Award-winning builder goes under owing millions

CREDITORS of the Bentleigh East-based building firm, Langford Jones Homes, have been advised by the liquidator, RSM Australia Partners, that the firm entered into external administration on July 1, 2022.

It has been reported that the firm owes in excess of $10 million to creditors.

A resolution, to go into voluntary liquidation, was passed at a meeting of members of the Companies on June 30, 2022. The action affects creditors of Brurob Nominees Pty Ltd (in liquidation) ACN 005 252 157, formerly trading as Langford Jones Homes, and Woodside Building Services Pty Ltd (in liquidation) ACN 633 421 575.

A creditors’ voluntary liquidation, or CVL, is a liquidation initiated by a company where it is unable to pay all of its creditors in full.

According to RSM Australia, this means that the Companies are insolvent.

It has been reported this week that the firm owe creditors in excess of $10 million but the figure is likely to go higher as all outstanding accounts are brought to book.

Operating extensively throughout coastal Victoria and Metropolitan Melbourne for more than 40 years, the firm has been a leading home builder in the Phillip Island, South Gippsland and Westernport areas with projects in progress in all of those locations.

The news has sent shockwaves through social media in recent days prompting those who have home projects pending, in progress or who may be waiting for defect rectification works, to reach out in forums or chat groups to pool what knowledge there is.

Here are a few comments

"This is really bad news, we have been patiently waiting for defect repairs for over 4 years, first excuse was “ let the house settle a bit more” then they were “too busy, wait a bit longer” then COVID was the excuse, they kept promising to come and only 2 weeks ago finally told us it would be sorted, now it’s going to cost us a fortune to fix as it’s not a small job. I am not at all happy. Interesting that the son left the company a while back now."

"Very sad news. Great company and good bunch of guys."

"What a shame we built a couple of times with them."

"Very, very sad. We heard so many tradies are outta pocket"

"They handed over our build in December, no defects rectified.... does builders’ insurance cover anything? Does anyone know?"

"Sad news, when only a month ago one of the highest awards in the industry was given to Bruce Langford-Jones OAM."

Langford Jones is at present not taking phone calls.

There is also the issue of tradesmen who may be awaiting payment in what is a very volatile sector at the moment, although many have taken to protecting themselves by demanding two weeks pre-payment from volume builders before they’ll turn up on site and then terminating if weekly wages don’t come through.

Materials suppliers are among the others left exposed but it’s homeowners in the progress of building or needing defect repairs that are in the most difficult position.

It was little more than a month ago, on Wednesday, May 25, 2022, that the Housing Industry Association (HIA) announced two recipients of the Sir Phillip Lynch Award of Excellence, one of the highest honours bestowed in the residential building industry.

One of them was Bruce Langford-Jones OAM, “recognised for more than 35 years exceptional service to the industry”.

Mr Langford Jones was honoured for his contribution to the development of the housing industry which went beyond his normal working life as Managing Director of Langford-Jones Homes, a company he established in Victoria in 1975.

“As a volunteer with HIA since 1985, his commitment to the advancement of the housing industry was outstanding,” said HIA National President Alwyn Even in presenting the award.

It has been reported that there are about 65 building developments at various stages of completion, with more than 250 creditors owed more than $10 million, liquidators RSM Australia partners Jonathon Colbran and Richard Stone Partners said in a statement on the company’s website.

The firm’s shareholders previously re-invested in an attempt to keep the business afloat but ultimately, market conditions have prevailed.

Rising labour and material costs and the impact of a recent cyberattack have been blamed.

One of the roles for the liquidator will be to co-ordinate the handover of the building projects to the homeowners and look to realise the value of any business assets.

Those wishing to receive information about the action can contact RSM Australia and speak with Anisha Maganty on (03) 9286 8297 or by email on anisha.maganty@rsm.com.au or Raymond Cao on (03) 9286 8092 or by email on raymond.cao@rsm.com.au.