Case information

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Case summaries are prepared by the Office of the Registrar of the Supreme Court of Canada (Law Branch). Please note that summaries are not provided to the Judges of the Court. They are placed on the Court file and website for information purposes only.

Bankruptcy and Insolvency ? Trustee ? Appeals ? Standard of review ? Proceeds of fire insurance policy on contents of former matrimonial home ? Court of Appeal finding Trustee entitled to 50 percent of proceeds ? Whether Court of Appeal improperly interfering with and failing to give proper deference to decision of motion judge ? Whether, when parties have by agreement dealt with their matrimonial property prior to one making an assignment in bankruptcy, Bankruptcy Court is entitled to undo such arrangements between parties other than through matrimonial proceedings.

The applicant, Ms. Aslan is the former spouse of the bankrupt Ibrahim Aslan. Ms. Aslan and the bankrupt were married in 1986. They separated prior to the assignment of bankruptcy on May 21, 2010. The bankrupt, Mr. Aslan was discharged February 22, 2011 and the parties were divorced July 19, 2011.
The spouses jointly owned their matrimonial home. There was a fire in the matrimonial home which resulted in substantial losses. They jointly filed a “Fire Proof of Loss” for the replacement costs for the home’s contents. The respondent, Trustee took over the bankrupt’s claim. The contents claim settled for $384,500.00 net of legal fees and disbursements.
The Trustee agreed to the release of $192,500.00, to Ms. Aslan, i.e. 50% of the settlement proceedings. The Trustee then sought a declaration from the court that 50% of the settlement was the property of the bankrupt.
The motion judge dismissed the Trustee’s claim. The Court of Appeal set aside this order and allowed the Trustee’s claim for half of the net proceeds of the insurance claim for the contents of the matrimonial home.