Unclear When Porter Davis Creditors Will Be Paid

Unclear When Porter Davis Creditors Will Be Paid
A partially finished Porter Davis home is seen in Rochedale, south of Brisbane, Friday, March 31, 2023. Building works will stop immediately on more than 1700 properties in Victoria and Queensland as a result of the collapse of Porter Davis. (AAP Image/Jono Searle)

It’s unclear when creditors owed millions of dollars following the collapse of builder Porter Davis will see their money or how much they'll get.

The company fell over in late March with about $147 million (US$97.67 million) in debt, leaving some 1700 homes in limbo in Victoria and Queensland.

On June 28, around 20 people representing hundreds of creditors met at the Sofitel in Melbourne to discuss the next steps.

Several motions were passed related to paying liquidators Grant Thornton, contracts and forming inspection committees on three companies.

The focus remains on clawing back money, but it’s still too early to say how much money would be recovered and put into a pool for creditors, according to Grant Thornton partner Matt Byrnes.

Families building homes and contractors such as tradespeople are among ordinary unsecured creditors owed $71.5m; however, they are unlikely to receive any money.

“There’s still some possibility if the (efforts to recover money) go really well that they could be, but at the moment we think it’s unlikely and that’s the advice we’ve given to the creditors,” Byrnes said.

The Commonwealth Bank of Australia is owed $33m, which will likely be paid in full.

Chesapeake Pty Ltd and employee priority creditors will likely get a partial dividend.

Separately, it was revealed liquidators have sold off subsidiary luxury home building company Englehart to an unidentified builder.

All their construction projects and employees remain unaffected by the collapse of the parent company.

Some 560 Victorian Porter Davis clients were not covered by insurance despite paying the construction giant before it collapsed, forcing the state government to establish a $15 million bailout scheme.

Simonds Homes and Metricon Homes have since committed to finishing off some of the incomplete houses.

Earlier in June, the liquidators released a statutory report revealing the builder may have been trading while insolvent from February 2023.

Byrnes said there were some indicators it may have done so before that however the exact date remains unclear and there was no compelling case proving that things went wrong before then.

There is no timeline for the liquidator’s investigation and about three terabytes of data to go through, which Byrnes estimated would take hundreds of hours.

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