As per Johnny's comments, the date that you made an Assignment in Bankruptcy, becomes the date that you acknowledge your student debt. Your Trustee then has 5 days to contact each of your creditors and inform them that you have made an Assignment in Bankruptcy on a particular date. This date not only sets the clock for a new Limitation period, it also establishes a Stay of Proceedings for any creditor to commence a legal action or to continue with collection activity.

You stated that you and your wife filed for bankruptcy in 2005. You further stated that your student debt was only 6 years in default and as the Bankruptcy and Insolvency Act read at that time, your student loan would have had to be 10 years or more in default before it could be discharged in a bankruptcy. Needless to say, it survived the bankruptcy.

When you were discharged on February 28, 2006, this does not constitute an acknowledgement of the debt. Further, when the Trustee was discharged in November, 2007, this too does not constitute an acknowledgment of the debt. And so, your new Limitation period will start from the date of the Assignment, suspended for the period during which you were in bankruptcy and then continues from the date of Discharge.

For lending institutions that issue student loans and for debtors who file for bankruptcy, but which their student loans survive the bankruptcy, it is customary for the financial institutions ( I.e. RBC ) to wait until the Trustee has been discharged before they commence either legal proceedings or collection activity. Now you know when your new Limitation period begins and depending on your jurisdiction of residence, when it will end.

If the Statute of Limitations in your Province /Territory of residence is 6 years, then this debt is Statute-Barred. This means that while the debt still exists, RBC cannot commence a legal action in an attempt to obtain a court judgment.

Payment by a Trustee of an income tax refund to your creditors after you have received your Discharge does constitute an "acknowledgment" pursuant to Paragraph 16.1(4)(d) of the Canada Student Financial Assistance Act and as such, resets a new limitation period providing your student loan survives the bankruptcy.

If, on the other hand, your student loan is extinguished in the bankruptcy, then any "acknowledgment" made by a Trustee becomes irrelevant.

Also keep in mind, for those student loans that survive a bankruptcy, a new Limitation period will be "triggered" when the Trustee files his final report with the Registrar of the Office of the Superintendent of Bankruptcy. This report is called the "Certificate of Compliance and Deemed Discharge of Trustee". It can be issued anywhere from 1 to 3 years after the bankrupt has received their Discharge depending on the complexity of the Estate, assets to be liquidated and income tax returns to be filed and assessed. For example, if a debtor makes an Assignment in Bankruptcy and has not filed income tax returns for the 3 years prior to the Assignment, the Trustee is required to file those income tax returns together with an income tax return for the period(s) that the debtor was in Bankruptcy. Only a small unit at the Canada Revenue Agency ( CRA ) deal with income tax returns filed by a Trustee in Bankruptcy and their assessment tends to extend well beyond the normal assessment of income tax returns.

When the Trustee has completed his administration of the bankruptcy estate, his final report is sent to the Office of the Superintendent of Bankruptcy along with Form 10------------Application of Trustee for Discharge. The Office of the Superintendent of Bankruptcy then sends a letter to the Trustee approving the discharge.

The Trustee then sends another final report along with Form 16------------Certificate of Compliance and Deemed Discharge of Trustee to the creditors, the bankrupt and the Office of the Superintendent of Bankruptcy and pays dividends to the creditors if there are any monies available in the estate. This is a mandatory requirement pursuant to Rule 65(1)(c)(iii) of the Bankruptcy and Insolvency General Rules.

HOT TIP

The Canada Revenue Agency ( CRA ) is notified of every bankruptcy filed in Canada. They update their computer systems to automatically send all tax refunds and all GST/HST rebates directly to the trustee.

Here's a fact that a trustee may not tell you. If there is enough money in your bankruptcy estate at the end of the bankruptcy to pay money to your creditors, the trustee is required to refund to you whatever they have collected in GST/HST credits during your bankruptcy.

Since your trustee won't know for sure how much will be in your estate at the start of the bankruptcy, they generally collect the money until your bankruptcy is finished.

The math is somewhat complicated, but the simple version is this: if there will be more than $2,000 in your estate, your trustee will be required to refund your GST/HST.

Here's what a trustee doesn't want you to know.

A trustee can send a DC905 form to the CRA at the start of your bankruptcy telling the CRA that the trustee doesn't want your GST/HST credits. If the trustee sends that form, the CRA will send all GST/HST payments directly to you, if you are eligible to receive it. So, if you are eligible to get a credit of $100 every 3 months, the CRA will continue sending it to you.

If you are paying $200 per month to a trustee during your bankruptcy, or if you expect the trustee will receive a sizable tax refund, or if you have other assets that the trustee will be seizing, you should request that the trustee send a DC905 form to the CRA so that you will continue to receive your GST/HST credits. The trustee will be refunding the money to you eventually anyways, but you are probably better off having the money now, rather than a year from now when your bankruptcy is over.