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Company collapse reveals long list of creditors

 

By Julia Wade

A local building company’s unfortunate recent collapse, has spread shock waves through Mangawhai and surrounding areas, with an estimated $1.2 million owing in liabilities.

Rogers Residential Building Ltd [RRB] listed in NZ Register of Companies [NZRC] in November 2014, was officially put into liquidation on March 6 by appointed independent joint liquidators, chartered accountants, Gerry Rea Partners. RRB Ltd is a separate company to another Mangawhai building firm, RRB Homes Ltd, registered to NZRC on November 2017, however the two directors of each company are married to each other. A RRB Homes Ltd director registered another building company, Seabreeze Ltd, on February 23, 12 days before RRB Ltd was officially signed into liquidation.

Locals and others who were looking to build in Mangawhai have been affected by the demise of RRB, with clients of the company allegedly invoiced for work that has not been done, and handing over large amounts of money for deposits on homes that have not been built or completed. There is also speculation that RRB were still accepting money for house deposits the month before they went into solvency.

To date, a long list of nearly 70 creditors from Whangarei, Hibiscus Coast, Auckland, Tauranga and Wellington, have reported to be left out of pocket in the wake of RRB’s demise including government agencies, service companies and a number of local businesses.

Financial trouble appears to have plagued the husband and wife team since opening their first registered business, Quality Textures, in 2000 which went into liquidation four years later. Out of the nine companies the pair have owned, RRB is the third to go into liquidation as well as a declaration of bankruptcy in 2011.

Those affected in the community have voiced their outrage, sadness and disbelief over social media, wondering how people are allowed to continue trading with what appears to be a long unsound financial record.

A Ministry of Business, Innovation & Employment (MBIE) spokesperson says that MBIE’s Registrar of Companies cannot prevent individuals from incorporating companies in New Zealand as long as they meet registration and regulation requirements, according to the Companies Act 1993.

“It is not uncommon for companies to fail and sometimes that failure is not the fault of its directors – it may be as a result of a downturn in the market or some other unforeseen

circumstance which can lead to failure even when a company is being well managed,” the spokesperson says. “An individual is entitled to set up another company and be appointed as a director of that company if they have not been prohibited or disqualified from being a director or involved in the management of companies in New Zealand.”

An individual can be barred from being involved in company management if there is strong enough evidence to suggest mishandling added to the failure of a company. If people have information that suggests mismanagement, they are able to make a complaint or provide information to the Registrar of Companies.

Gerry Rea Partners accountant Simon Dalton says besides realising and distributing company’s assets to creditors, liquidators also investigate the financial background to determine exactly the cause of failure and if any actions can, and should, be taken.

“As our investigations into RRB Ltd are ongoing I’m not yet in a position to comment on them. But in their case we understand the company had been struggling for some time,” he says. “They sought independent advice to determine what steps should be taken… and it was resolved to liquidate the company. They have been helpful in providing information to us to ensure that the process runs as smoothly as possible.”

Dalton says he understands RRB’s demise has generated a lot of rumour and speculation in the community and advises if people are unsure regarding their rights, to seek competent legal advice.

“We are here for the benefit of the creditors, to help those affected,” he says. “We have invited all known creditors of the company to make a claim in the liquidation. If people believe they are owed money, are in any doubt or have any questions, please contact us.”

The Focus contacted RRB’s director/shareholder to offer the couple the opportunity to share their side of the story. However due to the ongoing liquidation process they say they are not permitted to comment and advise any queries should be referred to the liquidators. n Contact Gerry Rea Partners (09) 377 3099 or info@gerryrea.co.nz for queries or Ministry of Business, Innovation & Employment, Register of Companies companiesoffice.govt.nz for more information. People affected can also contact Sandy Morrison 029 474 9007 with their experience.


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