407 ETR Debt Now Dischargable in Bankruptcy or Proposals

A recent ruling in the Ontario Court of Appeal means that 407 ETR highway debts can now be included in a bankruptcy or a consumer proposal under the Bankruptcy and Insolvency Act (BIA). In the past, people filing either a bankruptcy or a proposal were discharged from all their unsecured debts, but the MTO would withhold a new vehicle permit (“sticker”) when it came time for the person to renew unless payment of 407 debt was made in full. Effectively, this meant that that particular debt had not really been discharged.