S.O. 1990, c. A.33, s. 10 (3). Effect on estate (4) Where a new or additional assignee is appointed, the estate vests in the new or additional assignee alone or jointly with the co-assignee without a conveyance or transfer, and the new or additional assignee shall register a verified copy of the resolution of the creditors or of the order of appointment in the office in which the assignment was registered. R.S.O. 1990, c. A.33, s. 10 (4). Registration (5) A verified copy of the resolution or of the order may be registered in the proper land registry office and the registration thereof has the same effect as the registration of a conveyance. R.S.O. 1990, c. A.33, s. 10 (5). Rights of assignee 11 (1) Except as otherwise provided in this section, the assignee has the exclusive right of suing for the rescission of agreements, deeds and instruments or other transactions made or entered into in fraud of creditors or in violation of this Act. R.S.O. 1990, c. A.33, s. 11 (1). Right of creditor in certain cases if assignee refuses (2) Where a creditor desires to cause any proceeding to be taken that, in the creditor’s opinion, would be for the benefit of the estate and the assignee under the authority of the creditors or inspectors refuses or neglects to take such proceeding after being required so to do, the creditor has the right to obtain an order of the judge authorizing the creditor to take the proceeding in the name of the assignee, but at the creditor’s own expense and risk, upon such terms and conditions as to indemnity to the assignee as the judge prescribes, and thereupon any benefit derived from the proceeding, to the extent of the claim and full costs, belongs exclusively to the creditor instituting the proceeding for his, her or its benefit, but, if before such order is obtained the assignee signifies to the judge a readiness to institute the proceeding for the benefit of the creditors, the order shall prescribe the time within which to do so, and in that case the advantage derived from the proceeding, if instituted within such time, belongs to the estate. R.S.O. 1990, c. A.33, s. 11 (2). Following proceeds of property fraudulently transferred 12 (1) In the case of a gift, conveyance, assignment or transfer of any property, real or personal, that is invalid against creditors, if the person to whom the gift, conveyance, assignment or transfer was made has sold or disposed of, realized or collected the property or any part thereof, the money or other proceeds may be seized or recovered in an action by a person who would be entitled to seize and recover the property if it had remained in the possession or control of the debtor or of the person to whom the gift, conveyance, transfer, delivery or payment was made, and such right to seize and recover belongs not only to an assignee for the general benefit of the creditors of the debtor but, where there is no such assignment, to all creditors of the debtor. R.S.O. 1990, c. A.33, s. 12 (1). Taking proceeds under execution (2) Where there is no assignment for the benefit of creditors and the proceeds are of such a character as to be seizable under execution, they may be seized under the execution of any creditor and are subject to the Creditors’ Relief Act, 2010. R.S.O. 1990, c. A.33, s. 12 (2); 2010, c. 16, Sched. 4, s. 23 (1). Creditor suing on behalf of the creditor and other creditors (3) Where there is no assignment for the benefit of creditors and whether the proceeds are or are not of such a character as to be seizable under execution, an action may be brought therefor by a creditor, whether an execution creditor or not, on behalf of the creditor and all other creditors, or such other proceedings may be taken as are necessary to render the proceeds available for the general benefit of the creditors. R.S.O. 1990, c. A.33, s. 12 (3). Protection of innocent purchasers (4) This section does not apply as against innocent purchasers of the property. R.S.O. 1990, c. A.33, s. 12 (4). Section Amendments with date in force (d/m/y) 2010, c. 16, Sched. 