PHOTO: FILE
Taranaki Building Company Level Build Collapses, Leaving Homeowners and Contractors Out of Pocket
A Taranaki-based building company, JT Construction Ltd, operating under the name Level Build New Plymouth, has entered voluntary liquidation, reportedly leaving several families with unfinished construction projects and creditors facing substantial losses. According to Insolvency Matters, which is overseeing the liquidation, the company owes $400,000 to unsecured creditors and an additional $250,000 to the Inland Revenue Department.
Impact on Homeowners: Unfinished Projects and Financial Losses
The liquidation of Level Build has left clients like Cass and Darren Gray, who contracted the company for a $400,000 home extension in Vogeltown, New Plymouth, scrambling. They discovered financial irregularities when their kitchen supplier, who was a personal contact, had not been paid by Level Build despite receiving funds for the kitchen and other appliances. Cass Gray estimates their financial loss to be around $50,000, with their renovation project left incomplete. The couple is currently living with family as their home remains uninhabitable, lacking basic amenities like a kitchen and flooring.
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Another couple, Mark Pollard and Jess Lawn, contracted Level Build for their new home construction in Ōākura. They estimate a loss of $140,000 after paying a $120,000 establishment fee and an additional $43,000 just days before the company announced its liquidation. Pollard expressed frustration at the suddenness of the liquidation, stating they had been assured their home would be ready by Christmas but are now left with little more than a partially completed concrete slab.
Contractors Also Hit Hard
It’s not just homeowners who are feeling the financial pinch. Re-Lume Electrical, a local electrical contracting firm, is reportedly owed $30,000 by Level Build. Hamish Scott, a representative of Re-Lume, expressed disappointment, emphasizing that they had a friendly working relationship with Level Build’s owner, Jarom Tipene, only to be left out of pocket when the company collapsed.
Scott pointed out the unethical nature of continuing to invoice clients and demand payments mere weeks before the liquidation, suggesting that Level Build’s management should have anticipated the impending financial issues.
Liquidator’s Report Highlights Economic Challenges
The first liquidator’s report published by Brent Hunt of Insolvency Matters attributes Level Build’s collapse to difficult trading conditions exacerbated by the current economic climate, including rising material and labour costs and increased market competition. The report also noted that pricing errors further strained the business, making it unsustainable despite attempts to streamline operations.
In response, the company’s director, Jarom Tipene, terminated all staff and ceased operations to limit further losses. The liquidator’s report confirmed that all employees were paid outstanding wages and holiday entitlements before the company’s closure.
Growing Concerns Over Construction Sector Insolvencies
This case adds to a concerning trend of building companies in New Zealand facing insolvency, leaving homeowners and subcontractors in financial limbo. Many are calling for tighter regulations and oversight to protect consumers and small businesses in the construction sector, especially given the ongoing challenges of material shortages and cost escalations in the industry.
The situation serves as a reminder for clients to exercise caution and conduct thorough due diligence when engaging with construction firms, particularly in uncertain economic times.
SOURCE: RNZ