Leisure Time: three manufactured home communities go to a receiver

What these companies rent out is concrete pads. On land in Caledon, in Severn Bridge outside Gravenhurst and on the Bluewater Highway outside Goderich, three related companies laid out sites serviced with water, hydro and septic and rented them to people who then bought or built modular, prefabricated homes on them. The resident owns the house; the company owns the ground under it, and the resident holds only a leasehold interest in the land. Each property also offers recreational vehicle sites and overnight camping, per the affidavit a Bank of Montreal account manager in its Special Accounts Management Unit swore on April 6, 2026 in support of the bank's application, found at Application Record, May 14, 2026, Tab 2, paras. 4–8.

On September 11, 2026, Justice I.F. Leach of the Ontario Superior Court of Justice at London appointed msi Spergel inc. receiver, without security, of all the assets, undertakings and properties of Leisure Time Investments Inc., South Muskoka Investments Inc., 79681 Bluewater Investments Inc. and their related real estate holding company, Forge & Foster Holdings Inc., under s. 243(1) of the BIA and s. 101 of the Courts of Justice Act. The order's Schedule "A" lists five municipal addresses: 8431 Hwy 9 and 18478 Duffy's Lane in Caledon, 1104 Four Seasons Road and 1064 Baseline Road in Severn Bridge, and 79681 Bluewater Highway in Goderich, per the Order of Justice Leach, Sept. 11, 2026, para. 2 and Sched. "A". The court file is CV-26-00001097-0000.

Three mortgages and a guarantor

The companies were related, "each originally principally owned and controlled" by two principals through Forge, which the bank's affiant calls "their real estate investment company," per the Application Record, May 14, 2026, Tab 2, para. 3. BMO financed each community separately between late 2021 and mid-2022 under commercial mortgage securitization agreements: up to $2,111,250 for Bluewater, dated October 25, 2021; up to $1,500,000 for South Muskoka, dated March 9, 2022; and up to $5,600,000 for Leisure Time, dated May 4, 2022. Each loan carried a first mortgage and a general security agreement, all taken in the name of Computershare Trust Company of Canada as title custodian and assigned to the bank after default, and Forge guaranteed each borrower's debt up to the principal amount of its loan. Forge also granted site-specific security over the two Caledon parcels, one of which it co-owns with Leisure Time, per the Application Record, May 14, 2026, Tab 2, paras. 9–19.

The agreements amortized over 30 years, required the bank's written consent to any subordinate mortgage and to any change in effective voting control of a borrower, and obliged the borrowers to keep realty taxes current, per the Application Record, May 14, 2026, Tab 2, paras. 20–22. The bank's case is that each of those terms was broken.

The bank's account of the defaults

The accounts were referred to the special accounts unit in June 2025. By then, according to the affidavit, Forge had sold a controlling block of Leisure Time's shares to Leisure Time's property manager and his partners; the two original principals resigned as officers and directors on June 17, 2024 and the new group took their places the same day, without the bank's consent being asked for or given, per the Application Record, May 14, 2026, Tab 2, paras. 26–28.

Title to the properties had also filled up behind the bank. The affidavit lists, among others, mortgages to Olympia Trust Company of $800,000 against the Bluewater land, $500,000 against the South Muskoka land and $416,133 against the two Caledon parcels; mortgages to H3 Holdings Inc. of $800,000 in July 2024 and $212,500 in October 2025 against the Caledon parcels; a $204,000 mortgage to a family trust and a $600,000 mortgage to a numbered company and five individuals against Bluewater; and a $384,724 mortgage to an individual lender registered on April 25, 2024 against both Bluewater and South Muskoka, most with notices of assignment of rents beside them. The bank says none was consented to, and reads them as a sign of "serious cash flow problems," per the Application Record, May 14, 2026, Tab 2, paras. 29–30. Leisure Time missed loan payments through 2024 and into 2025, reporting was late or incomplete, and financial covenants were not met, the affiant adds, per the Application Record, May 14, 2026, Tab 2, para. 36. The allegations are the bank's, and they are untested.

The taxes are where the application found its urgency. The Municipality of Central Huron registered a tax arrears certificate of $116,284 against the Bluewater property on January 27, 2025. Its treasurer's certificate of December 10, 2025 describes 145.50 acres, taxes of $36,889.13 levied for 2025, nothing paid toward them, and total arrears of $252,561.80 reaching back to 2022 and earlier, per the Application Record, May 14, 2026, Tab 2, Ex. "HH", p. 499. The affiant says the municipality's deputy treasurer sent the bank's lawyers an updated certificate at January 28, 2026 showing $266,035.01 and "confirming that a tax sale is pending." Gravenhurst registered certificates of $46,930 and $7,015 against two of the South Muskoka parcels on September 5, 2025, and later certificates showed $61,538.30 in arrears going back to 2024 and $11,127.18 going back to 2022. The Caledon parcels carried 2025 arrears of $5,785.88 and $10,362.04, with nothing registered, per the Application Record, May 14, 2026, Tab 2, paras. 31–35.

