TechCity Canada: twelve items the bank asked for, and a receiver

When Royal Bank of Canada's special loans manager swore the affidavit behind its receivership application in April, his description of TechCity Canada Inc.'s business came from the front of its building. "According to signage embossed on the Real Property's façade, TechCity is in the computer and electronics industry," David Kennedy deposed, attaching a Google Street View image of 1274 Kennedy Road in Scarborough and a capture of the company's website, which said of itself that it "isn't working right now." The image, captured in June 2025, shows a two-storey building with a blue sign over the storefront advertising computers, electronics and accessories, and SALE banners running down both sides, per the Affidavit of David Kennedy sworn Apr. 22, 2026, para. 4 and Ex. "B", p. 78, in Application Record, June 2, 2026.

TechCity and 1000229443 Ontario Inc., the related company that owns the building and is TechCity's landlord, owed the bank more than $2.2 million on demands that had gone unpaid since February and March. On August 28, 2026, in the Ontario Superior Court of Justice (Commercial List), Court File No. CL-26-00000205-0000, Justice S. Dunphy heard the application on a day's notice and appointed msi Spergel inc. receiver of all the property of both companies, the Kennedy Road building included, under s. 243(1) of the Bankruptcy and Insolvency Act and s. 101 of the Courts of Justice Act, per the Order (appointing Receiver), Aug. 28, 2026, para. 2 and the Endorsement of Dunphy J., Aug. 28, 2026, paras. 3, 9.

A store, a building and the bank's four facilities

The numbered company took title to 1274 Kennedy Road from Kennedy Gateway Inc. by a transfer registered on May 2, 2023 for $2,300,000. RBC's term loan to it followed in August: a non-revolving facility of $1,850,000 on a 300-month amortization, under a credit agreement dated August 16, 2023 that conditioned any borrowing on an appraisal confirming a market value of at least $2,300,000 and the payout of the vendor take-back from the loan's proceeds, per the Application Record, June 2, 2026, Ex. "C", p. 85 and Ex. "D", pp. 128–129. It also required annual financial statements for both companies and "such other financial and operating statements and reports as and when the Bank may reasonably require," per the Application Record, June 2, 2026, Ex. "D", p. 129.

TechCity borrowed on its own account under two agreements dated August 1, 2024: a $200,000 revolving demand facility at RBC prime plus 2.54%, beside a business credit card with a $25,000 limit, and a non-revolving term facility of $292,546.24 at a fixed 4.00% under the Highly-Affected Sectors Credit Availability Program, the HASCAP loan, per the Application Record, June 2, 2026, Ex. "D", pp. 88, 112.

The security runs across both companies and two people. Each debtor granted RBC a general security agreement; the numbered company gave a $3,000,000 collateral mortgage on the building, dated September 3, 2023, and a general assignment of rents. Each company guaranteed the other, the numbered company for $500,000 of TechCity's debt and TechCity for $1,850,000 of the numbered company's, and Abida Perveen, the sole officer and director of both, and Amjad Shahid personally guaranteed the same two amounts, jointly and severally, on August 18, 2023, per the Affidavit of David Kennedy sworn Apr. 22, 2026, paras. 3, 8, 10–11.

Behind the bank on title sits the vendor: Kennedy Gateway Inc. registered a $150,000 second charge and assignment of rents on January 19, 2024. Apart from RBC's, the only PPSA registration against the debtors is Mercedes-Benz Financial's, over a motor vehicle. The City of Toronto's tax certificate showed $91,279.56 in arrears as of April 7, 2026, with unpaid real estate taxes for each year from 2023 to 2026 and the account assigned for collection, per the Affidavit of David Kennedy sworn Apr. 22, 2026, paras. 13–15, 24 and Exs. "C", p. 86, and "N", p. 281. By the hearing the court put the unpaid tax at approximately $100,000, per the Endorsement of Dunphy J., Aug. 28, 2026, para. 4.

After the robbery

It is "common ground," Justice Dunphy wrote, "that the debtor began to experience difficulties following a robbery that occurred in May 2025," per the Endorsement of Dunphy J., Aug. 28, 2026, para. 5. By January 2026 the account was with Mr. Kennedy in Special Loans. He met Mr. Shahid at the store on January 19 and the next day sent a list of twelve items the bank required "to commence our initial review and assessment." They included CRA overview reports, proof that the property taxes were paid, accountant-prepared financial statements to December 31, 2025, a forecast through 2026, an inventory listing by SKU, the insurance policy, the claims made and paid "as a result of the burglary event," and a plan to bring the HASCAP loan, then 78 days in arrears, up to date. Most were due January 24; the financial statements and forecast, February 10, per the Reply Affidavit of David Kennedy sworn Aug. 20, 2026, Ex. "1", pp. 7–8.

Mr. Shahid's answer, on February 3, was that the bank had not looked into a January problem on the mortgage account and kept sending the list instead. "We have already signed off too many unnecessary Document regarding this loan. Techcity Canada has no money and insurance is taking forever," he wrote, adding that he intended to pay off RBC before or by the next renewal. Thirty-three minutes later Mr. Kennedy wrote back that the bank was fixing an error on the numbered company's loan payment: "It looks like they took the arrears payment and the interest portion of the payment was not back-dated to the day it was due," per the Reply Affidavit of David Kennedy sworn Aug. 20, 2026, Ex. "1", pp. 6–7. All twelve items were still outstanding when Mr. Kennedy swore his reply affidavit on August 20, per the Reply Affidavit of David Kennedy sworn Aug. 20, 2026, para. 5.

RBC's lawyers made demand on TechCity and its guarantors on February 25, 2026, citing missed HASCAP payments and a credit card over its limit: $200,919.23 on the operating facility, $246,945.90 on the HASCAP loan and $27,626.75 on the card, for $475,491.88 as of February 19. The accompanying notices of intention to enforce security under s. 244(1) of the BIA put the total secured debt at $2,256,266.16. A second round on March 19, citing the tax arrears and missed payments, demanded $1,770,210.32 on the accelerated term loan as of March 9, per the Application Record, June 2, 2026, Ex. "K", pp. 252–254 and Ex. "M", p. 269.

The debtors' counsel wrote for the first time on March 6. His client was paying every facility on schedule except the HASCAP loan, he said, and would pay its arrears if the bank accepted a smaller monthly payment. His client had "always honoured his obligations to RBC," he wrote, and intended to go on doing so "in light of the setbacks which were not fault of my client, including having his entire inventory stolen." The proceeds of a "substantial insurance claim" would "all go towards paying off the bank facilities," and counsel was receiving instructions to sue the insurer. RBC answered that after acceleration it would not take smaller payments or wait for "the outcome of litigation with the insurer." On March 26 counsel asked for flexibility: his client "will need until September 2026 to arrange for refinancing to take out your client's position," per the Application Record, June 2, 2026, Ex. "L", pp. 264–267.