Former Brampton MP's law firm placed into receivership amid alleged real estate fraud

RSG Law Professional Corporation, an Ontario law firm founded by former Brampton Member of Parliament Rajvinder "Raj" Grewal, was placed into receivership on October 23, 2026, with AlixPartners Restructuring, Inc. appointed as receiver by Justice Sean Dunphy of the Ontario Superior Court of Justice. The appointment follows an earlier June 12 order appointing AlixPartners Advisory, Inc. as sales officer over properties associated with Avtar Singh Grewal and related parties, and forms part of a series of proceedings involving alleged real estate fraud, disputed mortgage claims and potential misuse of law firm trust accounts.

The underlying litigation was commenced by WIGI Restructured Bond Corporation, part of the Walton Group, against 1000234566 Ontario Inc., Amrinder Singh Mangat, Avtar Singh Grewal, Arandeep Grewal, RSG Law Professional Corporation and Davinder Singh Khattra. WIGI alleges that the defendants concealed real estate transactions and diverted sale proceeds that should have been used to repay vendor take-back mortgages. The proceedings have since drawn in numerous property-owning entities and secured creditors, with AlixPartners tasked with preserving assets, tracing funds and investigating competing claims.

The dispute originated with the sale of Bell Meadows, a 99.7-acre property south of Brantford that WIGI sold to 1000234566 Ontario Inc. in April 2023 for approximately $5.2 million. The property had previously been held through 586 fractional interests representing 425 ownership interests. Approximately 70% of the purchase price was deferred under a vendor take-back mortgage carrying interest at 3% annually, with a three-year term and a provision requiring repayment upon any subsequent sale.

According to an affidavit from Jonquille Levesque, WIGI's chief administrative officer, the mortgage was inadvertently removed from title by Ontario's Land Registry Office during a title conversion on April 13, 2023. The error went undetected by WIGI until April 2026. In the meantime, the purchaser sold Bell Meadows to Tutela Heights Developments Inc. for $7.4 million on June 18, 2025, without repaying the approximately $3.6 million mortgage principal or outstanding interest.

WIGI alleges that Davinder Khattra, who acted as counsel to the purchaser through RSG Law, represented that the sale had been delayed until September 2025 despite having executed and registered the June transaction. Communications continued concerning repayment and possible extensions, while WIGI remained unaware that the property had already changed hands. The allegations of fraudulent misrepresentation and diversion of proceeds have not been finally determined.

The mortgage matured on April 6, 2026. When WIGI instructed counsel to commence enforcement proceedings, a title search revealed both the mistaken deletion and the prior sale. WIGI obtained a Mareva injunction from Justice Myers on April 23, freezing assets up to $4.12 million and requiring disclosure of information concerning the disputed proceeds. Additional orders followed in May concerning RSG Law's accounts and related entities. A May 15 settlement agreement requiring payment by May 22 subsequently fell into default, resulting in a judgment against Avtar Singh Grewal for approximately $4.38 million on May 25.

On June 12, Justice Myers appointed AlixPartners Advisory as sales officer over properties associated with Grewal and related entities. The mandate became increasingly complex as secured creditors commenced or contemplated enforcement proceedings against individual properties, raising questions about ownership, mortgage priorities and the proper allocation of proceeds. AlixPartners subsequently sought a broader receivership mandate to preserve the assets and investigate transactions involving the property owners.

One of those properties is an undeveloped 364-unit residential project at 0 Mayfield Road in Brampton owned by RSG Mayfield Inc., whose sole director and officer is Raj Grewal. In separate proceedings, RSG Mayfield was placed into receivership on September 28, 2026, on application by Vector Financial Services Limited and Olympia Trust Company, after defaulting on a $25 million acquisition loan. The lenders were owed approximately $26.3 million as of September 8 and had raised concerns about an additional $8.1 million mortgage registered against the property following the discharge of an earlier $3.5 million second mortgage held by Avtar Singh Grewal.

The Mayfield project, which contemplated 52 single-family homes, 52 townhouses and 260 condominium apartments, had not proceeded to construction. Justice Myers appointed TDB Restructuring as receiver to oversee its sale, while preserving AlixPartners' oversight of any surplus proceeds through the broader WIGI proceedings. The order requires TDB to provide information and accountings to AlixPartners and remit residual amounts otherwise payable to the property owner after expenses and secured claims are satisfied. The arrangement was intended to permit the senior lenders to realize on their security without resolving the wider disputes concerning Grewal and related entities.

A further complication arose in October when WIGI disclosed a proposed settlement with Grewal and other defendants for approximately $4.71 million. The arrangement contemplated an initial $3 million payment from funds held in lawyers' trust accounts and a bank account controlled by Grewal, followed by steps to terminate certain Mareva restrictions and seek the discharge of the sales officer. The balance would be payable within 45 days of a court decision on the proposed discharge. AlixPartners raised concerns about the sources of the settlement funds, potential competing claims and the consequences of releasing restrictions before determining the rights of other stakeholders.

At an October 22 hearing, Justice Dunphy declined to approve the proposed expanded property receivership without an investigation of RSG Law's trust accounts. The Court was concerned that proceeds connected to alleged trust account irregularities could be subject to unidentified claims. Following consultations with the Law Society of Ontario and counsel involved in a separate law firm receivership brought by FCT Insurance Company Ltd., AlixPartners advanced a conservatory and investigatory receivership framework for RSG Law.

Under the law firm receivership mandate, AlixPartners is tasked with preserving assets owned by RSG and funds held in trust, investigating receipts and disbursements, reviewing financial institution records and reporting to the Court. The proposed framework also establishes a protocol involving the Law Society of Ontario to protect solicitor-client privilege and confidential client information during the investigation.

Justice Dunphy also granted an amended and restated property receivership order on October 23, replacing the earlier Sales Officer arrangement with a receivership administered by AlixPartners Restructuring. The order grants powers to preserve property, investigate transfers and ownership arrangements, trace funds, examine persons under oath and review competing claims and priorities. It does not expressly authorize the receiver to market and sell the properties, preserving judicial oversight while potential trust claims are investigated.

The order establishes a framework for secured creditors whose collateral is excluded from the principal receivership, including the lenders involved in the RSG Mayfield proceedings. Those creditors may continue enforcement but must provide information to AlixPartners, account for realization proceeds and remit any surplus attributable to the relevant owners' interests. The receiver must maintain segregated accounts for individual registered owners, without substantive consolidation of their property interests, and allocate professional costs to the appropriate assets.

In an accompanying ancillary order, Justice Dunphy directed property owners and relevant directors to provide detailed records by October 29, 2026, including title and financing information, development documents, operating expenses and corporate records.

AlixPartners is the receiver. Counsel includes Paliare Roland for the receiver and Torys for WIGI. TDB serves as receiver of RSG Mayfield, with Robins Appleby representing Vector and Olympia in those proceedings.