Yves Guay —

Professional Conduct Decision

What is a professional conduct decision?

An investigation into a Licensed Insolvency Trustees (LIT)'s professional conduct is initiated when there is information to suggest that the LIT has not properly performed the duties of a trustee or there has been improper administration of an estate or lack of compliance with the Bankruptcy and Insolvency Act (BIA).

In some cases, the findings are sufficiently serious to support a recommendation for sanctions against the LIT's licence (cancel or suspend a LIT's licence (subsection 13.2(5) of the BIA) or impose conditions or limitations (subsection 14.01(1) of the BIA)).

The professional conduct decision is deemed to be a decision of a federal board, commission or tribunal and may be judicially reviewed by the federal court.

In re:

Yves Guay,
Holder of an Individual Trustee Licence
For the Province of Quebec

Decision Rendered Pursuant to the Bankruptcy and Insolvency Act

Whereas a general audit of the office of Raymond Chabot Inc. in Sherbrooke was conducted in by a senior evaluation officer of the Office of the Superintendent of Bankruptcy (OSB);

Whereas pursuant to that general audit the senior analyst, professional conduct, of the OSB, in accordance with the general delegation of powers referred to in section 14.02(1) of the Bankruptcy and Insolvency Act (the Act), submitted a report on the conduct of the individual trustees Yves Guay and Pierre Guay and the corporate trustee Raymond Chabot Inc.;

Whereas the following infractions alleged in the report were established against the individual trustee Yves Guay, acting of behalf of the corporate trustee, namely that he:

