Liquidator denies procuring proxies

SYDNEY liquidator Pino Fiorentino has strenuously denied allegations he procured invalid employee proxies and voted them in support of a resolution to approve his fees. 

"I never procured anything,” the registered and official liquidator told Sydney Insolvency News (SiN) during a break in a hearing before the Federal Court last week.

“I made a mistake. I didn’t check the proxies. There’s no way I told the director, ‘fill out the proxies and sign them yourself’,” he said.

Fiorentino's comments came as the Federal Court heard his application for a judicial review of a hearing held before the Companies Auditors and Liquidators Disciplinary Board (CALDB) last February.

In late January and early February this year CALDB rejected several applications by Fiorentino for an adjournment of a hearing brought before CALDB by the Australian Securities and Investments Commission (ASIC), which is seeking cancellation of Fiorentino’s liquidator’s registration.

The last adjournment application, made on February 2, proceeded without Fiorentino being present for the bulk of the hearing. Nor was he represented by legal counsel.

CALDB went on to refuse the adjournment application and on February 4 heard the ASIC application. Fiorentino is challenging CALDB’s refusal to grant the adjournment and the subsequent hearing of the ASIC application. At time of writing CALDB had not made its determinations and reasons public.

In an outline of Fiorentino’s Federal Court submissions obtained by SiN, the impact of the proceedings currently  before CALDB is described as “grave” because “ …. the orders sought by ASIC amount to no less than causing the permanent end to the career of the Applicant”. 

The ASIC application was formally brought before CALDB in 2013 following an investigation by the regulator into ERB International, which had owned the Ella Rouge Beauty salon chain.

CALDB slugs Topp with six month suspension

SYDNEY insolvency operator Alan Godfrey Topp has been benched temporarily after failing to lodge hundreds of statutory notices and other documents with the corporate regulator.

Following an application from the Australian Securities and Investments Commission (ASIC), the Companies Auditors and Liquidators Disciplinary Board (CALDB) said it had ordered Topp's liquidator's registration be suspended for six months. According to the ASIC website, his status as an official liquidator is unaffected by the CALDB order.

In its November 2013 application, ASIC alleged that over a period of almost four years beginning in May 2009, Topp failed to lodge 321 documents, including 209 presentation of six monthly accounts, otherwise known as 524 forms. Of these 309 related to liquidations; the remaining 12 to administrations. 48 EX01 forms were also overdue along with 37 5011 or 1500 forms. The lodging lapses involved 61 companies.

ASIC notified Topp on April 4, 2013 that it had identified the compliance failures so it took just over 12 months for the process to reach the point where CALDB ordered the suspension.

CALDB, which heard the matter on April 7 this year, said Topp did not dispute the allegations, which were the subject of agreed consent orders between the parties. The panel also acknowledged that no dishonesty was involved and that Topp's plight had been exacerbated by insufficient resources and unspecified "personal issues".

Once his six month suspension is complete Topp will be restricted for a further six months to accepting appointments only as a joint liquidator.

As part of the agreed consent orders he is also required to pay ASIC's $2000 cost of the application as well as what promises to be hefty late lodgement penalty. Topp did not respond to a request for comment.

Email SiN

See also: Insolvency veteran slapped with suspension

Insolvency veteran slapped with suspension

Bill Hamilton
Photo: WJ Hamilton & Associates

BILL Hamilton, one of Australia's longest serving insolvency practitioners, has had his liquidator's registration suspended for six months following a hearing before the Companies Auditors & Liquidators Disciplinary Board (CALDB).

Details of the suspension and future compliance requirements were published in the Commonwealth Gazette yesterday, more than five months after the CALDB hearing, which took place on November 5, 2013. 

Hamilton, who began practising in 1960, last week advised the Australian Restructuring Insolvency & Turnaround Association (ARITA) that the decision was imminent. 

In a statement ARITA said: "In accordance with clause 7.1(b)(i) of the ARITA Constitution, Mr Hamilton's ARITA membership has been automatically suspended for six months effective from 2 June 2014 following a decision by the Companies Auditors and Liquidators Disciplinary Board (CALDB)".

CALDB found that Hamilton did not adequately and properly perform his duties as a joint liquidator by entering into a deed of settlement and release with the directors of ERB and a director-related company to accept an amount which had not been properly assessed.

Millionaire bankrupt's dishoarderly affairs

The interior of Arcadia Road
Photo courtesy BPS Recovery

BPS Recovery's Max Prentice wants guardians to manage the assets of a bankrupt who filled his five properties with newspapers, textbooks and batteries.

The bankrupt, who SiN has chosen not to identify, is a former university lecturer with a degree in chemical engineering and an extensive property portfolio.

