As creditors wait,sales for new venture begin

An artist’s impression of Lachlan Francis’ newest proposed apartment complex, The Mont Blanc, in...
An artist’s impression of Lachlan Francis’ newest proposed apartment complex, The Mont Blanc, in Queenstown’s Hallenstein St.IMAGE: SUPPLIED
A Queenstown property developer whose former company owes more than $1million to creditors is marketing luxury apartments through a new company.

Lachlan Francis’ company was to build a 16-unit apartment complex, Freshwater, on the corner of Hallenstein and York Sts.

His company, CFS Trustees Ltd, was placed in liquidation on May 4 last year at the request of out-of-pocket contractor Amalgamated Builders Ltd.

Liquidators say the company owes 16 unsecured creditors $1,021,474.94.

Seventeen days later, Mr Francis formed a new company, The Mont Blanc Ltd, which in January applied for consent for a similar-looking 23-unit complex on the same site.

The Hallenstein St site this week.PHOTO: GUY WILLIAMS
The Hallenstein St site this week.PHOTO: GUY WILLIAMS
Six apartments had already sold off the plans for about $2million or more, Invest Queenstown agent Simon Green said.

Contacted on Wednesday, Mr Francis said he needed to seek advice, and would look to comment next week.

One of the creditors, Queenstown Earthworks Ltd owner Craig Harper, said he was owed about $50,000, including about $30,000 he had paid to his own subcontractors for the work.

"We bent over backwards to help [Mr Francis]," Mr Harper said.

"It’s absolute b..."

He suggested Mr Francis hold a creditors’ meeting and say, "look, when we’ve finished this [project], we’ll pay the people who’ve done the work that’s already in there".

Local Just Dig It Ltd owner John Walsh, owed about $2000 for installing a service connection, said: "I’m concerned that he can do that, just like that, without paying his bills from the last [project]."

Aurum Survey Consultants Ltd director Bruce McLeod, whose Queenstown company was not owed a lot, said Mr Francis recently popped into his office.

"He sort of indicated we might get some of our money yet, but I’m not going to hold my breath on it."

Mr McLeod also thought it would be good if Mr Francis could pay CFS Trustees’ creditors from the proceeds of his new company’s complex.

Bruce Middleton, director of Amalgamated Builders, thought to be the biggest unsecured creditor by far, said he did not want to comment.

According to the first liquidators’ report, work ceased on Freshwater in late 2018 because of a dispute between CFS Trustees and "the head contractor", believed to be Amalgamated, "arising from the building contract budget".

"In 2019, the company sought to engage a new contractor ... however the previous contractor issued a statutory demand in respect of unpaid payment claims.

"The company was then put into liquidation on 4 May, 2020, by an order of the High Court in Whangarei."

Shortly before then, CFS Trustees had sold the site to a Wellington company that was the first mortgagee, thereby satisfying its debt.

The liquidators, PKF Corporate Recovery & Insolvency, said in their second report they were investigating this sale "and other related matters with a view to determining whether there may be an avenue for recovery for the company’s creditors".

"This involves a review of [Mr Francis’] conduct to determine whether he may be held liable for breaches of any duty under the [Companies] Act."

In the meantime, the remaining 17 apartments in The Mont Blanc — ranging from two to four bedrooms — are priced from $1,099,000 plus GST to $2,399,000 plus GST. — Mountain Scene

Add a Comment

Our journalists are your neighbours

We are the South's eyes and ears in crucial council meetings, at court hearings, on the sidelines of sporting events and on the frontline of breaking news.

As our region faces uncharted waters in the wake of a global pandemic, Otago Daily Times continues to bring you local stories that matter.

We employ local journalists and photographers to tell your stories, as other outlets cut local coverage in favour of stories told out of Auckland, Wellington and Christchurch.

You can help us continue to bring you local news you can trust by becoming a supporter.

Become a Supporter