  • opened a consolidated account for consumer proposal files without seeking and obtaining approval from the Division Assistant Superintendent, thereby contravening section 5(5) of the Act and sections 5 and 6 of the Superintendent of Bankruptcy's Directive No. 5 on Estate Funds and Banking;
  • did not maintain good order in the consolidated account for summary administration files, by including in a file titled [TRANSLATION] "consultation fees" receipts relating to files which were not summary administration files, and from to receipts relating to several summary administration files in which equitable monthly interest was not assigned, thereby contravening section 5(5) of the Act and section 8(c) of the Superintendent of Bankruptcy's Directive No. 1R on Estate Funds and Banking, replaced by section 5(b) of the Superintendent of Bankruptcy's Directive No. 5 on Estate Funds and Banking, on ;
  • did not deposit the funds received from a third party as compensation in the bank account of the estate of Nicole Breton, thereby contravening section 25(1) of the Act, or in a trust account clearly identified as a "third party deposit", and did not dispose thereof in accordance with the Superintendent of Bankruptcy's Directives, thereby contravening section 5(5) of the Act and sections 16 and 17 of the Superintendent of Bankruptcy's Directive No. 5R on Third Party Deposits and Guarantees;
  • signed a certificate of compliance indicating that he had received no remuneration or payment other than that indicated in the final statement of receipts and disbursements, when he should reasonably have known that he had received additional sums for the estate of Nicole Breton, thereby contravening section 13.5 of the Act and section 45 of the Rules;
  • made an unauthorized withdrawal of $1,100 from the [TRANSLATION] "consultation fees" file of the consolidated trust account of the summary administration files, in which he had deposited sums received from a third party for the estate of Nicole Breton, thereby contravening section 25(1.3) of the Act;
  • did not disclose in a supplementary final statement of receipts and disbursements sums received from a third party for the estate of Nicole Breton and cashed fees exceeding the rate prescribed in section 128 of the Rules, thereby contravening section 5(5) and 156 of the Act as well as section 5(5) of the Act and sections 5 and 9(a) of the Superintendent of Bankruptcy's Directive No. 5R on Third Party Deposits and Guarantees;
  • did not deposit the sum of $1,500 received from the debtor on in the bankruptcy file of Richard Keays into the estate trust account, thereby contravening section 25(1) of the Act;
  • on signed an amended statement of receipts and disbursements by the trustee which he should reasonably have known was incomplete, false and misleading, by indicating that he had repaid the sum of $1,500 to the debtor in accordance with the judgment rendered by the Court, without disclosing that this sum was returned to him by the debtor, thereby contravening sections 13.5 and 152(1) of the Act and section 45 of the Rules;
  • on signed a certificate of compliance which he should reasonably have known was false and misleading, by indicating among other things that he had received no remuneration or payment other than that indicated in the final statement of receipts and disbursements, when he should reasonably have known that he had received and cashed prior to that date the sum of $1,500 for the estate account of Richard Keays, thereby contravening section 13.5 of the Act and section 45 of the Rules;
  • did not perform his duties with integrity by not complying with the judgment rendered by the Court and by cashing the sum of $1,500 without the knowledge of the Court and the Superintendent of Bankruptcy in the estate file of Richard Keays, thereby contravening section 13.5 of the Act and section 36 of the Rules;
  • on deposited in the bankruptcy file of Pierre Sirois Construction Inc. the receipt of $779.33 in the consolidated account for summary administration files under [TRANSLATION] "consultation fees", thereby contravening section 25(1) of the Act, which requires that the trustee deposit in a bank all monies received for an estate, in a separate trust account for each estate;
  • did not disclose the sum of $779.33 received in the estate of Pierre Sirois Construction Inc. in a supplementary statement of receipts and disbursements, thereby contravening section 152(1) of the Act;
  • did not maintain good order in the consolidated account for summary administration files by depositing therein, from to , receipts relating to several ordinary administration files in a file titled [TRANSLATION] "Summary bankruptcies, disbursements", thereby contravening section 5(5) of the Act and section 5 of the Superintendent of Bankruptcy's Directive No. 5 on Estate Funds and Banking;
  • on did not deposit the receipt of $150 in a trust account for the estate of Marion Thibault, thereby contravening section 25(1) of the Act;
  • did not disclose this receipt of $150 in a supplementary statement of receipts and disbursements of the estate of Marion Thibault, thereby contravening section 152(1) of the Act;
  • withdrew the sum of $150 belonging to the estate of Marion Thibault as fees without first obtaining permission from the Court, thereby contravening section 25(1.3) of the Act;
  • on did not deposit the receipt of $500 in a separate trust account for the estate of Réal Audet, thereby contravening section 25(1) of the Act;
  • did not disclose a receipt of $500 in a supplementary statement of receipts and disbursements for the estate of Réal Audet, thereby contravening section 152(1) of the Act;
  • did not deposit two amounts of $175 received for the estate of Pierre Lessard in a trust account for that estate, thereby contravening section 25(1) of the Act;
  • on signed and submitted to the Court and to the Superintendent of Bankruptcy a report applying for discharge of the bankrupt which he should reasonably have known was misleading, by failing to indicate in the amounts realized the sum of $350 paid by the bankrupt Pierre Lessard to obtain a new hearing date for his discharge application, thereby contravening section 170(1) of the Act as well as section 13.5 of the Act and section 45 of the Rules;
  • did not prepare a statement of receipts and disbursements to disclose the sum of $350 received from the bankrupt Pierre Lessard to obtain a new hearing date for his discharge application, thereby contravening sections 152(1) and (2) of the Act;
  • used the consolidated account for summary administration files to deposit balances from summary administration files, ordinary administration files and Section I proposals, in a file titled "Normand Bourque Syndic Ltée (interest)" from to , thereby contravening section 5(5) of the Act and sections 5 and 8 of the Superintendent of Bankruptcy's Directive No. 1R on Estate Funds and Banking (since , Directive No. 5);
  • did not assign equitable monthly interest to each of the files contained in the "Normand Bourque Syndic Ltée (interest)" file of the consolidated account for summary administration files, thereby contravening section 5(5) of the Act and section 8(c) of the Superintendent of Bankruptcy's Directive No. 1R on Estate Funds and Banking, replaced by section 5(b) of Directive No. 5, issued on ;
  • obtained his discharge without having completed the administration of 163-823 Canada Inc., since he still held $2,095.92 on behalf of that estate when he made the trustee discharge application on , thereby contravening section 64(2)(e) (now section 61(2)(e)) of the Rules;
  • did not administer with care and diligence the balances in the estate and insolvency accounts held in trust in the "Normand Bourque Syndic Ltée (interest)" file, by delaying to dispose of amounts deposited in that file, thereby contravening section 13.5 of the Act and section 48 of the Rules;
  • did not dispose of the balances in the estate and insolvency accounts held in trust in the "Normand Bourque Syndic Ltée (interest)" file by a supplementary or amended dividend sheet, thereby contravening section 5(5) of the Act and section 15 of the Superintendent of Bankruptcy's Directive No. 8 on Unclaimed Dividends and Undistributed Funds;
  • made unauthorized withdrawals from amounts held in the "Normand Bourque Syndic Ltée (interest)" file of the consolidated account for summary administration files, totalling $4,798.76, by making good deficits in six ordinary administration files ($704.33) and in a summary administration file ($759.43) and by issuing a cheque made out to Normand Bourque Syndic Ltée ($3,335), thereby contravening section 25(1.3) of the Act;
  • made payments of disbursements by cheques which were drawn on the "Normand Bourque Syndic Ltée (interest)" account instead of being drawn on the estate account, thereby contravening section 25(2) of the Act;
  • opened and used an account titled "Normand Bourque Syndic Ltée" in the consolidated account for summary administration files to enter fees earned in various summary and ordinary administration files and cheques made out to Normand Bourque Syndic Ltée, thereby contravening section 5(5) of the Act and sections 5 and 8 of the Superintendent of Bankruptcy's Directive No. 1R on Estate Funds and Banking (since , Directive No. 5);
  • did not deposit the sum of $200 received for the account of Jean-Louis Pratte in a trust account for that estate, thereby contravening section 25(1) of the Act;

Whereas, in view of all the facts and circumstances mentioned, the undersigned does not consider it advisable or in the public interest to modify or reject the modified recommendation of the senior analyst, professional conduct, giving rise to the penalty accepted on both sides and described herein;

Whereas the trustee licence has already been cancelled, I the undersigned, as delegate of the Superintendent of Bankruptcy, in accordance with the powers conferred on me pursuant to section 14.01(2) of the Act, approve the following agreement and order the following:

  • the licence of Yves Guay, trustee, if reactivated, is suspended for a period of two years, and during that period the trustee may not act as a trustee in bankruptcy nor accept any instructions under the Bankruptcy and Insolvency Act;
  • if the trustee does not comply with the restriction imposed on his licence in this order, he shall be in default pursuant to section 13.2(5)(b) of the Act;
  • each duplicate original of this Order signed by the undersigned delegate shall have the same force and effect and may be used as such for all legal purposes.

Signed at Montréal, Quebec, .

Original signed by

(signed)

Hon. Benjamin J. Greenberg, Q.C.
Delegate of Superintendent of Bankruptcy

This document has been reproduced as submitted by the delegate of the Superintendent of Bankruptcy.

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