177 Cross Argus: the seller credit-bids its Oakville land back

From November 30, 1990 to March 15, 2023, a single-purpose real estate holding company called 915643 Ontario Inc. owned the land at 177–185 Cross Avenue and 580 Argus Road in Oakville, near the GO train station, where two single-storey retail buildings and a commercial building with a day care centre stand today. In March 2023, at the end of a chain of assignments that began with a 2022 agreement to sell to Metro Capital Limited, it sold the property for $53,000,000 to 177 Cross Argus Development Inc., nominee for Double Diamond Capital Inc., and took back two mortgages of $31,800,000 and $5,300,000 as part of the price. "To date, there has been no construction on the Project site," the company's president, Bernard S. Woo, swore in November 2025, per the Affidavit of Bernard S. Woo, Nov. 12, 2025, paras. 7, 9–10, 12, 14–15, 18. The buyer had proposed four towers of 55, 60, 50 and 6 storeys with 1,895 condominium units over six levels of underground parking, per the Affidavit of Sarmad Ganni, Oct. 28, 2025, paras. 5, 8.

On April 22, 2026, 915643 Ontario owned the land again, having bought it, largely by credit bid, from a receiver it had applied for. That receiver, Albert Gelman Inc., filed a Third Report dated September 11 that asks the court to approve its conduct, fees and receipts and disbursements, to let it pay the purchaser what remains of a $100,000 fund left behind at closing, and to discharge it, per the Third Report of the Receiver, Sept. 11, 2026, paras. 3, 5, 10, 12(h), 34.

A notice mailed on a Friday evening

The insolvency filing came out of a different mortgage. At closing, 177 Cross also gave a $5,000,000 third mortgage to Aarti Real Estate Enterprises Inc. and Mayuri Ventures Inc. "Originally, the idea was for the Third Mortgagee to become an equity partner in this project and convert its mortgage to equity," deposes Sam Ganni, a director; a few months later it decided not to, per the Affidavit of Sarmad Ganni, Oct. 28, 2025, para. 18. The mortgage matured in 2024, and the company says the real estate downturn that began that year kept it from refinancing. According to the affidavit, the third mortgagee pursued the company and its guarantors, Double Diamond and the two directors, Mr. Ganni and Nawar Mahfooth; took a collateral mortgage for the same $5,000,000 over five North York parcels in exchange for holding off; and obtained a default judgment on March 5, 2025 regardless, per the Affidavit of Sarmad Ganni, Oct. 28, 2025, paras. 19–23. The receiver puts the judgment at approximately $5.8 million with interest at 28.00% a year, per the First Report of the Receiver, Jan. 13, 2026, para. 4.

The third mortgagee's notice of intention to enforce security under s. 244 of the Bankruptcy and Insolvency Act went by registered mail at or after about 6:16 p.m. on Friday, September 19, 2025; the company told the proposal trustee it arrived on Monday, September 22. The third mortgagee said the ten-day period expired on September 29, and on September 30 it served notices of attornment of rents on every tenant. The company said the period had not run when, on October 2, it filed a notice of intention to make a proposal under s. 50.4(1), with Albert Gelman Inc. as proposal trustee; the proposal trustee took the company's side, per the First Report of the Proposal Trustee, Oct. 29, 2025, paras. 1, 26–29, 32.

The senior lender's complaints were older. Per Mr. Woo, interest on the first mortgage stopped on December 1, 2024; a deferral to February 1, 2025 was followed by one $200,000 partial payment; the second mortgage matured unpaid that same February 1; formal notices of default went out on May 8; and the first mortgage's rate, 4% for its first two years, became 7% on September 1. He deposes that property taxes had gone unremitted and that the lender's counsel learned on November 6 that Enbridge Gas had cut off gas to a residential tenant's unit. The lender's s. 244 notice of October 24 put the debt at more than $40 million: $32,601,238.40 of principal and $1,469,049.07 of interest on the first mortgage, and $5,512,000.00 and $598,144.24 on the second, per the Affidavit of Bernard S. Woo, Nov. 12, 2025, paras. 24, 39–43, 50–54.

The company's plan was to finish its development and zoning applications first. Mr. Ganni's affidavit lists the consultants retained toward official plan and zoning by-law amendment applications to the Town of Oakville, from a tree inventory and nine geotechnical boreholes to traffic, noise and wind-tunnel studies, and says $267,157 was still owed to them and $150,000 more was needed to file. The company wanted $500,000 of interim financing it was still negotiating, a $250,000 administration charge ranking ahead of every mortgage, and more time. A sale before the applications were submitted and approved, he swore, would bring "significantly less," per the Affidavit of Sarmad Ganni, Oct. 28, 2025, paras. 41–60.

That motion was served at 4:42 p.m. on October 28 for October 30. The lender's evidence is that the notice of intention was filed "without any notice to the Lender," without financing and without a plan acceptable to creditors, and that even prompt zoning applications "may take years to receive a response," per the Affidavit of Bernard S. Woo, Nov. 12, 2025, paras. 59, 61, 67. By the hearing the company was asking only for a short extension, and Justice Dietrich gave it one, to November 20. Counsel told her no cash was expected in the interval and there were "no employees, no operational office"; the administration charge, cut to $50,000, was put over after both mortgagees objected to one day's notice, per the Endorsement of Justice Dietrich, Oct. 30, 2025, paras. 3–5, 7, 9.

Withdrawn on consent, then a missed payment

By November 18 the parties had settled. Justice Cavanagh deemed the notice of intention withdrawn on consent, relying on Elk Gold Mining Corp. (Re), 2024 BCSC 371, for the court's jurisdiction under s. 183(1) to allow it. He recorded that 177 had "reached a resolution with the Third Mortgagee, which resolves the situation that led to the NOI filing," and found that a proposal proceeding was not the appropriate process in any event: "915 does not consent to it, there is no prospect of a viable proposal, and 177 has not yet secured financing for the proposal process or its professional fees. 177 has no employees or business to be saved." A receivership order in agreed form would be sought on consent on November 20 unless the debtors made payments agreed among the parties by 3 p.m. that day, per the Endorsement of Justice Cavanagh, Nov. 18, 2025, paras. 7–12.

On November 20 the payment "was not made," 177's consent became operative, and Justice Cavanagh found a receivership just and convenient, adopting paras. 48–50 of the lender's factum, per the Endorsement of Justice Cavanagh, Nov. 20, 2025, paras. 2–3. Because the order had to be made in a proceeding the lender commenced, he approved a notice of application on the Commercial List, where the NOI already sat, "even though the property in question is in Oakville," per the Endorsement of Justice Cavanagh, Nov. 27, 2025, paras. 2–4. The order issued November 27, effective November 20. It ended the third mortgagee's rent notices as of November 12, let it keep rent paid from September 30 through November 11, allowed the receiver to borrow up to $250,000, and extended the receiver's charge to Albert Gelman's fees as proposal trustee, per the Order Appointing Receiver, Nov. 27, 2025, paras. 13–16, 22, 25, 37.