Pride Group: the hotel operator on Schedule "A"

Schedule "A" to Pride Group's CCAA application lists seventy-seven entries, sorted by what they do. Nine Canadian operating companies, seven American ones, then forty-six real-estate holding corporations named for the streets they stand on — 84 St SE Calgary Holdings Inc., Manheim Road Holding Corp., 963 Sweetwater Holding Corp. Under "Limited Partnerships," three names: Pride Truck Sales L.P., TPine Leasing Capital L.P., and Sweet Home Hospitality L.P. The Monitor's Forty-First Report notes that Sulakhan Johal's first affidavit describes the last of these as a "hotel operator."

The hotel is a 137-suite Holiday Inn at 408 7th North Street in Liverpool, New York. Sweet Home is a New York limited partnership whose general partner, 2413586 Ontario Inc., holds 0.02% of the units; the rest are held equally by Sulakhan and Jasvir Johal, the brothers who founded Pride Group. Between June 13, 2014 and August 14, 2015 it acquired 49% of Maplewood Inn, LLC, the hotel's owner, whose other 5,100 membership units belong to Carmen Spensieri, a New York resident who had been Maplewood's sole owner before that (Forty-First Report of the Monitor, Jun. 4, 2026, paras. 12–13, 16 n. 2). Sweet Home is also, in the language of the orders, a DIP Borrower and a Pride Entity, which is why what happened in that hotel's bank account is now before the Ontario Superior Court of Justice.

The back of a sole tractor trailer

"I founded the Pride Group with my brother in 2010 as a used truck dealership operating from the back of a sole tractor trailer in Mississauga, Ontario," Johal swore on March 26, 2024, the day before the application. By then the group ran roughly 50 owned and leased locations across Canada and the United States and a fleet of some 20,000 trucks and tractor trailers; it employed 669 people and contracted with 405 independent contractors. He attributes the collapse to rising interest rates and diesel costs, sharply dropping spot freight rates, customer delinquencies on truck leases, a devaluation of trucks toward the end of the pandemic, and geopolitical events including the Russia-Ukraine war. Since the end of December 2023 the group had taken more than forty default notices. He also swore that the group "recently became aware of instances in which certain trucks have been financed by more than one lender, resulting in multiple lenders having competing claims against the same collateral, unbeknownst to both the Pride Group and the affected lenders" (Affidavit of Sulakhan Johal, Mar. 26, 2024, paras. 2, 7–8, 26, 78–80). The secured debt behind that fleet, as at March 22, 2024, came to approximately $1.69 billion and US$637.1 million across floorplan, leaseline, OEM, securitization and mortgage lenders — Royal Bank of Canada's securitization funding alone at $346.0 million (Report of the Proposed Monitor, Mar. 27, 2024, para. 34, pp. 9–10).

The restructuring did not survive its first summer. The proceedings "largely shifted in August 2024 from pursuing a restructuring to completing an orderly wind-down, with assets being turned over to Financiers," the Monitor recorded two years later, after the DIP facility matured at the end of July 2024 (Forty-Third Report of the Monitor, Jun. 30, 2026, para. 62). The stay now runs to September 30, 2026. The Johal brothers are themselves in bankruptcy, with PricewaterhouseCoopers Inc. as trustee (Sweet Home Production and Investigation Order, Jul. 7, 2026, para. 11). On July 7 Justice Cavanagh recorded that "[n]o funding remains available to continue administering the original entitlement determination process" for vehicles claimed by more than one financier, and authorized the Monitor to split the remaining proceeds equally among competing claimants where no interim resolution existed (Endorsement of Cavanagh, J., Jul. 7, 2026, paras. 14–20).

