Using a Writ to Seize a Business's Equipment or Inventory in Ontario

Collecting a judgment against a business is not the same exercise as collecting from an individual. A company can look like it has valuable equipment and inventory on paper, yet still be genuinely difficult to collect from once you look closely at who actually owns what, and who else has a claim on it first.

This article explains how a writ of seizure and sale applies to commercial assets in Ontario, and the practical obstacles that often come up.

Business Debtors Aren't Automatically Different

The basic enforcement tools are the same regardless of who owes you money: once you have a judgment, you can file a writ of seizure and sale with the sheriff for the county where the debtor has property, and pursue garnishment or an examination about assets. What changes with a business debtor is the kind of property involved, and who else might have a competing claim to it.

What Commercial Assets Can Generally Be Reached

• Equipment owned outright by the business — machinery, tools, office equipment, vehicles registered to the company
• Inventory the business owns and holds for sale
• Accounts receivable — money owed to the business by its own customers — generally pursued through garnishment rather than physical seizure
• Other business personal property, subject to the same general categories of exemption that apply to any debtor

Leased or Financed Equipment Complicates Things

A lot of business equipment is not fully owned by the business at all — it is leased, or financed under an agreement where a lender holds a registered claim against it until it is paid off. Where another party has a prior registered claim against specific equipment, that claim generally has to be satisfied first, which can mean little or no value is left for your judgment by the time a sale happens.

Before assuming a piece of equipment is a good enforcement target, it is worth finding out whether the business owns it outright or holds it under a lease or loan.

Corporate Structure Matters

If your judgment is against a corporation, enforcement generally reaches assets owned by that corporation, not the personal assets of its owners, directors, or shareholders. That separation is one of the basic features of operating through a corporation. There are limited exceptions — for example, where an individual personally guaranteed the debt — but as a general rule, a judgment against "the business" does not automatically let you seize an owner's personal house or car.

This is one reason it matters, before you sue, whether you are dealing with an incorporated company, a sole proprietorship, or a partnership. A sole proprietor's business assets and personal assets are generally not separated in the same way, which can make enforcement more straightforward — but also means there may be less to find if the individual has few assets of their own.

Practical Realities Worth Planning For

1. Businesses can wind down. A company in real financial trouble may close, sell off assets, or become insolvent, which changes the enforcement picture and may shift things toward an insolvency process rather than ordinary enforcement.
2. Inventory value can be misleading. Inventory that looks valuable on a balance sheet may be difficult to sell quickly, or for full value, at an enforcement sale.
3. Timing matters. Moving early, once you know a business has real assets, is generally more effective than waiting.
4. An examination can help. Questioning a company representative under oath about the business's assets and finances can reveal what is actually worth pursuing before you spend money on a writ.

Frequently asked questions