Unpaid JM Kelly Group creditor Mick Barfield drove from Mackay to Rockhampton this morning to protest outside the second creditors meeting of JM Kelly Builders.
Unpaid JM Kelly Group creditor Mick Barfield drove from Mackay to Rockhampton this morning to protest outside the second creditors meeting of JM Kelly Builders.

Angry creditors fail in bid to axe liquidator

DISAFFECTED creditors, with the help of the corporate regulator, plan to challenge today's vote to retain PwC Australia as liquidator of a failed Central Queensland builder.

An at times heated meeting, in Rockhampton, voted to retain the JM Kelly's Builders' appointed administrator as liquidator after rejecting 26 to 36 a bid to replace it with Jirsch Sutherland.

PwC Australia was also the liquidator of nine other companies in the JM Kelly Group.

It told the meeting it had referred to Queensland Police allegations people had falsely signed statutory declarations that JM Kelly Builders' creditors had been paid.

Disaffected creditors have also signalled they will lodge complaints with the Australian Restructuring and Turnaround Association (ARITA) and the Australian Securities and Investments Commission (ASIC) in relation to the conduct of today's meeting.

They have concerns regarding disclosure of proxies, exclusion of proxies, transparency around voting and the acceptance of proxies held on behalf of related parties.

Electrical contractor Craig Barlow, representing creditors who sought to change the liquidation to Jirsch Sutherland, said he would pursue the matters via complaints to the two bodies in a bid to challenge the outcome.

"From what we've been told today there is no way creditors would receive anything," he said.

Mr Barlow alleged there were lawyers in the room holding the proxies of family members linked to JM Kelly Builders' director John Murphy and that there had been an attempt to install a proxy of Mr Murphy on the Committee Of Inspection - which oversees creditors' interests.

"They (PwC Australia) was asked to identify related parties and they refused," Mr Barlow said.

The liquidator has around 20 days to produce minutes of the meeting which should reveal who voted and how.

The meeting voted to approved three sets of fees for the liquidator totalling $740,000.

Media representatives of PwC Australia were attempting to secure answers to a series of questions put by the Sunshine Coast Daily.

PwC earlier in the day released the following statement.

"At the second meeting of creditors of JM Kelly Builders Pty Ltd (the Company) held today in Rockhampton, creditors voted to place the Company into liquidation.

"This outcome followed investigations conducted by Voluntary Administrators, Derrick Vickers and Michael Owen of PwC Australia, into the affairs of the JM Kelly Group entities that confirmed that, with no other options available, placing the Company into liquidation was in the best interest of creditors.

"At the meeting, PwC Australia Partners, Derrick Vickers and Michael Owen, were appointed liquidators of the Company.

"Derrick Vickers said: 'The significant work undertaken by PwC Australia to date has uncovered a number of complex issues that require further investigation. Having been appointed as Liquidators, we now possess the requisite powers to pursue these matters to the full extent.'

"We will now focus on continuing our investigations into potential voidable transactions, intercompany loans and possible breaches of director duties. During the course of these ongoing investigations, the Liquidators may be funded to undertake a public examination which will allow us to use our powers to issue summons to individuals to produce materials and conduct examinations under oath.

"With creditors having voted to wind up the Company, the Liquidators will move quickly to assist employees in accessing the Fair Entitlements Guarantee (FEG) scheme to ensure that claims for outstanding entitlements are processed efficiently.

"The Liquidators also continue to conduct a sales program to realise value from the Company's assets, and this process is already well advanced."