Rebecca Joyce Kennedy

The People's Trust Company, as assignee of Enlightened Funding Corporation, brought a motion seeking an order to compel Deloitte Restructuring Inc., the court-appointed Receiver of Velocity Asset and Credit Corporation and 926749 Ontario Ltd., to produce documents relevant to the personal bankruptcy application against Hugh Waddell, the principal of the Respondents.

Despite Waddell's non-cooperation and previous adjournments, the court dismissed the motion.

The court found that the Receiver's appointment order, specifically section 4(m) concerning information sharing, was not broad enough to authorize production for purposes outside the receivership's primary objectives.

The court emphasized that the documents were sought to prosecute the bankruptcy application against Waddell, not to advance the receivership of the Respondents.

The court noted that other avenues exist within the Bankruptcy Application to compel such production.

The moving party, AutoLoans, sought a declaration of ownership over four vehicles, asserting a purchase agreement with Clonsilla Auto Sales and Leasing.

The court-appointed Receiver, Deloitte Restructuring Inc., opposed, arguing the transaction was a financing arrangement and, alternatively, a preferential transfer under the Bankruptcy and Insolvency Act.

The court found that the executed Fixed Rate Installment Notes (FRINs) constituted a binding financing transaction that was not legally displaced by subsequent backdated purchase documents.

Consequently, the vehicles remained property of the debtors, and AutoLoans' motion was dismissed.