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Record W2160729556

Mandatory Bankruptcy Counseling: The Canadian Experience

2001· article· en· W2160729556 on OpenAlexaboutno aff
Iain Ramsay

Bibliographic record

VenueKent Academic Repository (University of Kent) · 2001
Typearticle
Languageen
FieldSocial Sciences
TopicLegal Systems and Judicial Processes
Canadian institutionsnot available
Fundersnot available
KeywordsBankruptcyLegislatureDebtCreditorAgency (philosophy)BusinessAccountingActuarial scienceFinancePolitical scienceLawSociology
DOInot available

Abstract

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I. INTRODUCTION Like the United States, Canada has a relatively high rate of individual bankruptcy filings compared with other industrialized countries.1 While there are significant differences between the bankruptcy systems of the two countries, the Canadian system has two characteristics of interest to the current United States proposals on consumer bankruptcy reform. These are the use of means testing2 and the requirement of mandatory counseling as a condition of receiving a discharge.3 In this Article, I focus on mandatory counseling and discuss four issues concerning counseling: the nature and scope of bankruptcy counseling; its implementation in practice; existing evidence on its effectiveness; and finally, contrasting assumptions about counseling as a response to problems of debt. I conclude that the role and value of mandatory counseling remains controversial and the difficulties of providing objective measures of its success or failure ensure that a clear resolution of its success or failure is unlikely. II. THE INTRODUcTION OF MANDATORY COUNSELING Canada introduced mandatory counseling for bankrupts in 1992.(4) The rationale for the introduction of counseling was to prevent repeat bankruptcies5 and to further rehabilitative goals of behavior modification.6 Creditors had lobbied for the inclusion of mandatory counseling during legislative debates.7 The concept of counseling was also supported by the Office of the Superintendent of Bankruptcy, the independent agency that regulates the bankruptcy process in Canada.8 Debtors in Canada may choose to declare straight bankruptcy, resulting in a discharge of most unsecured debts after nine months, or make a consumer proposal to repay all or a portion of their debts over a period not exceeding five years! The majority of debtors who declare bankruptcy make income repayments to the estate during the nine-month period before discharge, primarily to pay the fees11 of the trustee in bankruptcy. In addition, individuals with surplus income, as defined in the statutory guidelines,12 are required to contribute a percentage of their income during the nine-month period.13 Approximately fifteen percent of bankrupts fall within this category.14 The norm for a consumer proposal is a three-year repayment plan and the average proposal offers to pay approximately fifty percent of unsecured debts.15 Whichever route is chosen, whether bankruptcy or proposal, individuals are required to undergo two counseling sessions. A failure to attend a counseling session results in a debtor not receiving an automatic discharge and requires a court application for discharge.16 There are three instances in the Canadian bankruptcy process that could be characterized as counseling, although only two are formally described as such. At the point when an individual is considering bankruptcy and has visited a trustee, the trustee is required to make a pre-bankruptcy assessment of a potential bankrupt.17 This includes an outline of the debtor's financial affairs, a discussion of the debtor's options, including the option of a consumer proposal, and the various rights and responsibilities of the debtor.18 This directive was introduced in response to concerns that individuals were being processed through bankruptcy by clerical personnel in trustee firms without being provided with a full explanation of their options and without an opportunity to meet a trustee.19 The first formal counseling session takes place shortly after the declaration of bankruptcy20 and is titled Consumer and Credit Education.21 The counselor should provide the debtor at this stage with consumer advice in (i) money management; (ii) spending and shopping habits; (iii) warning signs of financial difficulties; and (iv) obtaining and using credit.22 The second counseling session, which takes place shortly before the discharge23 in a straight bankruptcy is entitled Identification of Road Blocks to Solvency and Rehabilitation. …

Fetched live from OpenAlex and de-inverted. Abstracts are not stored in this database: the inverted indexes are 8.6 GB of the frame’s 9.3 GB of text, and the host has 13 GB free.

How this classification was reachedexpand

Full frame machine prediction

Teacher imitation

Not calibrated prevalence, not ground truth. Human validation pending. The Gemma side is a direct model label for every work in the frame, read from the title-only record. The Codex side is a classifier learned from the 10,348 direct Codex labels and calibrated to design-weighted sample rates; fields without enough sample support carry no Codex call. Candidate is the union of the two sides; consensus is their intersection. These outputs are machine_predicted_unvalidated and are not human labels.

metaresearch head score (Codex)0.003
metaresearch head score (Gemma)0.008
Version: metacan-v3-hybrid-931329e0061cValidation status: machine_predicted_unvalidated
Candidate categoriesnone
Consensus categoriesnone
DomainCandidate signal: none · Consensus signal: none
Study designCandidate signal: Observational · Consensus signal: none
GenreCandidate signal: Empirical · Consensus signal: Empirical
Teacher disagreement score0.047
Threshold uncertainty score0.344

Distilled classifier scores by category (both heads)

CategoryCodexGemma
Metaresearch0.0030.008
Meta-epidemiology (narrow)0.0010.001
Meta-epidemiology (broad)0.0000.000
Bibliometrics0.0010.005
Science and technology studies0.0170.005
Scholarly communication0.0040.001
Open science0.0030.003
Research integrity0.0030.004
Insufficient payload (model declined to judge)0.0130.001

Machine scores (provisional)

The two teacher heads of the student model, read on this work. A score orders the frame for review; it never asserts a category, and the validation status ships verbatim with every row.

Baseline scores from an immature model (maturity gate not passed, 7 training rounds). Scores rank; they never assert a category.

Opus teacher head0.022
GPT teacher head0.259
Teacher spread0.237 · how far apart the two teachers sit on this one work
Validation statusscore_only:v0-immature-baseline · verbatim from the scoring run: score_only means the number may rank works, and no category label ships from it

Classification

machine, unvalidated

Machine predicted; a candidate call from one source (direct Gemma or distilled Codex), not a consensus.

The models applied no category: nothing in the taxonomy fit this work.
Study designObservational
Domainnot available
GenreEmpirical

How this classification was reached, model by model and score by score, is at the end of the page under "How this classification was reached".

Quick stats

Citations7
Published2001
Admission routes1
Has abstractyes

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Same venueKent Academic Repository (University of Kent)Same topicLegal Systems and Judicial ProcessesFrench-language works237,207