Prior to being forced into receivership, the Aldergrove-based bus and truck maker Vicinity was being sued by Prince Albert, Sask. for more than $6 million over quality issues concerning seven buses that had to be pulled from the prairie city's public transit service after cracks in their frames were discovered.
Similar in design to mid-size buses Vicinity built and sold to B.C. Transit, the Prince Albert purchases were in danger of collapsing because of the cracks, the municipality alleged.
Prince Albert, the third-largest city in Saskatchewan, with a population of 38,000, operated a public transit system with seven routes at the time the lawsuit was launched in 2022.
A claim was filed after the buses, acquired in 2019, were declared unsafe by Saskatchewan Government Insurance (SGI), forcing the municipality to scramble to find replacements and maintain service.
Prince Albert was seeking a refund on the bus purchase, plus the cost of acquiring replacements, as well as compensation for the disruption to residents who rely on bus transportation.
Vicinity reportedly blamed the cracks on poor maintenance and a buildup of snow and ice.
In October of 2024, Royal Bank of Canada obtained a court order forcing Vicinity into receivership, where a secured creditor or the court appoints a receiver to take control of a business's assets and sell them to repay a loan.
A legal firm representing Prince Albert is included among the parties served notice by the receiver, published online Jan. 6.
Under Canadian law, if a company in receivership is being sued, the party that filed the suit will need permission from the court.
Langley Advance Times has reached out to Vicinity, the law firm and the municipality.
According to court documents, Vicinity owes $69 million, half of it to the Royal Bank of Canada (RBC) and Export Development Canada (EDC), and the rest to a long list of foreign and domestic businesses that does not include Prince Albert.
A tally of creditors published by receiver FTI Consulting Canada Inc. shows the company owes $22.4 million to the bank and $11.9 million to EDC, the federal agency that provides assistance to Canadian companies trying to expand into international markets.
Both are the only secured creditors listed, meaning they have the right to be paid before any of the others on the list.
Established in 2008, the company, initially called Grande West, was formed to meet a request for smaller and mid-size buses from BC Transit by building a low floor, heavy-duty, mid-sized model.
Vicinity was based in a 32,000-sq.-ft. facility, on 2.5 acres in Aldergrove, that included the corporate headquarters and an assembly plant.
The company website remains offline, its Facebook page has not been updated since September of 2024, and some of the buildings at the Aldergrove site were being offered for lease as of January.
Vicinity was delisted by the U.S.-based NASDAQ stock exchange, because its shares fell below the minimum bid price requirement of $1, and the receivership.
Cease trade orders were issued against Vicinity, including one from the British Columbia Securities Commission.
William Trainer, Vicinity founder and CEO, along with Joseph Miller, Andrew Imanse, Chris Strong, James White, and John LaGourgue have all resigned from the company board. Chief financial officer Tina Stewart also resigned.
