Customers fume after handing over $22k to bust builder

Customers of a failed building company have been left fuming after handing over all their money just two weeks before the whole business collapsed.

EXCLUSIVE

Customers of a failed building company have been left fuming after handing over all their money just two weeks before the whole business collapsed.

Vince*, who did not want to share his last name, and his wife Katherine, 49, were toying with the idea of building a granny flat in their backyard as another stream of income.

After months of umming and ahhing and back and forth with their preferred builder, Cubitt’s Granny Flats and Home Extensions, the Sydney couple finally transferred a $23,000 deposit to the business.

But just 12 days later, this Tuesday, Cubitt’s went bust.

Cubitt’s had been in business for 30 years and operated in NSW and the ACT.

Most of its 80 staff have been stood down while the appointed administrators, insolvency firm RSM Australia Partners, said 120 homes had been impacted.

Around 200 creditors are cumulatively owed $3.3 million.

Vince, a dad-of-three, has now been left wondering how the business was able to take his money at such a late stage if the company had known it was in financial strife.

“It came as a shock,” he told news.com.au. Based on his interactions with staff, it appears to have been a surprise to them, too.

Less than a fortnight after this transfer, the company went bust.

Katherine and her husband Vince are wondering what this means for them.

Adding to Vince’s concerns is the fact he is unsure if he received the correct insurance for his building contract, which could mean his deposit has gone into a black hole.

He could not find a HIA certificate which would confirm he had insurance.

The administrators, Richard Stone and Brett Lord, are not sure whether insurance was taken out for every project.

“The Administrators are examining the insurance status of projects as part of their investigation,” they said in a statement to news.com.au.

“Cubitt customers with any concerns or queries are encouraged to contact RSM.’’

Vince said he only found out about the collapse of Cubitt’s because site surveyors were supposed to visit his backyard this Tuesday, the same day the builder went into external administration.

The surveyors called him before they arrived asking if he’d be willing to pay them directly.

When he asked why, they said it was because Cubitt’s had gone under.

“We looked at their display homes, we were excited, we were trying to provide a future for our kids,” he said. “Now we’re just hit with this.”

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An email received on Thursday morning, after the building company had appointed external administrators.

Rubbing salt in the wound is an email Vince received on Thursday morning from Cubitt’s.

The marketing email had a subject line of “There’s Nothing Stopping You”.

“Cubitt’s Granny Flats and Home Extensions is a business you can depend on,” the email to Vince read. For almost 30 years, we’ve been perfecting the design and build of Granny Flats and Home Extensions for thousands of Australians.

“Our quality service and construction is thanks to our hand-picked consultants, designers and tradies across every part your journey.

“We work across the state and our buying power means you are not at the mercy of the market.”

The email was also interspersed with glowing testimonials and a section on how Cubitt’s were experts on receiving council planning certificates.

Bizarrely, the email address no longer works, as an email news.com.au sent on Tuesday bounced, but these marketing messages are still going out.

The email Vince received just weeks before Cubitt’s went bust.

Vince said there were no signs that Cubitt’s was in trouble.

“They weren’t pushing it, they never really pushed us,” he said.

He said they dealt with a “very nice” salesperson who is likely now out of a job.

“Now I just wish I’d taken another week to make up my mind,” Vince lamented.

In a statement supplied to news.com.au, the founders of Cubitt’s said they called all staff into a meeting on Tuesday and informed them the business could not keep carrying on.

“We informed our loyal and hardworking staff in person where possible and remotely via video, some of whom have been with us for more than 25 years, of our decision,” Cubitt’s said.

The meeting was described as “very emotional” and the decision was one that evoked “great sadness”.

The first creditor meeting is happening on March 7.

Cubitt’s said it was unable to continue because of the economic downturn flattening builders across the country.

“Due to bank lending conditions, supply prices, taxation changes, insurance prices, Covid recovery and lengthy weather events, Cubitt’s company has suffered more than it can shoulder,” the company said.

Cubitt’s also noted it had tried to “honour fixed price contracts” in 2021 and the owners, Ian Cubitt, Kim Cubitt and Kate Cubitt, tried to complete builds by financing it through their own personal money.

“We will be working with the Administrators to provide everything they need to achieve the best outcome they can for Cubitt’s, and its staff, customers, suppliers and other creditors,” they added.

Interested parties and impacted creditors are urged to contact [e-mail].

The sales campaign for Cubitt’s kicked off on Thursday morning, with an advertisement appearing in The Australian Financial Review.

RSM is hosting the first creditor meeting on March 7.

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