Geoff and Noreen Murphy and their son John have been summonsed to appear in the Federal Court of Australia in Brisbane on Friday to surrender the books and records of JM Kelly Group companies ahead of a public examination starting on August 8 in which they will be required to give evidence under oath.
Geoff and Noreen Murphy and their son John have been summonsed to appear in the Federal Court of Australia in Brisbane on Friday to surrender the books and records of JM Kelly Group companies ahead of a public examination starting on August 8 in which they will be required to give evidence under oath.

Murphys to face court over JM Kelly collapse

KEY figures in the multi-million dollar collapse of a Central Queensland construction group face the Federal Court of Australia in Brisbane on Friday ahead of a lengthy public examination into its affairs.

Geoffrey John Joseph Murphy, John Geoffrey Murphy and Noreen Murphy have been issued with examination summons to attend the court at 10am to produce the books and records of companies in liquidation associated with the JM Kelly Group based in Rockhampton.

They are then required to be examined on oath or affirmation before a Registrar of the Court at 9:30am on August 8 and from day to day until excused.

A public examination into the affairs of the group of companies has been set down to continue through to August 29.

It comes after the collapse of JM Kelly Builders Pty Ltd in October last year which left unsecured creditors owed nearly $15 million and after the ordering of the issue of summons by Justice Belcher on April 29 and then a May 24 ruling by Justice Reeves that affidavits sworn by PwC liquidator Derrick Vickers be sealed.

The State Government, through industry regulator the Queensland Building and Construction Commission, has provided $200,000 to fund the public examination to be conducted by liquidators PwC.

The demise of JM Kelly Builders Pty Ltd came a little more than two years after the collapse of JM Kelly Project Builders Pty Ltd, another entity in the JM Kelly Group and triggered the liquidation of a further 12 associated companies.

The State Government announced in late February a Special Joint Taskforce headed by Justice John Byrne and supported by a legal team from the Department of Prosecutions and Fraud Squad detectives.

The move was driven by a series of News Corp Australia articles about JM Kelly Builders and other industry insolvencies as part of a Back Our Subbies campaign to provide greater protection to building industry subcontractors.

The taskforce is due to report to the government by the end of June.

At a meeting in late April, PwC told a JM Kelly Builders Pty Ltd committee of inspection, that was representing unsecured creditors, that secured creditor the National Australia Bank was "reasonably comfortable" it would be paid out.

"Subject to paying out NAB from asset sales, then employees and FEG (the Commonwealth's Fair Entitlement Guarantee) need to be paid out before there is a distribution to unsecured creditors," minutes of the meeting filed with the Australian Securities and Investments Commission said.

"The Chairperson advised that there is large values moving around of potential claims.

"Funding had been secured from QBCC and FEG, neither of which have any uplift on any successful recovery as opposed to if funding was from a litigation funder.

"Further the funding from QBCC does not require repayment."

In response to a query from one of the committee of inspection about the return to creditors, Derrick Vickers for PwC said he was "optimistic especially considering the large amount of funding provided to conduct investigations and a public examination".

"FEG undertook their own internal inquiries as to prospects before contributing funding, as FEG is looking for a return on not only recovery of costs but payment of a dividend in respect of advances made for employee entitlements."

The committee of inspection has signed off on liquidator fees totalling more than $1.89 million for the period January 11 through to September 30.



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