Under most circumstances, an order of discharge releases a bankrupt person from all debts. There are, however, exemptions that have been legislated to ensure that a bankrupt party does not escape a debt arising from certain morally blameworthy actions. For example, an order of discharge does not release a bankrupt person from any debt arising from an award of damages by a court in civil proceedings stemming from “bodily harm intentionally inflicted, or sexual assault”: Bankruptcy and Insolvency Act, RSC 1985, c B-3 (the “BIA”), s. 178(1)(a.1)(i).
The case law is clear these exceptions are . . . [more]