Ten Days to Keep the Kitchen Equipment From Being Repossessed

The situation

Femke had already tried the obvious things. When the missed payment first happened, she called the supplier directly and asked for another two weeks, which they gave her. When that two weeks passed and the business still could not cover the full amount, she offered a partial payment and a new schedule, put together on a Sunday night at her kitchen table, and sent it over by email. It was rejected without much explanation beyond a short reply saying the account was now being handled by collections. That was the point at which Femke, who had been managing everything herself since the business started, realized she needed someone who actually understood what the supplier could and could not legally do.

The business itself had started as her parents' side project years earlier, weekend catering for family friends and community events, and Femke had grown it steadily after taking it over, working weekday shifts as a grocery clerk to cover her own bills while building the catering side into something closer to a real company. Revenue was approaching one hundred thousand dollars a year, still modest, but a real jump from the handful of weekend bookings it had started as. Her partner in the business, Mathan, worked full time as a hotel front-desk supervisor and helped on evenings and weekends, handling logistics and driving deliveries.

The equipment at the centre of the dispute, industrial ovens and refrigeration units, had been financed through a supplier, Pratheep, who had extended equipment credit to the business eighteen months earlier on the understanding that steady monthly payments would follow. A slow winter season had put Femke behind on two consecutive payments, and the missed payment plan that followed her first request for more time was the second chance the supplier was not willing to extend a third time.

Ten business days before the deadline in Pratheep's formal demand letter, Femke had a booked catering contract for a community festival, her largest order yet, that depended entirely on having that equipment in her kitchen. Losing it meant losing both the equipment and the contract at the same time, and losing the contract on top of the equipment would have set the business back further than the original missed payments ever had.

By the time she reached out to our office, Femke had already spent close to a week trying to solve the problem herself, on top of a full work schedule, and she arrived at the first call with a folder of emails, a spreadsheet of what she could realistically pay, and very little time left to act on any of it.

The complication

The deadline was the whole problem. Ten business days is not enough time to arrange traditional business financing through most lenders, whose underwriting alone can take several weeks even for a straightforward application, and it was nowhere near enough time to negotiate a fully documented repayment restructuring the way a larger company with in-house counsel might. Every option available to Femke had to fit inside a window that was, by the time she called our office, already closing.

Pratheep's demand letter had been drafted under the terms of the original equipment financing agreement, which included a security interest registered against the equipment itself under Ontario's personal property security regime. The right to repossess the ovens and refrigeration units if the default was not cured came from the security agreement the business had signed, not from the registration; what the registration did was protect Pratheep's priority over other creditors and buyers, which is what turned that right into something actually worth having. Enforcing it still meant following the required steps: written notice of intention to enforce against a corporate debtor, notice before any sale of the collateral, and no seizure that crossed into a breach of the peace, which in practice often meant going through the courts rather than around them. It was not an empty threat, and treating it as one would have been a mistake.

At the same time, repossession was not obviously in Pratheep's own interest either, once the full picture was considered. Used commercial kitchen equipment, once removed from a working business and resold second-hand, typically recovers only a fraction of what it is worth installed and running, and the process of seizing, storing, and reselling it would cost Pratheep time and money with an uncertain return. Femke's business, kept intact and paying, was worth more to Pratheep over time than the equipment sitting in a warehouse. That gap between the letter of the demand and the supplier's actual economic interest was the opening the negotiation needed.

The complication was making that argument convincingly and quickly, before the ten-day window closed, to someone who had already been burned once by a missed payment plan and had every reason to be skeptical that a second one would go any differently. Femke's own credibility with Pratheep, after one broken promise, was close to zero, which meant the shape of any new deal mattered as much as the substance. A vague new promise, however sincere, was never going to move a supplier who had already watched one plan collapse.

There was also a practical constraint working against Femke that had nothing to do with the law. She could not simply borrow her way out of the problem overnight, since most lenders wanted financial statements, a business plan, and proof of consistent revenue before approving anything, none of which could be assembled and reviewed inside ten business days. Whatever solution existed had to work within the deadline that already existed, not around a better one that did not.

