A secured creditor may apply for a receiver in Ontario under BIA s. 243(1). In Ontario, other litigants may also seek a receiver under separate statutory or equitable routes, including CJA s. 101, where they have a proper legal basis to request that relief in a pending or intended proceeding.
A Secured Creditor Has an Express Right to Apply Under the BIA
The Bankruptcy and Insolvency Act creates a specific federal route for secured creditors. Section 243(1) expressly provides that, subject to the notice restriction in s. 243(1.1), a secured creditor may apply for appointment of a receiver over all or substantially all of specified business property of an insolvent person or bankrupt.
That does not mean secured creditors are the only parties who can ever seek a receiver in Ontario. Section 101(1) of the Courts of Justice Act gives the Superior Court of Justice interlocutory jurisdiction to appoint a receiver or receiver and manager where it appears just or convenient. Rule 41.02 of the Rules of Civil Procedure explains how that relief is obtained: by motion to a judge in a pending or intended proceeding.
Rule 41.02 is procedural. It does not itself create a universal right for any person to obtain a receiver. The applicant must have standing and a substantive legal basis for the relief sought.
Other statutes can also expressly authorize receiver appointments. For example, under the Ontario Business Corporations Act, a complainant pursuing an oppression remedy may seek relief that includes appointment of a receiver or receiver-manager.
For the basic distinction between the remedy and the person appointed, see what a court-appointed receiver in Ontario is.
Who May Apply Depends on the Legal Route
Secured creditor under BIA s. 243(1). This is the principal insolvency route. The creditor must hold qualifying security and satisfy the statutory and evidentiary requirements for appointment. Whether the appointment should actually be granted is a separate issue from standing to bring the application.
Party seeking interlocutory relief under CJA s. 101. In a pending or intended Ontario proceeding, a party with a proper legal basis may move for a receiver under Rule 41.02. The court will consider the nature of the underlying proceeding, the applicant’s interest, the property or business at issue, and whether receivership is an available form of relief.
Corporate complainant under the OBCA. In an oppression proceeding, a qualifying complainant may seek an order appointing a receiver or receiver-manager under s. 248(3)(b). This illustrates why receiver appointments are not confined to secured-lender enforcement.
Other statutory applicants. Particular Ontario or federal statutes may create their own receiver-appointment powers for specified applicants and circumstances. Those routes must be analyzed under the statute that creates them rather than assumed to fall under BIA s. 243.
The question “who can apply?” is therefore distinct from “will the court appoint a receiver?” Standing identifies who may properly request the remedy; the appointment test determines whether the court should grant it.
How ME Law Approaches Receiver Appointment Applications
ME Law begins a receiver-appointment analysis by identifying the applicant, the source of jurisdiction, and the legal interest supporting the requested relief. For secured creditors, that usually means reviewing the security, BIA requirements, enforcement history and proposed order. In corporate or other contested proceedings, the analysis starts with the underlying claim and the statutory or equitable basis for seeking court control over property or operations.
Our Appointment of Receiver Litigation practice addresses motions to obtain or oppose receivership relief, while our Creditor Rights & Insolvency Enforcement Actions practice addresses secured-creditor enforcement and related insolvency remedies. The objective is to determine not merely whether someone wants a receiver appointed, but whether that applicant has the legal standing and evidentiary basis to ask the court for one.
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