Fighting for subbies rights
Update 26.05.17
To all Bloomer Constructions Unsecured Creditors.
As you would be aware, the Administrator's Report to Creditor was released on the 24th May (below).
It's almost as big as a novel but from a subbies perspective, the most important part is on page 60 (below).
Support the DoCA
The Administrators Jirsch Sutherland have ascertained that a Deed of Company Arrangement (DoCA) could potentially see unsecured subbies and suppliers get a return of 16.5c in the Dollar.
We would all like it to be more but it's better than the alternative that Bloomer in Liquidation would deliver.
The report states that the Liquidation option could give unsecured creditors, who are for the most part subcontractors, the industry norm of zero, up to a miserable 2.4c in the dollar return.
Preferential Payments
Liquidation would also expose subbies and suppliers to potential preferential payment claims dating back 6 months before the date of the appointment of Jirsch Sutherland (Administrator's).
If Bloomer Constructions is forced into Liquidation, we all know the only winners are the secured creditors, the liquidators and most of all, the Law Firm who gets the job of attempting to claw back hundreds, possibly thousands of preferential payments. I can be no other reason to support Liquidation but if there is one, please tell me.
Either way, the secured creditors and staff will get 100c in the dollar.
- Therefore, the only losers with Liquidation are the subbies and suppliers
- Which means the only winners are the Lawyers.
For Subbies who believe the DoCA is the better option, we need to show our support to adjourn the forthcoming windup hearing.
All unsecured creditors who want a better return should fill in the affidavit in support of the DoCA but first, take the time to read the full report. If you agree, then throw your weight behind the DoCA for a better outcome.
To download a printable version of the affidavit, click here.
Email completed affidavit back to one of the following email addresses as soon as possible:
Rob Berry - rberry@atlasgantt.com
DesB@jirschsutherland.com.au
Affidavit has to be witnessed by a Justice of the Peace.
Page 60
It's time to put the "emotionally good time" aside and make an informed business decision to support the DoCA.
Read the whole Notice of Second Creditors Report here in this link.
Update 24.05.17
Jirsch Sutherland have completed their initial investigation and it is their recommendation that the company execute the proposed Deed of Company Arrangement (DoCA).
The belief is that a DoCA will give creditors a better financial return than Liquidation.
The creditors report is a lengthy document. The link below has the full report.
Read the whole Notice of Second Creditors Report here in this link.
Bloomers Constructions- First meeting of creditors - Updated 09/05/17
Attendance: 75 creditors
The sombre and orderly meeting that went for just over 1 hour.
The main area of interest was the competing benefits of Liquidation or a possible deed of company arrangement (DOCA).
The Administrators were asked several times what the possible outcomes may be.
Their response;
- it's far too early to give any indication of which outcome maybe better.
- There is substantial investigations that need to be undertaking over the coming weeks.
- They will be reporting to creditors on the benefits of any scenarios
- The report is expected in the coming weeks.
DoCA
A draft DoCA proposal by Onterran was read out by the administrators.
The merits of the proposal are still being assessed by the administrators. Onterran has stated their balance sheet is not strong enough to meeting the full claim of creditors under the cross guarantee and if that was pursued, Onterran would appoint administrators themselves and a likely have the appointment of Receiver & Managers on behalf of the Banks.
If this were the case, it's Onterran's position that Bloomer's creditors would not receive any recoveries.
Many creditors (subbies & suppliers) questioned the likelihood of claw-backs or preferential payments.
SubbiesUnited comment on possible preferential payments:
This is something lawyers will fight over like dogs fighting over a bone because of the potential to earn millions of dollars in fees, all at creditors expense. We know what you are doing, we are watching you.
The administrator would not discuss details regarding any particular claim, however they broadly stated that it would be a factor in their recommendations and reporting.
Where to from here
The administrators have investigations to complete and then report to creditors.
There is another court date shortly for the wind up application from Hume Doors and others.
Bloomers project staff continue to attend to defects and contractor obligations to get back retention's (for creditors).
Confirmation of the time and date for the second creditors meeting is expected around the end of the month.
There were questions raised about SubbiesUnited in regard to our attendance at the meeting and voting in a block.
For the record, SubbiesUnited were not in attendance and did not organise block proxy votes. SubbiesUnited will address all unfounded assertions in an affidavit to the court to put an end once and for all to these self serving innuendos.
End Report
Again, I urge subcontractors to become active in supporting Subcontractors Alliance in their endeavour to drive security of payment legislation by donating what you can to the GoFundMe Campaign. SOPL is designed to benefit subcontractors.