Creditors of a Galashiels building company forced into administration last November with the loss of 38 jobs might have to wait “some considerable time” before their claims are settled.
That warning is made by administrator Richard Gardiner in a progress report on the affairs of family firm Murray and Burrell.
Back in January, he revealed that around 150 ordinary creditors, including many Borders businesses, had come forward claiming they were owed more than £800,000 by the Roxburgh Street-based company.
In an update posted on the website of Companies House, Mr Gardiner says the amount claimed by such creditors is now “in the region of £1.996m”.
“While I anticipate that a substantial dividend could be available to ordinary creditors, I am unable to provide an estimate on the timing or quantum of such dividend until such time as the outcome of assets realisations is known,” says Mr Gardiner.
“However, creditors should be aware that assets remaining to be sold are likely to take some considerable time to sell.”
Mr Gardiner also reveals that a group of 15 former Murray and Burrell workers is taking the failed firm to an employment tribunal in pursuit of a claim for £109,000.
That is in addition to existing employee claims of £34,000 for arrears and holiday pay and £187,000 for notice or redundancy pay.
The trade union representing the ex-employees is basing its pursuit of so-called protection awards on the alleged failure of the company’s management to consult them prior to entering administration.
“Having discussed this matter with the directors and legal agents, the decision was taken to vigorously defend the claim, and a hearing date is awaited from the tribunal,” states Mr Gardiner.
Asset disposal is continuing, and Mr Gardiner reports that the sale of the firm’s yard in Galashiels has been completed, for £167,000, to a pension fund run by former Murray and Burrell director Alexander Kemp.
Mr Gardiner also anticipates that the company’s partially completed nine-house development site at Craigpark Court in Galashiels will change hands for £540,000 and that the purchaser is “a provider of social housing”.
However, a major asset in the form of the 35-acre Buckholm Corner site to the north west of Galashiels has elicited “little interest” from potential buyers, he notes.
That site, with the capacity to accommodate 250 houses according to a planning brief by Scottish Borders Council, is valued at between £750,000 and £1m.
Mr Gardiner reveals that valuation is being challenged by the firm’s directors and that they also have an interest as two major ordinary creditors – ASM Developments, owed £564,000, and Waukrigg Developments, owed £231,000.