Does a punitive damages claim by a bankrupt pass to the trustee as property of the bankrupt?

Alberta, Canada


The following excerpt is from Gano v. Alberta Motor Association Insurance Co., 1997 CanLII 14775 (AB QB):

The restated question is - does a punitive damages claim by a bankrupt pass to the trustee as property of the bankrupt within the scope of s. 49(1) B.I.A. The answer to that question is found in the case law under headings Two and Four. The case law says that those claims which are for or in regard to the bankrupt’s property or estate pass to the trustee, nothing else. The same point is made in Kellaway v. Bury (1892), 66 L.T. 599 (Eng. C.A.), p. 601: As I understand the rule as to the vesting of causes of action in a trustee in bankruptcy it is this: It does not depend upon whether a cause of action arises upon a contract or whether it arises upon a tort. It depends upon the nature of the damages which result from that which is complained of. It the nature of the damages immediately resulting from that which is complained of is to injure the plaintiff’s [the bankrupt’s] estate, then it does vest in his trustee.

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