R. Graham Phoenix

In the context of CCAA proceedings for a land lease community, the senior secured lender brought a motion to appoint a receiver.

The CCAA stay of proceedings was expiring, DIP financing was exhausted, and no viable restructuring plan or purchaser had emerged.

The court found it just and convenient to appoint a receiver to stabilize the community, ensure continuation of essential water and sewage services, and facilitate a credit bid by the secured lender.

A separate unopposed motion to lift the stay to allow repossession of unused modular homes was also granted.

The applicant creditor, Heliotrope Investment Corporation, applied for bankruptcy orders against the respondents, Martha and Gary Beach.

The applicant alleged the respondents owed debts exceeding $1,000 and had committed an act of bankruptcy by ceasing to meet their liabilities generally as they became due.

The respondents opposed the applications, arguing they had sufficient assets, the debts were disputed in related civil proceedings, and the applications were brought for an improper purpose.

The court found that the applicant established the debts and the act of bankruptcy.

The court rejected the respondents' arguments, finding no sufficient cause to dismiss or stay the applications, and issued the bankruptcy orders.

The applicants sought a declaration of ownership over certain equipment and assets ("BuiltRite Assets") and an order compelling respondents to release them, asserting a first-ranking security interest.

The dispute centered on whether a Quitclaim effectively transferred ownership of "Trailered Assets" to Strongco Plastics Ltd. The respondents argued the Quitclaim lacked certainty and consideration, and that claims against the Hernandezes were stayed due to bankruptcy.

Marcelo Hernandez also cross-applied for compensation for work performed.

The court found the Quitclaim unenforceable due to lack of certainty and consideration, dismissing the applicants' claims regarding asset ownership.

The court also found ESC Enterprises Inc. unjustly enriched by Marcelo Hernandez's services and awarded him compensation.