By James Wells
MELBOURNE: The administrator’s report into the failed $120 million Bay Street Corporation project has indicated that the former Teac Australia managing director and half owner, Gavin Muir, may be pursued for allowing the building company to trade while insolvent.
The administrator of the Bay Street Corporation property project called ‘The Muir’, which involved the development of Teac’s former premises, has recommended that the business be wound up.
A return to creditors may be dependent on further legal action undertaken by both the Australian Securities and Investments Commission (ASIC) and Teac Australia, in separate legal investigations.
Teac Australia is looking to recover $2.75 million from Muir via proceedings in the Supreme Court of Australia, while ASIC last week received undertakings that the fomer consumer electronics executive would not leave Australia before 1 September this year.
An article published in The Age newspaper alleges that Bay Street Corporation may not have been able to repay its debts since the development commenced in November 2002.
“It was clear the company was ‘hopelessly insolvent’ by January 2004. Bear in mind that Muir was still taking money from so-called ‘investors’ in The Muir residential project last year,” the article said.
The article also claims that the administrator believes the methods used by Bay Street Corporation to raise money meant that it was a managed investment scheme that was unregistered, and therefore was a breach of the Corporations Act.
Muir has 60 days to respond to the allegations.
Bay Street Corporation administrator, PPB’s Nick Martin, was unavailable for comment.