Lawyer stuff-up blamed after receiver appointed to Hutchinson Builders in ASIC lodgement “error”

The “unfortunate” chain of events that led to an incorrect document appointing an external administrator to Hutchinson Builders has been revealed. WHO LODGED THE FORM:

Hutchinson Builders has revealed the “unfortunate” chain of events which led to a document appointing external administrators being lodged “in error”.

Australian Securities and Investments Commission records show a four-page notification of appointment of a receiver and manager, dated September 6 was lodged for Hutchinson Builders on September 9.

A two-page notice for a cease of receivership, also dated September 6, was lodged on September 13.

Hutchies director Russell Fryer said the blunder had been caused by a lawyer filling out a form incorrectly.

“The form was lodged by an external legal consultant, HWL Ebsworth, who was representing Hutchies, and mistakenly put our company name in the wrong place on the form,” Mr Fryer said.

“Hutchies was appointing a receiver to preserve our position on the Queen Street Village project.

“Regrettably, it was an unfortunate mistake.”

Hutchies is listed as a $22m secured creditor of company Nerang Street, developer of the $500m Queen Street Village project in Southport, which called in administrators earlier this month.

Hutchies has now published its audited 2021-22 financial report, a profit before tax of $29.8m, and a debt-free balance sheet of $388m.

Russell Fryer.

Mr Fryer said the builder remained in a strong position.

“There is no doubt that the industry remains challenged by supply, labour and weather delays which continues to add pressure on time and cost across the construction sector,” he said.

“People are looking for security in these uncertain times, and the strength of Hutchies’ balance sheet provides that certainty.”

Subcontractors had been “scared stiff” by the lodgement, which came on a backdrop of skyrocketing supply and labour costs which have seen a slew of major builders collapse into liquidation.

Bob Crouper, a 60-year construction veteran who ran his own mechanical services business, said the situation was “a shocker” and had rattled subcontractors.

“They’d be scared stiff,” he said.

“If Hutchies falls over then that’s almost the end of the road.

“It’s the last thing we want.”

Oliver Judd, CEO of the National Electrical and Communications Association said the industry would “breathe a sigh of relief” the document was an administrative error.

“The effects of a company of the size of Hutchies going into administration would have a significant impact right throughout the sector,” he said.

“Many NECA members have had long and successful associations with Hutchinson Builders and are involved in many of their current projects.

“Concern as to business liquidations weigh heavily on all subcontractors so I imagine there were some very nervous moments for those who saw the announcement prior to the retraction.”

Condev, ProBuild, Oracle and Pivotal Homes have been among the casualties, with the latest ASIC data revealing the industry experienced its greatest number of administrations in a June quarter since 2015.

A popup on the privately-owned company’s website this week described the lodgement as “an administrative error which has been immediately corrected and is in the process of being removed”.

“Hutchies has been trading for 110 years and has a debt free balance sheet with equity exceeding $380m,” the pop-up statement read.

Mr Crouper said he’d worked for Hutchies in the past and had been paid on time and in full.

A form to appoint a receiver to Hutchinson Builders was lodged “mistakenly”.

WHICH BIG BUILDERS PAY SUBBIES ON TIME

Chairman Scott Hutchinson.

Hutchies is working on The Lanes Residences.

The company, commonly known as Hutchies, is responsible for some of the country’s largest civil and commercial projects, including schools, hospitals, churches, high-rise office blocks, residential towers, service stations, Coles and Bunnings stores, airport terminals, sport centres and hotels.

It was this month also named the nation’s third most prolific home builder, with 3829 starts, primarily in the apartments sector.

Headed by chairman John Scott Hutchinson, the business reported revenue of $2.67bn this year, down from $2.87bn the previous year.

Local projects have included $275m The Star Gold Coast Tower One, which incorporates 423 apartments and the Dorsett Hotel; $140m 272 Hedges tower; $7.2m 77 Jefferson at Palm Beach, Vue tower at Broadbeach; $30m Capri on Via Roma; $12.4m Gold Coast Titans Training Centre; and $23m O’Reilly’s Rainforest Retreat hotel.

Current projects include the $17m Paradise Centre redevelopment, Mondrian Hotel and Residences, Miles Kirra and $65m residential project The Lanes at Mermaid Waters.

Hutchies is also building the $150m Eve Residences at Labrador, which it took on after Condev collapsed in May.

Artist impression Eve Residences at Labrador.