On March 12, 2024, Bill 36 was introduced in the Yukon Legislative Assembly to repeal and replace the Exemptions Act.
The Act defines what property is exempt from seizure during personal bankruptcy or following a money judgement. In its current state, the maximum monetary amounts of exempted items have not changed since 1954, potentially leaving vulnerable Yukoners and their dependents to become reliant on social assistance. The Garnishee Act is also being amended to increase the minimums that individuals can keep when their wages are garnished. That section of the Act has not been amended since 1980.
This Bill introduces an evergreen clause, administered in regulations for both the Exemptions and Garnishee Acts, to ensure values do not fall out of date again.
These changes are intended to enable debtors to maintain a reasonable standard of living and continue to earn an income. The proposed replacement of the Exemptions Act follows the approach recommended by the Uniform Law Conference of Canada’s Civil Enforcement of Money Judgements Act, which has been adopted in full by four provinces and in part by other provinces and territories.
Debtors and their families are not the only ones who will be affected by the changes. The Government of Yukon is mindful of the needs and rights of the creditors and their families as well. Numerous strong protections for creditors have also been added. Licensed Insolvency Trustees were engaged to help determine best practices and to inform the development of regulations to be introduced under the updated Exemption Act and Garnishee Act establishing the maximum dollar values of certain exempted items and garnisheed wage limits.
If passed, Bill 36 will modernize our laws to better support Yukoners. The current legislation is causing real harm to those going through the process of bankruptcy or a money judgement. Our legislation needs to reflect the current cost of living to ensure that debtors can continue to earn income and maintain a reasonable standard of living, while making sure creditors are properly compensated.
Minister of Justice Tracy-Anne McPhee
Licensed Insolvency Trustees are federally regulated and provide advice and services to individuals or businesses with serious debt problems.
The updated framework will exempt the following items with no limits:
- medical equipment; and
- social assistance payments.
The updated framework will exempt the following items with limits:
- a vehicle for personal use;
- primary residence;
- tools-of-the-trade; and
- hunting, trapping or fishing equipment.
The government's engagement with Licensed Insolvency Trustees will inform whether limits should be set for maximum values of certain household furnishings and appliances.
Seniors over 65 account for one in five bankruptcies in the Yukon, the highest rate among all age categories.
An “evergreen clause” will be enabled to provide annual adjustments to ensure the exemption values remain up to date.
Laura Seeley
Cabinet Communications
867-332-7627
Laura.Seeley@yukon.ca
Jasmine Doll
Communications, Justice
867-667-8114
jus.comms@yukon.ca