For those attending online, sound drop outs, screen freezes and a constant hubbub of background blather plagued much of Wednesday’s first meeting of creditors of Toplace Pty Ltd, but joint administrators and meeting co-chairs Suelen McCallum and Antony Resnick can take comfort from the fact that despite the glitches, creditors refused to back their only challenger.
Things started badly because they started late. An hour late.
This was McCallum explained due to creditors queuing outside while awaiting their turn to register.
Once the meeting was underway those online found their screens dominated by dVT Group partners McCallum and Resnick seated before a laptop in a function room at Drummoyne Oval.
There were problems with the hand held microphone. At times those online could see the co-chairs speaking but couldn’t hear.
This meant one of the chairs, usually Resnick, would repeat questions asked from the floor for the benefit of those online. When not farcical, laborious.
Creditors heard that while Toplace might have up to $1 billion in liabilities the 65 or more subsidiaries over which McCallum and Resnick have control are expected to have debtors, stock and real property they can utilise for the benefit of the general pool.
Creditors also heard that there were only two resolutions to consider.
Whether or not to appoint a Committee of Inspection (COI) and whether or not to remove the administrators and install replacements.
In respect of the latter they said that consents had been received from Ferrier Silvia principals Brian Silvia and Geoff Grainger.
A representative of one of the many Toplace Strata Plans said his clients were owed as much as $100 million. He believed FerrierSilvia’s experience and resources were superior to those of dVT Group.
Silvia then rose and addressed the meeting. He spoke of his lengthy career in insolvency, much of it focussed on the construction and property sectors.
When a creditor asked how FerrierSilvia could suggest it had sufficient resources when the creditor could only see a photo of five senior people on the firm’s website Silvia patiently explained that he had access to many more staff, including via a back office offshore and his old firm BRI Ferrier (NSW), the practice he left in November 2020. (More on that next week).
We’ll have to wait for the detail about who voted and how but the upshot was that resolutions to form a COI and remove the administrators failed, meaning that McCallum and Resnick are now in charge of what is like you be one of Australia’s largest property sector insolvencies.
Given the size of the job and the level of complexity we asked McCallum about the likelihood that she and Resnick will apply to have the convening period for the second meeting extended and she confirmed it was under consideration.
We also asked McCallum if she could confirm iNO’s mail that the administrators have secured at least $2 million in a Toplace bank account but we received no reply. Must have been a technical glitch.
Further reading:
The administration and no doubt eventual liquidation is likely to be lengthy and expensive and difficult for which ever External Administrator receives it. It is clear that claims against the developer are going to be difficult and the builder also difficult because of the vast amounts involved. A serious issue will be the extent of any right of indemnity against any relevant insurer and whether because of the multitude of different sites there is some overall “cap”.