NOTICE TO CREDITORS – UNCLAIMED MONIES - FOURTH AND FIFTH DISTRIBUTION
DML Resources Limited (In Liquidation) was placed into liquidation by order of the High Court at Auckland on 7 May 1998, pursuant to Section 241(2)(c)] of the Companies Act 1993. The liquidation is in the final stages of being completed.
The funds received over the period of liquidation funded distributions to unsecured creditors. Most unsecured creditors received 100 cents in the dollar. Of the five distributions, the liquidators have unclaimed monies from the fourth distribution in June 2013 and the fifth distribution in September 2014.
The Liquidators invite those creditors/employees who believe that they have a claim to these distributions to make contact with us, on 0800 30 30 34, or the e-mail address shown below, by no later than Friday 15 May 2020 .
A complete listing of the names of creditors who may have a right to the unclaimed monies can be found below:
Ace Air Conditioning
Allens United Waikato Ltd
American Express International (NZ) Inc
Ansett New Zealand
AR & CA Crossley Carrier
Ashby, W M
Auckland City Council
Australasian Diamond Tools Ltd
Autotreads East Tamaki Ltd
Benchmark Building Supplies
Bezar, B H
Blue Star Computer Supplies
Bop Line Boring Limited
Brass Fit Engineering Supplies Ltd
Cellnet Mobile Services
Coal Distributors (Auck) Limited
Dekufdaeh Pty Limited
DHL International NZ Ltd
Dominion Industrial Electrical Supplies Ltd
DSL Group Limtied
Ebbett Waikato Limited
Edwards, C P
Endeavour Solutions Ltd
Eutectic New Zealand Limited
Executive Taskforce Limited
Fairview Motors Ltd
First Aid Supply Team
Formerly Fuel Equipment Limited
Fuel Equipment Limited
Geotechnics Ltd - Sales Division
Gibson, D J
Gold Valley Motor Cycles & Marine
Harrison P J
Hauraki Bulk Store
Hi-Chem NZ Limited
HK Heaton Limited
Hose Supplies NZ Ltd
Hulmegas LPG Partnership
Huntly East Medical Centre
Huntly Exhaust Services
Huntly Hardware Supplies Ltd
Hurunui, G D
Ian Roebuck Crane Hire Ltd
INVENSYS New Zealand Limited
Iremonger, R L & B E
James Walker NZ Ltd
KGA Geotechnical Limited
Kimberley Tool & Design NZ Ltd
Lamont, A M
Ludowici NZ Limited
Malayan Banking Berhad
Marine & Industrial Limited
Mason Engineers (NZ) Ltd
McEntee Hire Services Ltd
Millennum Technology Services Ltd
Mine Design Systems Limited
MJG Splicing Service
Mobile Business Solutions Limited
Moore Business Forms
Nationwide Reservations Limited
New Zealand Couriers Ltd
New Zealand Two Way Radio
Niederer Drilling Ltd
North Shore Manpower
Oak Service Station
One Stop Automotive Limited
Owens Road Transport Ltd
Owens Transport Holdings Ltd
Paeroa Hire Centre Limited
Parsons, C t/a Buzz a Basket
PC Fixit (Auckland) Limited
Phoenix International Marketing
Pirtek Counties Limited
Plan & Print Ltd
Provincial Freightlines Ltd
R E Johnson Ltd
Rentokil Initial Ltd
S G Baker (Waihi) Ltd
South Auckland Ford
Spot on Fire Extinguisher Service
Stafford-Bush, T & W A
Steel, C P
Stewart, L J
Stoneham, C C
Summit Hammer Hardware '96
Swart, S & J
T Duffett & Sons Ltd
Taupaki, R V
Te Rapa Electrical & Trading
Telecheck Payment Services Ltd
Telegroup Network Services
Terralink NZ Ltd (In Liquidation)
The Bush Tramway Club Inc
The Christchurch Press Company Limited
The Hydraulic Tool Company Ltd
The Phoenix Printing Co Limited
Titan Cranes Ltd
TK Engineering Ltd
Tobin, B J
Top Gear Motors Limited
Total Maintenance Ltd
Transport Wholesale Limited
Trass, D S
Truck Farms Ltd
Tyco NZ Limited
United Environmental Ltd
Valley Bearings & Supplies
W H Limited
Waikato & King Country Press Ltd
Waingaro Quarry Ltd
Welding Engineers NZ Ltd
Weldwell NZ Ltd
Whitcoulls Office Products Limited
Williamson, E A
Winstone Aggregates Ltd
We are all responding to the various impacts of Covid-19 containment measures over the past days. The Government has ordered wide ranging travel and event restrictions although it is important to note the restrictions apply to people and not goods and services.
