Corbel subbies aghast at payout
Corbel Construction sub-contractors and suppliers are angry the directors of the failed company will be paid before them.
The company was working on projects in Christchurch and leaky apartments in Auckland, when directors and shareholders Mark Wells and Craig Jones put it into liquidation in December.
Months earlier, trusts controlled by Wells and Jones loaned Corbel $960,000. The loans were protected by a legal security agreement that puts them ahead of the 250 out-of-pocket subcontractors and suppliers. The trusts have been repaid about $100,000 so far.
Charlie Feary, who owns a drainlaying company owed $60,000, said it made him so angry to think about it he had to ‘‘let it go’’. ‘‘I’ve cut my losses. We were a two-year-old company. We have survived and I am still employing four guys but we have had to work harder to make it up. It is basically someone’s wages for a year. I did some research on Corbel and was told their credit was good, so I don’t know what I could have done,’’ Feary said.
Sub-contractor Richard Bendall, of Apolon, is owed about $120,000. He was working on leaky apartments in Auckland and said he had been unable to keep all his staff.
‘‘It seems odd the directors can do that. It is hard for a small company like ours and we are working hard to get ourselves back into a positive situation.’’
Bendall said laws passed in 2017 requiring sub-contractors’ retention payments be put in a trust account had not helped. Retention money is held back by a client or head contractor to ensure defects are fixed.
Liquidator Andrew Oorschot of Ashton Wheelans said Corbel sub-contractors were owed $1.5 million in retentions but $1.2m was not covered by the legislation and was just part of the unsecured claims. There was $227,000 of retentions in trust but half was wrongly classified, leaving $110,000. ‘‘We are continuing to pursue the directors regarding this matter ... they have an obligation to make good this shortfall,’’ Oorschot said.
There was unlikely to be any money for unsecured creditors owed an estimated $4.6m.
An independent legal opinion said the trusts could not be challenged, Oorschot said.
The directors’ trusts had been repaid $100,000 and were still owed $860,000 plus interest but were unlikely to be fully repaid, Oorschot said.
‘‘We are continuing to pursue the directors.’’ Liquidator Andrew Oorschot