What you probably should do right away is to contact the property (not booking.com), notify them about your cancellation and wait for their response.
Properties accepting this kind of reservation know the risk, and gamble on it. A part of the gamble may be that the property is popular, or located in popular place, so they might have no problem rerenting your room given enough advance notice. Even if they don't, the question about cancellation fee might not pop up. And if it pops up, you'll have an idea how the hotel would expect you to pay that fee, and how would they plan to enforce it.
Now, there is no guaranteed way for the hotel to get this fee. But there are several ways the hotel can try it:
They can send you a bill to your billing address (it is up to you to pay it);
They might be able to sell this debt to a collection agency (this is questionable);
They may sue you (in Canada - I assume it is Canadian hotel since your booking is in CAD), and get a judgment against you. Then they would collect as any other judgment. They might also be able to sue you in another country - like in US - if the conditions (those you didn't read) force you to agree to a specific jurisdiction. If you visit the city but just intend to stay in a different hotel, this is not even difficult.
The amount in question makes the court action unlikely, though, as suing someone is expensive, and one still might not get any money back even by winning the case.
However even if they do not get their money back, there still might be consequences. For example, the hotel may refuse any further reservations from you in future. If they exchange information about non-payers - this is typical, for example, with HK "hotels" operating under the same terms - none of them would make a booking for you. Or they might accept a reservation, and try to charge you this fee upon arrival. So it is still better to resolve it.