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21-123MR ASIC disqualifies director from managing companies for trading while insolvent
Grant Evan Donley of Sydney, NSW has been disqualified from managing companies for two years for his role in the failure of three companies and trading while insolvent.
The three construction companies specialised in interior fit-outs. They include:
- Conceptual Interiors NSW Pty Ltd A.C.N 165 311 795 (Conceptual Interiors NSW);
- Conceptual Interiors Group Pty Limited A.C.N 621 617 230 (Conceptual Interiors Group); and
- Conceptual Interiors Pty Ltd A.C.N 109 381 811 (Conceptual Interiors).
ASIC found that Mr Donley:
- allowed Conceptual Interiors NSW and Conceptual Interiors Group to trade while insolvent when the company was unable to meet its liabilities as and when they were due to be paid;
- failed to ensure Conceptual Interiors NSW and Conceptual Interiors Group met their tax obligations and failed to maintain adequate record keeping; and
- failed to exercise his powers and discharge his duties as a director of Conceptual Interiors NSW and Conceptual Interiors with care and diligence by failing to ensure the companies paid their taxes and income tax returns for the financial years prior to the winding up of the companies.
The three failed companies owed unsecured creditors a total of $3,188,218.64, including $792,751.40 owed to the Australian Taxation Office and $58,708.00 owed to Revenue NSW.
On 19 June 2018, Steven Naidenov of Aston Chace Group Pty Ltd was appointed the liquidator of Conceptual Interiors NSW; on 10 April 2019, Louisa Meng Li Sijabat of Vincents was appointed the liquidator of Conceptual Interiors Group; and on 26 February 2014, Michael Gregory Jones of Jones Partners Insolvency and Business Recovery was appointed liquidator of Conceptual Interiors.
In deciding to disqualify Mr Donley, ASIC relied on reports lodged by the liquidators of the three failed companies. ASIC also assisted the liquidator of Conceptual Interiors NSW and Conceptual Interiors Group to prepare a supplementary report by providing funding from the Assetless Administration Fund.
Mr Donley is disqualified from managing corporations until 25 May 2023.
Mr Donley became a bankrupt on 7 May 2019 and has not been discharged. In determining the period of disqualification, ASIC took into account that Mr Donley has effectively been prohibited from managing corporations from the date of his bankruptcy.
Section 206F of the Corporations Act gives ASIC the power to disqualify a person from managing corporations for a maximum period five years if, within a seven-year period, the person was an officer of two or more companies, and those companies were wound up and a liquidator provides a report to ASIC about the company’s inability to pay its debts.
ASIC also maintains a banned and disqualified persons register that provides information about people who have been disqualified from:
- involvement in the management of a corporation;
- auditing self-managed superannuation funds (SMSFs); or
- practising in the financial services or credit industry.