As InDaily revealed last week, Adelaide-based liquidator Paul Jorgensen – a partner at PKF Australia, a group of chartered accounting firms – is the subject of a complaint to national regulator ASIC by turnaround practitioner Eddie Griffith, of ReGroup Solutions.
Griffith accused Jorgensen of “fundamental failings” in his handling of the liquidation of Unique Urban Built.
Griffith said at the time that he represented 24 Unique Urban Built creditors, which are collectively owed $946,420.
The long-standing South Australian construction company was placed under external administration last month, owing 245 creditors at least $3.87 million collectively.
Now, InDaily has obtained Jorgensen’s report to creditors dated May 22 (dated May 21 elsewhere in the report) – which acknowledges “administrative errors” in his handling of the administration.
They include not advertising a creditor’s meeting, not lodging legally required forms – and lodging others late – errors in reporting and failing to include information about Unique Urban Built’s financial position so that creditors can adequately assess the reasonableness of his fees.
Jorgensen writes that he was handed a letter from ReGroup Solutions at the first meeting of creditors on May 8, which outlined “certain administrative problems with the calling of the meeting and other, and information available to creditors”.
“As a result of the matters set out in that letter, which I consider serious, I decided to adjourn the meeting to attend to the matters raised, to ensure creditors were in a position to properly make decisions (regarding) the liquidation of the company,” Jorgensen writes.
“The matters were mainly administrative errors which should have been picked up prior to calling the meeting.
“… No fee will be charged in the liquidation for time spent in rectifying these problems or in calling the adjourned meeting.”
Jorgensen writes that ASIC representatives attended the May 8 meeting.
“After the meeting I discussed their recommendations regarding information to be provided to creditors with them,” the report says.
“This report resulted partly from those recommendations.”
Addressing each of the allegations, Jorgensen writes that:
- The May 8 meeting of creditors had not been advertised on ASIC’s published notices website.
- Forms were lodged late with ASIC.
- An incorrect job type reference was included in the original creditors’ report.
- Written off pre-appointment time was referenced in the original creditors report.
Although Jorgensen acknowledges that pre-appointment time is not chargeable, but writes that “I do not see any problem in listing it for information”.
Moreover, he writes that a failure by Unique Urban Built director Nathan O’Neil to provide a summary of the company’s affairs in time – Jorgensen says it was only produced on May 21 – meant the liquidator was not in a position to provide a list of the company’s assets in which he could be confident.
“Given the short time in which the report was prepared, the necessity to protect assets of the company, statutory requirements and the failure of the Director to provide a summary of affairs and uncertainty regarding the assets of the company, I was not in a position to provide a list of assets in which I was confident,” Jorgensen writes.
“A list was prepared for the meeting and was discussed informally with creditors present in an informal discussion after the meeting had been adjourned.”
The latest report includes a breakdown of the company’s assets and liabilities, which amounted to a net positive $456,250 as at April 9.
It also reports that the company earned profits in 2017 but incurred significant losses in 2018 and 2019.
Jorgensen writes that although further investigations are required, the company was, in his view, insolvent from at least 2016.
He notes that he would have to analyse any defences that O’Neil might have against an insolvent trading claim and whether he has assets required to meet any such claim.
He also writes that O’Neil and his wife – who is not named in the report – are alleged to owe the company $1.39 million.
The next meeting of creditors is scheduled for June 7.
Unique Urban Built was registered in 2007 and is based in Norwood.
The company has engaged in commercial design and construction projects across South Australia, and was involved in upgrades to the Adelaide Aquatic Centre.
An ASIC spokesperson advised last week that the agency does not comment on any confidential complaints, or on whether or not such complaints have been received.
InDaily emailed and phoned Jorgensen this morning for comment, but he was unavailable to speak and we are yet to receive a response. He said last week that he was in the process of writing a report addressing the matters Griffith had raised and intended to continue to act as Unique Urban Built’s liquidator.
InDaily attempted to contact O’Neil via Unique Urban Built’s email address.
The company’s phone number has been disconnected and its website has been shut down.
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