Ravi Kitchen: the priority circle on Markham Road

Units 101 and 102 at 2855 Markham Road sit on level 1 of Toronto Standard Condominium Plan No. 2799, and their parcel registers list, in order of registration, every claimant in the dispute now before the Commercial List. 1818216 Ontario Inc. took title on October 22, 2020, the day Royal Bank of Canada registered a $720,000 charge against both units, and a $400,000 second charge in favour of Rajinder Singh Pahal followed on September 8, 2021. In the autumn of 2023 three liens arrived in eight weeks: two from the Canada Revenue Agency against Unit 101, on October 3 and November 20, and on November 30 a certificate of lien from the condominium corporation against both units, for $4,271.22 of unpaid common expenses plus later defaults, interest and collection costs, per the parcel registers and the lien attached to the Fifth Report of the Receiver, Aug. 28, 2026, App. "E", pp. 53, 57–58; App. "L", p. 78.

The units were sold out of receivership on March 5, 2025. On August 19, 2026, at a case conference, Justice Conway recorded where the receiver, BDO Canada Limited, stood: "The Receiver has funds to distribute but says there is a circular priority issue and cannot come up with a distribution waterfall at this point. Once it distributes the funds, it will seek a discharge," per the Endorsement of Justice Conway, Aug. 19, 2026, para. 1. The receiver's Fifth Report, filed nine days later, sets out the circle.

A soup kitchen in Etobicoke

The company operated as Ravi Kitchen and Ravi Wraps and Salads, a restaurant and café business with multiple locations in Toronto until February 1, 2024 or earlier, with its registered office at 322 Adelaide St. Its sole director, Tharmini Kandasamy, guaranteed its debts to RBC, as did two related companies, Ravi Soups and Wraps Inc. and 1865994 Ontario Inc., per the Affidavit of Angella White-Smith, Feb. 15, 2024, paras. 8, 11–13. The Adelaide Street address is also that of the Ravi Soups restaurant, which its website says opened there in 2007. Besides Markham Road the company owned Unit 17 at 27 Coronet Road in Etobicoke, where the receiver terminated operations that "consisted of a commercial soup kitchen which serviced a separate restaurant location," per the First Report of the Receiver, June 17, 2024, para. 11(b).

RBC moved the accounts to its Special Loans and Advisory Services group in August 2023, citing unpaid municipal taxes, second mortgages granted without its consent, and a notice of sale issued by Coronet Road's second mortgagee, Daljit Singh Banga. Demands and notices of intention to enforce security under s. 244 of the Bankruptcy and Insolvency Act went out on September 21, 2023, and a forbearance agreement offered three times between October and mid-December was never signed, per the Affidavit of Angella White-Smith, Feb. 15, 2024, paras. 46, 48, 50–57. Justice Black appointed BDO under s. 243 of the BIA on March 6, 2024, on uncontradicted evidence that RBC was owed more than $1.3 million. The company filed no materials, and its counsel, retained the night before, submitted without evidence that it should be given "a couple of months to sell certain real properties," per the Endorsement of Justice Black, Mar. 6, 2024, paras. 7, 12–13.

Two sales and a holdback

Coronet Road sold first: Justice Cavanagh approved its sale to Moraki Holding Inc. on September 10, 2024, per the Approval and Vesting Order, Sept. 10, 2024, p. 1, and the transaction closed on September 25, per the Fifth Report of the Receiver, Aug. 28, 2026, paras. 5–6. On December 4, 2024, Justice Penny approved an interim distribution from the proceeds, with a reserve for CRA deemed trust claims "which have not yet been resolved," per the Endorsement of Justice Penny, Dec. 4, 2024, paras. 3–6. The receiver paid $623,759.09 to RBC and $50,000 to Mr. Banga and held back $135,190, the deemed trust portion of CRA's claims, per the Third Report of the Receiver, Nov. 27, 2024, paras. 12, 19, 27. RBC's Coronet Road mortgage has since been paid in full, per the Fifth Report of the Receiver, Aug. 28, 2026, para. 36.

At Markham Road, the receiver learned after its appointment of a lease the company had signed on December 30, 2023, whose existence "was unknown to RBC or BDO prior to the Receiver's appointment." The tenant ran a hookah and shisha lounge from the units, and the condominium corporation raised numerous concerns about the tenant, including alleged unauthorized alterations to the premises resulting in fire safety concerns, per the First Report of the Receiver, June 17, 2024, paras. 11(a), 17–18, 22. Justice Osborne authorized the receiver to end the tenancy on 30 days' notice, citing "the somewhat unclear nature of the legal status of hookah lounges in Ontario and the possibility of fire hazards," per the Endorsement of Justice Osborne, June 26, 2024, paras. 5, 8.

The tenancy was still in place in January 2025. By then the receiver had invited two bidders to improve their offers by October 28, 2024, and had accepted the tenant's, per the Fourth Report of the Receiver, Jan. 27, 2025, paras. 2, 19–20. The agreement was assigned to 16712681 Canada Inc.; Justice Cavanagh approved the sale on February 13, 2025, and it closed on March 5. The price sits in a confidential brief sealed until the receiver is discharged, and from closing every claim attached to the net proceeds "with the same priority as they had with respect to the Purchased Assets immediately prior to the sale," per the Approval and Vesting Order, Feb. 13, 2025, paras. 6, 10.