SA court told managing director of Trims was ‘bailing out’ his son’s ‘failed restaurants’ before retailer’s financial collapse

THE managing director of iconic clothing retailer Trims went bankrupt because he was “bailing out” his son’s “failed restaurants” and million-dollar debts, a court has heard.

THE managing director of iconic retailer Trims went bankrupt because he was “bailing out” his son’s “failed restaurants” and million-dollar debts, a court has heard.

Matthew Trim was on Wednesday let out a side door of the Federal Circuit Court by security staff, avoiding the media, following a bankruptcy hearing about his father, Russell.

Mr Trim, owner of Grace The Establishment, repeatedly denied his businesses had anything to do with his father’s finances or the liquidation of Trims in 2013.

Examiner Catherine Gobbo, however, said Bank SA records of loan restructuring offers to Mr Trim, his father and his wife Olivia suggested otherwise.

“These were your debts, these were all your debts arising from your failed restaurants and your father was bailing you out,” she said.

“It’s the case that, had your father not entered into this restructuring arrangement in 2011, that he would not be bankrupt and you would be bankrupt.”

Mr Trim said that was “not correct” and that “we did not have a failing business”.

“I don’t think that’s true, no,” he said.

“That’s nothing to do with the position my father is in, and obviously Trims went into liquidation — what does that have to do with me?

“What’s Trims got to do with this restructuring?”

Trims was placed in administration in May 2013, owing about $3.2 million to unsecured creditors and $580,000 in staff wages and entitlements, and in liquidation a month later.

At the time, Russell Trim was the company’s managing director — it is now run by Justin Trim and Peta Thompson.

Under examination, Matthew Trim agreed the bank documentation showed he was named as a borrower, customer and guarantor on a $4.4 million loan offer in April 2010.

Further loan offers followed and, by September 2011, only the names of his father and his wife were on the documents.

Mr Trim said that was because his wife held all the equity in their new home, and that his businesses were “still paying the interest” on the restructured loan.

He refuted Ms Gobbo’s suggestion he was experiencing “financial difficulties” at the time.

“That’s what you say — you keep saying it, do you think it will come true?” he asked.

“Financial difficulties is if you’re losing money and not making money ... at that stage I had one business making money and one losing money ... I would call that ‘not ideal’.”

Mr Trim said his absence from the paperwork was “no big deal”, but Ms Gobbo disagreed, saying it allowed him to “walk away without owing any money”.

When Ms Gobbo asked Mr Trim how he intended to pay the lawyers representing him in court, he replied: “I don’t know, I haven’t worked that out yet.”

The bankruptcy hearing continues.

This afternoon, a Federal Court spokesman said Mr Trim’s side-door exit was not approved by authorities.

“The decision to allow this person out through a side entrance was made by security staff and was not referred to the court registry,” he said.

“It’s not our usual practice to allow such a thing to happen.”