Using A Receivership To Respond To Commercial Real Estate Fraud

Certificates of pending litigation, cautions, constructive trusts, interim preservation of property orders, fraudulent conveyance actions, Mareva injunctions and receiverships are just some of the remedies in the litigator's tool box when responding to a commercial real estate fraud.

Deciding which remedy to pursue and when depends on each case and the nature of the fraud. Considerations include whether to secure the property in question, the ill-gotten gains, the fraudster itself or, as is commonly the case, a combination of all three. Additional factors that inform the decision are the available timelines, costs, the accessibility of assets and the likelihood of recovery.

This article looks briefly at receivership proceedings as a way to respond to a commercial real estate fraud. Considered by some to be a remedy devoted to the insolvency bar, receiverships commenced under s. 101 of the Courts of Justice Act and the Business Corporations Act are becoming more common. Given the complexity of...