4, s. 23 (1) - 25/10/2010 Assignments take precedence over attachments, etc. 13 An assignment for the general benefit of creditors under this Act takes precedence over attachments, garnishee orders, judgments, executions not completely executed by payment, and orders appointing receivers by way of equitable execution subject to the lien, if any, of an execution creditor for costs where there is but one execution in the sheriff’s hands or to the lien, if any, for the costs of the creditor who has the first execution in the sheriff’s hands. R.S.O. 1990, c. A.33, s. 13. Waiver of claims by Crown 14 Where the Crown has a claim in respect of estreated bail against the estate of a person who makes an assignment for the benefit of creditors, the Lieutenant Governor in Council may waive any preference in respect of the claim that the Crown has against the estate by virtue of its prerogative right. R.S.O. 1990, c. A.33, s. 14. Amendment by judge 15 No advantage shall be obtained by any creditor by reason of any mistake, defect or imperfection in an assignment under this Act for the general benefit of creditors if the assignment can be amended or corrected, and any such mistake, defect or imperfection shall be amended by the judge on the application of the assignee or of any creditor of the assignor, and on such notice to other parties concerned as the judge thinks reasonable, and the amendment, when made, shall be related back to the date of the assignment, but not so as to prejudice the rights of innocent purchasers. R.S.O. 1990, c. A.33, s. 15. Publishing notice of assignment 16 (1) A notice of the assignment shall, forthwith after the delivery thereof to the assignee or assent thereto by the assignee, be published by the assignee at least once in The Ontario Gazette and not less than twice in a newspaper having a general circulation in the area in which the property assigned is situate. R.S.O. 1990, c. A.33, s. 16 (1). Registering assignment (2) The assignment or a copy thereof shall also, within five days from the execution thereof, be registered by the assignee, together with an affidavit of a witness thereto of the due execution of the assignment, in the office of the local registrar of the Superior Court of Justice for the area in which the assignor, if a resident in Ontario, resided at the time of the execution thereof, or if not a resident then in the office of the local registrar of the Superior Court of Justice for the area in which the personal property so assigned or where the principal part thereof is at the time of the execution of the assignment, and the local registrar shall number and enter the assignments and endorse thereon the time of receiving them, and they shall be open for the inspection of all persons desiring to inspect them. R.S.O. 1990, c. A.33, s. 16 (2); 2001, c. 9, Sched. D, s. 14. Fees of clerk (3) The local registrar is entitled to the same fees for services as if the assignment had been registered under the Personal Property Security Act. R.S.O. 1990, c. A.33, s. 16 (3). Section Amendments with date in force (d/m/y) 2001, c. 9, Sched. D, s. 14 - 29/06/2001 Penalty for neglecting publication or registration 17 (1) If the notice is not published as provided by section 16 or if the assignment is not registered within five days from the delivery thereof to the assignee or assent thereto by the assignee, the assignee is liable to a penalty of $10 for each day during which the default continues. R.S.O. 1990, c. A.33, s. 17 (1). Onus of proof (2) The burden of proving the time of the delivery or assent is upon the assignee. R.S.O. 1990, c. A.33, s. 17 (2). Liability of sheriff (3) Where the assignment is made to a sheriff, the sheriff shall not incur the penalty unless he or she has been paid or tendered the cost of advertising and of registering the assignment, nor is the sheriff bound to act under the assignment until the costs in that behalf are paid or tendered to him or her. R.S.O. 1990, c. A.33, s. 17 (3). Compelling publication and registration 18 If the assignment is not registered or notice thereof is not published, the judge may, upon the application of any person interested in the assignment, by order enforce the registration of the assignment or the publication of the notice. R.S.O. 1990, c. A.33, s. 18. Omission to publish, etc. 19 The omission to publish or register as required by section 16 does not, nor does any irregularity in the publication of registration, invalidate the assignment. R.S.O. 1990, c. A.33, s. 19. Duty to call meeting of creditors 20 (1) It is the duty of the assignee immediately to become informed, by reference to the assignor and the assignor’s records of account, of the names and residences of the assignor’s creditors, and, within five days from the date of the assignment, to call a meeting of the creditors for the appointment of inspectors and the giving of directions with reference to the disposal of the estate by sending by registered mail to every creditor known to the