Campbell, Saunders Ltd. has acted as a privately appointed or Court-appointed Receiver or Receiver-Manager on behalf of banks and private lenders in a variety of industries.

A secured lender or creditor may appoint a Receiver pursuant to the terms of a General Security Agreement (GSA) granted by the debtor company to the lender which captures all of the security or assets of the debtor. If a Receiver believes there will be a conflict with the debtor company or a creditor, the Receiver can also be appointed by Court order.

Before a Receiver can be appointed, the secured creditor must provide the debtor company with a minimum of 10 days’ statutory notice (i.e., a Notice of Intention to Enforce Security) pursuant to the provisions of the Bankruptcy and Insolvency Act to allow adequate time for the debtor company to repay its indebtedness.

Only after the expiry of the minimum 10-day period can a secured creditor enforce its security, unless the 10-day period is waived by the debtor company. At any time prior to the expiry of the 10-day notice, a debtor company is able to file a Notice of Intention to Make a Proposal to its creditors, which would stay and prevent a secured creditor from enforcing its security for an initial 30-day period.

Upon appointment, the Receiver is entrusted with the responsibility to take possession and secure the debtor company's assets. The primary objective is to manage these assets in a manner that facilitates the repayment of the secured creditor or the liquidation of the company's assets to settle the outstanding secured loan.

While the Receiver represents the interests of the secured lender, they also have a fiduciary duty to the debtor company and all its stakeholders. This entails acting in good faith, preserving and securing the assets of the debtor, and maximizing the realization of assets. However, the Receiver is not obligated to continue the operations of the debtor if it is financially unreasonable to do so.

Once the secured creditor has been repaid its debts and related costs, any remaining assets are returned to the debtor company.
If you or your company have received a Notice of Intention to Enforce Security from a secured lender, we strongly advise you to seek immediate consultation with one of our insolvency professionals. Failing to do so may severely limit your ability to restructure your business once the 10-day notice period expires.

At Campbell, Saunders Ltd., we understand the complexities of receivership and insolvency matters. Our team of experts is committed to providing sound advice and strategic solutions to help you navigate through challenging financial situations. Contact us today to protect your interests and secure a better financial future for your business.