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Landlord tips in for new administrator at Kilmore’s Colmont School

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The new administrators of Kilmore’s Colmont School have been paid $100,000 by the school’s landlords to help cover expenses.

In a ‘circular to creditors’ emailed to creditors last week, it detailed that Chien-long Tai, director on behalf of Skywriters Pty Ltd, the landlord, and Victorian International Enterprises, the entity that provided marketing services, had provided ‘an indemnity and upfront payment of $50,000 to cover … initial trading costs and expenses associated with our appointment’ on August 4 – the day prior to the first creditors meeting where the original administrators were sacked.

“Subsequently, on August 5, 2022 we received a further upfront payment of $50,000,” the letter read.

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“These funds are currently held in our firm’s trust account and will not be drawn to meet our remuneration until our remuneration has been approved.

“There are no conditions on the conduct or outcome of this appointment attached to the provision of these funds.”

Cor Cordis partner Rachel Burdett said the administrators were bound by the ethical and conduct requirements of the Corporations Act and under the Australian Restructuring Insolvency and Turnaround Association, ARITA, Code of Conduct to be independent and disclose the information to both the party providing the indemnity, to creditors and to Australian Securities and Investments Commission, ASIC.

“Due to the extent of work required to address the situation at hand, it is not unusual for practitioners to request an indemnity and upfront payment for fees to undertake an administration process,” she said.

“The administration process itself is incredibly involved and requires an immediate and 24-7 approach to ensure we tackle the more pressing issues as soon as possible. 

“In this instance, our focus was to ensure that the students’ education was prioritised and actioned immediately.”

In a media statement last week, Cor Cordis outlined its meeting since taking over as administrators – meeting with staff, independent schools, in particular Ivanhoe Grammar School, and the Victorian Registration and Qualifications Authority.

Cor Cordis representatives also met with the Department of Education and Training, Independent Schools Victoria, Catholic Education Commission of Victoria, and the International Baccalaureate Organisation.

“The most important outcome of these discussions is that some year 12 students will commence at new schools on Monday and the remainder are able to enrol at Ivanhoe Grammar School. This will ensure they can complete their year 12 studies in 2022,” Ms Burdett said.

“We are pleased that all year 12 students and their teachers will have the opportunity to enrol at Ivanhoe Grammar School.

“The school has been incredibly supportive and will ensure all new students have a buddy to make the transition easier during this time.”

Ms Burdett said the administrators had been able to leverage a Commonwealth fee scheme, which supported international students where money retained by the company was insufficient.

“We are also reconciling monies held by the company to fees paid to ascertain what funds are available for all students. These funds are presently held by the former administrator and this position will be known shortly,” she said.

Ms Burdett said they had worked with various schools to transition the current year 11 and 12 international students.

She said the landlord had agreed to provide a rent-free period from August 9 until September 30, which would enable continued accommodation of school boarding students until they transitioned to their new schools and accommodate the continuation of the administration process.

“We are continuing to work with interested parties in relation to whether there is a longer-term position for the company,” she said.

“Our priority is and always has been to ensure the students and the community is looked after. The next few weeks will involve detailed investigations and reviewing any forthcoming proposals.”

Ms Burdett said a date for a second meeting of creditors was yet to be confirmed.

“However given investigations need to occur it will likely be held mid to late September,” she said.

“To ensure we provide creditors with a complete and thorough report of our investigations, we will apply to the courts to extend our current statutory period, which technically expires on August 20.”

When asked what Cor Cordis would do differently from the previous administrators, Ms Burdett said

Cor Cordis had a depth of experience and resources to manage the situation.

“Our focus is always to ensure we’re managing all stakeholder expectations and delivering outcomes that deliver value to these stakeholders,” she said.

“We strongly believe that on appointments in these situations, action is critical, particularly in the first initial period, when the company’s financial position is highly distressed.

“In this particular situation, we continue to assess all available options.  We intend to investigate events thoroughly and take action to recover funds if appropriate.”

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