Liquidator chases dairy company for $3m claim
The Waikato firm contracted to build Open Country Dairy’s $20 million wastewater plant is now in liquidation, and pursuing a claim worth about $3m against the dairy company.
Wastewater management firm BPO stopped construction on the new treatment plant at Open Country Dairy’s Waharoa factory in the Waikato, in March.
By the end of the month, BPO was placed into liquidation.
It is understood BPO claimed it had signoff from a site manager for a time extension to complete the project but Open Country Dairy had decided not to pay the extra costs. Open Country’s chairman says it has paid everything it owed.
KhovJones director Steven Khov, the appointed liquidator, said it meant BPO was unable to pay its sub-contractors, and that forced the Hamilton firm into liquidation.
‘‘Open Country Dairy is claiming they don’t owe that money and that is where the dispute arises,’’ Khov said. ‘‘I understand the work on the plant is incomplete, and we have a lot of sub-contractors, that worked on the plant, now out of pocket.’’
Khov said he understood about four of the bigger subcontractors had opted to accept a deal with Open Country Dairy to keep working on the project.
Khov said an investigation into the matter now sits at BPO filing a claim for more than $3m, which represents the costs put to Open Country Dairy, to settle the debt.
‘‘We remain committed to pursuing the claim but are also open to settling amicably,’’ he said.
Open Country Dairy chairman Laurie Margrain said the dairy company had ‘‘paid every cent owing’’ to BPO.
‘‘They are claiming some payments around some overruns, and we don’t agree with that. In our view, we have paid everything that is due.’’
Margrain said Open Country Dairy had taken over the wastewater plant’s construction project, using some of the subcontractors that had worked with BPO.
‘‘We took over the final stages of the install and now have a team that has got a lot more experience than what BPO had, so we are totally on track.’’
Margrain said it would be ready for the new milking season in July. ‘‘Aspects of the plant have been operational for some time. We lost a month because of Covid-19 but we will be able to complete the project.’’
Open Country Dairy was forced to upgrade the Waharoa plant after the factory was fined a record $221,250 in 2019 for emitting a vomitus stench connected to a failure in its wastewater pond liner in 2018.
The dairy company began planning its $20m wastewater
‘‘We remain committed to pursuing the claim but are also open to settling amicably.’’ Steven Khov
treatment plant and applied to the Waikato Regional Council for a 35-year permit to operate the system.
It would allow the plant to discharge treated wastewater into the Waitoa River, and to discharge contaminants from its new treatment plant to air.
A review, prepared for the regional council, recommended the permit be declined.
A resource consent hearing was planned for March, when Open Country could argue its case, but it was postponed because of the coronavirus alert and a new date has yet to be scheduled.