A Plymouth construction firm has gone bust leaving debts of nearly £4m - most of which won’t be paid.
Eliot Design & Build Ltd, based at Stoke Damerel Business Centre, went into liquidation in late 2020 but the scale of its debts are only now being revealed..
The company had been involved in several high-profile house building projects, for the affordable and open markets, around the South West, including in Plymouth, Exeter and Truro.
But it went out of business in November 2020 leaving 14 staff facing redundancy and needing support from the Government’s redundancy payment service. A report on the conduct of its directors has since been sent to the Government.
Documents recently filed at Companies House now reveal that 187 creditors were owed a total of £3,860,583. So far, claims from 89 of them, totalling £3,342,917 have been received by liquidators at Castle Hill Insolvency Ltd, Newton Abbot.
Steven Henson, in his recently released Liquidator’s Annual Progress Report to Creditors and Members, said this could be the tip of the iceberg as claims from housing developers have yet to come in.
He said: “The total claims are expected to be significantly higher than what we expected at the outset, mainly due to claims made by other housing developers. They were originally included in the statement of affairs as £0 as the claims were unquantifiable pre-liquidation.”
Documents lodged at Companies House revealed £190,423 in assets was available to preferential creditors, including employees owed £34,883 in wage arrears and holiday pay. A property owned by the company was sold for £450,000, but with a mortgage on it of £298,386, it brought in £151,613.
Now it is estimated there will be a deficiency of at least £3,490,952 which means many people owed money will not be paid. Mr Henson said: “Based on current information, it is not expected that there will be a dividend payment to unsecured creditors.”
Banks and other lenders are owed £496,706, including £50,000 owed to Barclays Bank, £69,799 to Crowd2Fund and £185,000 to Funding Circle Ltd.
The taxman, HM Revenue and Customs, is owed £81,474, and utilities are short of large sums too, including the £101,721 claimed by South West Water, £30,615 by Wales and West Utilities, and £38,702 by Western Power Distribution.
Among the largest sums owed are several Plymouth businesses, including construction consultancy Bailey Partnership, short of £27,466, while £29,438 is owed to Gregory Plumbing and Heating Ltd, £133,487 to K&D Gilbert Ltd, £40,688 to LTC Scaffolding, Plymouth City Council is owed £12,814.
Elsewhere in the South West, £14,688 is being claimed by Concorde Recruitment in Truro, £77,028 by Frame UK in Redruth, £34,347 by Bristol’s GeMech Ltd, £47,448 from Hewaswater Scaffolding Ltd in Cornwall, £206,769 by MJL Contractors in Helston, and £47,380 is owed to Sam Gilpin Demolitions in Newton Abbot, amongst others.
The largest sum on a list of creditors is for £878,395 - claimed by parent company Eliot Group Ltd, which is also now in liquidation.
Another associated company, Eliot Developments (SW) Ltd is currently facing a notice for compulsory strike off, at Companies House. Such a petition is often raised by Companies House when a business has failed to file accounts or annual statements. Eliot Developments’ accounts for the year to March 31, 2021, were due by December 31, 2021, but are late.
Meanwhile, the liquidator has submitted a report on the conduct of the Eliot Design and Build directors to the Department of Business, Energy and Industrial Strategy. He said: “As this is a confidential report, I am unable to disclose the contents.”
In the case of an insolvent voluntary liquidation, the liquidator must report to the Secretary of State on the conduct of any past or present director where it appears to him likely a court will find the conduct of that director makes the person unfit to be concerned in the management of a company. The liquidator may believe more than one director is responsible for mismanagement.
In Plymouth, Eliot Design and Build has worked with Westward Housing Group on schemes at Ham Green Lane and the site of the former Clittaford Social Club. It was also involved in construction of 43 dwellings in Colebrook.
