• Bankruptcy in Ontario, Canada is a complicated legal process.canadian 20 image by dwags from Fotolia.com
  
  When a business can't pay the bills, it declares bankruptcy and the court steps between the company and the creditors. Ontario, Canada, has the Bankruptcy and Insolvency Act (BIA) to assure an orderly and fair accounting and payment.
  
  

Starting the Bankruptcy Proceedings

• A company can be placed in bankruptcy by a creditor petitioning the court, the directors of the company entering into bankruptcy, a number of creditors who reject the initial plan of the company to pay its bills, or by the company failing to comply with a plan to pay creditors.
  
  

Causes for a Business Bankruptcy

• The executives and the creditors recognize that the company has no assets or enough assets to pay its bills. Landlords can cause a bankruptcy. If the company can't pay the lease on their office space. The landlord can seize the assets of the company through the BIA.
  
  

The Court Steps In

• The court approves the request for bankruptcy and appoints a trustee or receiver to gather the assets and distribute them in an organized manner to the creditors. The trustee stands between the executives of the company and the creditors. He works for the executives by relieving them of the stress of working with dissatisfied creditors and for the creditors by effectively and honestly accounting for all of the assets and distributing them fairly among the creditors.