October 9, 2025
VANCOUVER, British Columbia — Investors and former business partners connected to companies led by British Columbia entrepreneur Dwayne Wallace Stewart are calling for immediate, on-the-record answers about unpaid obligations, intercompany transfers, and a pattern of litigation that spans more than two decades. A review of court filings, arbitration references, and corporate agreements reveals a web of related entities involved in disputes over hemp contracts, shareholder debt, and the use of family assets, including the Kinloch farm properties in Abbotsford. Stewart has not been found liable in the pending civil action, and he is entitled to contest every allegation. He and his counsel have previously argued that many challenged payments were legitimate business expenses approved by executives, and that proposed lawsuits would not be in the best interests of the companies.
Part 1: Unpaid awards and the EnCann precedent
For years, BC Hop Company Ltd. and affiliated brands were promoted as Fraser Valley success stories, evolving from hops to hemp biomass and then to consumer CBD products through Kinloch Wellness and Flow Scientific. Yet behind award-season highlights, documents reviewed for this release show counterparties publicly alleging nonpayment and enforcement headaches after they prevailed in arbitration or secured written repayment terms. Multiple parties now say those episodes are the Rosetta Stone for understanding why investors still ask a fundamental question, “Where is the money we’re owed?”
A case study with names, dates and dollar figures
A high-profile example is the EnCann Solutions arbitration and subsequent enforcement push. According to materials compiled in 2025, EnCann told the Supreme Court of British Columbia that an arbitrator had ordered BC Hop Company to pay damages and return a deposit arising from a December 2018 biomass contract for 10 metric tonnes. EnCann alleged the award remained unpaid, prompting an enforcement petition. Public summaries of that dispute cite damages of $760,763.40 plus the return of a $100,000 deposit, with interest and costs to follow. EnCann’s CEO, Lincoln Johnson, was quoted as saying the company fought a two-year battle to collect and that BC Hop was “avoiding accountability,” an unusually blunt statement in a small Canadian industry where players typically avoid public fights.
Arbitrations are about contracts and performance, not morality. The reason creditors keep citing EnCann is simple: it is a rare window into operational choices when supply tightened and prices moved. The award suggests that the product owed to EnCann was transferred elsewhere, converting a deposit into an unsecured claim and necessitating legal enforcement. Investors now treating EnCann as a milestone ask a practical question: if a company would not pay when ordered to do so, what comfort should unsecured investors take when a project misses targets and cash runs short?
A public record of disputes that predates hemp
A litigation chronology compiled for due diligence indicates that Stewart-linked disputes predate the hemp era, including contractor suits, small-claims matters and mortgage foreclosures. Those files intersect with the shift from construction to agriculture and later to hemp, and they colour how today’s investors interpret promises of future payment. The historical throughline, investors say, is the aggressive use of time: adjournments, workouts, partial payments, and re-papered deals that buy breathing room. Stewart’s defenders counter that any founder under pressure must fight for time and keep the doors open, insisting that many payments attacked by critics were lawful business expenses approved by the company’s CFO, president and COO.
Contemporaneous communications from 2016–2019 underscore the high-wire act around the Kinloch acreage. In a 2019 family email, Stewart described racing a foreclosure clock, crediting individual investors with assembling bridge capital to keep the farm from being sold and acknowledging a long trail of personal and corporate debt “serviced off and on.” The note portrays a founder operating under extreme pressure while seeking new investment to preserve both a family legacy and BC Hop’s operations.
The corporate web that followed
By 2020–2023, the corporate web had grown. Documents show an intercompany guarantee signed by Stewart on July 17, 2020, personally guaranteeing Valley Hops’ obligations to BC Hop Company and acknowledging that, as of March 31, 2020, the borrower’s obligations totalled $1,663,666. The signature was executed via DocuSign, confirming the formality of the commitment.
In June 2022, an Omnibus Agreement among BC Hop, the Stewart family trust, and minority shareholder 1101866 B.C. Ltd. documented “Historical Debt” totalling $2.48 million in promissory notes, additional “Ancillary Debt” of roughly $742,000 after credits, and a plan to reorganize shareholdings while seeking up to $4 million in Farm Credit Canada financing. It set a $1.2 million repayment requirement by December 31, 2022, to satisfy the historical debt, acknowledging that if the deadline were missed, the old obligations would revive with full force.
By September 1, 2023, a share purchase and debt repayment letter contemplated a complex swap: BC Hop would transfer 2,000,000 Kinloch shares toward settlement of BC Hop’s debt; Kinloch would pay $2,078,000 to acquire shares from the minority holder and settle Kinloch debt; a $72,000 advance would be forfeitable if the deal failed; and 6,700 kg of hemp inventory would be released or sold under a separate contract. All steps were required to close concurrently. This design, standard in restructurings, also underscores how value can be moved among related entities while third-party obligations wait for cash that never materializes.
What defenders say, in writing
Defense counsel’s June 25, 2025 letter lays out management’s position: transfers between BC Hop and Valley Hops were “legitimate payments” for services or supplies and were approved by senior executives; vehicle leases and phones for family members were part of compensation; landlord payments flowed to a company connected to Gordon Stewart because BC Hop was delinquent on rent; loans to Kinloch were working capital, not personal distributions; and any payments to Flow Scientific or Kinloch were duly approved and used for appropriate BC Hop purposes. Counsel also argued that proposed derivative litigation would be prohibitively expensive, likely time-barred, and would primarily benefit a secured creditor rather than minority claimants.
