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VIC Builder Undergoing Liquidation - Get Deposit Back?

Discussion in 'Commercial Law Forum' started by Rolo, 19 October 2016.

  1. Rolo

    Rolo Member

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    Hi,

    Our builder just went into liquidation. We have paid a 5% deposit, but no builders insurance was issued and we confirmed this with VMIA.

    We have been told that taking the deposit without issuing a building certificate was illegal. Will this make any positive impact on our claim to the liquidator for return of our deposit or will we still be at the back of the queue as an unsecured creditor?
     
  2. Victoria S

    Victoria S Well-Known Member

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    I've never dealt with that particular situation before - taking deposit without issuing building certificate, however generally deposits will need to be refunded through the liquidator and you would become a normal unsecured creditor.

    In some cases if you paid by credit card you can go to your bank and ask them to reverse the transaction, however if this is not possible you may simply need to register as an unsecured creditor. After a company enters administration or goes into liquidation, you can no longer commence or continue legal action against it to recover payments for which you receive no benefit.
     
  3. Rolo

    Rolo Member

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    Many thanks for you reply, that's the conclusion we have come too also. With regards to you last statement regarding legal action after liquidation, I think that should be caveated with "... without permission from the court" from what I have read, but in what circumstances would the court allow legal action?
     

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