Breakwater Bar and Restaurant at Mackay Harbour liquidators reveal $1.19 million debt

A Mackay bar and restaurant which shut suddenly in March couldn’t pay superannuation to its family employees with the appointed liquidators claiming it had been insolvent as early as 2021. See how it spiralled.

Breakwater Bar and Restaurant was a popular eatery and wedding venue at Mackay Harbour, which entered into liquidation in March. Picture: Facebook

A harbourside seafood restaurant in Mackay collapsed under the weight of its debts, with the full impact to creditors and staff now revealed in a report by the liquidators.

LA Ford, better known as Breakwater Bar and Restaurant, entered into liquidation on March 24 — but the liquidators believe the debts reached a critical point by June 2021.

The Mackay Harbour restaurant owes $1.19m to almost 30 creditors including $156,000 for rent, $87,000 in employee superannuation payments, $384,000 to the Australian Taxation Office and almost $10,000 for meat and produce, according to a June 27 report lodged to ASIC by appointed liquidator Business Reset.

The company, founded and directed by Latasha-Ann Ford of Beaconsfield, opened for business in July 2017 and officially ceased trading on March 24 this year, three days before the liquidator was appointed.

Breakwater Bar and Restaurant occupied a prime piece of beachfront real estate. Picture: Facebook

But the liquidator’s report claims Breakwater had been insolvent from about June 30, 2021. Its debts to the ATO and the more than $80,000 in unpaid superannuation all came after that date as the company stopped paying its bills in full.
Ms Ford clarified the superannuation was owed to herself and immediate family members working in the business.

But where did the trouble begin?

Staffing woes and the disruptions of the pandemic were hammer blows to the restaurant as Ms Ford tried her best to keep above water.

“Before covid we had four chefs,” she explained.

“After covid we were left with only one chef. It was virtually impossible to find a chef or cook.”

Ms Ford had to make the tough decision to drop trading from seven days a week to five so that the chef could have days off, but that severely limited bookings and events on weekends, where the business’ main income came from.

“Then at the beginning of 2023 the breakwall was closed for nine months and passing traffic was reduced to zero,” she said.

Ms Ford said she put the business up for sale, but had no luck.

“All 20 interested parties came back with the same response that rent and over heads was to high. A Sydney buyer offered $3.2m in cash but was rejected by the landlord as the offer included the building,” she said.

What’s owed

These debts are on top of $610,371 in “accumulated losses” with Business Reset reporting to ASIC that it sought to prioritise super payments as a creditor in the liquidation process expected to wrap up in the next six to 12 months.

Breakwater Bar and Restaurant told its customers it was shutting down on April 5, thanking its employees. They are owed $87,000 in unpaid superannuation according to the liquidator’s report. Picture: Facebook

“The director has advised that, in her opinion, the failure of the company was due to … the impact of Covid-19, unfavourable economic conditions, (and) unmanageable ATO debt,” the report states.

“In addition to the above, I am of the opinion that unprofitable trading and failure to manage the company’s taxation affairs contributed to the failure of the company.”

In a Report on Company Activities and Property for the liquidator’s report, Breakwater was owed $285,382 “for an unpaid director loan account and that amount was unlikely to be recoverable”.
Ms Ford is the only listed director of the business and said that money was not a lump-sum loan, but her wages taken while the business was operational.

The restaurant first opened its doors in 2017, taking customers for lunch, dinner, drinks and coffees.

“On May 27, 2024, (Ms Ford) declared personal bankruptcy and the company will rank as an unsecured creditor of her bankrupt estate for the loan account,” the report states, adding it “appears unlikely” the estate would provide returns for creditors.

Ms Ford co-owns a home which she said it is in the hands of the bankruptcy trustee as to if and when it will be sold, with proceeds being used to pay debts.

Those creditors include Mackay-based developer Charles Camilleri whose company Camco Developments is owed $156,785 as the landlord of 9 Breakwater Access Rd, where the restaurant traded.

What was left behind at the restaurant, according to the liquidator’s report, is next to worthless after factoring in costs to collect, transport, insure and sell the items.

The report adds a search of Ms Ford’s assets only recovered $85 across three bank accounts as the liquidator seeks permission from ASIC to demand ATO refund what it alleges are five preferential payments before the restaurant folded, totalling $52,150.

Business Reset stated its investigations were ongoing but it was “unclear whether sufficient funds will be realised” to pay creditors including lenders Shift, Finance One, and On Deck – which are collectively owed more than $121,000.
The Daily Mercury reached out to Mr Camilleri, but did not receive a response prior to publishing.

Originally published as Breakwater Bar and Restaurant at Mackay Harbour liquidators reveal $1.19 million debt