Farber v. Goldfinger

Farber v. Goldfinger, 2011 ONSC 2044
Ontario Superior Court of Justice
March 31, 2011

Milton Davis and Ben V. Hanuka brought a motion to strike a the Report of a Trustee in Bankruptcy on the basis that the Report was inadmissable evidence. Mr. Davis and Mr. Hanuka had previously brought a motion to have the Trustee removed from the case on the basis that the Trustee was in a conflict of interest. In response to that motion, the Trustee filed a Report as opposed to sworn affidavit evidence and the Trustee’s counsel refused to allow the Trustee to be cross-examined on the Report, effectively shielding the Trustee’s evidence from being tested.

Mr. Davis and Mr. Hanuka argued that (1) affidavit evidence was required in response to their motion to remove the Trustee; (2) that affidavits are necessary to ensure procedural fairness, including the right to cross-examine; (3) that the Report constituted hearsay evidence and was thus inadmissable; (4) that the Report was neither balanced nor neutral; (5) that the nature of the motion required affidavit evidence; and, (6) that the motion was not an appropriate situation for the Trustee to file and rely on a Report.

Ultimately, the Motions Judge held that the Report was, in fact, admissable, but left it up to the Judge hearing the removal motion to determine what weight, if any, to place on the Report.

The issues raised in this motion raise interesting and relevant questions about the broad range of powers held by a Trustee in Bankruptcy, and other officers of the Court who regularly deliver Reports to the Court, and in what circumstances those Reports can be filed.