assignee a notice calling the meeting to be held in the assignee’s office or some other convenient place to be named in the notice not later than twelve days after the mailing thereof, and by advertisement in The Ontario Gazette. R.S.O. 1990, c. A.33, s. 20 (1). Other meetings (2) All other meetings to be held shall be called in like manner. R.S.O. 1990, c. A.33, s. 20 (2). Appointment of inspectors 21 (1) The creditors at any meeting may appoint one or more inspectors who shall superintend and direct the proceedings of the assignee in the management and winding up of the estate, and the creditors may also at any subsequent meeting for that purpose revoke the appointment of any inspector. R.S.O. 1990, c. A.33, s. 21 (1). Appointment of another inspector (2) Where the appointment of an inspector is revoked or where an inspector dies, resigns from office or leaves Ontario, the creditors at any meeting may appoint another inspector to take the inspector’s place. R.S.O. 1990, c. A.33, s. 21 (2). Inspector not to purchase assets (3) An inspector shall not directly or indirectly purchase any part of the stock in trade, debts or other assets of the assignor. R.S.O. 1990, c. A.33, s. 21 (3). Meeting of creditors by request of majority thereof 22 (1) In the case of a request in writing signed by a majority of the creditors having claims duly proved of $100 and upwards, computed according to section 24, it is the duty of the assignee, within two days after receiving the request, to call a meeting of the creditors for a day not later than twelve days after receiving the request, and in case of default the assignee shall incur a penalty of $25 for every day after the expiration of the time limited for calling the meeting until it is called. R.S.O. 1990, c. A.33, s. 22 (1). Power of judge (2) In case a sufficient number of creditors do not attend the meeting mentioned in section 20 or fail to give directions with reference to the disposal of the estate, the judge may give such directions as he or she considers necessary for that purpose. R.S.O. 1990, c. A.33, s. 22 (2). Voting at meeting 23 At any meeting of creditors, the creditors may vote in person or by proxy authorized in writing, but no creditor whose vote is disputed is entitled to vote until after filing with the assignee an affidavit in proof of the claim, stating the amount and nature thereof. R.S.O. 1990, c. A.33, s. 23. Scale of votes 24 (1) Subject to section 10, all questions at meetings of creditors shall be decided by the majority of votes, and for such purpose the votes of creditors shall be calculated as follows: 1. For every claim of or over $100 and not exceeding $200, one vote. 2. For every claim over $200 and not exceeding $500, two votes. 3. For every claim over $500 and not exceeding $1,000, three votes. 4. For every additional $1,000 or fraction thereof, one vote. R.S.O. 1990, c. A.33, s. 24 (1). Upon claims acquired after assignment (2) No person is entitled to vote on a claim acquired after the assignment unless the entire claim is acquired, but this does not apply to persons acquiring notes, bills or other securities upon which they are liable. R.S.O. 1990, c. A.33, s. 24 (2). Casting vote (3) In the case of a tie, the assignee or, if there are two assignees, the assignee nominated for that purpose by the creditors or by the judge, if none has been nominated by the creditors, has a casting vote. R.S.O. 1990, c. A.33, s. 24 (3). Valuing securities (4) Every creditor in the proof of claim shall state whether the creditor holds any security for the claim or any part thereof, and if such security is on the estate of the assignor or on the estate of a third person for whom the assignor is only secondarily liable, the creditor shall put a specified value thereon and the assignee, under the authority of the creditors, may either consent to the creditor ranking for the claim after deducting such valuation or may require from the creditor an assignment of the security at an advance of 10 per cent upon the specified value to be paid out of the estate as soon as the assignee has realized the security, and in such case the difference between the value at which the security is retained and the amount of the gross claim of the creditor is the amount for which the creditor shall rank and vote in respect of the estate. R.S.O. 1990, c. A.33, s. 24 (4). Right to revalue in certain cases (5) If a creditor’s claim is based upon a negotiable instrument upon which the assignor is only indirectly or secondarily liable and