RSG Law: a receiver for the firm and the funds it was required to hold in trust

AlixPartners Restructuring, Inc. became receiver of a law firm on October 23, 2026. Justice Dunphy of the Ontario Superior Court of Justice (Commercial List) appointed it, without security, over "all the assets, undertakings, and properties" of RSG Law Professional Corporation and, separately, over "all of the funds in RSG's possession or control that RSG was required to hold in trust," the Trust Property, "which Trust Property does not constitute RSG Property." The receiver "shall investigate the Trust Property and the Records" for "the purposes of tracing, preserving, investigating and reporting to this Court," per the RSG Law Receivership Order, Oct. 23, 2026, para. 2.

The motion was brought by AlixPartners Advisory, Inc. "in its capacity as Sales Officer," under s. 101 of the Courts of Justice Act, the only statute the order cites for the appointment, on court file CV-26-00007954-00CL, the action in which WIGI Restructured Bond Corporation is "the Plaintiff." The order records that the motion was served: the court heard the submissions of counsel on the counsel slip, "no one else appearing although duly served," and abridged the time for service so that the motion was "properly returnable today," per the RSG Law Receivership Order, Oct. 23, 2026, recitals, para. 1 and Sched. "A".

On the same motion Justice Dunphy made two more orders, an Amended and Restated Receivership Order (the ARRO) over real property and an Ancillary Relief Order. All three recite that the court read the receiver's Second Report of October 9, 2026 and its First Supplement of October 19. Neither report is in the record, and no endorsement or reasons from the hearing are. None of the orders makes a finding about the transactions the receiver is to investigate, per the ARRO, Oct. 23, 2026, recitals and the Ancillary Relief Order, Oct. 23, 2026, recitals.

Eleven entries and no findings

The order empowers the receiver, "but not obligated," to identify, trace and investigate the Property and "the transactions described in Schedule 'A' (the 'Specified Transactions')." The schedule's eleven entries reach any transaction by which a "Registered Owner acquired, encumbered, or charged any Properties, as described in the Second Report"; the transactions referred to in WIGI's notices of motion of April 23 and May 1, 2026; any transactions to do with "the sale by 1000234566 Ontario Inc. and 1000451281 Ontario Inc. to Tutela Heights Developments Inc., which funds were directed to RSG Law"; any transactions "as described in the Trust Ledger Statement of RSG, dated June 18, 2025"; and the transactions referred to in six proceedings dated between May 8 and September 1, 2026. Those six are statements of claim by Vector Financial Services Limited, by Madz Family Holdings Inc. and Sajnik Holdings Inc., and by a group of claimants the Second Report defines; applications to appoint a receiver by First Source Financial Management Inc. and Owemanco Mortgage Holding Corporation, and by Canadian Imperial Bank of Commerce; and a notice of action by National Bank and others, per the RSG Law Receivership Order, Oct. 23, 2026, para. 3(a) and Sched. "A". The claims, applications and notice of action it lists are other parties' proceedings, and the orders make no finding on any entry.

The banks and the Law Society

RSG and everyone with notice of the order, banks included, are restrained from dealing with the Property without the receiver's written consent or a further order. A financial institution maintaining an account used by RSG "in connection with the practice of law, including any trust account, general or operating or other account," must place an administrative hold on it once the receiver gives notice and turn the funds over if directed. It must also deliver records that run from account-opening and Know Your Customer files "regardless of date" and the source of deposits to IP addresses, device identifiers, branch camera footage and recorded telephone instructions, "notwithstanding that any disclosure may include 'personal information' about third parties," per the RSG Law Receivership Order, Oct. 23, 2026, paras. 7–10.

The firm's own records go first to the Law Society of Ontario. Under the protocol in Schedule "B," the LSO passes to the receiver what it determines is not protected by solicitor-client privilege and withholds the rest with a privilege log; a privileged record that reaches the receiver inadvertently goes back to the LSO, and the receiver may not review or use it pending the LSO's directions or a further order; and production under the protocol waives no privilege. The LSO need not identify to the receiver clients associated with the Property, or disclose what s. 49.12 of the Law Society Act requires or entitles it to keep confidential. The stay of proceedings against RSG does not affect the Law Society's own powers, per the RSG Law Receivership Order, Oct. 23, 2026, paras. 14, 25 and Sched. "B," paras. 1–3, 5–6.