Soft Collections

Sweet Home surfaced out of the arithmetic of that wind-down. Reconciling lease payments and Soft Collections so it could distribute what remained in its trust accounts, the Monitor found that Sweet Home had received Soft Collections it never passed on. The reporting the Revised Governance Protocol requires captured them anyway. Financiers were paid what they were owed — by other Pride entities, out of accounts Sweet Home never funded. "Because these amounts were collected by Sweet Home and paid to the Financiers by other Pride Entities, there is a resultant intercompany claim against Sweet Home" (Factum of the Monitor, Jun. 30, 2026, paras. 20–21).

The mechanism was Zelle. In 2023 alone, 273 Zelle payments totalling US$554,213.00 landed in Maplewood's Bank of America operating account for amounts owing to TPine Leasing Capital Corporation and Pride Truck Sales L.P.; from late November 2023 the same thing was happening in Sweet Home's own account, "contrary to the Monitor's and the CRO's previous understanding that Sweet Home existed to hold Membership Units in Maplewood and operate the Hotel." Then there was one transfer that was not lease money at all. On March 13, 2024 — "exactly two weeks before the outset of these CCAA Proceedings," as the Monitor puts it — US$2,500,000 moved out of Sweet Home's account into Maplewood's, and no one has yet told the Monitor why (Factum of the Monitor, Jun. 30, 2026, paras. 17–19).

At about the same time, the Monitor learned Maplewood had agreed to sell the hotel for a price that would leave money over once Bank of America's mortgage, tax arrears and closing costs were paid. It asked Mr. Spensieri for information, got no answer, and moved. On July 7, 2026, on the consent of Mr. Spensieri and Maplewood and otherwise unopposed, Justice Cavanagh granted the Sweet Home Production and Investigation Order under s. 11 of the CCAA: ten days for Sweet Home to deliver its records, authority to seek account statements from Bank of America and any other institution banking Sweet Home or Maplewood, a mandate to investigate any transfer at undervalue, fraudulent preference, fraudulent transfer or other reviewable transaction touching Maplewood or the hotel, and the power to examine any Maplewood Related Person under oath on seven days' notice (Sweet Home Production and Investigation Order, Jul. 7, 2026, paras. 3–9; Endorsement of Cavanagh, J., Jul. 7, 2026, paras. 4–5). Paragraph 12 froze the sale proceeds, after the mortgage, for 45 days — to August 21, 2026. The U.S. court hearing the group's Chapter 15 case entered an order enforcing it on July 10.

Forty lines

The Forty Fourth Report, filed July 29 and argued August 6, is the first accounting of what those powers produced: forty rows — the "Identified Transactions" — running from March 2024 to July 2025 (Forty Fourth Report of the Monitor, Jul. 29, 2026, para. 20 (Motion Record of the Monitor, returnable Aug. 6, 2026, Tab 2)).

Read down the Sweet Home rows and the table records $3,500,000 arriving in Maplewood's account — $2,500,000 on March 13, 2024, $500,000 on June 17, $400,000 on October 30, $100,000 on October 31 — against $500,000 going back the other way on August 15, 2024. Read down the rows for Mann's Truck Sales & Leasing Inc. and it records $3,000,000 leaving and nothing returning: $865,000 on April 16, 2024, $1,635,000 on April 19, $500,000 on June 18. Between them sits the round trip: the $2,500,000 that came in from Sweet Home on March 13 went out the same day to the client trust account of Haddad Law Firm, and came back on April 16, the day the first Mann's payment left.

Haddad's account of the four weeks between is that nothing happened: "It was held intact and was not disbursed, applied, or drawn upon for any purpose." Asked why the money had been sent, the firm, which keeps its records under the Michigan Rules of Professional Conduct, answered that "my engagement of record is general corporate representation of Pride Group Enterprises, LLC," and that "the file does not record a purpose for the transfer, which was handled at the client's direction and is a matter for the client and its principals." Its engagement materials followed a signed member consent removing the Johals as managers of Sweet Home and Maplewood (Forty Fourth Report of the Monitor, Jul. 29, 2026, para. 21, Appendix "F").