Firm linked to crooked ex-cop failing

A building company linked to a crooked ex-cop is on the brink of collapse after a contractor owed tens of thousands of dollars applied to have it placed into liquidation.

Affordable Concrete and Paving Ltd has been chasing Garden City Homes for payment for work it completed more than a year ago.

Despite the Christchurch home building company’s repeated promises topay, the concrete business was still out of pocket about $30,000, its officer manager, Anita Boyd, said yesterday.

Boyd said Affordable Concrete and Paving had engaged a debt collector and threatened to

force Garden City into liquidation, but neither resulted in payment. So, as a “last resort ... we followed through with the threat”, she said.

On January 22, Affordable Concrete and Paving applied to have Garden City Homes placed into Liquidation, a noticed published in The Press yesterday says.

The application is scheduled to be heard in the High Court at Christchurch On March 14.

Garden City Homes’ sole director and shareholder is Mehak Kala, but her husband, Sanjeev, has been intimately involved in running the business. He quit the police after he conned a student into giving him $1000 to help reduce a dangerous driving punishment and was convicted of fraud in 2016. The former constable was a gambling addict and had been banned from Christchurch Casino.

The Kalas did not respond to requests for comment yesterday.

Last year, a The Press investigation revealed Garden City Homes owed an array of contractors and suppliers hundreds of thousands of dollars and various home builds were months behind schedule. The company then insisted it was not in financial trouble, had paid invoices as scheduled and any delays with projects were due to issues outside its control.

However, in January, Garden City Homes was placed into receivership after it defaulted on a $400,000 loan from Prime Finance Ltd. It owed a similar amount another lender.

At the time, one of the receivers, Damien Grant of Waterstone Insolvency, told The Press

Garden City’s “management accounts did not appear to have been well maintained, which made it difficult to see a sustainable trading future”. Grant said that while there appeared to be enough assets to cover the “secured lenders”, “the prospects for unsecured creditors may be more difficult”.

At the time, Mehak Kala said the appointment of the receivers had “come as a shock”.

The loan from Prime Finance was due to end on January 1, but Garden City had sought an extension until the end of the month, Kala said. “We had tried to contact Prime Finance by phone, text and email multiple time for the last two weeks, but [got] no response.”

Kala said Garden City was making arrangements to pay secured lenders and would work with the receivers. She said adverse media articles about the company last year “caused unnecessary stress” and affected the business.

A number of contractors and lenders had been paid and the company was making arrangements to settle other debts, Kala said.

According to the Companies Office, Garden City Homes was incorporated in July 2018.

The company’s financial woes appear to have begun in late 2022, when contractors and suppliers began having to chase it for payment and building materials weren’t available as required. The Kalas went on holiday to Rarotonga about that time.

Debt collectors and lawyers were involved in efforts to recover money the company owed to businesses, The Press reported last year.