The same letter directly addresses a widely discussed point: the $1,663,666 transfer on July 17, 2020. Counsel denies that the sum was taken for personal use, stating any funds moved to Valley Hops were on account of legitimate obligations and overseen by the CFO, president and COO. That statement goes to the heart of investors’ concerns because it frames large intercompany movements as ordinary-course settlements rather than cash extractions.
Why EnCann still matters in 2025
The EnCann episode continues to be treated as a stress test of governance. Investors who backed later ventures in terpenes or consumer CBD say the arbitral award and its enforcement struggle suggested a management culture that prioritized immediate operating needs over counterparties holding paper. When cash is scarce, someone gets paid and someone receives a promise; who lands in each column is a governance choice. That is why creditors keep asking for audited intercompany agreements, PPSA lien snapshots, and formal board approvals of related-party transactions. Without those, money can be raised in one entity and value realized in another, leaving the original funders with a hollow claim.
The optics of parallel narratives
While enforcement actions and debt workouts played out in one part of the portfolio, Kinloch Wellness and related brands highlighted awards and favourable press in another. That parallel narrative can be true, and still invite scrutiny. A company can win trophies in Barcelona while an affiliated supplier battle drags on in Vancouver. The AP-style question is whether the cash flowed in ways that align with the marketing strategy and whether outstanding awards were promptly satisfied before insiders or related entities were paid. The need for independent oversight becomes more critical when the same directors appear across entities that buy and sell to one another.
What investors say they need to see
Sophisticated investors are not asking for miracles, only verifiable paper. Three demands recur. First, publish all intercompany agreements that govern pricing among BC Hop, Valley Hops, Flow Scientific and Kinloch, so insiders cannot hide margin in a sister company while telling noteholders there is no cash. Second, provide a current PPSA search for liens on inventory, trademarks and equipment, so unsecured creditors understand their place in the queue. Third, disclose the minutes and resolutions approving related-party transactions, so payments to family-connected entities can be assessed on the record.
What the paper trail already shows
The paper trail already shows that, as of March 31, 2020, Valley Hops owed BC Hop $1,663,666, formalized via an intercompany guarantee signed by Stewart. That is not evidence of wrongdoing; it is proof of a system in which large balances move inside a closely held group and are later reconciled through share flips, inventory releases or cross-company loans. When such systems work, creditors are kept whole. When they do not, counterparties find themselves chasing obligations through a hall of mirrors.
The 2022 Omnibus Agreement shows how the group attempted to rationalize debt while pursuing external financing. It memorializes $1.2 million to be paid by year-end 2022 to settle historical debt and ties the reorganizations to expected Farm Credit Canada financing. If that repayment did not occur, the agreement explicitly states that the old obligations remain outstanding. That binary clause should have produced a transparent ledger: either paid in full by December 31, 2022, with proof, or not paid, leaving the legacy debt still active.
The September 2023 share-and-debt letter connected the dots between BC Hop, Kinloch, and the minority shareholder, detailing the return or sale of roughly 6,700 kg of hemp stock and a forfeitable $72,000 advance, all while requiring concurrent closings. For investors trying to follow the money, those provisions are not abstract. They determine who, if anyone, gets cash first when a step fails or is delayed.
The family dimension and landlord payments
One reason this story attracts attention is the involvement of family members and family-connected entities. According to the June 2025 letter, payments to Gordon Stewart or to a numbered landlord company were rent for property used by BC Hop, for which the company “remains delinquent,” while payments to a Stewart family member for social media were compensation for services. Counsel’s framing is straightforward: these were legitimate obligations and approved expenses, not siphoning. Critics point out that when awards and judgments sit unpaid, any payments to insiders, even for legitimate reasons, will be scrutinized against a fairness standard.
Why is this part of the series being published now
Part One publishes because questions about unpaid awards and shifting assets are not academic. They determine whether small vendors survive, whether minority investors ever see principal, and whether public claims of growth are reconciled with private ledgers of debt. The record assembled here, including an arbitrator’s decision, intercompany guarantees, an omnibus debt deal and a share-for-debt letter, gives the public enough specificity to ask pointed questions and to demand documentary answers.
What we ask, on the record, today
• Have all the arbitral awards and court-ordered payments involving BC Hop Company or other Stewart-controlled entities since 2018 been paid in full? Provide matter names, amounts, dates, and wire confirmations. For avoidance of doubt, include the EnCann award.
• Did any entity sell or transfer inventory pledged to investor-funded obligations while leaving the original obligation unpaid? If so, identify the transactions and board approvals, and reconcile any intercompany offsets against outside payables.
• Will the companies agree to escrow a fixed percentage of receipts from bulk and wholesale sales until all outstanding awards and principal investor amounts are satisfied, with independent quarterly audits published to creditors?
Right of reply and next steps
Stewart and his companies are invited to answer in writing within seven calendar days so their statements can be published in full. Any response received will run verbatim alongside this release. The second installment will examine how family land, foreclosures and financing choices shaped cash-flow decisions in later ventures, and why those choices matter to today’s creditors.
