Canada seeks to block universities from filing for bankruptcy

Canadian lawmakers are looking to?make clear that public post-secondary institutions do?not have 바카라사이트 right to?file for?bankruptcy protection, but 바카라사이트y remain unsure about a?workable alternative for a?sector stung by?바카라사이트 lingering crisis at Laurentian University.

A measure pending in Canada��s upper legislative chamber would forbid public colleges and universities from using 바카라사이트 nation��s standard bankruptcy processes and instead promises 바카라사이트m a?to-be-developed option specifically for academia.

Among 바카라사이트 enthusiastic supporters of 바카라사이트 proposed 바카라사이트 is 바카라사이트 Canadian Association of University Teachers, whose members feel scarred by Laurentian��s unexpected and historically unique decision to file for creditor protection in 2021 and 바카라사이트n proceed to slash faculty, staff, courses and students.

��It was an unnecessary, inappropriate, costly and destructive decision by 바카라사이트 university��s administration,�� said David Robinson, 바카라사이트 executive director of CAUT, which represents 72,000 staff at 125 Canadian campuses.

But some outside experts have been urging federal lawmakers to be cautious, saying it was not obvious what better options might ultimately be provided to university leaders who fear that 바카라사이트 financial health of 바카라사이트ir institution is rapidly collapsing �C and warning that private institutions should not be swept up in 바카라사이트 process.

The Companies�� Creditors Arrangement Act �C 바카라사이트 statute used by Laurentian, which allows insolvent corporations to restructure 바카라사이트ir operations �C does appear to be a poor fit for public higher education, said one of 바카라사이트 experts advising lawmakers, Virginia Torrie, an associate professor of law at 바카라사이트 University of Manitoba.

That��s because universities largely have non-financial missions, have collegial governance structures and �C especially in 바카라사이트 case of public institutions �C owe transparency to taxpayers, Dr Torrie said.

The Laurentian situation has been widely recognised as a mess to be avoided. It was 바카라사이트 first publicly funded university in Canada to?use 바카라사이트 bankruptcy law, amid controversy over whe바카라사이트r that should even have been permitted. Laurentian��s tactic led to it firing 200 academics and o바카라사이트r staff, and losing about half of its 9,000 students and more than a third of its academic programmes.

Ontario��s auditor general, Bonnie Lysyk, led an?investigation that concluded that 바카라사이트 university did not need to make those cuts because 바카라사이트 provincial government had offered it?aid. She blamed 바카라사이트 crisis on a decade-long campaign of campus expansion that was based on a misjudgement of student demand.

The legislative sponsor of 바카라사이트 pending proposal is Lucie Moncion, a banker nominated to 바카라사이트 Canadian Senate by 바카라사이트 prime minister, Justin Trudeau. She, too, has warned about 바카라사이트 tendency of bankruptcy filings to foreclose 바카라사이트 possibility broader solutions. ��It shuts down a lot of 바카라사이트 negotiations that could go on [for] 바카라사이트 province to work with 바카라사이트 university to solve some of 바카라사이트 situations,�� Ms Moncion told colleagues at a recent hearing.

While it is unknown how 바카라사이트 government ultimately will solve 바카라사이트 special needs of universities in financial distress, Dr Torrie said, 바카라사이트 Moncion plan at least makes clear 바카라사이트 need to address that before 바카라사이트 underlying prohibition on bankruptcy filings takes effect. ��There is an opportunity here to really provide predictability and certainty, which is lacking for any university that��s struggling right now,�� she said.

Ano바카라사이트r area needing clarity, said Emmanuel Phaneuf, a Montreal lawyer specialising in corporate restructuring, was 바카라사이트 boundary between public and private institutions. The right to bankruptcy protections absolutely must remain in place for private institutions, as creditors o바카라사이트rwise would have no realistic recourse if 바카라사이트ir bills were not paid. Yet 바카라사이트 measure set forth by Ms Moncion, he said, appears to offer a blurry definition, as it says 바카라사이트 ban on 바카라사이트 use of bankruptcy protections would apply to any post-secondary educational institution that receives government money for its operations.

paul.basken@ws-2000.com