Creditors claims against five beleaguered PBS Building companies so far total $169 million, say administrators.
RSM Australia Partners were called in as external administrators when the PBS Building companies went into voluntary administration in March.
This sparked a 16-week asset recovery program with RSM’s Jonathan Colbran, Richard Stone and Mitchell Herrett lodging a report with ASIC.
The report states a preliminary figure of around $169 million in creditor claims including $55 million for trade creditor claims, however, this figure could change as more claims are verified during the next few weeks.
More than 500 creditor claims were made.
Assets with book values of more than $50 million have been identified.
The companies had 24 projects worth $439 million under construction when it filed for voluntary administration.
RSM confirms that 22 of those projects have had their contracts ended to allow the principals to recommence work. Work has restarted on seven sites so far.
It has also allowed principals to pay $7.8 million to subcontractors and allowed some subcontractors and other employees to be hired by the principals.
There are also $6.8 million in verified payment claims with another $1.3 million to be considered.
The next creditor’s meeting is on July 5 when the administrators plan to inform creditors, answer questions and then adjourn the meeting until September.
This will provide them time to chase payments owing to PBS Building before creditors meet to vote on what to do next.
“The additional time will enable more than $6.8 million worth of identified SOPA construction contract payment claims that have already been issued, to be pursued, adjudicated out-of-court, and determinations issued,” Colbran said.
“The additional time will also allow a further $1.3 million worth of SOPA claims to be explored and potentially pursued.
“To date more than $4.5 million of the identified SOPA claims have already been determined in PBS’ favour.
“These SOPA claims have the potential to produce significant recoveries for the companies—and ultimately creditors—at a cost that is far less, and in a manner that is far more efficient, than if these claims were pursued through the courts.’’
PBS Building operated in the ACT, New South Wales and Queensland with Project and Revenue trust accounts set up for the New South Wales and Queensland operations.
While these seem to have been managed adequately, there is no precedent for managing the more than $4 million held in them via external administration.
The administrators have sought directions from the Queensland federal court on the matter which was heard last week.
Meanwhile in Victoria, the state government has announced that the compensation claim scheme for customers of Porter Davis will be extended to customers of other building companies who have filed for insolvency.
Porter Davis customers were left out of pocket as mandatory Domestic Building Insurance was not taken out on their behalf.
Any Porter Davis customers who paid a 3 per cent pre-deposit for “tender agreements” but received no cover will also be able to access one off payments of up to $50,000.
Customers of builders who went into liquidation in the last 12 months with no insurance cover will now be able to access the scheme.
Snowdon Developments and Hallbury Homes customers have had similar experiences and can access payments up to $50,000.
Builders must have entered liquidation between July 1, 2022 and June 30, 2023 for their customers to be eligible for the payment.
“We’ve backed the original Porter Davis families, and now other hardworking families who have similarly suffered over the past 12 months will have the certainty and confidence they deserve to move ahead,” Victorian treasurer Tim Pallas said.
The Victorian government has announced reform of the Domestic Building Contracts Act 1995 to strengthen the insurance requirements and introduce a new offence and penalities for builders who take deposits without providing insurance.
Porter Davis’ failure to take out insurance for its customers is currently being investigated by the Victorian Building Authority.
