Fairlie building companies owe creditors more than $2.4m

Friday, 29 November 2024

The owner of two Fairlie-based building companies, which owe creditors more than $2.4m, has been declared bankrupt.

K J McIvor Building Ltd and KJMB 2022 Ltd, were put into liquidation on April 15 at the request of Inland Revenue.

KJMB 2022 Ltd is wholly owned by Kerry McIvor, of Fairlie. McIvor is the majority shareholder (95%) and sole director of K J McIvor Building Ltd.

In their second six-monthly report, liquidators Elizabeth Keene and Luke Norman, of KPMG, said KJMB 2022 Ltd owed creditors just over $523,000 while KJ McIvor Building Ltd owed more than $1.9million.

Both companies had overdrawn shareholders accounts, KJMB 2022 to the tune of $40,000 and the other just under $281,000. The liquidators said a file had been claimed for each amount “in the shareholder’s bankruptcy”.

“The liquidators are obligated to evaluate the actions of management, review antecedent transactions and if necessary, report any adverse findings to the appropriate authorities and/or initiate proceedings for recovery of the funds dissipated.”

According to the insolvency register, Kerry McIvor was declared bankrupt following a creditor application, at the Timaru High Court on September 30.

McIvor was approached for comment.

Whether those left out of pocket would be repaid was not yet known, but liquidators were trying to sell a property at Fairlie which was owned by one of the companies.

KJMB 2022 owes $367,000 to preferential creditor Inland Revenue and $196,000 to unsecured creditors — Inland Revenue and Martin Wakefield Ltd.

KJ McIvor Building Ltd’s three secured creditors were owed a combined total of $1.05m, preferential creditor Inland Revenue was owed $500,000, five known unsecured creditors were owed $253,000 and $33,000 was owed to informal creditors.

The liquidators said vehicles owned by the company had been sold through Turners prior to the liquidation. The company’s plant and equipment had only a nominal value and had been disposed of by the liquidator.

KJ McIvor Building owned a property in Fairlie, which had also been listed for sale prior to the liquidation. That had since been relisted and was being prepared for auction, the liquidator’s report, dated November 13, says.

“Given the stage of the liquidation, there is material uncertainty in relation to the value that may be received for a number of the assets…

“The liquidators are undertaking investigations to determine whether there are any claims, and/or other assets that may give rise to additional recoveries for the benefit of creditors.”

They said they had not made any distributions to creditors and could not say whether that would be likely.

“It is not practicable at this stage to estimate amounts likely to be available for payment to each class of creditor, and/or an estimated rate of payment.

“At this stage, it is not possible to provide an estimated date for the completion of the liquidation.”

They asked anyone with any information which would assist in their enquiries to provide details in writing with any documentary evidence.

K J McIvor Building received more than $200,000 in Covid wage subsidies for 14 or 15 employees during the pandemic.

In April, Inland Revenue sent out a “last chance warning” to construction companies who had fallen behind in their tax obligations to sort them out or face enforcement action.

The department had taken a “softly, softly” approach during the pandemic years, but that had changed, Inland Revenue’s Richard Philp said on April 9.

Emails and letters were expected to be sent to 40,000 construction companies with outstanding debt, overdue tax returns, or both.

Liquidations have been on the rise in New Zealand this year, between January and August 1671 companies went bust, up 40% on the same period in 2023 with 1199 liquidations.

In May, Centrix managing director Keith McLaughlin warned of a difficult period ahead for many South Canterbury businesses. Centrix collects data on liquidations and McLaughlin said the numbers were well up on previous years.

He urged any business owners facing tough times to speak to their banks and Inland Revenue.