The story is not so comforting for hundreds of Beechwood’s unsecured creditors. They are now considering the latest

report from the company liquidator Armstrong Wily before meeting in Sydney next Monday to discuss options to recoup their money.

At least 123 businesses are owed $11 million by local Beechwood Homes parent company LED South Coast.

A further $49 million is expected to be claimed by unsecured creditors to related companies.

Proceeds from the sale of the Beechwood Homes business must first be distributed to employees, banks and receivers before any funds can flow to these unsecured creditors.

Armstrong Wily has proposed a number of avenues for creditors to be repaid, including recovery of loans and transactions between related parties, pursuit of possible claims against current and former company directors for breach of duty and pursuit of a possible claim against the company’s former accountant and auditor RSM Bird Cameron.

An item that continues to be of interest to the liquidator is the Business Separation Agreement between Larry King and John Carson, which saw Huntingdale Park and Graham Park developments in Berry, as well as a number of blocks in the Carrington Park estate, transferred to Carson ownership.

The Armstrong Wily report suggests that loan accounts with Huntingdale Park Developments Pty Ltd, John Carson Constructions Pty Ltd and John Carson total more than $11 million.

However, spokesperson for John Carson Homes Group Mr Nathan Heard refutes the implications of the report.

“All debts noted in the report were repaid in December 2006,” Mr Heard said.

Creditors have been presented with the option of funding litigation themselves or obtaining insolvency litigation funding.

The latter would cost up to 40 per cent of any successful amount awarded by the courts.

Brian Aulsebrook of South Coast Timber Supply is one of the larger creditors in the region.

He can only shake his head at the situation and believes the NSW Government should support the hundreds of suppliers in any litigation.

“It’s a bit of a bad story. Why won’t the Government help us out?” Mr Aulsebrook asked.

“Even a loan to chase these directors would help.”

Finding some good in the dismal saga, Mr Aulsebrook spoke well of the sale of Beechwood Homes to Resibuildco.

“Things are trading well with the new Beechwood management and staff”, he said.

Fellow creditor Col Cheadle echoed this view.

“The past is the past”, said Mr Cheadle.

“The new bloke will make it bigger and better than ever.”