With the Great Depression wreaking havoc across all walks of life, the hockey world saw the collapse of two clubs in 1931. The Detroit Bulldogs folded in a sea of debt and bad hockey following the worst season ever by a professional club in 1930-31. The Ottawa Athletics, facing severe financial difficulties, also canceled their 1931-32 campaign. While the Bulldogs were gone for good, the Athletics asked for, and received, permission to sit out the season and save some money with an eye towards returning in 1932 or possibly 1933.
The real impact of the financial crash of October 1929 hit the North American Hockey Confederation in the 1930-31 season as clubs saw their attendance plummet as fans simply did not have the disposable income to go to hockey games.
To help the clubs with travel expenses the NAHC moved the New York Eagles into the American Division and the Montreal Nationals into the Canadian Division. While the move suited the Nationals, who proved a strong competitor in the Canadian, the arrival of the Eagles into an already strong division was a disaster for the Detroit Bulldogs who posted the worst season in the entirety of professional hockey history, winning one - yes one - game all season against 42 losses and a single tie. Unsurprisingly this allowed three of the other four American Division teams to post point totals north of 50 and even the fourth-place Eagles finished at .500 with a 17-17-10 mark and 44 points.
In the offseason the owner of the Boston Bees, Francis Denny, whose club had lost the best-of-three Challenge Cup Final to Ottawa, successfully forced a change on his reluctant fellow owners with a change in the format of the Cup Final to a best-of-five format going forward. Citing the success of baseball's World Championship Series, which had been a best-of-seven series since the 1890s, Denny convinced the other owners that more games meant more revenue - and also allowed the better team (which had been his team in the 1930 Final, he believed) a better chance to win out.
The regular season brought new division winners and a surprising crash of the 1930 champion Ottawa Athletics. The New York Shamrocks captured the American Division, by virtue of the quirky NAHC tiebreaking rules which stipulated that the club with the fewer losses would gain precedence when two or more clubs finished with the same number of points. That proved the case in 1930-31 as the Shamrocks and Boston Bees each posted 58 points, but New York's 25-11-8 campaign was given the edge over Boston's 26-12-6 mark. In the Canadian, the Montreal Valiants posted the best mark in the entire league with a 30-11-3 campaign that was good for 63 points. Conversely, the Athletics tumbled into the cellar with an 8-29-7 mark, 16 points behind the fourth-place Quebec Champlains.
The Valiants boasted the league's most potent offense, tallying 137 goals, while allowing just 78. The Masters Trophy went to centerman Harvey McLeod who led the league in scoring with 54 points on 30 goals and 24 assists (both second). Toronto had a coaching change as Jack Barrell took over behind the bench, while also playing right wing in six games (he failed to score) in what turned out to be his last season as a player. Under Barrell's leadership the Dukes finished a strong second to the Valiants in the Canadian Division led by Leo Morey whose 32 goals led the league. The Nationals proved more than competitive in their first season in the Canadian Division, finishing third with 48 points. Quebec (39 pts) and the Athletics (23 pts) completed the Canadian standings.