that is not mature or exigible, the creditor shall be considered to hold security within the meaning of this section and shall put a value on the liability of the person primarily liable thereon as being the security for the payment thereof, but after the maturity of such liability and its non-payment the creditor is entitled to amend the claim and revalue the security. R.S.O. 1990, c. A.33, s. 24 (5). Where creditor holding security fails to value it (6) Where a person claiming to be entitled to rank on the estate holds security for the claim, or any part thereof, of such a nature that the person is required by this Act to value the security and fails to value it, the judge, upon summary application by the assignee or by any other person interested in the estate, of which application at least three days notice shall be given to the claimant, may order that, unless a specified value be placed on the security and the assignee is notified in writing within a time to be limited by the order, the claimant is, in respect of the claim, or the part thereof for which the security is held in case the security is held for part only of the claim, wholly barred of any right to share in the proceeds of the estate. R.S.O. 1990, c. A.33, s. 24 (6). Consequences of neglect of order (7) If a specified value is not placed on the security or the assignee is not notified in writing according to the exigency of the order or within such further time as the judge by subsequent order allows, the claim, or the part, as the case may be, is wholly barred as against the estate, but without prejudice to the liability of the assignor therefor. R.S.O. 1990, c. A.33, s. 24 (7). Proof of claim 25 (1) All persons claiming to be entitled to rank on the estate shall furnish to the assignee particulars of their claim proved by affidavit and such vouchers as the nature of the case admits. R.S.O. 1990, c. A.33, s. 25 (1). Limiting time for proof of claim (2) Where a person claiming to be entitled to rank on the estate does not, within a reasonable time after receiving notice of the assignment and of the name and address of the assignee, furnish to the assignee satisfactory proofs of claim as provided by this and the preceding sections, the judge upon summary application by the assignee or by any other person interested in the estate, of which application at least three days notice shall be given to the claimant, may order that unless the claim is proved to the satisfaction of the judge within a time to be limited by the order, the claimant shall be deemed to be no longer a creditor of the estate and is wholly barred of any right to share in the proceeds thereof. R.S.O. 1990, c. A.33, s. 25 (2). Consequences of neglect to prove claim (3) If the claim is not so proved within the time so limited or within such further time as the judge by subsequent order allows, it is wholly barred and the assignee is at liberty to distribute the proceeds of the estate as if no such claim existed, but without prejudice to the liability of the assignor therefor. R.S.O. 1990, c. A.33, s. 25 (3). Not to interfere with assignees (4) Subsections (2) and (3) do not interfere with the protection afforded to assignees by section 53 of the Trustee Act. R.S.O. 1990, c. A.33, s. 25 (4). Creditor may prove claim not due (5) A person whose claim has not accrued due is nevertheless entitled to prove under the assignment and to vote at meetings of creditors, but in ascertaining the amount of any such claim a deduction for interest shall be made for the time that has to run until the claim becomes due. R.S.O. 1990, c. A.33, s. 25 (5). Contestation of claim 26 (1) At any time after the assignee receives from any person claiming to be entitled to rank on the estate proof of the person’s claim, notice of contestation of the claim may be served by the assignee upon the claimant. R.S.O. 1990, c. A.33, s. 26 (1). Limitation (2) Within thirty days after the receipt of the notice, or within such further time as the judge allows, an action shall be brought by the claimant against the assignee to establish the claim, and a copy of the statement of claim in the action, or of the claim in case the action is brought in the Small Claims Court, shall be served on the assignee, and in default of such action being brought and statement of claim or claim served within the time limited the claim to rank on the estate is forever barred. R.S.O. 1990, c. A.33, s. 26 (2). Service on solicitor of assignee (3) The notice by the assignee shall contain the name