Queries to ASIC over proxies stalk PwC’s Vickers

PwC’s Derrick Vickers may well have suspected that his use of special proxies at the first meeting of creditors of Queensland construction outfit JM Kelly Builders Pty Ltd would attract some push back and if he did then he was right.

INO has learned that since the October 29, 2018 meeting both ASIC and ARITA have received complaints and queries from creditors disappointed that their bid to replace Vickers and new PwC recruit Michael Owen failed.

It should be declared at the outset that those creditors include construction industry activists who were intent on replacing Vickers and Owen and who aren’t ready to give up.

Nor is there’s independent corroboration at this stage indicating that the issues raised with the regulator and the professional body can even be made out.

Finally, we were not able to contact Vickers prior to publication to get his side of the story and INO makes no suggestion of wrongdoing.

A range of allegations have been made – Vickers allegedly didn’t allow creditors to record the meeting; he didn’t detail whether proofs of debt received were rejected, admitted in full or only in part; he did not provide any detail in relation to the proxies – but what’s interesting is the question raised in regards to whether a special proxy remains valid if the wording of the resolution to which the proxy applies is changed.

Advice to the creditors seen by INO indicates that while the proxy holder must vote the special proxy in accordance with the instruction provided, if the resolution’s new wording does not in essence change the spirit of what was intended then the proxy remains valid.

In Vickers’ case he was almost certainly cognisant that he was about to be ambushed.

He reportedly proposed the resolution “that Derrick Vickers and Michael Owens of PWC be removed as voluntary administrators and that Ginette Muller and Marcus Watters be appointed in their place” and then called a poll.

The voting forms handed out to creditors however read: “To replace the existing administrators.”

While only eight voted against the resolution the value of their votes eclipsed the value of the 18 in favour.

What the activists believe has given them a sniff of a chance is that Vickers apparently told the meeting that the eight against were not in the room.

Therefore it was impossible for those eight creditors to know the exact wording of the resolution to which their proxies were applied.

Technicality much? Definitely, but with creditors wielding greater powers to replace appointees the profession will nevertheless need to get used to it.

Don’t be surprised if ASIC or ARITA release some updated advice soon.