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Sunday, December 2, 2012

I'm back in control of Skelton Sherborne but....

Just before 5pm last Friday afternoon Deloitte advised me they have been "partially" retired by HSBC as receivers to Skelton Sherborne and handed control of the business back to me. A circular was sent by Deloitte to clients and suppliers early that evening advising them of this. 

If you have read my two previous blog posts you know the team and I have been fighting hard to find a way to get the control of Skelton Sherborne back and the receivers out. I should be really happy as I am largely in control again but I have been handed back a company that has literally had it's 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.

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. I am urgently seeking advice on this and the exact financial position of the company to get clarity on this.

Therefore regrettably I need to put our clients on notice that we may not be legally able to resume normal trading and cargo deliveries right away and there are the other issues raised as a consequence of a partial retirement of receivers I need to urgently find a way to overcome.

So what does "partially" retired as receivers mean?

Deloitte advise that the only areas of the business they continue to maintain control over are bank accounts, the debtor book as at the 30 November and statutory refunds. All other aspects of the business are back under my control as the director. They have pulled their people out of our office on Friday so it is just my team and I there now.

So what does this mean to the operation of the business and can it start to resume normal trading? Breaking it down...

Bank accounts
The HSBC bank accounts remain under their control. This effectively leaves the business without a bank account to operate and any funds contained in the existing HSBC accounts Skelton Sherborne doesn't get the benefit of to operate the business.

Debtor book
Deloitte will be collecting all amounts owed to the company as at 30 November, 2012. Therefore Skelton Sherborne will not have access to these funds to allow us to operate with either. 

Statutory refunds
The company has a stamp duty refund due of about $86k so Deloitte advise they 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. Furthermore subject to the advice I am seeking, we may now be insolvent and therefore cannot resume normal trading unless this situation can be resolved within the law.

During the receivership Deloitte kept advising clients they were "trading" the business. Well as a business owner my definition of "trading" includes taking on new work. Many of our incredible clients have tried to keep supporting us through this period. Sadly we were instructed by Deloitte to turn this new business away so Skelton Sherborne has next to nothing in it's immediate pipeline to keep us going either.

I feel like we have just taken the hospital pass from hell with all of this but we are not dead yet. Anyone who really knows me will probably say I never give up on anything I believe in. I believe in Skelton Sherborne, it's people and know their families are worth fighting for. If we can find a way to keep trading, as HSBC should have sensibly allowed us as a profitable company to do, then the outcome for the Skelton's crew, our clients and our suppliers will be much better. 

My team and I are grateful for the many comments on this blog, some media attention, countless emails and texts of support. The words in one email in particular I love and have kept me going and smiling despite the seriousness of the situation. 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.

I will keep posting a blog daily with important information for clients and suppliers and details of how this unfolds. For more immediate and frequent updates on cargo movements and the situation you can follow me on Google+ . I am sorry but unfortunately sometimes my key team and I are struggling to keep pace with the phone calls.

All for now,

+Brad Skelton 

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