Ri-Con subbies launch investigation into builder collapse
A GROUP of subcontractors badly impacted by the collapse of builder Ri-Con Contractors, has engaged investigators to prepare a brief of evidence in a bid to force a criminal investigation into events leading up to the company's liquidation.
The subbies had been working on jobs for which Gympie, Noosa and Sunshine Coast councils were clients.
O'Brien Plumbing Noosa and O'Brien Plumbing Sunshine Coast along with other impacted subbies, have engaged Complete Corporate Services to prepare a brief.
Peter King, who owns O'Brien Plumbing Sunshine Coast, has also called on Noosa and Sunshine Coast Councils to follow Gympie's lead and agree to release documents provided by Ri-Con to secure progress payments.
Builders were required by law to certify they have paid subcontractors before any future progress payments were released by clients.
Gympie councillors voted unanimously this week to release the documents, including statutory declarations submitted by Ri-Con to the council about payments, copies of the insurance currency certificates for the Kilkivan Equestrian Centre and Gympie Youth Hub projects, and the tender documents issued for these works, despite the risk of the council being left legally exposed.
Sunshine Coast Council through a spokesman said today it too would provide documents to affected subcontractors on request.
Noosa Council Community Services director Kerri Contini said the council was unaware of rejecting any "properly-made requests" from subcontractors for such documents.
"However, given the size of the organisation and the number of council staff who have been contacted by subcontractors since Ri-Con went into liquidation in January, there may have been some that we are unaware of," she said.
"Council has already, and will continue to, provide information and documentation to subcontractors through the appropriate channels.
"We continue to respect and comply with our contractual and legislative obligations to all subcontractors, as well as our obligations to the court proceedings under way."
Mr King's business was left owed just under $80,000 by Ri-Con which also owed O'Brien Plumbing Gympie $160,000.
Having been previously caught, suffering crippling losses because of non-paying builders, he also has questioned why the Australian Securities and Investments Commission had not come down hard on directors of companies who allowed them to trade while insolvent for extended periods.
"There can be millions of dollars involved yet ASIC does nothing every time," he said.
Mr King said subbies also wanted to see what active indemnity insurance Ri-Con was carrying at the time of it hitting the wall.
Civil contractor Dave Daniels, who was left owed more than $30,000 for work done on the Caloundra Tennis Centre, said he had warned the council's on-site supervisor - as had other subbies - about Ri-Con's failure to pay within contracted timelines.
He said Sunshine Coast Council should have questioned the accuracy of statutory declarations provided by the builder.
"Subbies were going to the council representative saying they needed to be paid," he said.
"The council was aware there were issues on the site."
Liquidator Paul Nogueira said in his last report to ASIC that a shortage of funds and limited access to Ri-Con's financial systems left him "unable to form any view" on claims the documents presented to its clients may have breached laws.
The report said the Commonwealth Bank was likely to be the only business to recoup money from the collapse.
Subcontractors Alliance head Les Williams said the misuse of statutory declarations had been a common factor in many Queensland building industry insolvencies.
"No-one prosecutes," he said. "The law is not being enforced."