The New Bankruptcy 'Detective Agency'? The Origins of the Superintendent of Bankruptcy in Great Depression Canada

Abstract

In the depths of the Great Depression, R.B. Bennett’s Conservative government appointed W.J. Reilley as Canada’s first Superintendent of Bankruptcy. Reilley’s experience made him eminently qualified. He had trained as a lawyer and had been the Registrar of the Bankruptcy Court of Ontario at Osgoode Hall for many years. The creation of the federal Superintendent’s office in 1932 is one of the major milestones in the legislative history of Canadian bankruptcy law. In the bankruptcy law literature, there is a broad recognition that the 1932 reforms were vital. These accounts are incomplete. This article seeks to provide a fuller understanding of these reforms by examining sources of opposition to the establishment of the Superintendent’s office. Not all accepted the new regulatory approach and the prospects of a bankruptcy bureaucracy during the Depression. Within months of Reilley taking office, critics called into question his qualifications and demanded his resignation. Little is known about the 1932 reforms as the creation of the Superintendent’s office has largely been overshadowed in the insolvency field by the enactment of corporate reorganization legislation in 1933 and farm credit legislation in 1934.

Keywords: Bankruptcy, Insolvency, History, Great Depression, Debt

JEL Classification: K35