Directions for Conservatory Measures to the Canadian Imperial Bank of Commerce, 199 Bay Street, Commerce Court West, Concourse Level, Toronto, Ontario, M5L 1G9—May 22, 2012
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:
Melvin Charles Zwaig
Zwaig Associates 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 (the Superintendent) with the general power to supervise the administration of all estates and matters to which the Act applies;
Whereas Melvin Charles Zwaig (the Trustee) is the holder of an individual license as trustee in bankruptcy;
Whereas Zwaig Associates Inc. is the holder of a corporate licence as trustee in bankruptcy;
Whereas the Trustee is the sole practitioner of Zwaig Associates Inc.;
Whereas Mr. Brian Haley from the Office of the Superintendent of Bankruptcy was informed by Ms. Elizabeth Rawson that the trustee was hospitalized since the weekend of January 31/February 1, 2009 and that to this date, he had not returned to his office;
Whereas on February 26, 2009 Ms. Dana Jurksaitis from the trustee's office informed Mr. Brian Haley from the Office of the Superintendent of Bankruptcy that Mr. Melvin Charles Zwaig had passed away that day;
Whereas a notice corroborating the death of Mr. Zwaig was published by the funeral director, Paperman and Sons Inc.;
Whereas the trustee's file inventory totals 130 estates with an aggregate amount of approximately $730,000 in the trust bank accounts;
Whereas the Office of the Superintendent of Bankruptcy has been unable to identify any succession arrangement for the continued administration of the estates;
Whereas the Superintendent initially appointed Tammy Turner, and subsequently appointed Avi Koren and Abubakar Khan, all employees of the Superintendent, as Guardian Trustee;
Whereas the Superintendent has deemed it advisable to transfer the estate files in question to a private-sector Trustee;
Whereas I believe on reasonable grounds that the estates require protection;
Whereas the Superintendent may, for the protection of an estate, exercise the powers set out in subsection 14.03(1) of the Act, in the circumstances referred to in section 14.03(2) of the Act;
Whereas the Superintendent has delegated to me, in accordance with section 14.01(2) of the Act, the powers of the Superintendent as specified at section 14.03(1) of the Act, in the circumstance referred to in section 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;
Whereas paragraph 14.03(2)(a) of the Act applies;
I, Kirti Gauthier, in my capacity as delegate for the Superintendent, direct the Canadian Imperial Bank of Commerce, 199 Bay Street, Commerce Court West, Concourse Level, Toronto, Ontario, M5L 1G9 that, pursuant to sections 14.03(1)(b) and (c) of the Act:
- it consider upon receipt of the present directions, BDO Canada Limited or its duly appointed representative, as the only authorized signatory as relates to any operations on the funds credited to the estates of bankruptcies and proposals administered by Melvin Charles Zwaig and Zwaig Associates Inc.;
- it make no debit, payment or transfer of funds credited to, or which ought to have been credited to, the estates of bankruptcies and proposals administered by Melvin Charles Zwaig and Zwaig Associates Inc. without the signature of BDO Canada Limited or its duly appointed representative;
- it not pay out of these accounts: cheques, bills of exchange, bank drafts or other instruments, issued before the receipt of these directions that are presented for payment after the receipt of these directions, without these cheques, bills of exchange, bank drafts or other instruments being signed by BDO Canada Limited or its duly appointed representative;
- it submit all statement of accounts, accepted cheques and other documents or information having to do with the above-mentioned estate trust bank accounts to BDO Canada Limited, 1717 2nd Avenue East, Suite 200, P.O. Box 725, Owen Sound, Ontario, N4K 5W9, Attention: William (Bill) A. Courage;
That these directions take effect immediately and will remain in effect until such time as the undersigned is satisfied that they are no longer required;
That in accordance with section 14.03(3) of the Act, these directions bind the Canadian Imperial Bank of Commerce, which must comply with them;
That, pursuant to section 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 Ottawa, Ontario, this 22nd day of May, 2012.
National Manager, Trustee Detection and Compliance
This document has been reproduced as submitted by the delegate of the Superintendent of Bankruptcy.
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