Mobilicab: 30 days of charges, and unpaid wages ahead of them

Mobilicab sold golf carts, new and used, from sites in Québec, Ontario, Alberta and British Columbia, and the Superior Court of Québec describes it as "a major distributor of new and used golf carts in Canada" [translation], per the Judgment on Applications for the Appointment of a Receiver, Oct. 9, 2026, para. 6. On October 5, 2026, its employees received notice that Mobilicab would cease operations. Unpaid wages and accrued vacation pay were outstanding, in an amount the receiver was to assess once appointed (Judgment, para. 10). Four days later Justice Eleni Yiannakis put the company and its parent, Investissement Hatley Inc., into receivership with PricewaterhouseCoopers Inc., and among the purposes the judgment gives for the appointment is to assess whether to store Mobilicab's inventory "until the next season rather than realize it at the wrong time" [translation] (Judgment, para. 29).

The proposed receiver's report, the judge wrote, shows Mobilicab's financial position deteriorating markedly since 2024, with recurring net losses. Revenue fell from $62.2 million in the year ended October 31, 2024 to $45.4 million in the year ended October 31, 2025, a drop of 27%, and Mobilicab was about $1 million behind in remitting GST and QST it had collected, per the Judgment, para. 12. In the proposed receiver's opinion the company no longer had sufficient resources to carry on in the ordinary course (para. 13).

The applications came from the debtors' principal lenders. Mobilicab owed the Canadian Imperial Bank of Commerce about $8 million, including sums it owed as guarantor of Hatley's obligations, and the Business Development Bank of Canada about $1.4 million; Hatley, also in default to BDC, was indebted for about $11 million; and the two companies had given each other unlimited cross-guarantees, per the Judgment, paras. 3, 9. Both debtors were served and confirmed that they did not oppose PwC's appointment. "In fact, the directors seem to have simply abandoned ship," [translation] the judge wrote (Judgment, para. 15).

Three buildings, one tenant

Hatley, incorporated federally in 2001, owns and operates commercial buildings and is a holding company, per the Report of the Proposed Receiver, Oct. 7, 2026, paras. 4–5. It acquired Mobilicab in 2017 and has no employees (Judgment, para. 7). Of its four buildings, the three outside Québec — 255 Thompson Drive in Cambridge, Ont., 1108 Edmonton Trail in Crossfield, Alta., and 545 Raab Street in Hope, B.C. — were leased to one tenant, Mobilicab, whose employees managed and maintained them, per the Application for the Appointment of a Receiver, Sept. 30, 2026, para. 6 and the Report, paras. 18–19, 44.

Those three are BDC's security: a financing offer of October 12, 2022 made a $4.8 million term loan available and a second, of August 4, 2023, two more, of $4.4 million and $1.8 million. Mortgages on the three buildings secure them, and Mobilicab guaranteed 100% of the balance under three suretyship agreements, per BDC's Application, Sept. 30, 2026, paras. 8–11. As of August 10, 2026, BDC put the loans at $4,515,740.02, $4,263,298.67 and $1,715,732.30, interest included, with costs and interest accruing. To its knowledge its own security ranks first, with BDC Capital Inc. and Capital Croissance PME II S.E.C. holding second-ranking security, pari passu with each other (Application, paras. 12, 22).

As of May 14, 2026, BDC says, Hatley was in default, having failed to pay the monthly instalments on all three loans. A forbearance agreement of June 15 gave Hatley until July 31 at the latest; that date passed, BDC says, without a refinancing offer for the buildings, and its notice of intention to enforce its security under s. 244 of the Bankruptcy and Insolvency Act is dated August 18. BDC had also learned, it said, that Mobilicab had stopped paying its rent (Application, paras. 14–18, 29). All four buildings were listed with brokers under contracts dated between April 29 and July 24, 2026, and to the proposed receiver's knowledge none had received an offer to purchase (Report, paras. 18, 30–31).

BDC's application had called Hatley "likely insolvent" (Application, para. 24). The judge found it clearly insolvent: the debtors had acknowledged their insolvency on June 10, 2026, after CIBC's second default letter, and Mobilicab, tenant of three of Hatley's four buildings, could no longer pay its rent, while Hatley's revenue consisted mainly of rent (Judgment, paras. 23–24).

Many secured creditors, and a neutral officer

Filed in different districts, the two applications were heard together on October 5 and 8 under Hatley's file number, and the judgment deals with them together because the companies' operations and finances are "intimately linked" [translation] (Judgment, para. 4 and n. 3, p. 14). Mobilicab's application covered all of its movable property, including its receivables, its inventory of carts and spare parts, and its equipment; Hatley's, the three buildings (para. 8).

Some of Mobilicab's other creditors had begun or announced enforcement, in Québec and in the other provinces where it does business. Those with registered security on its property included DLL, Club Car and Capital Croissance, and those with registered reservations of ownership under leases included Mitsubishi, CWB and BNF (Judgment, para. 11). Mitsubishi had demanded the return of nearly 450 carts (para. 22).

Those creditors figure in the judgment's reasons for a court officer. The first default letter aimed at Mobilicab was dated March 23, 2026, and the one aimed at Hatley May 14; the proposed receiver testified that the debtors' position would only worsen over the coming months; and with other creditors acting and Mobilicab's operations stopped, the judge called the situation urgent. In the judge's view, assets in several provinces needed the interprovincial coordination a national receiver under the BIA is best placed to provide, and the number of secured creditors, among them the applicants, DLL, Club Car, Mitsubishi and Investissement Québec, along with the complexity of their priorities, including postponements of rank, favoured "a neutral and independent officer who will report to the court" [translation], per the Judgment, paras. 28, 30. Third parties' property, including the carts claimed by Mitsubishi and other lessors, also called for a receiver to identify it and deal with it in an orderly way, the judgment says (para. 31).

Thirty days of charges

In Mobilicab's file the applicants asked for $400,000 of interim financing secured by a priority charge, and a $250,000 administration charge for the fees and disbursements of the receiver and its counsel. In Hatley's, BDC asked for $283,612 of interim financing and a $250,000 administration charge for the professional fees of the proposed receiver and of BDC (Judgment, para. 33). According to BDC's application, its term sheet priced the facility at BDC's variable base rate minus 0.75% a year, with a $10,000 fee and a $340,334.40 super-priority charge ranking behind only the administration charge (Application, para. 34).

The judge accepted the need for both. The preliminary budgets, three months for Mobilicab and six for Hatley, showed the interim financing would pay the wages of employees kept on to help the receiver, protective measures, insurance and professional fees, and the proposed receiver and its lawyers were willing to act only under a priority charge in the amounts sought (Judgment, paras. 37–41 and n. 27). BDC's own fees were a different question. In Séquestre de Groupe Finstar inc., 2026 QCCS 1280, the judge wrote, the court had pointed out that "only the fees, disbursements and costs of the receiver may be the subject of the administration charge, and not those of the applicant creditor" [translation], so BDC's fees "cannot form part of the base of the administration charge" [translation] (Judgment, para. 39). Hatley's order constitutes the charge in favour of the receiver, its attorneys and its other advisors (Order Appointing a Receiver, Oct. 9, 2026, para. 36).