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Mums and dads, tool firms stung in building firm collapse

Bloomer's difficulties had repercussions for many firms across Queensland, court records show.
Bloomer's difficulties had repercussions for many firms across Queensland, court records show.

A HODGEPODGE of creditors were at odds over how to claw back money after a big construction firm went belly up, court documents showed.

People and companies owed millions after Bloomer Constructions collapsed voted against liquidation and in favour of a different arrangement.

Companies in Emerald, Bundaberg and Gladstone as well as on the Fraser Coast and the Sunshine Coast were among those claiming money owed, papers filed in Brisbane Supreme Court show.

More than 600 creditors were identified in an affidavit from an administrator earlier this year.

"There are severable identifiable groups of creditors, with varying priorities," Sule Arnautovic wrote.

Three included "subcontractors, trade suppliers, employees, larger developers" as well as "mums and dads" home owners, National Australia Bank, insurance companies, statutory authorities and others.

A creditor who was at the most recent creditors meeting told NewsRegional people owed money voted for a deed of company arrangement, or DOCA, by "probably three votes to one".

The Australian Securities and Investments Commission says DOCAs aim to get a better return for creditors than immediate winding up of the company, although court documents showed that remained a matter of debate.

Subbies United spokesman John Goddard was among those claiming money owed.

As someone owed money before when building firms fell over, he had little faith in liquidations.

"In 30 years I've not seen a cent come back to me or my company," he said.

Regional Queensland firms with claims in a court document filed on May 22 included a Maryborough timber firm claiming $426,607 and a Goondiwindi crane hire outfit seeking $36,656.72.

One Gladstone landscaper was claiming $27,000 and a Warwick company said it was owed $10,539.

Firms in Maroochydore, Sippy Downs, Rockhampton and Bundaberg were also owed thousands.

But some Brisbane companies were claiming more than $350,000.

Bloomer owner Onterran said in a market update "the formalities of entering into the DOCA are in the process of being completed and a market update will be provided once done".

The Bloomer collapse was part of a broader industry malaise that has had building commentators concerned.

Mr Goddard blamed the downturn partly on changes the previous LNP government made to financial reporting provisions.

There was no suggestion Bloomer was a rogue operator - in fact, Mr Goddard praised efforts Bloomer had made to repay subbies owed money.

"I've never seen a building company try to actually get creditors paid like that," Mr Goddard said.

But he said the 2014 changes emboldened sharks elsewhere in the industry.

The Queensland building industry was generally in a "terrible" situation, he said, but some initiatives were providing a glimmer of hope.

Mr Goddard said new special project bank accounts would provide some protection for subbies.

"You don't have to go to bed at night sweating over a $100,000 cheque."

-NewsRegional

News Corp Australia

Topics:  bloomer constructions bundaberg construction doca emerald fraser coast gladstone john goddard landscaping subbies subbies united sunshine coast timber hire


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