Category: Bankruptcy Discharge

Can I include 407 ETR Debt in my Consumer Proposal?

407 ETR debt results from the use of the 407 Electronic Toll Route in Toronto’s north end.  All drivers using the road are required to have a transponder to record and transmit their trips, or they are charged a significant video charge in addition to the road toll. Debts to 407 ETR can be included in a consumer proposal, so that no collection action can be taken to collect the debt owed. However, if the debt for the tolls remains unpaid (regardless of the consumer proposal), the 407 ETR submits a request to the Ministry of Transportation (MTO) to deny the renewal of the vehicle’s plate until the debt has been paid. A consumer proposal is a process which requires that creditors express their acceptance or rejection of the payment plan by vote or voting letter. The consumer proposal is considered to be accepted by the creditors if the dollar amount represented by votes in favour of the proposal represent over 50% of the dollar amount represented by all the votes. In our experience, the 407 ETR will always vote against a proposal. The Trustee and the debtor should consider this when drafting a proposal with significant 407 ETR debt. If you do not plan to have a vehicle in future, and there is no need to renew your plates, then the rights of the 407 ETR will not affect you.  However, if you require plate renewal, the only choice (based on current case law) is to pay the tolls, and/or to contact 407 ETR to try to make a payment arrangement. If you have significant 407 ETR debts, speak with your trustee about these issues before deciding whether bankruptcy is the best option for you.