Waterway Houseboats Ltd. and associated company Vinco Holdings Ltd. have released a statement stating that they expect to be in receivership beginning on June 11.
The statement from Waterway notes that the effects of flooding in 2012 were devastating, but their team kept the company operating. They sought damages against the province, the District of Sicamous and the owners of a private property who the BC Supreme Court found played a role in the flood’s damage to their property.
The key issue at play in the case was whether a blockage caused by a truck being washed into Sicamous Creek and becoming lodged under a private bridge could have been prevented when the bridge was replaced and the creek was dredged after the 1997 flooding. The court ruled that remediation work performed after flooding in 1997 contributed to the serious damage to Waterway’s property sustained in 2012 and the loss of income that resulted.
Following the April 16, 2019 court decision, Waterway Houseboats’ chief operating officer Neil Millar stated they were happy with the court’s verdict but not with the approximately $2 million in damages that was awarded when they had initially sued for approximately $10 million.
“We had been anticipating a substantial monetary award that would make us whole. Our able counsel was also optimistic that this would be the case. Sadly the actual award of damages is several million dollars less than we had expected,” the statement, which is posted to the home page of Waterway Houseboats’ website, reads.
“In our view, there are clear errors in judgment regarding the amount of the award. While we feel that we have a very good case to rectify this upon appeal, that process could take approximately two years and it could cost hundreds of thousands of dollars.”
According to Waterway, their bank CIBC has been supportive of their rebuilding efforts after the flood and courtroom battle so far, but now appears to have given up in light of the relatively small amount of damages awarded by the court.
According to the statement from the company, an application for the appointment of a receiver is being made against Waterway by CIBC. It will be heard in a Vancouver courtroom on June 11. Waterway expects the bank’s application to be granted, putting the company in receivership and its assets out of the control of company management.
Waterway goes on to state they are disappointed in CIBC’s decision to move forward with the receivership application. They say they have been working collaboratively with the bank on a financial restructuring plan which they believe would have been successful given the necessary time and support.
If the receivership application is accepted by the court it will be up to the receiver whether the business will continue to operate or shut down. The statement from Waterway says that given recent discussions they think the latter will be the case.
“Up until a few days ago, we were very optimistic that in the event that CIBC decided to appoint a receiver, the receiver would operate the business at least through to the end of the 2019 sailing season to preserve Waterway’s value,” the statement reads.
Waterway states they are exploring options to take over the appeal of the court’s decision on damages if the bank will not fund it and think a substantial cost recovery is possible.
A representative of CIBC said they could not comment on client matters.
“We know that this unfortunate series of events will be devastating for our employees, our customers and our suppliers. It is devastating for us as well, as we have lost a life’s work. We are hopeful that the assets of Waterway will realize a substantial value so that at least some of the losses can be recouped.”
The houseboat company celebrated 50 years in business in 2018.