R and B Australia Pty Ltd (In Liquidation) Formerly trading as How High Services ACN (the Company)

Transcription

1 R and B Australia Pty Ltd (In Liquidation) Formerly trading as How High Services ACN (the Company) Statutory Report by Liquidator 10 July 2018 Ferrier Hodgson is an affiliation of independent partnerships/entities Liability limited by a scheme approved under the Professional Standards Legislation Level 6, 81 Flinders Street ADELAIDE SA 5000 GPO Box 2558 ADELAIDE SA 5001 P. (08) F. (08) E. adelaide@fh.com.au ferrierhodgson.com

2 Contents Section Page 1 Introduction 3 2 Current position 3 3 Investigation into the Company s affairs 4 4 Return to creditors 8 5 Liquidator s remuneration 8 6 Conclusion 8 Glossary 9 Annexures 10 A Proof of debt 11 2

3 1 Introduction I advise that I was appointed Liquidator of the Company on 18 April 2018 pursuant to an Order of the Federal Court of Australia (the Court). I now take this opportunity to report to creditors on the following matters: The progress of the liquidation; The current position in relation to the identification and realisation (if applicable) of any assets; The progress of my investigations into the Company's affairs; and The likelihood of a dividend being paid in the liquidation. This report should be read in conjunction with the information contained in my Initial Notice to Creditors dated 15 May At the date of this report there are no funds available to permit the payment of a dividend to any class of creditor. My investigations into the Company s affairs are continuing and any return to creditors is dependent on the outcome of those investigations. 2 Current position Matters addressed during the liquidation Since my appointment, the following matters have been attended to: Statutory notifications following my appointment; Made numerous attempts to contact the Company s sole Director, Mr Troy Robbins, via mail, telephone and requesting that he prepare a Report as to Affairs (RATA) for the Company and to provide me with the books and records of the Company. As at the date of this report I have been unable to contact Mr Robbins, nor has he responded to any of my correspondence; Sought the assistance of the Australian Securities and Investments Commission (ASIC) in relation to the Director s non-compliance with respect to providing a RATA and the books and records of the Company; Correspondence with banks advising of my appointment and seeking to identify and freeze any bank accounts in the name of the Company; Review of the Company s bank statements as provided to me by Bank of Queensland Limited (BOQ); Correspondence with a former Director of the Company; Communications with the petitioning creditor of the Company, Revroof Pty Ltd trading as Revolution Roofing (Revroof) following my appointment; Communications with the Company s external accountant, Doran Accountants; Correspondence with the Building Commission of Western Australia, advising of my appointment and requesting that any building registration or licence held by the Company be surrendered; Investigations to identify any assets of the Company, including but not limited to making enquiries with statutory bodies such as the Western Australian Department of Transport; Review of the Personal Property and Securities Register (PPSR), including correspondence with Toyota Finance Australia Ltd (Toyota Finance) in relation to a vehicle registered in the Company s name; Liaised with Grays Online in relation to an estimated value for the financed vehicle; Liaised with the Company s former Director in relation to the location of the financed vehicle; Provided a Notice of Disclaimer to Toyota Finance in relation to the financed vehicle and lodged same with ASIC; Attendance to statutory requirements; and Preliminary investigation into the affairs of the Company and lodgement of this report to creditors with ASIC. Liquidator s realisations to date Summary of receipts and payments There have been no receipts or payments in the liquidation to date. 3