"In 40 years in practice I have never had such an asset-rich bankrupt," Prentice, trustee in bankruptcy and co-principal of BPS Recovery said.

"The bankrupt had unencumbered title to four properties in Glebe and one in Newtown."

The bankrupt's debts are estimated at around $180,000, while the value of his assets exceeds $2 million. Normally this would result in an annulment, but there's nothing normal about this technical insolvency. 

The man was declared bankrupt on April 10, 2012 after utilities suppliers petitioned the Federal Court over thousands of dollars in outstanding bills.

Prentice accepted the appointment in June 2012 and immediately slapped caveats on a large Victorian terrace in Arcadia Road, Glebe, two apartments in nearby Sheehy St, another in Charlton Way and an apartment in Chelmsford Street, Newtown. None of the properties were encumbered by mortgages but neither the title deeds nor the bankrupt could be located.

LIPS highlights gender split

LIPS Committee from left: Elisabeth Pickthall (Piper Alderman),
Lisa Chapman (Piper Alderman), Jayne Edwards
(Raine & Horne Commercial) and
Laura Stanton (Dean-Willcocks Insolvency Solutions).
Photo courtesy LIPS Committee 

THE gender-exclusive Ladies Insolvency Practitioners  movement made a rare exception last week when it admitted male practitioners to its Christmas soiree.

Most of the year LIPS events are women-only but last Thursday evening the rules were bent. In recognition, blokes thronged the Hunter street offices of host firm O'Neill Partners in numbers that initially saw LIPS' membership outnumbered. 

By 8.00pm O'Neill's L 17 verandah had filled and the ratio was closer to fifty fifty. Unsurprisingly, gender dominated many a discussion.

SiN asked one soiree-goer why she thought so few female insolvency practitioners had become registered liquidators. Her answer? "Personal liability". She had seen a mentor ruined when an appointment went bad. Did she think women might in general be more risk averse than men? She thought it was "possible". But it's likely other factors are also at play.

Coca Cola chasing Obeids over beverage debt

IT'S one thing to be hauled before an anti-corruption inquiry and grilled like a kebab. It's another thing entirely to fall foul of big beverage. Regrettably for the Obeid clan, it's done both.

Court documents obtained by SiN reveal that Circular Quay Restaurants Pty Limited, the company identified during  hearings of the Independent Commission against Corruption (ICAC) as a front for the Obeid family's waterfront hospitality ventures, has defaulted on a statutory demand for payment issued by Coca Cola Amatil (CCA).

Circular Quay Restaurant's sole director is Paul Maroon, who took over from John Abood, Eddie Obeid's brother-in-law in 2012. Abood however remains as sole shareholder.

As a consequence of the demand default, CCA has initiated wind-up proceedings in the NSW Supreme Court with a hearing set for December 10. 

If the Obeid-controlled company doesn't produce the roughly $108,000 claimed by CCA, any liquidator subsequently appointed will potentially control a suite of exceptionally valuable and controversial harbour foreshore leases. 

They were renewed for a period of 10 years in 2009 but may automatically terminate if the lessee is liquidated. Time will tell.

According to court documents CCA is being represented by Emanueli Oliveri of Oliveri Lawyers. Ben Sewell of Sewell & Kettle is handling the matter for Circular Quay Restaurants Pty Limited.

Email SiN

Godfrey delivers dollars to discharge debt

IT seems Murray Godfrey has found the $160,000 he needed to stave off potential bankruptcy. 

In the Federal Court today, lawyer Carlos Toda produced details of an arrangement that enables his client to avoid an embarrassing and potentially career-disrupting creditor's petition application. 

If it had proceeded, the hearing could have seen the Veritas Advisory founder bankrupted, forcing the cancellation or suspension of his liquidator's registration. Instead, the matter's been dismissed by consent.

The petition was brought by applicant creditor Graham Werry of Weriton Finance on October 23, 2013.

18 months earlier Godfrey had consented to District Court orders requiring him to pay Werry $160,000 by December, 2012. 

The deadline was missed and Werry turned up the heat, serving Godfrey - a registered liquidator and an official liquidator of the Supreme and Federal Courts - with a bankruptcy notice.

That was on July 5, 2013. Godfrey immediately sought to have the notice stayed or set aside. 

His application was dismissed and a sequestration order loomed. But at the 11th hour Godfrey produced something his pursuer is prepared to accept.

When contacted today Werry declined to go into detail, but he sounded very satisfied. Godfrey was less forthcoming.

Federal Court registrar Geoffrey Segal ordered that copies of the sealed consent agreement and other documents be delivered to the Official Receiver within two days.



Email SiN