JM Kelly financial controller Elizabeth Murphy quizzed about the health of her mother who became a director of a subsidiary

An elderly woman, now suffering from dementia, was the sole director of a JM Kelly company that took on large debts from other firms in the now failed building group, a court has heard.

MOTHER’S ROLE

THE story behind the $50 million collapse of JM Kelly Group gets more complex by the day.

The Federal Court on Tuesday heard that the 80-year-old mother of JM Kelly financial controller Elizabeth Murphy was the sole director of a JM Kelly company that took on large debts from other firms in the now failed building group.

Barrister Craig Wilkins, acting for JM Kelly liquidators PwC, told the court that Noreen Murphy was the director of GJ Murphy Holdings in June 2018 when it assumed debts of $1.65 million from other companies within the Rockhampton-based construction firm.

The group collapsed in October of that year owing millions.

The court in Brisbane heard that the JM Kelly Group made a series of other complex loan transfers as the Queensland Building and Construction Commission (QBCC) probed the struggling construction firm to see if its licence should be revoked.

Mr Wilkins said the effect of the loan transfers was to appear to “wipe the balance sheet clean” for companies in the group holding building licences with the QBCC.

Mr Wilkins asked Elizabeth Murphy whether her mother did any due diligence on the debt being taken on before agreeing to the move.

JM Kelly financial controller Elizabeth Murphy.

“You would have to accept that the sole director of a company ought to act prudently to take steps to assure themselves that the debts are of value,” said Mr Wilkins, who added the companies assigning the debt had negative asset positions. “These debts were never repaid.”

Ms Murphy agreed with Mr Wilkins that at the time of her being a director her mother did not lack capacity to carry out her duties but was not aware of what due diligence she carried out in relation to the debt assignment. She said the group in its entirety was in a positive asset position. Ms Murphy said her mother’s condition had deteriorated this year.

The court also heard of a transfer of more than $2.4 million made by JMK Pastoral to JM Kelly Builders on 30 June 2017. Mr Wilkins said three days later a transfer of $1.15 million returned to JMK Pastoral from JM Kelly Builders.

Under questioning from Mr Wilkins, Ms Murphy said the transfer were part of loan repayments agreements between companies in the group.

The case continues.

TRUCKING GOOD

BRISBANE-BASED Battery World Australia and Yuasa Batteries are getting behind a motor event described as race cars on steroids.

The companies will announce a multi-year sponsorship deal of the Stadium Super Trucks Australia tournament at a special exhibition launch Wednesday on the Gold Coast.

The first round of the 2020 competition will kick off at the Adelaide 500 in February where the event will feature massive stunts and jumps, crashes and intense door to door racing. Battery World general manager Shawn Kerr (illustrated) says that when in full flight the super trucks are “mega machines and race cars on steroids.”

“We are confident this addition will create even more of a spectacular to the Supercars’ Events,” Kerr says.

Stadium Super Trucks now sponsored by Battery World.

VALE STUART

SAD news in the legal profession with the news that rising young Brisbane intellectual property lawyer Stuart Efstathis, has died aged only 26.

Stuart, who passed away on 17 October as a result of an ongoing respiratory condition, was by all account a bright star in the complex area of IP Law.

He joined Brisbane IP law firm Eaglegate Lawyers in June with practice principal Nicole Murdoch saying the young man had a great passion for assisting clients.

His academic background in applied science, where he majored in biotechnology, helped his practice of IP law. He also was an avid photographer and football fanatic.

Ms Murdoch says Stuart made a very positive contribution to the practice of law in Queensland and would be mourned by the profession.

SCRATCH AND SMELL

PEOPLE going through the security screening at the Commonwealth Law Courts in Tank St may have noticed the collection of deodorants being held in a tray there. City Beat spies tell us that the cans are not there to make the hard-working security guards smell nice but rather are confiscated from people trying to enter the court precinct with the items in theirs bags. The fear is the deodorants could be used as a weapon and sprayed in the face of people during heated moments in court. Ouch.

Commonwealth Law Courts at North Quay, Brisbane City..