Richard Albarran.
Reading the latest report to creditors from the liquidators of Orbis Commodities Pty Ltd, iNO is yet again moved to ponder on the wisdom of forcing appointment takers to provide a life-of-job fee estimate in their initial notice to creditors.
When the estimate is between $50,000 and $100,000 and 18 months later the amount being sought exceeds $1.4 million, one wonders if the requirement doesn’t do more harm than good, particularly if relations between appointees and at least some creditors are already strained?
Two insolvency practitioners who are about to find out just how unhelpful the initial estimate obligation can be are Hall Chadwick’s Richard Albarran and Kathleen Vouris, currently liquidators of Orbis and related entity Pacific Investment Holding (PIH).
Orbis and PIH conducted agricultural trading activities in the Asia Pacific Region in a joint venture (JV) operated by Orbis director Willem Johan Van Vlymen and Patrick Wong, a Chinese national.
When Wong and Van Vlymen fell out in 2012 a deal was arranged for Van Vlymen to purchase Wong’s shares in Orbis and PIH. Orbis was a party to that agreement.
Van Vlymen failed to obtain finance and negotiated an extension to complete the deal by February 2017.
Just prior to the deadline Chifley Advisory’s Given Moss and Trent McMillen were contacted by barrister Matthew Hogg. He had a referral and the pair were appointed VAs to Orbis on February 28, 2017.
Wong, who’d loaned monies to the companies party to the proposed sale agreement, appointed Worrells partner Chris Darin as receiver of Orbis on March 3, 2017.
At a meeting of creditors in June of that year and in spite of Wong’s objections, Moss used his casting vote to break a deadlock on a resolution to return the company to the control of its director. Years then proceeded to pass.
Then in September 2020 barrister Hugh Somerville contacted Albarran. Over the next few months meetings were held, e-mails exchanged and in April 2021 Albarran and Vouris were appointed administrators of Orbis and PIH by Van Vlymen.
Creditors were advised that the administrators expected the appointment would generate up to $100,000 in fees.
Then Albarran and Vouris got busy. They wrote to Darin seeking books and records and an understanding of what he’d been doing.
It seems the VAs and the receiver struggled to see eye to eye. Eventually Albarren and Vouris had Darin and Wong questioned via public examinations.
The also worked assiduously to make manifest a deed of company arrangement (DoCA) purportedly being propounded by the Solomon Islands Government. That meant making multiple applications to the court for extensions of the convening period for the second meeting.
When the deed proposal fell over in August in controversial circumstances – there were clauses in the proposed deed that allowed for Albarran and Vouris to be paid in priority to Wong – the company was wound up and Albarran and Vouris were appointed liquidators.
On Wednesday this week the liquidators’ report to creditors dropped. As well as providing extensive background and an update as to what is still to be done, they advised that they would be seeking approval for the payment of more $1.4 million in fees
More than $1 million of that is for time charged whilst administrators. $50,000 has apparently been generated since their appointment as liquidators and a further $250,000 is sought to conclude the winding up.
Assuming they approve the resolutions, with voting to close by December 22, creditors might well be hoping the $250,000 estimate will turn out to be closer to the mark than that first fee forecast, with its breezy certainly of a figure that was short of the mark by a factor of more than 10.
Further reading:
Orbis VAs’ DoCa Efforts In Vain
Extend-A-Thon Continues As VAs Sweat On Solomons
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