and place of business of a solicitor upon whom service of the statement of claim or claim may be made, and service upon the solicitor shall be deemed sufficient service. R.S.O. 1990, c. A.33, s. 26 (3). Right of assignee to compel plaintiff to proceed with action against assignor (4) Where prior to the assignment an action has been commenced against the assignor and is pending at the time of the assignment, the assignee may, by notice served upon the plaintiff in the action, require the plaintiff to proceed, and the plaintiff is bound to proceed in that action to establish the claim, instead of bringing an action against the assignee as provided for by subsection (2), and the plaintiff may thereupon apply to the court in which the action is brought for an order adding the assignee as a party defendant in the action, and the assignee may be so added upon such terms as to the costs that may be subsequently incurred as the court or a judge thereof, or the judge making the order, directs. R.S.O. 1990, c. A.33, s. 26 (4). Procedure where assignee is satisfied but assignor desires to dispute 27 (1) If the assignee is satisfied with the proof adduced in support of a claim but the assignor disputes it, the assignor shall do so by notice in writing to the assignee, stating the grounds of dispute, and the notice shall be given within ten days after the assignor is notified in writing by the assignee that the assignee is satisfied with the proof adduced and not afterwards unless by leave of the judge. R.S.O. 1990, c. A.33, s. 27 (1). Where assignee does not require action to be brought (2) If upon receiving the notice of dispute the assignee does not consider it proper to require the claimant to bring an action to establish the claim, the assignee shall notify the assignor in writing of the fact, and the assignor may thereupon, and within ten days of receiving the notice, apply to the judge for an order requiring the assignee to serve a notice of contestation. R.S.O. 1990, c. A.33, s. 27 (2). Conditions (3) The order shall be made only if, after notice to the assignee, the judge is of opinion that there are good grounds for contesting the claim. R.S.O. 1990, c. A.33, s. 27 (3). Where decision of assignee final (4) If the assignor does not make such an application, the decision of the assignee is, as against the assignor, final and conclusive. R.S.O. 1990, c. A.33, s. 27 (4). Decision of judge on validity of claim (5) If upon the application the claimant consents in writing, the judge may in a summary manner decide the question of the validity of the claim. R.S.O. 1990, c. A.33, s. 27 (5). Intervention by assignor at trial (6) If an action is brought by the claimant against the assignee, the assignor may intervene at the trial either personally or by counsel for the purpose of calling and examining or cross-questioning witnesses. R.S.O. 1990, c. A.33, s. 27 (6). Retention of assets in Ontario and deposit of money 28 (1) No property or assets of an estate assigned under this Act shall be removed out of Ontario without the order of the judge, and the proceeds of the sale of any such property or assets and all money received on account of any estate shall be deposited by the assignee in a financial institution described in subsection (1.1) and shall not be withdrawn or removed without the order of the judge, except in payment of dividends and charges incidental to winding up the estate. 2007, c. 7, Sched. 7, s. 180. Financial institutions (1.1) A financial institution referred to in subsection (1) is, (a) a bank or authorized foreign bank within the meaning of section 2 of the Bank Act (Canada); (b) a corporation registered under the Loan and Trust Corporations Act; (c) a credit union within the meaning of the Credit Unions and Caisses Populaires Act, 2020; or (d) a retail association as defined under the Cooperative Credit Associations Act (Canada). 2007, c. 7, Sched. 7, s. 180; 2020, c. 36, Sched. 7, s. 294. Penalty (2) An assignee or any person acting in the assignee’s place who contravenes this section is liable to a penalty of $500. R.S.O. 1990, c. A.33, s. 28 (2). Application of penalty (3) One-half of the penalty goes to the person suing therefor and the other half belongs to the estate. R.S.O. 1990, c. A.33, s. 28 (3). Imprisonment in default of payment of penalty (4) In default of payment of the penalty and all costs incurred in an action or proceeding for the recovery thereof within the time limited by the judgment, the court in which the action is brought may order that the assignee or person may be imprisoned for any period not exceeding thirty days, and the assignee or person is disqualified from acting as assignee of any estate while the default continues. R.S.O. 1990, c. A.33, s. 28 (4). Section Amendments with date in force (d/m/y) 2007, c. 7, Sched. 