R-Chad: a shareholder's stalking horse, outbid on Remembrance Road

The property at 675–705 Remembrance Road covers 1.43 acres of northwest Brampton, with frontage on both Remembrance Road and McLaughlin Road. On it stand an Esso station with eight pumps under a canopy, a freestanding car wash, a two-storey building holding a Tim Hortons with a drive-thru, the station's convenience store and a real estate office, and a single-storey building let to two medical tenants. The receiver's broker, Avison Young, marketed it as "recently built" and "fully occupied," per the Sales Brochure, Feb. 17, 2026, pp. 2–3.

R-Chad Investment Inc. owned the land and ran the station itself. Its shares are held equally by two people who are also its only officers and directors, according to the affidavit National Bank of Canada filed to put the company into receivership. Canadian Western Bank had lent against the property under a commitment letter of April 4, 2023 — a demand term loan and a demand revolving line of credit — secured, among other security, by a first-ranking mortgage and assignment of rents and a general security agreement; the two banks amalgamated on March 1, 2025. The loan matured in April 2025 and was not repaid; $8,138,715.62 was owing as at July 14, 2025, plus interest and costs, per the Affidavit of Raymond Pai, Aug. 11, 2025, paras. 1, 3, 5, 7–11 (Second Report, App. D).

The bank's affiant, a manager in its special asset management unit, swore that "the breakdown in the relationship between the shareholders has resulted in a deadlock of its only two directors, which is a threat to the Debtor's ability to manage its business and meet its obligations to creditors." The only other financial encumbrance on title was a construction lien of $270,111 registered by Builtron Contracting Inc. in October 2024, per the Affidavit of Raymond Pai, Aug. 11, 2025, paras. 4, 13 (Second Report, App. D). The receiver later said it understood the two shareholders to be in litigation over various matters, "including ownership of the Company," per the Second Report of the Receiver, June 24, 2026, para. 7.

On July 14, 2026, ten months after the receivership began, Justice Bordin of the Superior Court of Justice in Hamilton approved the sale of the property to Remembrance Retail Inc., the purchaser designated under the winning bid of OWO Management Inc. The price is sealed. The stalking-horse bid that set the auction's floor had come from one of the two shareholders. The other did not oppose the sale, but took the view that the receiver had not taken steps it should have and that approving its activities was premature; the judge approved them, and agreed with the receiver that the investigation he wanted called for a motion of its own, per the Endorsement of Bordin J., July 14, 2026, pp. 1–2, 4 and the Distribution Order, July 14, 2026, para. 1.

Two shareholders on notice

Justice Latimer appointed MNP Ltd. receiver, without security, of all of R-Chad's assets, undertakings and properties on September 4, 2025, under s. 243(1) of the Bankruptcy and Insolvency Act and s. 101 of the Courts of Justice Act, per the Receivership Order, Sept. 4, 2025, para. 1. His endorsement that day wrote both shareholders into the process. Before any public marketing, the receiver had to seek approval of its proposed process "on a motion with notice to the stakeholders, including all shareholders of the Company." None of the sale proceeds or other funds could be distributed to the company or its shareholders "without the consent/agreement of all shareholders of the Company or Order of the Court," and absent that consent, the funds under the receiver's control at its discharge "shall be paid into Court," per the Endorsement of Latimer J., Sept. 4, 2025 (Second Report, App. A), p. 45.

MNP took possession, kept the fuel coming from Global Fuels Inc., redirected the tenants' rent, and hired PetroKing to run the station at $11,500 a month plus HST and a 20% incentive on the gross margin of fuel sold at the pumps, per the First Report of the Receiver, Nov. 25, 2025, paras. 10–14. From September 4 to December 31, 2025, the property brought in $2,515,301.92 in operating revenue, rent included, for operating income of $341,478.75 before professional fees, accruing property taxes and debt service, per the Supplemental Report of the Receiver, Jan. 23, 2026, para. 7.

The receiver paid the bank $100,000 in October 2025, on the assumption that its security was valid and enforceable and against the bank's confirmation that it would return the money if the security were found invalid, unenforceable or subordinate, per the First Report of the Receiver, Nov. 25, 2025, paras. 33–34. From surplus operating funds it made four more payments, totalling $260,000, by June 2026. An opinion from Lerners LLP dated January 7, 2026 confirmed, subject to the usual qualifications and assumptions, that the security was valid and enforceable, per the Second Report of the Receiver, June 24, 2026, paras. 13(f), 33.

One shareholder's bid

The receiver's first plan was a listing: its first report proposed that Avison Young, chosen over CBRE and Ren/Tex Realty, list the property for an initial 90 days, per the First Report of the Receiver, Nov. 25, 2025, paras. 18–20. Five days before the December 9, 2025 hearing, both shareholders asked for more time, and one of them "suggested she may be willing to serve as a stalking horse bidder." Her counsel's standard-form offer of December 19 "was not capable of acceptance," the receiver's factum says, but by early January 2026 the material terms had been substantially agreed, per the Supplemental Factum of the Receiver, Jan. 26, 2026, paras. 4–7.

On January 29, 2026, Justice Krawchenko authorized and empowered the receiver to enter into the agreement, made as of January 22, 2026, with that shareholder "in trust for a corporation to be incorporated," and approved the sale process and auction procedures; nothing in the order approved the sale itself, per the Order (Approval of Sale Process), Jan. 29, 2026, paras. 3–5. The receiver described the bid as one that "establishes a floor value for the Purchased Assets," and the property was offered en bloc only. A competing bid had to be on the receiver's template, carry a deposit of at least 10% and come without financing or diligence conditions; if qualified bids arrived, the receiver could run an auction, open to the stalking-horse bidder, in rounds with $100,000 increments; and if another bid was selected, approved and completed, she would be paid a break fee, per the Supplemental Report of the Receiver, Jan. 23, 2026, paras. 11–12 and the Order (Approval of Sale Process), Jan. 29, 2026, Scheds. A, C.

The other shareholder opposed, on an affidavit that reached the court the day of the hearing. As Justice Krawchenko summarized it, he made no allegation of improper conduct, negligence or wrongdoing against the receiver and did not oppose a stalking-horse transaction; he opposed her as the bidder. The judge held that his "feelings" about her "are not relevant in this motion or to the proposed plan," because any agreement for sale "will necessarily return to this court for approval of that sale," per the Endorsement of Krawchenko J., Jan. 29, 2026, paras. 6–8, 16. Answering an earlier affidavit of his, the receiver had said that the remaining matters in it "do not pertain to the Sale Process or the relief sought on this motion," and that it "is not a party to any other proceedings referenced and takes no position on the merits of any such matters," per the Supplemental Report of the Receiver, Jan. 23, 2026, paras. 15–19.