REGINA — Farmers owed equipment or money from Saskatchewan-based Leon’s Manufacturing and Ram Industries Inc. will have to wait for the court process to unfold after the companies went into receivership June 11.
The Bank of Montreal forced the move after the companies defaulted on their obligations to the lender in 2021 and again in 2023, according to court documents.
The two Yorkton companies owe the bank $16.6 million. The documents said the receiver, Ernst and Young, had not yet been able to determine asset value.
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The documents show the company failed to meet payroll and obligations to creditors generally. They list 15 judgments against Leon since Aug. 1, 2023 totaling nearly $568,000 in enforcement charges.
The companies tried to obtain refinancing but weren’t successful.
Earlier this year, Leon’s CEO John Malinowski told the Western Producer the company didn’t have a cash flow problem. That contradicted accounts from several customers who said they were required to pay up front for equipment they either didn’t receive or received after years of phone calls, emails and in some cases personal visits. Some did get refunds.
Noman Haq, the accountant at Threesixty Route Logistics in Winnipeg, said dealing with Leon’s “was the worst experience of my life.”
The company moved goods for Leon’s but wasn’t paid and is now out about $50,000. Haq said hundreds of emails went back and forth but promises made about forthcoming cheques were never kept.
Edmonton lawyer James Raworth, who represented several clients against Leon’s, said he wasn’t surprised about the receivership order. He was working with three clients when the order was issued.
He said they now have to go through the laborious and time-consuming receivership process for what might result in repayment of pennies on the dollar.
Raworth spoke to the Western Producer in April and said after that, he heard from people who told him the situation was worse than he knew.
He questioned why RCMP didn’t take the issue seriously when clients contacted them.
When asked in May whether the Yorkton RCMP were looking into Leon’s, an email reply said the force does not confirm or deny who might be under investigation, to protect privacy.
“Existence of investigations of any sort will usually be acknowledged if or when charges are laid,” the email said, adding the matters could be civil.
Raworth said he heard from former employees as well as customers.
“I’ve been trying and trying and trying to get the RCMP involved and now because (the companies) are in receivership, where’s the justice going to be for some of these people who have been ripped off?”
Raworth noted that allegations are not proof but he planned to dig further into the situation.
“My understanding is that this company up until weeks ago was still selling products,” he said.
Haq and his company plan a protest at Ag in Motion next month to make farmers aware of the situation and ask them to boycott Leon’s.
Leon’s was established by Leon Malinowski in Bankend, Sask. in 1952. It makes and distributes dozer blades, scrapers and other products. Its associated company, Ram, makes hydraulic cylinders.
The companies had strong reputations for their products until the last several years when complaints began.
