Bankruptcy and Insolvency Act
Explore the Bankruptcy and Insolvency Act (BIA) in Canadian law — what it governs, how it applies to real estate, and why it matters to creditors and debtors.
June 13, 2025
What the Bankruptcy and Insolvency Act?
The Bankruptcy and Insolvency Act (BIA) is a federal law in Canada that governs the legal process for personal and business bankruptcies, insolvencies, and restructuring options.
Why the Bankruptcy and Insolvency Act Matters in Real Estate
In Canadian real estate and business law, the BIA establishes how creditors are repaid when a debtor can no longer meet financial obligations.
Key functions of the BIA:
- Provides frameworks for bankruptcy and consumer proposals
- Establishes priorities for creditor repayment
- Enables court-appointed trustees to administer bankruptcies
- Facilitates corporate restructuring under Division I proposals
The BIA protects both debtors and creditors and often intersects with property foreclosures, receiverships, and the sale of real estate assets.
Understanding the BIA helps investors, lenders, and borrowers navigate financial distress and asset recovery.
Example of the Bankruptcy and Insolvency Act in Action
A bankrupt builder’s assets were liquidated under the Bankruptcy and Insolvency Act, and creditors were repaid in accordance with the statute’s rules.
Key Takeaways
- Governs bankruptcy and insolvency in Canada
- Applies to individuals and businesses
- Sets out creditor repayment priorities
- Overseen by licensed insolvency trustees
- Often invoked in distressed property sales
Related Terms
- Insolvency
- Receivership
- Consumer Proposal
- CCAA
- Foreclosure
An overview of the Calgary's Culture + Entertainment District and the forthcoming hotels. / Truman, Louson
A rendering of the W Calgary and JW Marriott (left), Autograph Collection Hotel (centre), and all three hotels (right). / Truman, Louson
The Rupert and Renfrew Station Area Plan boundaries. / CIty of Vancouver
The land use plan, heights, densities (left) and limitations (right) for the Rupert and Renfrew Station Area Plan. / City of Vancouver
The 5655 Cambie Street site at the northeast corner of W 41st Avenue and Cambie Street in Vancouver. / NSDA Architects, Polygon
Renderings of the commercial building podium for Elysee. / NSDA Architects, Polygon
Renderings of the commercial building podium for Elysee. / NSDA Architects, Polygon
Renderings of the commercial building podium for Elysee. / NSDA Architects, Polygon 
Renderings of the 31-storey Elysee proposed for 5655 Cambie Street in Vancouver. / NSDA Architects, Polygon
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Rendering of 3406-3434 Weston Road/ICON Architects
Rendering of 13-21 John Street/Turner Fleischer
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Rendering of 3434 Lawrence Avenue East/BDP Quadrangle via First Capital REIT
Rendering of 1251-1311 Yonge Street/BDP Quadrangle