7, s. 180 - 01/10/2009 2020, c. 36, Sched. 7, s. 294 - 01/03/2022 Accounts to be kept accessible 29 Upon the expiration of one month from the first meeting of creditors or as soon as may be thereafter and afterwards from time to time at intervals of not more than three months, the assignee shall prepare, and keep constantly accessible to the creditors, accounts and statements of the doings as assignee and of the position of the estate. R.S.O. 1990, c. A.33, s. 29. Set-off 30 The law of set-off applies to all claims made against the estate, and also to all actions instituted by the assignee for the recovery of debts due to the assignor, in the same manner and to the same extent as if the assignor were plaintiff or defendant, as the case may be, except in so far as any claim for set-off is affected by this or any other Act respecting frauds or fraudulent preferences. R.S.O. 1990, c. A.33, s. 30. Dividends, when to be paid 31 As large a dividend as can be paid with safety shall be paid by every assignee within twelve months from the date of the assignment, and earlier if required by the inspectors, and thereafter a further dividend shall be paid every six months and more frequently if required by the inspectors, until the estate is wound up and disposed of. R.S.O. 1990, c. A.33, s. 31. Notice of dividend sheet 32 As soon as a dividend sheet is prepared, notice thereof shall be given by registered mail to each creditor, enclosing an abstract of receipts and disbursements, showing what interest has been received by the assignee for money in the assignee’s hands, together with a copy of the dividend sheet, noting thereon the claims objected to, and stating whether any reservation has or has not been made therefor, and after the expiry of eight days from the date of mailing the notice, abstract and dividend sheet, dividends on all claims not objected to within that period shall be paid. R.S.O. 1990, c. A.33, s. 32. Distributing money and determining claims 33 (1) The assignee may take the proceedings authorized by subsections 11 (2), (3), (6) and (7) and 12 (7) and (8) and section 14 of the Creditors’ Relief Act, 2010 to be taken by a sheriff and, in that case, sections 11, 12, 13 and 14 of that Act apply with necessary modifications to proceedings for the distribution of money and determination of claims arising under an assignment made under this Act, with the substitution of “assignee” for “sheriff”, but this section does not relieve the assignee from mailing to each creditor the abstract and other information required by section 32 of this Act to be sent to creditors so far as the same is not contained in the list sent by the assignee under section 11 of the Creditors’ Relief Act, 2010. 2010, c. 16, Sched. 4, s. 23 (2). To what court application to be made (2) Applications under this section shall be made to the Superior Court of Justice. R.S.O. 1990, c. A.33, s. 33 (2); 2001, c. 9, Sched. D, s. 14. Section Amendments with date in force (d/m/y) 2001, c. 9, Sched. D, s. 14 - 29/06/2001 2010, c. 16, Sched. 4, s. 23 (2) - 25/10/2010 Remuneration of assignee 34 The assignee shall receive such remuneration as is voted to the assignee by the creditors at a meeting called for the purpose after the first dividend sheet has been prepared, or by the inspectors, in case the creditors fail to provide therefor, subject to review by the judge upon complaint of the assignee or of any creditor. R.S.O. 1990, c. A.33, s. 34. Where remuneration not fixed before the final dividend 35 Where the remuneration of the assignee has not been fixed under section 34 before the final dividend, the assignee may insert in the final dividend sheet, and retain as remuneration, a sum not exceeding 5 per cent of the cash receipts, subject to review by the judge, but no application by the assignee to review the allowance shall be entertained unless the question of the assignee’s remuneration has been brought before a meeting of creditors competent to decide the same before the preparation of the final dividend sheet. R.S.O. 1990, c. A.33, s. 35. Remuneration of inspectors 36 (1) An assignee shall not make any payment or allowance to an inspector beyond actual and necessary travelling expenses in and about the