4 Asset realisations The Director has failed to submit a RATA and the books and records for the Company. It is unknown to me whether the Director has received notification of the Company s winding up (and hence may explain the reason for noncompliance) for the following reasons: Correspondence issued by my office and sent via registered post to the Director as per ASIC records was Returned to Sender ; Attempts to contact the Director by telephone were unsuccessful as the telephone numbers provided to my staff by Revroof and Telstra were disconnected; and No response was received following the issuance of my correspondence to the Director via , even though the to the Director did not bounce back and is therefore assumed to have been delivered. I requested the assistance of ASIC to obtain the required documents and information from the Director. As at the date of this report, ASIC has also been unable to locate the Director and has been unable to obtain compliance by the Director. I make the following comments in relation to my investigations in relation to the Company s assets: Cash at bank The Company previously operated two bank accounts with BOQ, however the accounts were closed on 10 November 2017 and 6 March 2018, being prior to the date of my appointment Debtors I am not aware of any debtors owing to the Company given the absence of books and records Other asset enquiries A search of the database maintained by the Western Australian Department of Transport revealed that a Toyota Hilux was registered in the name of the Company. Shortly following my appointment, I was contacted by a former Director of the Company who advised that he was in possession of the Company s vehicle and that the vehicle was currently located in Helensvale, Queensland. A search of the PPSR confirmed that the vehicle was subject to finance with Toyota Finance and that the payout figure was $33, as at the date of my appointment. I made enquiries with Grays Online as to the estimated value of the vehicle. Grays Online advised that the estimated realisable value of the vehicle on a sight unseen basis, but taking into account information for the vehicle provided by the former Director, was lower than the payout figure to Toyota Finance. Accordingly, the Company s interest in the vehicle was disclaimed. 3 Investigation into the Company s affairs My report pursuant to Section 533 of the Act on the outcome of my investigation into the affairs of the Company has not yet been filed with ASIC. Such a report is generally filed within six months of the liquidator being appointed. Statutory information The Company was incorporated on 3 July ASIC records reveal the following statutory information in relation to the Company at the date of my appointment: Location Address Registered office c/- Narod Business Services Pty Ltd, 38 Mary Street NOOSAVILLE QLD 4566* Principal place of business 5 Bournemouth Parade, TRIGG WA 6029 *Enquiries made by my staff have confirmed that Narod Business Services Pty Ltd is related to the Company s external accountant, Doran Accountants, which attended to the Company s ASIC matters. 4

5 Office held Name Date appointed Date ceased Director Troy Robbins 3 July Secretary Troy Robbins 31 March Shareholder Class of shares No. of shares held Fully paid Troy Robbins Ordinary 12 Yes History of the Company and reasons for its failure History of the Company Whilst I have not had any contact with the Director, based on my discussions with the Company s former Director, the Company s external accountant and the petitioning creditor, I understand that the Company operated a roofing installation business based in Western Australia. I understand that the Company ceased trading prior to my appointment in or around November In any event, I notified the Building Commission of Western Australia of my appointment and requested that any building registration or licence held by the Company be immediately suspended. Based on my discussions with the Company s former Director and the Company s external accountant, I understand that the Director may have left Western Australia and returned to live in New Zealand, however I have been unable to confirm this. The Company was wound up on the application of Revroof, filed on 16 March Revroof has submitted a Proof of Debt in the amount of $9,137.23, which relates to the supply of various roofing products. Books and records Section 286 of the Act requires a company to keep written financial records that correctly record and explain the company s transactions, financial position and performance and would enable true and fair financial statements to be prepared. The financial records must be retained for a period of seven years after the transactions covered by the records are completed. The failure to maintain books and records in accordance with Section 286 provides a rebuttable presumption of insolvency which might be relied upon by a liquidator in an application for compensation for insolvent trading. The only statutory accounts prepared for the Company relate to the Company s first year of operation (ie for the period 3 July 2015 to 30 June 2016). Statutory accounts have not been prepared for the Company for the financial years ended 30 June 2017 and 30 June 2018, notwithstanding the Company appeared to have been trading until around November Based on the Proof of Debt submitted by the Australian Taxation Office (ATO), I note that the Company failed to lodge quarterly BAS for the quarters within the period 30 June 2017 to 30 June 2018 inclusive. The Company has also failed to lodge Income Tax Returns, PAYG Annual Reports and Taxable Payments Annual Reports for the financial years ended 30 June 2017 and 30 June As at the date of the appointment, the amount owing to the ATO is comprised of the following: Description $ Running Balance Account deficit debt in respect of BAS amounts as at 18 April ,669* Failure to Lodge penalty for failing to lodge a Taxable Payment Annual Report for the year ended 30 June ,050 Total 5,719 *Although this amount should change once all of the outstanding lodgements are brought up to date. 5