NZ is in the early stages of the coronavirus outbreak but many small and medium-sized businesses are already feeling its effects on cashflow to which will be added impending cost increases such as the 1 April increase in the minimum wage.
From the commentary we have seen it is possible that our summer has insulated us from the worst of the virus to date, however that could change as we move into colder temperatures. It is also likely that spending across all sectors (except perhaps government) is down as families and individuals react to the uncertainty that is emerging. Certainly hospitality, events, and tourism are taking a big hit. In some areas, industries such as logging have not worked for 5 weeks or so.
Discussion has been that a 30% drop in revenue is forecast. If that becomes reality many businesses large and small will struggle. The message to support businesses is for consumers to try to live as normally as possible and that includes maintaining your spending habits as best and as safely as you can, and to look after yourself and those around you. In other words “Support your local”. This could reduce the harm that enforced isolation has on the country and its communities and businesses.
The first option to assist you and/or your business is to check what insurances you have to cover your business and personal issues. Read Here - Chapman Tripp - COVID-19 business protection check list
Banks and financiers may also be able assist. The RB measures to reduce the interest rate will probably have a small impact. The larger impact will be from the RB deferring the increase in capital that banks hold, and will support any increase in the banks’ ability but not necessarily willingness to lend further or to reschedule repayments, as we expect that the fundamental rules around lending will continue to apply. So a sound underlying business with good history and prospects, security and cashflow will be required.
The government support package announced yesterday is aimed to inject money into the economy to support job retention. The sick leave and one off 12 week wage subsidy packages look to be available to every business that has experienced or expects to experience a 30% or more drop in revenue due to Covid 19. There are limits to how much each of the packages will assist for example the wages subsidy is capped at $7,029.60 per employee working 20 hours or more per week and $150,000 per employer. Assuming a 40 hour week the subsidy will assist business payroll funding by paying $14.62 per hour per employee up to a maximum of $150,000. As the subsidy does not abate, the per hour impact of the subsidy increases if employees work less hours until the minimum subsidy per employee of $350.00 per week for employees working less than 20 hours per week kicks in.
Some steps toward mitigation need to have been taken such as discussions with your bank, and you have a best endeavours obligation to maintain employment levels and to pay each employee at least 80% of their normal income for the subsidy period.
While property owners receive some other income tax support with cashflow impacts into the years ahead, unfortunately for those who lease there is no other support than the wages subsidy.
For businesses which have lost large percentages of revenue and support either a large number of employees, or have high fixed overheads the government measures will make some difference but probably not enough to trade without running the risk of breaching directors duties, if the company trades while insolvent.
So despite the support package it seems inevitable that some businesses will close, and possibly never re open unless arrangements can be made with their creditors.
If maintaining your business is too hard – there are a range of options
If your business was facing difficult times pre coronavirus and the impact of coronavirus is the last straw, then we can provide a number of options to wind up your company. If you think you can trade out and it is time that is needed to pay suppliers, then a formal or informal compromise with creditors may be an answer.
It is our business to help struggling businesses and to provide stress free advice. We seek to bring an end to messy situations and we are here to support you/your business. We may not always have the answer you want to hear, but we can offer options.
Some early advice is:
* If you are having difficulties or concerns about meeting your normal tax obligations due to the effects of COVID-19, Inland Revenue has a range of ways to help depending on your circumstances.
* Get in contact with your bank if you’re experiencing cash flow issues, especially in regards to loans repayments or lack of funding. They might be able to help or put you in touch with someone who can.
* Support local business
* Be health conscious
* Get advice if by trading you could be creating serous loss to suppliers/creditors
* Seek advice from your Chartered Accountant or Trusted advisor
Options for insolvent/struggling companies are:
* Company Compromises
* Voluntary Administration
We assist companies and individuals facing financial difficulties through a range of insolvency services including liquidations, company compromises and receiverships. Our specialist advisors will guide you through your options.
Many businesses are facing hard times in the current market with cashflow stretched and delayed creditor payments. Your business might be one of them. Early action is critical in determining whether your business can be rescued or not.
Taking steps to ensure your company remains financially sound will minimise the risk of an insolvent trading action and facing personal liability. It may also improve your company's performance.
There are serious penalties and consequences of insolvent trading including civil penalties and criminal charges. Insolvency can be established by either of the Cashflow test or Balance Sheet tests. Note, importantly, that only one of these tests needs to be met to establish insolvency.
A solvent balance sheet may include items that are overstated, such as obsolete stock, plant, and work in progress, or debtors that are not really collectable. After deducting these items many balance sheets become insolvent.
Your company must keep adequate financial records to correctly record and explain transactions and the company's financial position and performance. A failure of a director to take all reasonable steps to ensure a company fulfills this requirement contravenes the Companies Act 1993.
