Angry creditors are calling for an independent investigation into the collapse of a Brisbane-based builder and for its administrator to be ousted as the company’s debt soars.
Phil Bartsch, The Courier-Mail Subscriber only|June 1, 2020 10:30am
A FIERY creditors battle has erupted with calls for an independent review into the collapse of a Brisbane-based builder and a bid to oust its administrator as outstanding debts balloon.
Bulkbuild Pty Ltd, a company with a strong track record on major projects, went into voluntary administration almost two weeks ago owing creditors $1.6 million.
Since then, its estimated debts have skyrocketed — more than doubling to $3.4 million.
It also has been revealed the developer of a West End apartment project — where work was still underway when the company collapsed — is claiming it is owed more than $1 million.
Tensions flared late last week at the first creditors meeting, which was adjourned for a week after a move to replace company-appointed administrator Leon Lee of Moreton + Lee Insolvency.
It is understood there are at least 70 creditors, many of them subcontractors.
Subbies United advocacy group spokesman John Goddard said the meeting had “degenerated into a fiasco … and uproar when the administrator abruptly postponed the meeting”.
He said an overwhelming majority of creditors indicated they wanted the administrator replaced — “almost 2 to 1 against him”.
But Mr Lee disputed the creditors’ vote count, which was based on both numbers and the value of debt owed.
Mr Goddard said the week-long postponement would “come at a cost to creditors and the money trail will be seven days colder”.
Mr Lee said he would have been willing to step aside as administrator at the meeting if there was a clear majority but otherwise he would “not be bullied”.
“It was pretty close with slightly more saying they wanted to replace me but they didn’t have the majority in terms of (debt) value,” he said.
Subbies United claims Mr Lee’s count was “at odds” with its calculations.
Mr Lee said the count did not include the largest debt claim, by Fortitude Valley-based developer Ferro Property Group.
He said the developer, which is behind the $27 million luxury seven-storey London Residences project at West End, had lodged its claim “with no paperwork attached” at 4.30pm the day before the meeting and its validity needed to be assessed.
“That claim is for just over $1 million so it is very material,” Mr Lee said.
“I could have put the resolution up at the meeting and it would have failed and I would have stayed (as administrator) … but I decided the prudent thing to do was adjourn for a week.
“So if the developer’s claim is deemed valid in the meantime, then the creditors that want me replaced will have the majority in both numbers and value and I will be rolled.
“But whoever the administrator is, they have to act for all creditors — including the subbies, the developer, trade suppliers, the ATO (Australian Taxation Office) and employees.”
Mr Goddard said Subbies United was also pushing for an independent investigation into the collapse of Bulkbuild as the company’s lawyers approached Mr Lee in February about its “impending administration/liquidation” but did not appoint him until May 18.
“In that three months, dozens of creditors continued to pour their resources into Bulkbuild’s projects …(and) fall into the trap which has the potential to destroy some of them,” he said.