Liquidators Six-Monthly Report

Transcription

1 Liquidators Six-Monthly Report PHILLIPS & O BRIEN LIMITED (IN LIQUIDATION) Introduction On 22 March 2017 at 8.30am Jessica Kellow and Iain Shephard, RITANZ-accredited Insolvency Practitioners, were appointed liquidators jointly and severally of Phillips & O Brien Limited by special resolution signed by the shareholders. This is our six-monthly report required by Section 255(2)(d) of the Companies Act 1993 and is to be read in conjunction with our previous report. Background Phillips & O Brien Limited (now In Liquidation) ( the Company ) has traded for in excess of 40 years undertaking long haul freight between Auckland and Wellington together with local deliveries. The Company also held a contract for the collection of recycling from a major paper manufacturer. The Company also offered storage and a pick and pack service from an expansive warehouse in Seaview. The Company was burdened with historical debt from an associated entity which has created a drain on cash flow. In recent times, the director has reduced overheads and staff numbers however has not been able to keep to payment arrangements made with Inland Revenue and the landlord. Faced with a statutory demand that was unable to be satisfied, the shareholders resolved to place the Company into liquidation. Liquidators Actions The liquidators have liaised with many parties including Inland Revenue, the Companies Office, the New Zealand Gazette and the Accident Compensation Corporation, and completed a review of all information received. The liquidators advertised their appointment in the relevant publications and made a call for creditor claims. The liquidators also directly contacted all known creditors and answered any queries they may have had. The liquidators subsequently reviewed all completed creditor claim forms received. The liquidators have reviewed the actions of the directors with consideration as to whether there were any potential breaches of appropriate sections of the Companies Act The

2 liquidators investigations have thus far included examining the Company s financial statements and considering the Company s bank transactions. The Liquidators assessed the likelihood of a sale on the open market. The business was underperforming and had been for some time. The trucks had significant deferred maintenance and required substantial investment. The storage facility revenue was limited and was required to be operated in conjunction with the logistics/transport operator. The best outcome in respect of a realisation of the assets was a sale to the director under a new entity. Realisation of Assets Sale of Assets As mentioned above, the liquidators sold the majority of the assets to the director of the Company under a new entity for $130,000. These assets included four vehicles; two trailers; office furniture; and other miscellaneous tools and equipment. The liquidators sold two forklifts for $23,345.00, and a Hino truck for $7,085 to unrelated parties. In total, the liquidators have received $173, from the sale of the Company s assets. All of the physical assets of the Company were encumbered and subject to security interests. The liquidators accordingly accounted to the secured creditors for the nett proceeds of the sale of the assets. Further information is indicated below. Pre-Liquidation Bank Account The liquidators received $4, from the Company s pre-liquidation bank account. Accounts Receivable As indicated in our previous report, the Company had factored many of its accounts receivable to Scottish Pacific Finance. At the date of liquidation, the amount owing to Scottish Pacific was $95,986. Scottish Pacific had been collecting the Company s factored accounts. The financial records provided to the liquidators at the date of liquidation had not reconciled the factored and non-factored receivables. The liquidators had previously estimated approximately $85,000 in non-factored accounts still to be collected. Further information provided to the liquidators during the course of the liquidation has indicated that the Company s non-factored receivables total $131,894.83, of which the liquidators have collected $110, The liquidators are continuing to pursue the remaining $20, in receivables.

3 Creditors Claims Secured Creditors The liquidators have corresponded with all known secured creditors and have requested underlying security documentation. The liquidators were aware that Aleport Investments Limited held a general security agreement over the assets of the Company. At the date of the liquidation, the GSA-holder was owed $361,420. Following the sale of the Company s assets, the liquidators accounted to the GSA-holder for the net proceeds of the sale, being $95,000. The liquidators also accounted to a secured creditor in the amount of $15,000, this amount being the net proceeds from the sale of the trucks over which the creditor held PMSI security. Preferential Creditors The liquidators received 12 preferential claims from the Company s former employees, totaling $72, The liquidators have received a preferential claim from Inland Revenue in the amount of $294, Unsecured Creditors The liquidators have received 17 unsecured claims totaling $240, Distribution to Creditors The liquidators have made two distributions totalling 50 per cent of the employees preferential holiday pay. The liquidators do not expect there will be sufficient funds to allow any further distributions to employees. In light of the above, the liquidators do not expect a distribution to Inland Revenue in respect of its preferential claim. Unfortunately, there is no possibility of a distribution to unsecured creditors. Receipts and Payments A schedule of the liquidators receipts and payments is enclosed. Estimated Date of Completion It is not practical to estimate the date of completion at this time.

4 Contact Details Contact Person Jessica Kellow Telephone Postal Address PO Box Wellington JESSICA KELLOW Liquidator Dated 21 March 2018

5 PHILLIPS & O'BRIEN LIMITED (IN LIQUIDATION) Schedule of Liquidators' Receipts & Payments As at: 21 March 2018 Receipts Proceeds Pre Liquidation Account 4, Account Receivable 110, Interest NZTA Refund Sale of Assets 173, , Less Payments Auctioneers commission & charges Bank Fees Inland Revenue - GST 15, Inland Revenue - PAYE 11, Legal Fees 7, Liquidators Costs & Disbursements 111, NZTA 9.17 Motor Vehicle Expenses Preferential Wages & Holiday Pay 30, RWT Secured Creditor Distribution 110, , Liquidators' Bank Account 44.66