Some of the key signs of insolvency are:-
This list is by no means exhaustive, but it does give an idea of where to look for signs of impending trouble. You should constantly be on the look out for these signs - because your creditors certainly are!
As a director you need to be aware of your options so that you can make informed decisions about your company's future. If your company is insolvent you must not incur further debt in the name of the company or you could be made personally liable for that debt. Options include refinancing or capital injection (to return the balance sheet to a solvent position or to remove cash flow pressures), sale or acquisition, restructuring or changing company activities, and appointing an external administrator. Generally the matter is left too late and the only options left are to appoint a voluntary administrator, receiver or a liquidator.
Voluntary administration is designed to resolve the company's future direction. The voluntary administrator takes full control of the company to try to work out a way to save either the company or the company's business.
The aim is to administer the affairs of the company in a way that results in a better return to creditors than they would have received if the company had instead been placed straight into liquidation.
A mechanism for achieving these aims is a Deed of Company Arrangement. VA however suits certain companies and can be a costly exercise. A company compromise can achieve similar results.
A liquidator is an independent person who takes control of the company so that its affairs can be wound up in an orderly and fair way for the benefit of creditors. Sometimes business assets can be sold at market value and a new business resurrected. It pays to get good advice to avoid being held personally liable and have the sale managed by the liquidator.
A company goes into receivership when a receiver is appointed by a secured creditor who holds security over some or all of the company's assets. The receiver's primary role is to collect and sell sufficient of the company's charged assets to repay the debt owed to the secured creditor. Sometimes there is nothing much left and liquidation can also follow.
Of course, if your company is in financial difficulty, the best scenario is to avoid a crisis in the first place, and the best way to do this is to seek independent expert advice in respect of your duties and the options available.
This article is intended to provide general information and should not be construed as advice of any kind. Parties who require clarification on issues raised in this article should take their own advice.
We all know it’s frustrating not being paid. What’s worse is that not getting paid affects your cash flow and chasing bad debts takes time that could otherwise be spent doing productive work.
If you decide that your best option for resolving the debt is to liquidate the debtor company, the process generally takes at least three months. There are a number of milestones along the way, which are outlined below.
Provided the debt is not disputed, the first step is to issue a statutory demand. The purpose of the statutory demand is to test the company’s solvency – the presumption being that, if the company is solvent and the debt is not in dispute, the company will pay the amount demanded in the statutory demand.
A company who receives a statutory demand has 10 working days from the date of service to apply to the High Court to set it aside, usually on the basis that the debt is disputed and/or the debtor company is solvent. If no setting aside application is made, the debtor company has 15 working days to pay the amount demanded in the statutory demand.
If the debtor company does not pay the amount demanded within the 15 working day timeframe, there is a legal presumption that the company is insolvent (which can be overcome if the company provides proof of solvency). The creditor can issue liquidation proceedings relying on the presumption of insolvency as the basis for its liquidation application for 30 working days from the date that the statutory demand expires.
When the liquidation proceedings are filed in the High Court, a hearing date is given. While the time between filing the application and the allocated hearing date can differ from Court to Court (if the Court is outside Auckland, Wellington, or Christchurch, the hearing date will need to coincide with the judges’ circuit sittings), the hearing date is usually between two and three months after the date of filing.
Once the processed documents are provided, they must be served on the defendant company. The application for liquidation also needs to be advertised in the paper where the company carries on business and the New Zealand Gazette. The advertising must be run at least five working days after the defendant company is served and at least five working days before the liquidation hearing date.
If the defendant company takes no steps in response to the liquidation application, the defendant company will be placed into liquidation by the High Court on the hearing date and the creditors’ nominated liquidators will be appointed. If the creditor does not produce a consent to act from its nominated liquidators at or before the hearing, the Official Assignee will be appointed as liquidator. If someone appears at the hearing on behalf of the company, the High Court can allow the proceeding to be adjourned (usually to allow time for settlement discussions or for payment of the debt to be made).
Creditors other than the creditor who brought the liquidation proceedings can appear at the liquidation hearing as either a creditor in support or in opposition to the liquidation application. If you are a creditor in support and the creditor who brought the liquidation proceedings decides to discontinue its proceeding (usually because some arrangement as to payment has been made), you can ask to be substituted as plaintiff. A substituted plaintiff can continue with the previous creditor’s liquidation application instead of having to start a new liquidation application and preserves the filing date of the application, which is used for calculating time periods for voidable, undervalue, and related party transactions.
If you are a creditor and want to discuss the liquidation process further, give our team a call on 09 303 0506. McDonald Vague’s directors are Accredited Insolvency Practitioners (AIPs) and Chartered Accountants. We also have three non-director AIPs and our professional staff are members of RITANZ.
If you want more information on what to consider when choosing an insolvency practitioner, Keaton has written a helpful article: Picking an Insolvency Practitioner.