6 Putting aside that no books and records have been received from the Director, based on the Company s outstanding statutory lodgements, the Company s books and records have not been maintained in accordance with Section 286 of the Act. Preliminary analysis of financial statements received Set out below is a summary of the profit and loss for the Company as at 30 June 2016 (FY16): $000s FY16 Sales 286 Expenses (305) Profit / Loss (19) I make the following brief comments: As discussed at Section 3.3, the FY16 financial statements were the only statutory accounts prepared for the Company. Based on my discussions with the petitioning creditor, Revroof, the Company s Director expressed difficulty in making payment of the Company s outstanding invoices in or around August 2017, citing issues with receiving payments from customers and amounts owing to the ATO. Based on the FY16 financial statements and the limited information provided by Revroof, the Company may not have made a profit since its incorporation. The balance sheet as at 30 June 2016 is of little relevance given the passage of time and therefore is not considered for the purpose of this report. Deficiency statement Notwithstanding I have not received the Company s RATA, the following is my current estimated deficiency of assets to liabilities for the Company based on information available to me: $ Total Assets Nil Liabilities Petitioning creditor s costs (7,658) Employee creditors Secured creditors Nil Nil Unsecured creditors (53,434) Total Liabilities (61,092) Estimated deficiency (61,092) My comments are as follows: Assets Please refer to my comments at Section

7 Liabilities Petitioning creditor s costs The costs incurred by the petitioning creditor, Revroof, in respect of the winding up proceedings have been fixed by the Court in the amount of $7,658 and are payable in priority to other unsecured creditors of the Company in accordance with the provisions of Section 556 of the Act. As at the date of this report there are no funds available to make payment of the petitioning creditor s costs Employee creditors Based on information provided by the ATO, the Company employed four staff (including the Company s Director) during FY16. I note that the Company s FY16 financial statements record a superannuation liability of $6,722. Whilst the Proof of Debt submitted by the ATO does not include a Superannuation Guarantee Charge for the Company, it is unknown to me whether a debt still exists for unpaid superannuation and/or other outstanding employee entitlements Secured creditors There are no secured creditors of the Company based on PPSR searches other than Toyota Finance (discussed below) Unsecured creditors I estimate the Company s liability to unsecured creditors to be $53,434, which is principally comprised of the payout figure owing to Toyota Finance ($33,297.11) (ie before any proceeds from the sale of the vehicle and deducting realisation costs) and the debt due to the petitioning creditor, Revroof ($9,137.23). Voidable transactions As discussed at Section 3.3 of this report, I have not been provided with the books and records of the Company. Accordingly, it is not possible for me to advance my investigations into possible voidable transactions pursuant to Section 5.7B of the Act, beyond what I have undertaken to date based on available information. I will report to creditors in due course on the outcome of my investigations once complete. Insolvent trading Section 588G of the Act provides that directors are obliged to prevent a company from: Incurring a debt whilst insolvent; or Becoming insolvent by incurring a debt. If a contravention of Section 588G can be established, then Section 588M empowers a Liquidator (or a creditor under certain circumstances) to recover compensation from a director for any loss or damage suffered as a consequence of any such contravention. Having regard to the apparent failure to keep adequate books and records, the Company is prima facie presumed, pursuant to Section 588E(4) of the Act, to have been insolvent for the period for which books and records are not maintained. Technically, this would render the Company insolvent from around 30 June 2017 (if not earlier), being the earliest outstanding ATO lodgements and date for which annual financial statements were not prepared. Given the quantum of claims in the liquidation, the fact the liquidation is presently devoid of funds and the whereabouts of the Director is currently unknown, it appears unlikely that there would be any commercial merit in pursuing an insolvent trading claim against the Director. I note that Section 588R entitles creditors to commence proceedings under Section 588M against the Director of the Company in their own right, subject to the consent of the Liquidator. Should creditors have any further information that may assist my investigations into the conduct of the Company s affairs, they should communicate details in writing to my office as soon as possible. 7

8 4 Return to creditors At the date of this report there are no funds available to permit the payment of a dividend to any class of creditor. My investigations into the Company s affairs are continuing and any return to creditors is dependent on the outcome of those investigations and successful recoveries (if any) arising from same. 5 Liquidator s remuneration Creditors will recall from the Initial Notice to Creditors dated 15 May 2018 that I estimated that my total remuneration for the liquidation would be between $20,000 and $25,000 plus applicable GST. It should be noted that the Liquidator s fees are only paid if there are sufficient recoveries in the liquidation to enable payment. As there have not been any recoveries in this liquidation to date, I will not be requesting approval of my remuneration from creditors at this time. An information sheet concerning approval of remuneration in external administrations can be obtained from ASIC at 6 Conclusion At this stage, the timing of the finalisation of the liquidation is unclear, given my ongoing investigations into matters outlined in this report. I will advise creditors of any additional matters that come to my attention after the issuance of this report. In the meantime, I encourage any creditor of the Company to submit to me the Formal Proof of Debt form (Annexure A), along with any other information which may assist me with my investigations, at their earliest convenience. Should you have any questions, please contact Tara Martin of this office on (08) Dated this 10 th day of July 2018 TD Mableson Liquidator 8

