Can one person in a marriage file a consumer proposal, if the other does not?

Can one person in a marriage file a consumer proposal, if the other does not?

Absolutely – with a caution. If the debts are individual, and not joint with the spouse, then a consumer proposal allows that person to deal with his or her debts while not involving the other. However, all assets listed in the debtor’s name, even joint assets, are listed in the documents (though only their share of it), and the total family income must usually be disclosed. Any debts which are jointly held by both spouses would be included in the proposal, but the non-insolvent spouse would be fully liable to pay them.  That is the whole point of joint debt –that if one person does not or cannot pay, someone else is on the hook for it.

In some cases, a creditor may be willing to hold off action against the non-insolvent spouse until the proposal is complete, and they have been paid their share. The spouse would then only pay the balance due, plus any interest added while waiting.

If you have joint debts, contact your trustee to discuss the implications and your options.

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