Bank of Montreal
What is a conservatory measure?
The Superintendent of Bankruptcy puts in place conservatory measures when a bankruptcy or insolvency estate needs protection. It might be in cases of Licensed Insolvency Trustee (LIT) malfeasance or if serious wrongdoing on the part of a LIT puts estate files at risk. Conservatory measures may also be put in place if a LIT becomes ill or dies without a valid succession agreement. Finally, conservatory measures may be put in place if a LIT, for whatever reason, has allowed the administration of his or her practice to become substandard.
In the matter of :
Rochelle Pont Budd
J. Lukca & Associés inc.
Directions for Conservatory Measures
(section 14.03 of the Bankruptcy and Insolvency Act)
Whereas the Bankruptcy and Insolvency Act (the Act) provides the Superintendent of Bankruptcy with the general power to supervise the administration of all estates and matters to which the Act applies;
Whereas Rochelle Pont Budd (the trustee) is the holder of an individual trustee licence;
Whereas J. Lukca & Associés inc. is the holder of a corporate trustee licence;
Whereas an investigation conducted by the Superintendent of Bankruptcy pursuant to subsection 5(3)(e) of the Act revealed that the trustee's administration presented numerous deficiencies, including those listed below;
The percentage of files open for more than three years exceeded the established standard, thereby requiring that the trustee provide the Superintendent with a plan for closing her files as per the Initiative for the Orderly and Timely Administration of Insolvency Estates (IOTA);
The trustee did not respect the closing plan that she submitted on or subsequent amendments to that plan;
On , the trustee requested an extension to August 31, 2006 in order to complete the closing plan, but she did not provide an amended closing plan as requested by the Senior Bankruptcy Analyst in a letter dated and by the Assistant Superintendent, Trustee Compliance, in a letter dated ;
Without justification, the trustee failed to submit her monthly progress report on the closing plan for the months of April and June, 2006, while the report for May was submitted late;
The trustee committed numerous irregularities in the administration of her trust bank accounts and in several aspects of her estate administration;
Despite a request from the Official Receiver, the trustee did not provide proof that estate funds had been deposited in the consolidated trust account of J. Lukca & Associés inc. in the case of 13 consumer proposals filed in or before 2002;
The trustee did not distribute dividends to creditors as per the terms of proposals since the last interim payment made in 2002, in 12 of these 13 estates;
The trustee did not demonstrate that she had corrected the situation in three of these files, as per the request of the Official Receiver;
The trustee refuses or neglects to adequately render account for her administration;
Whereas the Superintendent of Bankruptcy may, in order to protect estates, exercise the powers set out in subsection 14.03(1) of the Act, under the circumstances anticipated in subsection 14.03(2) of the Act;
Whereas the Superintendent of Bankruptcy has reasonable grounds to believe that the estate files require protection;
Whereas the Superintendent of Bankruptcy has delegated to the undersigned, in accordance with subsection 14.01(2) of the Act, in certain situations mentioned in subsection 14.03(2), the Superintendent's powers as specified at subsection 14.03 (1) of the Act, copies of which delegation are attached, along with copies of subsections 14.01(2) and 14.03(1) to (4) of the Act;
Whereas subsections 14.03(1)a) and b) and (2)b) and c) of the Bankruptcy and Insolvency Act apply;
I, the undersigned, Marie Tardif, in my capacity as Delegate of the Superintendent of Bankruptcy, direct:
The Bank of Montreal, branch located at 630 René-Lévesque Boulevard West, Montréal, Quebec H3B 1S6:
- to make no debit, payment or transfer on funds credited to the estate accounts administered by Rochelle Pont Budd and listed in Appendix A without the co-signature of Ms. Patricia Couture or Mr. Roger Rousselle or Mr. François Leblanc, in addition to that of Ms. Rochelle Pont Budd.
- not to pay out of these same accounts any bills of exchange, cheques, bank drafts, certificates of deposit, or other such instruments that may have been issued prior to receipt of these directions but are presented for payment after receipt of these directions, unless said cheques, bills of exchange or bank drafts have been co-signed by Ms. Patricia Couture or Mr. Roger Rousselle or Mr. François Leblanc in addition to Ms. Rochelle Pont Budd.
- to provide to Mr. Robert Massé by end of day on July 19, 2006, a list of all estate trust bank accounts with a balance as of July 5, 2006, that are under the name of or controlled or administered by Rochelle Pont Budd, Trustee in Bankruptcy.
These directions take effect immediately and will stay in place until the trustees have corrected their deficiencies or until further notice;
In accordance with subsection 14.03(3) of the Act, these directions bind their addressees, who must comply with them;
In accordance with subsection 14.03(4) of the Act, a person who complies with these directions is not liable for any act done by the person only to comply with them.
Signed, in the City of Montréal, Québec,
Assistant Superintendent, Trustee Compliance
Account Numbers title "General Trust Account"
- Date modified: