Tuesday 15th May 2012
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Colin McCloy and Craig Sanson of accounting firm PwC have been turned down as liquidators of Auckland engineering company Wire By Design because of their role in winding up a related company.
The company was placed in receivership this month owing $960,000 to the Inland Revenue Department and $24,075 to Faulkner Collins, which failed last year and from whom Wire By Design bought its assets.
McCloy and Sanson are the liquidators of Faulkner Collins and IRD had proposed they have the same role at Wire By Design. However, the receivers of Faulkner Collins opposed the appointment, according to a reserved judgment from associate Judge Hannah Sargisson in the High Court at Auckland.
The failure of Wire By Design came after a dispute with the New Zealand Transport Agency over compensation for land required for the Waterview motorway extension at Mt Roskill. The Engineering Printing and Manufacturing Union was critical of the NZTA’s handling of the dispute, which it said contributed to the company’s failure.
Wire by Design director Hadley Wright claimed NZTA owed his company $2.6 million in compensation for lost business during the seven months it was out of operation because of its relocation, Fairfax reported last week.
The company also said it had a counter-claim against IRD for $282,161 due on a GST refund though Judge Sargisson said there was “too much uncertainty” over what might be recouped.
In addition to being liquidators of Faulkner Collins, McCloy and Sanson had a continuing business association with a number of the secured creditors of Wire by Design, Judge Sargisson said in her decision.
“Weighing up all considerations it seems to the court there is too much risk for the good reputation of Mssrs McCloy and Sanson because of the inevitable perception that their independence would be at risk,” she said. Andrew McKay of Corporate Finance has subsequently been appointed liquidator to Wire By Design, according to the Companies Office.
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