I did my training in the early 80's, so I am well out of the loop when it comes to primary flight training but this application fee is nothing but a shameless ripoff.
You are better off paying a hotel room/renting a car for maybe a week while you set yourself up in a proper place of your own. I would certainly shop around and maybe pit one school against another on this fee business if indeed some paperwork on their part is required to get you a visa.
Kids are not exactly beating a path to flying schools these days, so how do they think they can get away with this bull****?
Shop around, and not only in the Montreal area, there are bound to be other schools happy to have your business. Can you imagine how this place will scalp you on the rest of your training if this is what they want just for you to enroll? With the amount of training you will be doing, you are in a bargaining position on something like this.
Remeinds me of the £100 fee Ryanair charges to "process" your application..along with all the other userous schemes now rampant in aviation. Beware these sheisters! Especially when they know you come bearing £'s (strong foreign currency, so they think you will take abuse and still think it a bargain).
Good luck to you.