Which one of the following statements about bankruptcy is false?
A) Bankruptcy law is identical in every province of Canada.
B) All creditors of a bankrupt debtor are treated equally and will receive shares of the assets directly in proportion to how much is owed to each of them.
C) A debtor who has been discharged from bankruptcy is released from his previous financial obligations.
D) Bankruptcy refers to a situation in which a debtor who cannot pay debts transfers his assets to a trustee who acts on behalf of creditors
E) Bankruptcy law may allow a debtor to escape from having to pay his debts.

Question

Quizplus · Accepted Answer

In bankruptcy, not all creditors are treated equally; secured creditors are paid first, and unsecured creditors may receive a proportionate share of remaining assets.

Which One of the Following Statements About Bankruptcy Is False