Directions for lifting of Conservatory Measures (Scotia Bank)
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: John Lukca and J. Lukca & Associés inc.
Directions for Lifting of 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 John Lukca 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 trustees' 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 trustees provide the Superintendent with a plan for closing their files as per the Initiative for the Orderly and Timely Administration of Insolvency Estates (IOTA);
The trustees did not respect the closing plans that they submitted on August 25, 2003 and June 30, 2005 or subsequent amendments to those plans;
On March 28, 2006, the trustees requested an extension to August 31, 2006 in order to complete their closing plan, but they did not provide an amended closing plan as requested by the Senior Bankruptcy Analyst in a letter dated April 27, 2006 and by the Assistant Superintendent, Trustee Compliance, in a letter dated June 8, 2006;
The trustees did not respond to the Official Receiver's requests for information on estate files;
The trustees committed numerous irregularities in the administration of their trust bank accounts and in several aspects of their estate administration;
The trustees did not prove that they had corrected the situation, despite requests to do so;
After being discharged, the trustees made payments to the Superintendent, in the form of levies. These payments were made out of bank accounts that were not listed in the April 30, 2006 banking report;
The trustees refuse or neglect to adequately render account for their 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 on July 4, 2006, Marie Tardif, a Delegate of the Superintendent of Bankruptcy, directed the Scotia Bank branch located at 7885 Décarie Boulevard, Montréal, Quebec H4P 2H2:
- to make no debit, payment or transfer on funds credited to the estate accounts administered by J. Lukca & Associés inc. 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 or Mr. John Lukca.
- 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 or Mr. John Lukca.
- 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 J. Lucka & Associés inc., Trustee in Bankruptcy.
Whereas all deficiencies detected pertaining to the administration of the estates have been satisfactorily corrected; all irregularities with respect to the trust bank accounts have been satisfactorily corrected; all estates under the administration of John Lukca and J. Lukca & Associés inc. have been properly completed and discharges have been issued; all funds in the trust accounts have been distributed satisfactorily; all trust bank accounts have a nil bank balance; and there are no estates under the licenses of John Lukca or J. Lukca & Associés inc.;
Whereas the Superintendent has delegated to me, in accordance with subsection 14.01(2) of the Act, the powers of the Superintendent as specified at subsection 14.03(1) of the Act, in the circumstance referred to in subsection 14.03(2), a copy of which delegation is attached, along with copies of sections 14.01, 14.02 and 14.03 of the Act;
I, Samra Rabie, in my capacity as Delegate for the Superintendent, remove the conservatory measures issued to the Scotia Bank.
That these directions take effect immediately.
That, pursuant to subsection 14.03(4) of the Act, a person who complies with this direction is not liable for any act done by that person only to comply with this direction.
Signed at the City of Montreal, Quebec, this 18th day of July, 2016.
Regional Director—Eastern Region
Office of the Superintendent of Bankruptcy
- Date modified: