Self-help debt recovery evident, court hears
Elements within the construction industry who are owed money have in the past turned to helping themselves when it comes to recovering debts, the Circuit Civil Court heard when an interim examiner was appointed to a Co Dublin machinery rental company.
Counsel Ross Gorman told Judge Jacqueline Linnane that such “self help” remedies of debt recovery created a significant issue in cases where ailing construction companies were under the protection of the court, but with no interim examiner in place to monitor that protection.
Mr Gorman, who appeared with Cosgrove Gaynard Solicitors for Cool Cat Plant Services Ltd, of Naul Road, Knocksedan, Swords, Co Dublin, said the company was unable to pay its debts and was seeking the appointment of Joseph Walsh of JW Accountants, Dublin, as interim examiner.
He said 80% of Cool Cat’s heavy machinery fleet could be parked on third-party sites overnight and largely consisted of vehicles on lease from providers, who constituted the company’s main creditors.
Patrick Hughes, the company’s sole shareholder and managing director, of Holywell Lane, Festre Hall, Swords, said Cool Cat Plant Services employed 38 workers who faced losing their jobs if the company was forced into liquidation.
Chartered accountant Daire Turner, of Daire Turner and Associates, Skeffington St, Wexford, who had prepared an expert report, said the company had a good prospect of survival under examinership.
It had been incorporated in April 2008 and its main business included large excavation projects, site clearance, major earthworks and waste disposal.
It had established a good reputation within the sector and had a very strong client base.
Mr Turner estimated liquidation would result in a redundancy cost and expenses bill of €189,000, to be met by the State.
He had established it had a turnover of €4.79m in the last 11 months and was trading above break-even.
He said the company in recent weeks had received demands in respect of arrears on lease or hire-purchase agreements.
Mr Gorman told Judge Linnane the company was cash-flow insolvent and unable to pay its debts.
Payments for work done by the company were made by its customers over 30- to 90-day periods of grace, with some firms having failed to pay well beyond those periods.
Judge Linnane appointed Mr Walsh as interim examiner and adjourned further proceedings until early July.
