“The hospital pass from hell”: Brad Skelton regains partial control of his business from receivers
Brad Skelton, the founder and director of transport company Skelton Sherborne, has regained partial control of the $68.5 million shipping company after it was placed in receivership last week. But he says the deal is "the hospital pass from hell".
Last week Deloitte was appointed by HSBC bank as receivers to Skelton Sherborne, prompting its founder and owner Brad Skelton to post an apology letter to clients and staff on the internet.
At the time, Skelton told SmartCompany he was "fighting like hell" to save his business.
It appeared Skelton had succeeded in his wish when just before 5pm on Friday Deloitte advised him the receivers had been "partially" retired by HSBC and handed control of the business back to him.
However, Skelton has taken to the internet again to explain the problems in being only partially given back control of Skelton Sherborne.
"I should be really happy as I am largely in control again but I have been handed back a company that has literally had its heart ripped out as a consequence of HSBC's actions in unjustifiably freezing bank accounts and then appointing receivers who brutally carried out their task in getting the banks money with little or no regard for our clients and our ongoing relationship with them, the future security of employment of my team and payment of other creditors who are owed money too," he said on his blog yesterday.
"I fear that these actions may have caused the company to become insolvent and as any responsible director knows it is against Australian corporations law to trade while insolvent."
Skelton said he is urgently seeking advice on potential liability for trading and the exact financial position of the company.
In the meantime Skelton said he may not be legally able to resume normal trading and cargo deliveries right away.
He said Deloitte continues to maintain control over bank accounts, the debtor book as at the 30 November and statutory refunds.
All other aspects of Skelton Sherborne are back under Skelton's control and Deloitte has pulled its people out of the office.
However, Skelton says as the HSBC bank accounts remain under Deloitte's control Skelton Sherborne has been effectively left without a bank account to operate. Skelton is unable to use any of the funds in the existing HSBC accounts.
As Deloitte has access to the debtor book it will be collecting all amounts owed to Skelton Sherborne as at November 30th, and so the business will not have access to these funds to allow us to operate with either.
Skelton Sherborne also has a stamp duty refund due of about $86,000 which Skelton said Deloitte has advised it will collect this as well.
"Therefore to run the business I effectively have no banking facilities, no cash coming in from past work performed, nor the benefit of a stamp duty refund," Skelton said.
He is concerned as during the receivership Deloitte advised it was "trading" the business and Skelton said his definition of trading includes taking on new work.
"Many of our incredible clients have tried to keep supporting us through this period," Skelton said.
"Sadly we were instructed by Deloitte to turn this new business away so Skelton Sherborne has next to nothing in its immediate pipeline to keep us going either."
Skelton said if he can find a way to keep trading then the outcome for staff, clients and suppliers will be much better.
"I feel like we have just taken the hospital pass from hell with all of this but we are not dead yet," he said.
"An old acquaintance of mine in Perth who said he has been through the same thing with his former bank said "Good luck and don't give up until the bastards have nailed you to a cross".
"Well, neither Skelton Sherborne or I are on the cross yet, let alone nailed. We will find a way to keep going and survive this as intact as possible."
SmartCompany contacted HSBC and Deloitte for comment, but both declined to respond.