The Supreme Court of British Columbia has appointed a receiver to oversee operations of the companies that own and operate Bear Mountain Resort, where partners have been at odds over how the property is being managed and its land is developed.
In a decision on Wednesday, the court gave Alverez & Marsal ÎÚÑ»´«Ã½ Inc. the authority to manage the business and take control of the finances of Bear Mountain, which under Ecoasis Developments has hundreds of acres of undeveloped lands as well as two golf courses and tennis facilities on Skirt Mountain in east Langford and the Highlands.
Sanovest Holdings Ltd. and 599315 ÎÚÑ»´«Ã½ Ltd., headed by chief executive Dan Matthews, are equal partners in Ecoasis Developments LLP, which was formed in 2013 under the company name Ecoasis Bear Mountain Developments Ltd.
Sanovest, which holds a $62-million loan on the Bear Mountain lands, asked ÎÚÑ»´«Ã½ Supreme Court to appoint a receiver after Ecoasis Developments LLP failed to pay off the loan in full by May 1.
Sanovest claimed in filings last spring there was a breakdown in trust between the two controlling partners — Sanovest director Tian Kusumoto and Matthews, chief executive of Ecoasis Bear Mountain Developments.
Sanovest asked for a receivership to preserve its assets and ensure fair treatment among creditors. Ecoasis and 14 other associated companies known as the Developments Partnership were listed as respondents in the petition by Sanovest.
The two partners have been at odds on several issues, including how to market and develop the remaining lands, expense accounts, debts including property taxes and on whether to sign a contract extension with the privately held Bear Mountain Westin Hotel for use of the locker-rooms, pro shop and cart-charging facilities linked to the two 18-hole golf courses.
This week’s ruling gives the receivers powers to take possession and exercise control over the property and any money coming in or being spent.
The resort operations at Bear Mountain, including golf courses, tennis and other recreational facilities, are not under receivership as a result of this week’s order, according to the filing. It said those businesses will continue to be managed by Ecoasis Bear Mountain Developments as “oppression litigation” cases between the owners are before the courts.
The filing also notes the receivership order will not have an impact on the arbitration proceedings between Ecoasis Resort and Golf LLP and Bear Mountain Resort & Spa Ltd., BM Management Holdings Ltd. and BM Resort Assets Ltd.
However, the receiver said Ecoasis Bear Mountain Developments is required to provide access to the property and records and to co-operate with requests.
The receiver will have authority to enter into agreements, engage consultants, appraisers and agents, auditors, accountants and managers, and to lead any pending legal proceedings. Under certain financial thresholds, the receiver will have the power to sell or lease property and can apply for permits and licences required by any government authority.
The ruling states that Alverez & Marsal ÎÚÑ»´«Ã½ Inc. will present a report and its recommendations for the property to the court around Oct. 25.
It is expected to include an inventory of assets, undertakings and properties of the companies and a report on the management and business of Ecoasis Bear Mountain Properties, and whether it should continue to manage the business and “if so, on what terms, if any,” said the ruling.
A hearing for the receiver’s counsel to speak to the report, and for any applications resulting from it or any relief, is scheduled for the Supreme Court in Vancouver on Nov. 6. Before Dec. 2, the receiver is expected to deliver a report of a sale and marketing process to be approved by the court.
Sanovest claimed earlier it hasn’t received any audited financial statements since the end of 2018 from the development partnerships and that it will be unable to meet the bills as they come due, including $542,000 for accounting and legal services, a $300,000 default payment to the City of Langford for the Bear Mountain Parkway roadwork and $2 million owing vendors and other creditors.
Property taxes on Bear Mountain lands for 2024 were $1.6 million.
This week’s court ruling sets terms for the continuation of services at Bear Mountain, including contracts for goods and services, banking and payroll through the direction of the receiver.
All funds and payments received, including the sale of property, will be deposited into one or more new accounts to be opened by the receiver and held to be paid according to terms of the court order, the ruling said.
