CHARTERED PROFESSIONAL ACCOUNTANTS OF ALBERTA v NEILSON

The Applicant Chartered Professional Accountants of Alberta applied to enforce portions of a sanction agreement which arose from the Respondent’s professional misconduct as a certified general accountant. The sanction agreement imposed fines and costs on the Respondent, Neilson, and was made during the Respondent’s bankruptcy. Notably, the fines and costs were awarded pursuant to a regulatory regime. As such, the Rules of Court did not apply.

In assessing whether the costs and fines were provable claims under the Bankruptcy and Insolvency Act, RSC 1985, c B-3, Eamon J. considered the separate cost regime governed by the Rules of Court. Eamon J. noted that such costs are “well defined and predictable”. For example, it is probable that costs will be awarded pursuant to Rule 10.29 following the litigation; and Rule 4.29 dictates costs in light of a formal offer to settle. As such, the costs would qualify as provable claims. Justice Eamon held further that the Applicant was entitled to a money Judgment against the Respondent for the fines. The Application was granted.