A sometimes heated meeting of creditors of failed agency McCorkell narrowly voted to replace liquidator Liam Bailey of insolvency firm O'Brien Palmer.
The removal motion Wednesday was backed by creditors including the Australian Tax Office (ATO) and SAP Australia, now a former client of McCorkell, and was instigated by Karen Powell, the former managing director.
The new liquidator is Michael Hogan of Hogan Sprowles, who was referred by solicitor Adesh Goel, from Dilanchian Lawyers & Consultants.
Bailey was originally appointed liquidator by Scott McCorkell, the CEO and founder in 1992 of McCorkell and Associates, owned by McCorkell and his wife.
Scott McCorkell had lobbied creditors to keep Bailey as liquidator, sending pre-filled proxy papers voting against the removal motion.
The agency went into liquidation the week before Christmas, putting 18 out of work without pay, redundancy or superannuation payments, and leaving a long list of trade creditors.
McCorkell Group, registered November 24 before thne company went into administration, with Scott McCorkell its sole director, bought the business of McCorkell and Associates on December 14, 2022, for $29,129.61.
This new company is still trading, using the same website, but with reduced staff.
According to documents lodged with ASIC, Bailey, before he was appointed liquidator, introduced a valuer, Andrew Whittingham of Groves & Partners, to Scott McCorkell to establish a price for the agency.
Bailey, at the meeting of creditors, said his work had been complicated by creditors calling the removal meeting and by him having to deal with Fair Work Commission claims from staff put out of work.
“They're far far beyond what you would expect,” he told the meeting.
The circumstances of the liquidation of McCorkell have also been referred to the ATO and the corporate regulator ASIC.
Former employees have yet to be paid entitlements and have been told to make a claim under the Fair Entitlements Guarantee, a scheme of last resort, which will take some months to finalise.
The meeting of creditors was also told The Standard Agency, which also operated out of the McCorkell address, was now a creditor. According to ASIC records, this company was formed in 2017 and that Scott McCorkell is the sole director.
Bailey, who pointed out his current investigation was preliminary and that his work had been interrupted, was quizzed over his investigation.
He ended up apologising: "I'd like to apologise for the deficiency in my report… and I apologise for any confusion caused by that.”
A search of PPSR (Personal Property Securities Register), which records whether or not others have an interest in property other than land, was carried out on the new company, McCorkell Group, rather than the company in liquidation, McCorkel and Associates
Bailey: “I have made this point many, many times… being appointed right before Christmas. Having been on leave myself, coming back and dealing with a number of matters, with other staff on leave, and then put on notice to convene this meeting shortly after my return to work.
“My investigation would have been completed by the middle of March, meeting the requirements of the (Corporations) Act, had I not been put on notice of the requirements convened for this meeting.”
He was also asked whether the agency had received any offers from potential buyers.
Scott McCorkell, who attended the meeting of creditors, answered: “I have never received any offers or anything to buy the business? It's not been on the market.”
The meeting was also told Scott McCorkell had still not provided a ROCAP, a Report on Company Activities and Property, within five business days of the appointment of a liquidator, as required by law.
Voting
Bailey announced: “We have a split outcome. The value of creditors to the tune of 59.54% have voted for the replacement, 39.83% against. In terms of the numbers (of creditors), we have 34.38% for and 62.5% against.
“The issue now comes down to whether or not I exercise a casting vote in favour of the motion or decline to cast and the resolution be defeated.”
Before he could declare his hand, Bailey was asked by a creditor if her vote had been counted or not? Her vote had been missed. She voted for the resolution, to change liquidators
Bailey: “Was anybody else missed or … has a special proxy or has not voted?”
The liquidator then put his casting vote in favour of the motion, effectively removing himself and appointing Michael Hogan.
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