Nathan, a shady entrepreneur, realized that he would eventually go bankrupt since his business undertakings are not working the way he planned. Owning a house, a cabin, two pickup trucks, and an art collection, he decides, to make some donations to his relatives, his friends, and his business partners. He gave his art collection to Lucas, his business partner, 128 days before going bankrupt. He gave one of the pickup trucks to a friend he had in college and to whom he hadn’t spoken for over 10 years 180 days before filing for bankruptcy. He gave the house to his wife, Peyton, 363 days before going bankrupt. He gave his cabin to his sister, Brooke, and his brother, Julian (50/50) 420 days before the bankruptcy. Finally, he gave his second pickup truck to his son, Skills, 15 days before going bankrupt. The trustee, once Nathan filed for bankruptcy, found out about all the donations, and is wondering which ones can be cancelled and which one could hold.

a) Which donations are valid and why?

b) Which donations are invalid and why?

A couple of days after filing for bankruptcy, Nathan is in a major car accident and dies. While working on the bankruptcy of the deceased, the trustee realizes that Nathan will have major funerals, worth 50 000$ because his family feels like it should be a celebration of life. The trustee also finds out that Nathan owed 10 000$ to the provincial government, in unpaid taxes, and $5000 to the federal government.

He was also 6 months late in the payment of his car’s rent and he owed, to the electricians working for him (employees) 750$ in back pay each. (5 electricians) Finally, he owed 100 000$ to four major banking institutions for unpaid lines of credit (25k for TD, 25k for Scotia, 25k for RBC and 25k for HSBC). Obviously, the trustee also has fees to cover.

c) What should the trustee do?

d) Who will be paid in priority?

e) What is the order of payment and what are the amounts that will be paid to each of the following actors?