What we did

1. Reviewed the security registration and financing agreement immediately. Before contacting Pratheep, we confirmed exactly what rights the security agreement and its registration actually gave him, on what timeline, and what steps he would legally need to take to enforce it, so we knew precisely how much room existed inside the ten-day deadline rather than guessing at it or assuming the worst-case reading of the demand letter.
2. Contacted Pratheep's collections representative directly, in writing. Rather than another phone call, we sent a formal letter proposing a standstill, a temporary pause on enforcement, framed around specific dollar figures and dates rather than the general request for more time that had already been rejected once. Putting it in writing, from a lawyer's office rather than the debtor herself, signalled that the next proposal was going to be a documented commitment rather than another verbal promise.
3. Proposed an immediate partial payment as a show of good faith. We arranged for Femke to pay a meaningful portion of the arrears upfront, funded from a small family loan Mathan helped arrange, since a real payment on the table carries far more weight in a standstill negotiation than a promise alone, and it signalled that the business had the will and some ability to make good on what it owed.
4. Set a firm, short standstill period tied to a refinancing plan. Rather than an open-ended pause, we proposed a defined ten-week standstill during which Pratheep agreed not to enforce the security interest, giving Femke a real but bounded window to arrange proper refinancing rather than another indefinite promise that would have left Pratheep no better off than before, and no more confident than he already was.
5. Helped Femke apply for a small business loan in parallel. While the standstill negotiation was underway, we connected Femke with resources for a small business loan application and helped her assemble the revenue records and cash flow projections a lender would need, since the standstill only bought time, it did not solve the underlying cash shortfall that had caused the default in the first place.
6. Documented the standstill agreement in writing before the deadline passed. We drafted a short, clear agreement setting out the partial payment, the ten-week pause, and the new repayment schedule to follow, and got it signed by both sides with two full business days to spare before the original repossession deadline, because a verbal understanding reached at the last minute would have given Femke nothing to point to if Pratheep's collections team changed its mind under pressure from head office.
7. Confirmed the festival contract could proceed without disruption. Once the standstill was signed, we confirmed in writing with Pratheep's office that the equipment would not be touched during the standstill period, giving Femke something concrete to show her festival client and her own staff so the booking could be prepared for with confidence instead of a lingering worry that the ovens might disappear mid-week.
8. Set clear milestones inside the standstill so both sides knew where things stood. Rather than one silent ten-week gap, we built two check-in points into the agreement, at three weeks and six weeks, where Femke would report progress on the loan application, so Pratheep had visibility into whether the plan was on track instead of waiting anxiously for the deadline to arrive.

The outcome

The equipment stayed in the kitchen, and the festival contract went ahead as planned, generating roughly eighteen thousand dollars in revenue that became the core of the money used to catch up on the debt. The community festival order was fulfilled in full, and it led to two smaller repeat bookings from organizers who had seen the work firsthand, adding steady revenue over the following months that Femke had not been counting on when the crisis first hit. Without the standstill, the equipment would very likely have been gone before the festival weekend even arrived, taking that entire chain of later bookings with it.

The small business loan came through about six weeks into the ten-week standstill period, later than Femke had hoped but still inside the window the agreement had bought her. She used it to pay off the remaining arrears to Pratheep in a single payment, ahead of the standstill's outside date, and resumed regular monthly payments on the original equipment financing under a schedule adjusted to better match the business's seasonal cash flow, with lower payments through the slow winter months and higher ones through the busy summer festival season.

Within four months of the near-repossession, the account with Pratheep was fully current, and within a year it was paid off entirely. Femke still works her grocery clerk shifts alongside running the business, and Mathan still helps on weekends, but the catering side has grown steadily since, no longer a side project stretched thin by a single missed payment, but a business that survived its first real financial scare with its equipment, its biggest contract, and its supplier relationship all intact. Pratheep, notably, agreed to extend a modest new equipment line to the business the following year, a sign of how much the standstill had rebuilt the trust the first missed payment had cost.

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