Creditor revolt on Cullen Group

Cullen creditors replace liquidatorsCreditors of failed construction firms are getting Bolshie.
Cullen Group liquidator Michael Caspaney

Creditors have used their muscle to install Michael Caspaney as liquidator of Cullen Group.

Queensland construction industry creditors have been getting the pineapple – either end is a daunting prospect – since at least 2013 when the still unfolding collapse of Walton Constructions commenced, and if this week’s events in the state of committees is any guide, restive grow the natives.

On Tuesday, trade creditors of mid-tier building firm Cullen Group turned out in droves at the first meeting with a very clear intent. The incumbent liquidators were to be punted. It made no difference that they’d conducted themselves impeccably since being appointed on December 22. They were the directors’ choice. They had to go.

From reports of the meeting it sounds like the incumbents – Mark Pearce and Michael Dullaway of Pearce & Heers – sniffed the breeze early and acquiesced without objection. That at least made it easy for their replacement, Menzies Advisory’s Michael Caspaney.

How Caspaney came to get the gig is interesting. Being Melbourne-based Caspaney it seems lives far enough away to satisfy Cullen Group’s mainly Gold Coast-based unsecureds that there’s no relationship with Cullen Group director Wayne Cullen. At the same time he possesses the advantage of being Queensland born which might go a long when trust is in short supply.

How Caspaney will investigate the collapse however is an open question. Cullen Group’s liabilities are likely to rise above the $22.5 million reported on Tuesday and FTI’s John Park and Kelly-Anne Trenfield are in control of various real property assets, having been appointed receiver managers on December 23. SiN also understands that all the major debtors are disputed and subject to counter claims.

Assuming he identifies significant and viable claims, Caspaney may well be asked to file a supplementary 533 report for ASIC’s benefit. He might even be invited to apply for a grant from the Assetless Administration Fund (AAF).

Perhaps litigation funders will sniff a quid and open the chequebook. Whatever happens, there’ll be a horde of hardworking unsecureds anticipating results that don’t involve diluting already paltry returns so professional litigants can profit. It sounds a challenging assignment and Caspaney has been bold by opening an office in Brisbane, where the natives are restless, and expectant.

About the Author

Peter Gosnell

Sydney Insolvency News illuminates the practice of insolvency in Australia’s largest city, highlighting the triumphs and failures of Sydney’s registered practitioners and the accounting and legal professionals who work with them. SiN is produced by Peter Gosnell, former business editor and senior business reporter at The Daily Telegraph newspaper. During a decade-long career, your correspondent reported on such notable corporate collapses as HIH, One.Tel, Westpoint and Fincorp as well as some of the nation’s highest profile bankruptcies and the investigations and prosecutions arising from Australia’s most notorious instances of white collar crime.

1 Comment on "Creditor revolt on Cullen Group"

  1. Les williams | 2 March 2017 at 2:54 pm | Reply

    Rather supercilious piece. Maybe if you were a QLD construction industry subcontractor being constantly defrauded by prepackaged liquidation you not be so blasé .
    Subcontractors expect this director to be prosecuted something that does not occur being protected by compliant client appointed IP’s. They also expect that bogus counter claims by clients to be investigated and substantiated, which does not occur currently and designed to defeat claims made under the Act. These ” unsecured’s ” are small businesses whose significant revenue is targeted by these parasites you write about . You make them sound like bugs

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