A refinancing that did not arrive

After the file moved to the special accounts unit, the affiant told the property manager the bank was looking to exit the relationship. In an email of August 5, 2025 the property manager wrote that Leisure Time was being submitted to lenders, "looking for 60%LTV," and that he expected financing "for Mid October 2025," per the Application Record, May 14, 2026, Tab 2, paras. 37–38 and Ex. "MM", p. 512. On October 21, with a Leisure Time payment of $63,116.42 still uncollected, he reported a letter of interest for Leisure Time and, on the other two, "seems like it is still moving forward." The affiant asked to speak to the financing party directly and heard nothing back, per the Application Record, May 14, 2026, Tab 2, paras. 39–41 and Ex. "NN", p. 514.

Demands followed on November 24, 2025, each served with a notice of intention to enforce security: $5,456,402.07 on Leisure Time, $1,982,662.98 on Bluewater and $1,468,971.79 on South Muskoka, $8,908,036.84 in all, with Forge named as guarantor on each, per the Application Record, May 14, 2026, Tab 2, para. 42.

The companies asked for time: they were, the affiant says, in talks with Blue Metric Group to come in as a joint venture partner and fund a payout. The forbearance agreement of January 6, 2026, written as a letter from the three borrowers to the bank, acknowledged debts at January 5 of $5,458,424.00 for Leisure Time, $1,451,848.99 for South Muskoka and $1,971,435.83 for Bluewater, each including a mortgage prepayment charge (on Leisure Time's 5.49% loan, $73,348.74), and confirmed that neither the borrowers nor Forge disputed them or had any setoff or counterclaim, per the Application Record, May 14, 2026, Tab 2, Ex. "RR", pp. 535–539. In return for forbearance to March 31, 2026, the borrowers undertook to keep up principal and interest, to pay all realty taxes owing to the end of 2025 by January 23, to send biweekly updates on the joint venture from that date, to confirm by March 6 a firm deal closing by March 31, and to pay a $10,000 forbearance fee. The three operating companies also signed consents to a receiver, per the Application Record, May 14, 2026, Tab 2, paras. 43–47 and Ex. "RR", p. 540.

By the affiant's account, none of the milestones was met. No confirmation came that the Bluewater and South Muskoka taxes had been paid, no biweekly updates were sent, no firm transaction was confirmed, and the debt was not repaid by March 31. A proposed sale of the South Muskoka property that the property manager had mentioned had not happened either, per the Application Record, May 14, 2026, Tab 2, paras. 48–50. The bank asked for a court-appointed receiver to assess the businesses, deal with the municipalities over the arrears and with the encumbrances on title, and run a court-supervised sale process that could sell the businesses as going concerns, "en bloc or separately," or the properties themselves, per the Application Record, May 14, 2026, Tab 2, paras. 51–53.

Four months to a hearing, and no one for the companies

The notice of application, filed electronically on May 7, 2026, set the hearing for June 12 by videoconference from London, per the Application Record, May 14, 2026, Tab 1, p. 5. It was heard on September 11. The order recites two further affidavits from the bank's affiant, sworn July 17 and September 9, 2026, per the Order of Justice Leach, Sept. 11, 2026, p. 1.

Justice Leach's handwritten endorsement records the respondents as unrepresented, and notes that no one appeared for them when the matter was called; counsel for the bank attended. In the judge's view, "it is just and convenient to grant the relief requested, and appoint the receiver as sought by the moving bank." The indebtedness and defaults had been acknowledged, he noted, and the companies had repeatedly agreed and consented to a receiver in the event of default, per the Endorsement of Justice Leach, Sept. 11, 2026, p. 1. "Such defaults continue notwithstanding the indulgences, including the forbearance extension agreement extended by the Bank," the endorsement continues, and the unpaid tax arrears liability "now threatens secured property," per the Endorsement of Justice Leach, Sept. 11, 2026, pp. 1–2.

The order stays proceedings against the companies and their property except with the receiver's consent or leave, lets the receiver operate the businesses, and allows sales out of the ordinary course without further approval up to $250,000 a transaction and $500,000 in total. The receiver may borrow up to $1,500,000 on a Receiver's Borrowings Charge that ranks ahead of all other security but behind the Receiver's Charge for its own and its counsel's fees and the BIA's statutory charges, per the Order of Justice Leach, Sept. 11, 2026, paras. 3(c), 3(k), 9–10, 18, 21. The bank gets its costs of the application under its security or, failing that, on a substantial indemnity basis out of the estate, per the Order of Justice Leach, Sept. 11, 2026, para. 31. The order sets no next attendance, and any interested party may move to vary it on seven days' notice, per the Order of Justice Leach, Sept. 11, 2026, para. 32.