Fighting for Subbies rights.
Bloomer Constructions are making progress with their plan to novate contracts and finalise projects negotiations in an attempt to get Subcontractors and Suppliers paid.
To recap on what we know to date:
- Bloomer Constructions has ceased trading
- As such they are not incurring any further expenses, debts or liabilities
- They have confirmed that Subcontractors & Suppliers are not incurring further losses on any projects.
Their actions at the moment are focused on:
- Mitigation (minimising) of subcontractor losses by novating projects (the act of replacing one party in a contract with another) to other builders or,
- Having the Developer (client) directly engage subcontractors to complete works where possible, through Project Bank Account's.
So far, they have successfully reduced subcontractors exposure or liabilities by millions of dollars through theses negotiations.
Discussion with Bloomer & Pointcorp Today.
Wayne Bloomer said today that many of their project discussions and handovers are going according to plan, one of them being the 21 million dollar Lambert Street Kangaroo Point development. While there has been some disruption, the job has hardly missed a beat.
This morning I talked to Pointcorp's Development Director Godfrey Esmonde who said he is working closely with Wayne Bloomer.
He said Bloomer has been open with him from the start and the job site continues to operate under the supervision of Pointcorp and Bloomers. To facilitate continuity, Pointcorp have met with all subcontractors and Bloomers staff and come to agreements that allow the site to progress and give continuity of work to Bloomers employees and subcontractors. He said the site has remained open and is working from 50 to 70% of capacity.
Discussion between Bloomers and Pointcorp are being held to resolve how best to keep the site operational and subcontractors and staff engaged and remunerated for monies owing.
From my point of view, the worst disruption is to Creditors cashflow because of the unpaid claims.
One hurdle to the process is that Bloomer cannot sign a stat dec stating that he has paid his creditors to have a claim released. It's catch 22 but they are looking to find the answer because Creditors need to be paid. The Developer wants to release the funds but can't without the stat dec.
It's a criminal offence to sign a false stat dec.
Payment of outstanding claims
Today a subcontractor told me he received a payment. He was also informed that another claim will be paid soon so it appears that as projects are novated, subcontractors claims are being paid to some degree. I was not told what percentage of his claim was paid.
A liquidation would have meant zero return so you could say that’s a win.
Bloomer staff contacted our office yesterday in regard to revising a January claim and I know others have been contacted so the wheels are slowly starting to turn.
The bottom line is that money and work is starting to flow to subcontractors and suppliers but we need to keep in mind that this is a very complex situation.
The QBCC's Role
The QBCC cannot comment on cases before them.The QBCC are mindful of the financial and human consequences that a builder collapse has on Subcontractors, Suppliers, their staff, families and the community.
My role
My role is not to advise Creditors on how best they should deal with or protect their financial position. Thats up to each of you and you should seek your own experienced legal advice.
In this case, I act as a conduit between Bloomer Constructions and their creditors to keep you informed.
At all times I am working in the best interests of subcontractors and suppliers.