Jean-Daniel Breton, CPA, FCIRP, LIT
It is hard to believe that it has been almost a year since I assumed the role of CAIRP Chair. Since my last message, change has been the only constant, as our industry transitions from a 35-year low in formal insolvency filings to a turning tide, with a sharp increase in both business and consumer insolvencies in the first half of 2022, as is illustrated in the 2 graphs below.
These two graphs, presenting the evolution of quarterly filings from 2007 to date, show that while the insolvency filings have been increasing, they are still below the pre-pandemic levels.
Notwithstanding the lower insolvency filing numbers, Canadians are facing a growing list of economic and social uncertainties along with geopolitical issues that have been punctuated by the emergence of a war in Ukraine. Given this, the impact will be felt by the insolvency community across the country as we are likely to see insolvency rates continue to climb in the coming months.
Ensuring the effective functioning of the insolvency and restructuring system is more critical than ever during these times. In this regard, significant time and focus have been given to proactive advocacy efforts over the last few months. This included CAIRP’s participation in the OSB’s Consultation on the Modernization of Physical Office Requirements for LITs in March 2022. CAIRP engaged an outside firm, Discover by Navigator, to consult CAIRP members on their views for the OSB’s Consultation on the Modernization of Physical Office Requirements for LITs. Our thanks to the Consumer Practice Committee, the Corporate Practice Committee, Provincial Associations, and members for their thoughtful input. Their feedback was invaluable in guiding CAIRP’s response to the consultation.
CAIRP hosted the OSB-CAIRP Webinar in June 2022. Joining me as part of the featured presentations was Elisabeth Lang, Superintendent of Bankruptcy. The Superintendent provided an overview of the OSB’s 2022-23 Business Plan Priorities; gave key updates on the OSB’s work regarding the debt advisory marketplace and shared some operational highlights. My update included a briefing on CAIRP’s continued efforts over the last 24 months to help members weather the COVID-19 pandemic, ongoing advocacy efforts to enhance the insolvency system and key areas of focus over the past year and the year ahead. More than 700 participants attended the session.
CAIRP has been raising a number of member issues with the OSB, which has been responsive and collaborative. As reported in a recent CAIRP newsletter, the issue of a credit reporting company identifying a consumer proposal as a bankruptcy on credit reports has been resolved and efforts are underway to resolve a similar issue with another credit reporting company. CAIRP is working with the OSB to resolve other credit reporting issues identified in this issue’s article entitled Credit Reporting Errors-The Role of the LIT and we will keep members posted on our progress. CAIRP also raised a number of other issues flagged by members with the OSB, and in a number of cases, “Cease and Desist” letters were sent by the OSB, or the OSB referred the matters to the Competition Bureau for enforcement.
To further enhance the insolvency system, CAIRP has also been meeting on a quarterly basis with Innovation, Science and Economic Development Canada (ISED) to discuss a range of issues including COVID-19 and the economy; public interest functions of public post-secondary educational institutions in insolvency and restructuring situations; super-priority for unfunded pension liabilities; and bilingual/multilingual insolvency court proceedings. ISED and CAIRP have agreed to continue to meet regularly going forward and the next meeting, which should take please in the early fall, will again focus on Micro-Small and Medium Sized Enterprises (MSMEs).
Interventions are also a key priority for CAIRP. CAIRP was granted intervenor status in the Sanaa Ismail Abed Ali vs. Attorney General of Canada case in BC, appearing before Justice Basran on December 15, 2021. The case looks at who bears the responsibility for paying for an interpreter in a summary administration bankruptcy. The Judge’s decision was issued on February 3, 2022 (2022 BCSC 169) and supported the arguments CAIRP made in its intervention. Dentons LLP (Tevia Jeffries) represented CAIRP in the matter.
In Quebec, CAIRP’s intervention in the Pierre Nolet vs. the Attorney General of Canada case moved to a pre-hearing conference on December 12, 2021 before Justice de Blois, where an agreement was reached to consider firstly a threshold issue. It is expected the case will be heard in early October 2022. Norton Rose Fulbright Canada LLP (Christian Roy) is representing CAIRP on this file.
We remind members that the Intervention Committee reviews cases and makes recommendations regarding a possible intervention based on set criteria that focus primarily on the importance of the decision for the profession and the need to promote the objectives of federal insolvency legislation. Members are invited to reach out to CAIRP when they become aware of a case where insolvency principles are at play and where an intervention might be warranted.
Efforts continue towards raising the profile of CAIRP and its members, with a number of projects carried out over the past year. CAIRP was very active in its ongoing media outreach with the issuance of six media releases generating stories in major and regional news outlets across the country. The CAIRP Media Communications Committee along with the Provincial Associations initiated and drove a project this past spring which involved the creation of eight new provincial association websites. The provincial websites are closely aligned to CAIRP in brand look and feel and messaging, and stem from the CAIRP website platform which was enhanced and refreshed earlier in the year. The aligned messaging will greatly assist the industry in its efforts to raise its profile and better serve the public with consistent, clear messages. Our thanks to all involved.
As well, CAIRP continued the work towards establishing a new Associate category, as was approved by the members at CAIRP’s September 2021 Annual General Meeting, when they ratified the by-law modifications that provide for the creation of the Insolvency Administrator Associates category. The new category launched in April 2022, with an invitation to known qualifying administrators to join. Members should consider enrolling their employees who meet the qualifications for this category, as there is a mutual benefit to the active participation from these associates.
Staying abreast of key issues is critical to our members. CAIRP’s professional development (PD) planning committees put together a stellar line-up of thought provoking and informative webinars to address the need. Over the past year, CAIRP released 28 original live and on-demand webinars in English and French with over 3,800 views. From a performance measures perspective, the webinar series was very popular with members, since over 81% of CAIRP members attended one or more of the sessions. During the year, 95% of members who answered a survey rated the sessions as having met or exceeded their expectations and 86% advised they would recommend a CAIRP professional development event to a colleague. The National Webinar series has been continued for the 2022-23 year, providing CAIRP members along with non-members with a varied, high-quality virtual PD program. If you haven’t signed up, I would encourage you to do so.
I encourage you to check out the list of our newly minted Chartered Insolvency and Restructuring Professional (CIRP) colleagues for 2021-22 who are featured in this issue of Rebuilding Success. The CIRP certification mark is the recognizable symbol of integrity, education and professionalism of the insolvency and restructuring profession in Canada. This past year 23 professionals from across the country completed the CIRP Qualification Program and achieved their CIRP designation. This achievement is a result of hundreds of hours of dedicated effort and determination. On behalf of all CAIRP members, we congratulate them on their achievement and welcome them as new members of CAIRP. Our thanks as well to the families, friends, colleagues, mentors, sponsors and education volunteers who supported them on their journey.
I would like to congratulate the Editorial Board for their first all-digital issue of Rebuilding Success. As Bill Courage, the Chair of the Editorial Board has noted in his message, this new format will allow CAIRP to deliver timely content between issues. We look forward to your feedback as CAIRP moves this initiative forward.
As we look to the future and to assist the insolvency industry adapt to this unprecedented time, CAIRP will be moving forward with a Strategic Review over the coming months, to ensure CAIRP continues to be well positioned to support and serve its members in taking advantage of opportunities and overcoming any challenges that lay ahead. We look forward to working with members on this initiative.
We anticipate a busy fall and winter ahead with further consultations with the OSB and other government departments and we will keep you posted on key developments. A big thank you to all of our volunteers on the CAIRP Committees and the CAIRP staff for their excellent work on our behalf.
Stay safe and well.