Businesses hold out little hope of getting cash back from collapsed building firm

Businesses from across the isles face little prospect of gaining back any of the thousands of pounds owed to them following the collapse of construction company JHB.

A report by accountants KPMG shows local scaffolders, suppliers and other organisations – many of them small-time operators – among the 34 bodies forced to lodge substantial claims totalling over £459,000.

However many do not feel they will ever see their money again – not least because most of JHB’s assets were sold off before it went into administration back in March.

Some have written off their chances of seeing their money again, and deliberately avoided attending a recent creditors meeting held at The Lerwick Hotel, preferring to focus instead on making new money rather than trying in vain to rake up a portion of what is owed.

One of those badly burned by the experience was scaffolding firm Access 2000, owed over £9,000 for work it has carried out on the Scalloway Museum and a private house at Quoys.
The company’s accountant Ruby Godden said she was not holding her breath to see any of the money again.

“We always have to remain hopeful, but I can’t see it happening,” she said. “It was quite a lot of money they owed us, for the Scalloway Museum and the private job as well. We know we’ll never get that money back.”

Electricians George Robertson (Shetland) Ltd was owed £9,750 when JHB went out of business, following contract work it had carried out to wire new buildings.

The company’s Andrew Simpson said it had been owed money “for months”. “We always seemed to be working behind the payment schedule for them,” he said.

“It’s unbelievable the profits they [JHB] were making and then suddenly they were half a million in the red in the space of a year. It sticks in your throat. There were a lot of local companies on that list [the creditors’ list].

“We were the lucky ones because we did get a payment of £7,000 in December. Without that we would have been looking at nearly £20,000 lost.”

The largest debt locally is owned to D&R Contractors of Bixter, which was due £15,322 from JHB at the time it fell into administration.

DC Electrics Ltd was waiting for over £13,000. Meanwhile Lerwick Building Centre was due £9,534.09 from JHB. Painting partnership Anderson & Cluness had sent invoices totalling £7,754.

Engineering and development consultancy Mott MacDonald, which has a presence in Lerwick’s Greenhead industrial estate, is due £7,651.

T&N Joinery completed £2,715-worth of unpaid work for JHB, while Dunrossness firm Allan’s of Gillock Ltd is owed £1,215.

Smaller claims have been lodged by Malakoff Limited, due £978, and Lerwick garage JB’s Autostore which is asking for £746.

DITT Building Supplies wants £582 and Sutherland’s Filling Station £432.

By far the biggest creditor is revenue and customs. It has lodged two claims against JHB, one for £346,253 and the other for over £11,000.

The troubled construction firm had been pinning its hopes for a secure future on a major housing scheme for upper Scalloway and Utnabrake, but problems getting started result­ed in two thirds of its workforce having to be shed at the beginning of February.

By then councillors had agreed to defer a decision on the houses for two cycles after hearing the development was being planned on good agricultural land.

They wanted to hear the outcome of a then still ongoing appeal against refusal on a similar scheme in Tingwall’s Veensgarth, turned down last year because it, too, was on good ground.
JHB subsequently raised a complaint of maladministration against the council’s planning service over the way it handled the application, lodged as far back as July in a partnership with Hjaltland Housing Association.