Question

14) To get a receiving order, a creditor must show

A) The debtor has failed to make payments to that creditor
B) The debtor was more than $1000 in debt and has committed an act
of bankruptcy under the act.
C) The debtor has made more than one late payment on account
D) The debtor retained their car and clothing

Answer 1

A creditor must show that the debtor owes over $1000 and has committed an act of bankruptcy to get a receiving order, potentially resulting in asset liquidation to settle debts.

Therefore, option B is correct.

Step-by-step explanation:

To obtain a receiving order, a creditor must demonstrate that the debtor owes more than $1000 and has committed an act of bankruptcy under the Bankruptcy and Insolvency Act. This involves proving that the debtor has not only failed to meet the payment obligations towards the particular creditor but also has met one of the conditions that classify as an act of bankruptcy. For example, if a debtor is late on multiple loan payments or if they have been subjected to a foreclosure due to nonpayment, these might be grounds for a creditor to petition for a receiving order, ultimately leading to the debtor's assets being liquidated to pay off debts.