Ontario Court appoints receiver over two law firms after $18 million in mortgage funds goes missing

Simran Law Professional Corporation, the Brampton, Ontario law firm of Simranjyot (Simran) Kaur, and JP Mann Law Firm Professional Corporation, the Mississauga law firm of Jagpal Singh (J.P.) Mann, were placed into receivership on October 19, 2026 on application by FCT Insurance Company Ltd., a title insurer, without notice to the respondents. Grant Thornton was appointed as receiver and investigator under section 101 of the Courts of Justice Act (Ontario) over the two law practices. The Law Society of Ontario (LSO) supported the application.

Ms. Kaur's firm acted for vendors and Mr. Mann's firm acted for purchasers in 25 separate real estate transactions. More than $18 million in mortgage advances was paid into the respondents' trust accounts to discharge existing mortgages. With limited exceptions, none of those mortgages was discharged, and the lawyers' undertakings to discharge them were not honoured. None of the funds was used as directed, returned or accounted for. The Court had to decide whether this exceptional relief was justified against operating law firms, and how to protect solicitor-client privilege while granting it.

Justice Dunphy called the situation "extraordinary." He said similar schemes have been occurring "with distressing regularity" and constitute an "exceptionally grave attack" on the legal profession and the civil justice system. He stressed that lawyer trust accounts, lawyer undertakings and the concept of trust itself are under threat, and that "a decisive reaction is called for and without delay."

The Court found that FCT had shown a strong prima facie case of serious breaches of trust. It rejected any suggestion that this was "sloppy ledger-keeping." Twenty-five similar transactions over an extended period, combined with inaccurate or misleading explanations from the respondents, pointed to serious and repeated mishandling of trust funds. The Court noted that these transactions might be "the tip of an iceberg," that other clients' money could be involved, and that shortfalls might have to be calculated and allocated. Justice Dunphy found that he had jurisdiction, that the appointment was just and equitable, and that there was a real risk of further harm without it. He also noted that the LSO had stepped in to safeguard privilege.

The order freezes the firms' property and trust funds and requires banks to place holds on the firms' accounts and produce records. The LSO will screen records for solicitor-client privilege before they reach the receiver. The receiver's initial report is due November 19, 2026, and a comeback hearing is set for November 23, 2026.

Grant Thornton is the receiver. FCT was represented by Dentons. The LSO represented itself.