Medulla & Co.: a receivership 'only marginally over the line'

On October 14, 2026, Justice Sean Dunphy of the Ontario Superior Court of Justice (Commercial List) appointed Bricks Damiani Inc. receiver and manager, without security, of all of the assets, undertakings and properties of Medulla and Co Luxury Salons Ltd. acquired for or used in relation to its business, its three units at 277 Davenport Road in Toronto included. The appointment was made on Equitable Bank's application of September 2, under s. 243(1) of the Bankruptcy and Insolvency Act and s. 101 of the Courts of Justice Act, per the Receivership Order, Oct. 14, 2026, paras. 1–2 and Sched. "A". In the endorsement granting it, Justice Dunphy wrote: "It is just and equitable to appoint a receiver in this case but I am becoming increasingly worried by the reliance upon lenders upon the receivership remedy when there are other more efficient and far less expensive remedies open to them by way [of] private sale, summary judgement and/or writs of possession," per the Endorsement of Justice Dunphy, Oct. 14, 2026, para. 3.

The building at 277 Davenport Road, in Yorkville, is a six-storey condominium with nine residential units and one commercial unit. The company owns the commercial unit, Unit 102, which has 3,760 square feet of gross floor area, and "operated an upscale hair salon" there, "which I understand is now closed," Bilge Kilicuzar, an Equitable Bank account manager in special loans and restructuring, swore on August 31, 2026. The company also owns a parking spot and a storage locker in the building, per the Affidavit of Bilge Kilicuzar, Aug. 31, 2026, paras. 1, 6.

"Only marginally over the line"

The application, the endorsement says, had been "validly commenced and served without response from the debtor." It notes the company's default and the demands and notices given, the bank's "specific mortgage security in addition to a GSA," and its "contractual authority to seek a receiver in this situation," per the Endorsement of Justice Dunphy, Oct. 14, 2026, para. 2. And it records what the bank was worried about: "In the present case, the lender has concerns arising from the presence of other secured collateral on the premises and on-going liens being imposed by the condo corp." The endorsement does not say whose collateral that is, per the Endorsement of Justice Dunphy, Oct. 14, 2026, para. 3.

"I view this case as being only marginally over the line in terms of establishing a foundation to ask the court to appoint a receiver," Justice Dunphy wrote. "I don't want the fact that I have agreed to do so here to be mistaken as a broader license to expand use of a remedy that is ill suited for small, simple cases of which this is certainly one," per the Endorsement of Justice Dunphy, Oct. 14, 2026, para. 3.

Chad Kopach of Blaney McMurtry LLP appeared for Equitable Bank, and Hartley Bricks for the proposed receiver, per the Endorsement of Justice Dunphy, Oct. 14, 2026, p. 1. No one appeared for the company, which the order records was "duly served"; besides Kilicuzar's affidavit, the order lists a second affidavit, sworn October 13, 2026, that is not in the record read for this piece, per the Receivership Order, Oct. 14, 2026, p. 2.

A loan, two liens and two notices of sale

The rest of the record is the bank's. Equitable Bank lent the company $2,500,000 under a commitment letter dated July 26, 2022, for a 60-month term, at a rate the affidavit gives as currently 6.45%, the bank's prime rate plus 2.00%. For security it took a $2,500,000 charge registered in first position against the three units on August 19, 2022, a general assignment of rents and a general security agreement. The GSA is registered under the PPSA and "ranks in second position," the affidavit says; the search results attached to it list an earlier registration, made on June 29, 2018, by The Toronto-Dominion Bank. The mortgage and the GSA both provide for a receiver on default, and the company's sole officer and director gave an unlimited personal guarantee, per the Affidavit of Bilge Kilicuzar, Aug. 31, 2026, paras. 5, 7–12 and Ex. 7.