Joint liquidators have been appointed to the bonded warehouse operator Eastland Warehousing Ltd, which owes an estimated £810,000 to the Revenue Commissioners. Eastland is the subject of an intensive custom and excise investigation on accounts kept by the warehouse-keeper.
At a creditors' meeting in Dublin yesterday, the Revenue Commissioners and an unsecured creditor - Landbridge Logistics which is owed £5,688, according to the Eastland statement of affairs - opposed the directors' plan to appoint Mr Paul Wyse, of accountants Oliver Freaney, as sole liquidator. After an adjournment for discussions between the directors, Revenue and Landbridge representatives, Mr Wyse was appointed joint liquidator with Mr Tom Kavanagh of Kavanagh Associates.
An intensive customs and excise investigation is under way into queries on the accounts maintained by Eastland, as reported in The Irish Times on October 8th. Custom officials had informed the importers who store wine and spirits in the bonded warehouse, that they could reclaim their goods subject to payment of the excise duty and VAT to the customs. At the meeting, Eastland director Mr Joe McNamara, who owns 60 per cent of the company, refused to discuss the estimated excise duty and VAT debt of £810,000. He said he had been advised by his solicitors not to answer any questions on that matter. Mr McNamara's legal adviser, Mr Rod Ensor, of Matheson Ormbsy Prentice, said any questions in relation to the Revenue were not "a matter for this forum".
Despite a number of questions from the Landbridge representative, including why the debt to the Revenue had not appeared in the previous year's accounts and whether the £810,000 figure was the maximum liability to customs and excise, no further information was disclosed. Mr Ensor stressed that a customs inquiry was going on and that the liability was subject to that inquiry. Eastland's statement of affairs shows that the company has cash in the bank of £379,366. Some £340,000 of this amount is guaranteed to the Revenue.
At the meeting, Mr McNamara apologised to creditors for any money they may lose. He blamed the collapse of the company on tight trading margins over a number of years in competitive markets and bad debts. He said the company had no choice but to call the meeting. The statement of affairs of the company, which has 55 tenants and operates a bonded warehouse, showed an estimated deficiency of liabilities over assets of £214,789. Preferential creditors - the Revenue Commissioners and employees - are owed an estimated £816,400. Unsecured creditors are owed £15,508. The company has estimated the total value of its assets at £617,119, leaving a deficit of £199,281 against debts to preferential creditors. Unsecured creditors are unlikely to receive any payment.
Among the other unsecured creditors are Eastland auditors Roddy Mooney McCarthy, owed £2,541, Woodchester owed £1,856 and Link Transport owed £1,003. Creditors were told that the warehouse used by Eastland was owned by a company called HJS Ltd which is owned by the Eastland directors. Eastland paid HJS an annual rent of £72,000 under the terms of a 35-year-lease with five-year review breaks. The statement of affairs showed that HJS owed Eastland £25,304, which Mr McNamara said was for "administration fees" and was "fairly collectible".
Eastland directors owe the company £28,026 - Mr McNamara and Mr John McDonnell, who is company secretary and a 40 per cent shareholder, each took loans of about £14,000 from Eastland for personal reasons. Mr McNamara said this money was "not easily collectible".
