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As licensed insolvency trustees, CAIRP (Canadian Association of Insolvency Professionals and Restructuring Professionals) members are highly respected professionals. The trustee designation signifies years of in-depth study, work experience, competence and commitment to the highest of professional ethics and objectivity. In additional to being a trustee, approximately 95% of trustees are members of CAIRP. Chartered insolvency restructuring professionals (CIRPs) must maintain high standards of conduct and professionalism.
The Rules of Professional Conduct (the Rules) which set these high standards are, first and foremost, to protect the public. Secondly, they are to ensure that we treat everyone with due respect, courtesy and integrity.
There are a number of principles upon which the Rules are based. These principles are:
1. A member's conduct shall all times maintain the good reputation of the profession
2. All members shall perform his professional services with integrity and care
3. A member shall sustain his professional competence by keeping informed of developments in professional standards and legislation
4. A member, when engaged in an assignment, shall be free of any influence, interest or relationship which impairs professional judgement or objectivity or which, in the view of a reasonable and informed observer, has that effect
5. A member has a duty of confidence to a client and shall not disclose, without proper cause, any information obtained in the course of an engagement. Nor shall such information by exploited directly or indirectly by a member
6. A member shall accord to any other member the courtesy and consideration due between professional colleagues
7. A member who handles money or other property in trust shall do so in accordance with the terms of the trust and the applicable law relating to such money or trust property and shall maintain such records as are necessary to account properly for such money or other trust property.
8. A member shall not directly or indirectly pay to any party a commission or other compensation to obtain a professional engagement nor shall he accept directly or indirectly from any party a commission or other compensation for having referred work relating to a professional engagement
9. A member shall not adopt any method of obtaining or attracting professional engagements which tends to bring disrepute on the Association or any of its members
10. In order to ensure consistency of competence, a national Insolvency Qualification Program (CQP) was developed. The CQP provides training courses and manages the official qualification process for individuals seeking to become a licensed insolvency trustee in Canada.
The CQP monitors the acquisition of the 2,400 hours of experience required by candidates and administers the National Insolvency Exam (NIE).
Following the completion of the NIE and the attainment of 2,300 hours of experience, candidates are invited by the Office of the Superintendent of Bankruptcy (OSB) to sit an oral board exam. If the candidate is successful at the oral board and fulfills the requirements, the OSB issues a licence recognizing the individual as a licensed insolvency trustee.
Most trustees have support staff that assists them in their administration of the insolvency filing and generally, the more senior staff have completed courses offered through CAIRP. The courses recognize that, while the trustee is ultimately responsible for the proper handling and administration of an estate, reliance is placed on others to assist and carry out many day-to-day duties.
-CAIRP, Interpretation of the Rules of Professional Conduct and Standards of Conduct
1. In order to ensure that a member maintains not only his own good professional reputation, but also that of the Association, the member shall always perform his engagement in a conscientious, diligent, and efficient manner and shall provide a quality of professional service which the public can generally and reasonably expect from any member in a similar situation.
2. A member is obligated to do his reasonable best in providing prompt professional service on an engagement.
1. A member should be satisfied that his or his associates' relationship with the debtor, any creditor or any other clients having an interest in the professional engagement is not such as to impair his professional judgement or objectivity.
2. A member, his partners, his associates, his staff and their respective household shall not acquire directly or indirectly in any manner whatsoever any assets under the administration of the member, provided that any of the foregoing may acquire assets from a retail operation under administration of the member where those assets are available to the general public for sale and that no special treatment or preference over and above that granted to the public is offered to or accepted by the member, his partners, his associates, his staff and their respective households.
3. A member shall not permit himself to be placed in a position of conflict of interest; in keeping with this principle, a member shall not accept any appointment;
a) which is prohibited by law, or
b) as a receiver, a receiver-manager, agent for a secured creditor, liquidator or any appointment under the Bankruptcy and Insolvency Act , except as an inspector, in respect of any insolvent person or corporation where the member is, or at any time during the immediately preceding two years was:
i) related to such person or corporation; or
ii) the auditor or accountant of such person or corporation.
4. The term "accountant" means anyone who has prepared unaudited financial statements in accordance with S.8200 of the CICA Handbook.
5. A member shall not permit himself to be placed or remain in a position where a conflict of interest may exist, or may appear to exist, without making full disclosure to, and obtaining the written consent of all interested parties; in keeping with this principle, a member shall not accept any appointment:
a) as trustee under the Bankruptcy and Insolvency Act where the member has already accepted an appointment as receiver, receiver manager, agent for a secured creditor, liquidator, trustee under a trust indenture issued by the bankrupt corporation or by any corporation related to the bankrupt corporation, or on behalf of any person related to the bankrupt without having first made disclosure of such prior appointment to the Bankruptcy Court or the Official Receiver, as the case may be; following the acceptance of such appointment as trustee under the Bankruptcy and Insolvency Act , the member shall inform the creditors of the bankrupt of his prior appointment as soon as reasonably possible thereafter;
b) as receiver, receiver-manager, agent for a secured creditor or on behalf of any person related to the bankrupt where the member has already accepted an appointment as trustee under the Bankruptcy and Insolvency Act without first obtaining the permission of the inspectors of the bankrupt estate; where inspectors have not been appointed at the time that the second appointment is to be taken, the member shall obtain the approval of the creditors of the bankrupt of having taken the second appointment as soon as reasonably possible thereafter; and if the second appointment is taken before obtaining the approval of the creditors, it should be taken subject to their approval.
c) as receiver, receiver-manager, agent for a secured creditor or trustee under the Bankruptcy and Insolvency Act in respect of any corporation where the member is, or at any time during the immediately preceding two years was, the trustee (or related to such trustee) under a trust indenture issued by such corporation or by any corporation related to such corporation without first obtaining the permission of the creditors secured under such trust indenture; upon the acceptance of an appointment as trustee under the Bankruptcy and Insolvency Act , the member shall inform the creditors of the bankrupt corporation of his prior appointment as (or relationship to) the