BULK SALES ACT SEARCHES – Ontario Only
Sales of large quantities of stock or the sale of assets and equipment of the business itself outside the regular course of business are considered a sale “in bulk”. The Bulk Sales Act is designed to protect the creditors of a business owner by requiring the owner to follow the procedures of the Act for sales outside the regular course of business.
If a buyer wishes to purchase the assets and equipment of a business, the seller “in bulk” must provide an affidavit stating that all creditors have been paid, or they will be paid from the proceeds of the sale. In some cases the buyer pays an assigned trustee and creditors of the business may wish to waive their rights in which case the proceeds are paid.
A ‘Bulk Sales search‘ determines if a bulk sales affidavit has been filed with the relevant Ontario Superior Court of Justice office.
The Private Investigator (PI)
If you are interested in an Ontario business’s assets, debts, cash flow, and general financial condition, then a a Bulk Sale Act search is an important search. It may tell you if the business is failing or if it has suffered a set-back. You may learn of an abandoned line or the sale of a production facility. You may learn of a legal action in another jurisdiction by contacting or researching the other parties to the bulk sale. Any sale that indicates that creditors will be paid from the proceeds of the sale may indicate a judgment that is being satisfied or it may be part of the settlement of a claim.