A rocky CCAA restructuring wasn't enough to unmask the insolvency monitor's records
A British Columbia court has refused to let a bank cross-examine a CCAA monitor absent proof of actual wrongdoing.
The Supreme Court of British Columbia ruled on August 6, 2026, dismissing Royal Bank of Canada's bid to compel wide-ranging document production and oral examinations of Crowe MacKay & Company Ltd., the court-appointed monitor over a group of insolvent trucking and logistics companies, and the monitor's legal counsel.
The monitor was appointed after V K Delivery & Moving Services Ltd. and three related companies - Product Line Holdings and Logistics Ltd., VK 24/7 Logistics Solutions Ltd. and VK Linehaul Ltd. - entered creditor protection on May 16, 2025. The stay of proceedings was extended several times before the court denied a further extension on December 9, 2025, citing bad faith by the companies, and a receivership order followed, with MNP Ltd. appointed receiver. The Court of Appeal dismissed the companies' appeal on December 19, 2025.
RBC's case against the monitor rested on five specific failures. US$196,000 and US$9,000 were wired out of an RBC Georgia bank account in October 2025 instead of being applied to the RBC debt. A $320,000 fund earmarked for the Canada Revenue Agency sat outside any trust arrangement RBC had asked for. Lease arrears reached $130,000 after only five of 42 expected payments came in between May and November 2025. RBC also said the monitor understated the companies' deemed trust debt to the CRA by roughly $2 million, and couldn't reliably track RBC's collateral after GPS units meant to monitor the companies' trucks turned out not to be working.
Justice Basran pointed to the settled principle that monitors, as officers of the court, face examination only in exceptional or unusual circumstances - the process is meant to test whether their fees are fair and reasonable, not to lay groundwork for a lawsuit. Going through each of RBC's complaints, he found no maladministration. The RBC Georgia transfer was immaterial against the companies' roughly $3 million in monthly revenue and an $8.35 million refinancing effort underway at the time. The CRA shortfall claim had no evidentiary foundation. The lease and collateral problems were real oversights, but not the kind of exceptional conduct that opens a monitor up to broad cross-examination.
Basran also flagged that RBC's push for disclosure looked tied to a possible future negligence claim against the monitor and its counsel, which he said was not a proper basis for the scope of production RBC wanted. "It is in the interests of justice to protect the Monitor and its counsel" from adversarial proceedings, he wrote, dismissing RBC's application. RBC can still examine the monitor and its counsel, but only on whether their claimed fees are fair and reasonable. Costs on both applications will be argued November 2 and 3, 2026.
The lesson for banks and workout teams: a bad outcome in a CCAA proceeding doesn't, on its own, open the door to putting a monitor through the wringer. Courts still draw a hard line between checking a monitor's fees and re-litigating its judgment calls after the fact.
