Mountain Sounds: company collapses owing unsecured creditors $1.5m
First they cancelled a week out from the event, now the directors of the company behind the failed Mountain Sounds festival have appointed a liquidator with debts of more than $1.5 million.
**This article has been updated to reflect revised figures submitted to ASIC by liquidator Shaw Gidley. A spokesman for the firm, Jeff Shute, said: “It was identified that the amounts obtained for the purpose of preparing the list of creditors did not take into consideration contractual deposits paid to various artists during the lead-up to the Mountain Sounds festival.”**
Grammy Award nominee Courtney Barnett is among hundreds of unsecured creditors unlikely to receive a cent following the $1.5 million collapse of failed festival company Mountain Sounds Pty Ltd.
But the main festival organisers, Adam Masters and Clayton Parker, will walk away from the botched festival debt free, given a creditor’s report reveals the two directors are owed nothing.
The company behind the Mountain Sounds Festival was placed into voluntary liquidation last week with debts of $1,578,415.
A report to the Australian Securities & Investments Commission (ASIC) by liquidation firm Shaw Gidley shows the company had just $130,198 in assets.
Among the worst affected unsecured creditors was ticket seller Eventbrite, which is owed $893,000 and artist management company Maker left $84,150 in the red.
The company also collapsed owning the Australian Taxation Office nearly $90,000.
The company cancelled this year’s festival, blaming onerous new licensing conditions and the government’s “war on festivals”.
But the Express Advocate revealed the company only lodged its amended Development Application a week out from the event and it had failed to comply with several conditions, including notifying the local police and Roads and Maritime Services within certain time frames.
Despite announcing a scaled-down version of festival, the initial creditor’s report reveals the directors of Mountain Sounds, Mr Masters and Mr Parker, had not paid the majority of the artists.
All up nine booking agencies were owed $341,000 including independent artist Courtney Barnett, who is owed a $47,850 fee.
And while those debts may be paper losses only, the real losers are hundreds of punters who purchased tickets in good faith including one who paid $5,500 another who spent $2,020 and a third who spent $1,274.
All up unsecured ticketholders are owed nearly $100,000.
People who paid using their credit cards are being urged to contact their banks to inquire about the possibility of a refund.
IN RELATED NEWS
Meanwhile a number of local businesses have also been caught out by the collapse including
R.A.C.K Projects, of Wamberal, which is owed $11,252 and Geoff Steer Towing and Transport, of Somersby, owed $1,694.
In a statement issued by Shaw Gidley the liquidator advises hard copy ticket holders and those who purchased tickets through Live-IT who have not received a credit card chargeback should register with them by email: msf@shawgidley.com.au.
“All registered patrons will shortly be sent an SMS advising of the process to register their claim for refund against the Company,” the statement read.
**UPDATE**
Organisers of Mountain Sounds festival have supplied a short statement to the Express Advocate in relation to liquidation:
“Mountain Sounds can confirm we are in the process of liquidation. This has come as a result of being forced to cancel the event a week out from when it was due to take place.
“Cancelling the event has meant we have had to forfeit all artist and infrastructure deposits and many other upfront expenses, plus have forgone all on day and sponsorship revenue expected.
“This is yet another example of the catastrophic impact the new policies will have on not just festival organisers but all parties involved should the new (government) policies go ahead.”
Organisers dispute many of the financial figures contained in the liquidator’s report.
They insist both Courtney Barnett and Maker were paid 50 per cent of their fees before the event had taken place, and that the remainder would have been paid if the festival had gone ahead.
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