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Some creditors to miss out

PHOTO/FILE

KAREN COLTMAN
[email protected]

When the file is closed on Arbor House Trust’s liquidation some creditors will be left out of pocket.

Liquidator John Scutter, of Fervor Limited, made public the trust’s six-monthly report last week, which shows preferential creditors [former employees] have been paid $59,192 mainly in wages, but $53,000 to preferential creditors is still owing.

Another $37,140 is owed to unsecured creditors.

But the balance sheet to date for the trust shows cash left after all assets have been settled at $23,000. There are some small amounts of cash to come in, but Scutter is expecting a shortfall.

Scutter said the trust had worked hard to pay everyone it could.

“Because it is a legal liquidation process there will be no more money available when it is finished,” he said.

Some of the remaining secured creditors are utility companies but others are smaller companies. Twenty-six unsecured creditors are owed money.

At the time of closing the rest home in October last year, Trust chairman Rob Tuckett said it was losing money, district health board funding was inadequate, and they had been struggling for some time.

The trustees decided to close rather than risk building up debt. If a couple of beds became empty, the balance sheet tipped into the red.

In July the trust sold the property for $800,000 to a newly established company, Arbor Holdings Ltd, well below its September 2017 QV [rateable value] of $1,380,000.

Arbor House Trust chairman Rob Tuckett said after the sale that he was pleased to have found a buyer as they needed to sell to get out of debt. He hoped the liquidation process would put the trust in the clear.

WCM Legal directors, the trust’s legal representation, approached the trust with the offer to buy Arbor House and Arbor Holdings Ltd was then established, Tuckett said.

A few months later the property was placed back on the market. Arbor Holdings Ltd director Jason Carruthers told the Times-Age at the time it had no idea Arbor House residents would not be its tenants.

“The trustees signed a six-year lease, it was a good situation for us and the occupants,” Carruthers said of that decision.

“It had been operating for over 30 years as an age-care provider so we thought this would continue but three months after our purchase it is empty. We had no intention to develop the property.”

The property remains on the market for sale or lease.

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