9 Glossary Abbreviation Description ACN Australian Company Number Act The Corporations Act 2001 ASIC Australian Securities and Investments Commission ATO Australian Taxation Office BAS Business Activity Statement BOQ Bank of Queensland Ltd Company R and B Australia Pty Ltd (In Liquidation) Court Federal Court of Australia Director Troy Robbins FY16 Financial Year Ended 30 June 2016 GST Goods and Services Tax PAYG Pay as You Go PPSR Personal Property and Securities Register RATA Report as to Affairs Revroof Revroof Pty Ltd trading as Revolution Roofing Toyota Finance Toyota Finance Australia Ltd 9

10 Annexures 10

11 A Proof of debt Form 535 Formal Proof of Debt or Claim Form Corporations Act 2001, Regulation (2) Return to: Ferrier Hodgson GPO Box 2558, ADELAIDE SA 5001 Tel: (08) Fax: (08) Indebted Company: R and B Australia Pty Ltd (In Liquidation) ACN Date of Appointment: 18 April 2018 A. Name and Contact Details of Creditor 1 (the Creditor) (if in a personal capacity, given name and surname; if a corporate entity, full name of company, etc) 2 of (insert address) 3 Tel: 4 Tick this box to elect to receive electronic notification of notices or documents, in accordance with Section 600G of the Corporations Act 2001, at the address specified above. B. Details of Debt or Claim 1 Amount owing: (insert dollars and cents, inclusive of GST if applicable) 2 Nature of Debt or Claim: (insert description of debt and/or reference any supporting documentation) 3 Select one of the following options: The Creditor is an unsecured creditor of the indebted Company The Creditor is a secured creditor of the indebted Company The Creditor is an employee / former employee of the indebted Company The Creditor is a related party (please indicate: secured / unsecured) For all claims: 4 I have attached supporting documentation to substantiate the Creditor s claim (secured creditors must attach evidence of security) 5 To my knowledge or belief the creditor has not, nor has any person by the creditor's order had or received any satisfaction or security for the sum or any part of it except for the following: (insert details and value of security where relevant) C. Signature 1 Dated: 2 Signature: 3 Name / Capacity: 11

12 Creditor Assistance Sheet: Completing a Proof of Debt Form Section A Name and Contact Details of Creditor 1. Insert the full name of the employee, individual, sole trader, partnership or company that the debt is owed to. 2. Insert the address of the employee, individual, sole trader, partnership or company that the debt is owed to. 3. Insert the telephone number of the employee, individual, sole trader, partnership or company that the debt is owed to. 4. Insert the address of the employee, individual, sole trader, partnership or company that the debt is owed to. Section B Details of Debt or Claim 1. The amount owing should only include debts or claims which arose prior to the date of appointment. 2. Insert the currency if not Australian dollars. 3. Type of creditor: tick one of the options only. 4. For all claims, ensure supporting documentation is attached, such as invoices, statements, agreements. 5. For secured creditors, insert particulars of all securities held. If the securities are on the property of the company, assess the value of those securities. If any bills or other negotiable securities are held, indicate refer attached above and show them in a schedule in the following form: Date Drawer Acceptor Amount ($) Due Date Section C Signature Instructions 1. Insert the date that the proof of debt form is being signed. 2. The form should be signed by one of the following persons: If the debt is owed to an employee/individual, then the individual that the debt is owed to; or If the debt is owed to a sole trader, then the sole trader that the debt is owed to; or If the debt is owed to a partnership, then one of the partners of the partnership; or If the debt is owed to a company, then a duly authorised office of the company (normally a director or secretary of the company). 3. Insert the name of the person signing the form, and note their capacity (that is, their role): If the debt is owed to a sole trader, note their capacity as proprietor, eg: [Full name], proprietor ; or If the debt is owed to a partnership, note their capacity as partner, eg: [Full name], partner of the firm named in Section A above ; or If the debt is owed to a company, note their capacity as director or secretary, eg: [Full name], director/secretary of the company named in Section A above ] 12