assignee’s duties as inspector except under the authority of a resolution of the creditors passed at a meeting regularly called fixing the amount thereof, and in the notice calling the meeting the fixing of the remuneration of the inspectors shall be specially mentioned as one of the subjects to be brought before the meeting. R.S.O. 1990, c. A.33, s. 36 (1). Limit of allowance (2) An inspector shall not be allowed more than $4 a day besides the inspector’s actual travelling expenses. R.S.O. 1990, c. A.33, s. 36 (2). Examination of assignor or employees 37 (1) Upon a resolution passed by a majority vote of the creditors present or represented at a meeting of creditors regularly called, or upon the written request of a majority of the inspectors, or upon an order made by the judge, the assignee may examine upon oath before an associate judge, local registrar, judge of the Superior Court of Justice, official examiner, official referee or any other person named in the order, the assignor or any person who is or has been the assignor’s agent, clerk, servant, officer or employee of any kind, touching the estate and effects of the assignor, and as to the property and means the assignor had when the earliest of the assignor’s debts or liabilities existing at the date of the assignment was incurred, and as to the property and means the assignor still has of discharging debts and liabilities, and as to the disposal made of any property since contracting the debt or incurring the liability, and as to any and what debts are owing to the assignor, and the person examined may be required by the assignee to produce upon such examination any property, book, document or paper in the person’s custody, power or control. R.S.O. 1990, c. A.33, s. 37 (1); 2001, c. 9, Sched. D, s. 14; 2020, c. 11, Sched. 5, s. 13; 2021, c. 4, Sched. 3, s. 19. Where examination to take place (2) Unless otherwise ordered, the examination shall take place in the area in which the person to be examined resides. R.S.O. 1990, c. A.33, s. 37 (2). Procedure on examination (3) The rules and procedure of the Superior Court of Justice as to the examination of a judgment debtor, or any clerk or employee or former clerk or employee of a judgment debtor, so far as may be, apply to an examination held under subsection (1). R.S.O. 1990, c. A.33, s. 37 (3); 2001, c. 9, Sched. D, s. 14. Section Amendments with date in force (d/m/y) 2001, c. 9, Sched. D, s. 14 - 29/06/2001 2020, c. 11, Sched. 5, s. 13 - 08/01/2021 2021, c. 4, Sched. 3, s. 19 - 01/09/2021 Examination of persons having custody of property of assignor 38 Any person who has or is believed or suspected of having in the person’s possession or power any book, document or paper of any kind relating in whole or in part to the assignor, the assignor’s dealings or property and who refuses or fails to produce the book, document or paper for the inspection of the assignee within four days after demand in writing by the assignee may by order of the judge be examined before the judge or any of the officers mentioned in section 37 touching the book, document or paper, and is subject to the same consequences in the case of neglect to attend or refusal to disclose the matters in respect of which the person may be examined or to make such production as is mentioned in section 40. R.S.O. 1990, c. A.33, s. 38. When assignor does not attend or refuses to answer questions 39 If the assignor does not attend for examination and does not allege a sufficient excuse for not attending or, if attending, refuses to disclose the assignor’s property or transactions respecting the property or does not make satisfactory answers respecting the property or if it appears from the examination that the assignor has concealed or made away with property in order to defeat or defraud the assignor’s creditors or any of them, the judge may order the assignor to be committed to a correctional institution in the area in which the assignor resides for any period not exceeding twelve months. R.S.O. 1990, c. A.33, s. 39. Compelling attendance and production of books 40 Any person, other than the assignor, liable to be examined is subject to the same consequences in case of neglect to attend or refusal to disclose the matters in respect of which the person may be examined or to make production as a witness in an action in the Superior Court of Justice. R.S.O. 1990, c. A.33, s. 40; 2001, c. 9, Sched. D, s. 14. Section Amendments with date in force (d/m/y) 2001, c. 9, Sched. D, s. 14 - 29/06/2001 ______________