The second creditors’ meeting as part of Brindabella Christian Education Pty’s voluntary administration process is expected to be held in July. Photo: Region.
Creditors should find out this month what caused Brindabella Christian Education Ltd (BCEL) to fall $23.8 million into debt and whether there had been any misconduct by its directors.
The company had operated Brindabella Christian College and its Lyneham and Charnwood early learning centres before it went into voluntary administration on 5 March this year.
The company’s debt (as of 14 March) comprised $1.4 million to employees, $9.5 million to secured creditors (including $9.3 million for NAB), $4.1 million to parents (for tuition fees paid upfront), $6.1 million to the ATO and $2.7 million to suppliers.
The school was sold to Christian Community Ministries (CCM) and came under its control on 15 May. CCM will operate the college under a raft of conditions.
A recent committee inspection meeting with Deloitte administrator Sam Marsden heard the sale result should see all creditors paid in full.
“[This] is a fantastic result and very uncommon in insolvency,” meeting minutes stated.
“This has not been an ordinary [voluntary administration], in part because it became clear early on that CCM were generating their offer in order to reach an outcome where all creditors were paid, and even increased their offer to account for contingent claims.
“CCM has assumed all employee entitlements except for those employees who have resigned or been terminated during the administration period.”
Secured creditors have already been paid out, pre-paid fees for 2025 tuition are being honoured and CCM’s taken on the liability for the school’s cancelled trip to China, either refunding families or applying the funds against outstanding school fees.
“CCM has allocated funds for the creditor pool and further funds for contingencies, such as possible employee underpayments, to ensure all creditors are paid,” the minutes noted.
“There is likely to be a surplus, which will be returned to CCM under the conditions of the [Asset Sale Deed].”
The company’s now expected to proceed into liquidation at the second creditors’ meeting.
The focus of the administrators was now on transferring contracts to CCM and investigating how BCEL failed.
The sale process and details about the transaction would be detailed in the report to creditors which was being written.
“[The report will] also include information on what the transaction means for the different classes of creditors,” the meeting minutes noted.
“There will also be information on the causes of the company’s failure and any possible misconduct by the directors.”
Mr Marsden advised the second creditors’ meeting was likely sometime in July.
The ATO has paused its winding-up petition against BCEL in the Federal Court as it tries to recover the $6.1 million it’s owed.
That case has been adjourned until 25 July, but the administrators will seek to have the application dismissed, subject to the outcome of the second creditors’ meeting.
Former BCEL board chair and director Greg Zwajgenberg has previously claimed the ATO was pursuing him alone for the owed tax debt.
The company’s charity status was revoked by the Australian Charities and Not-for-profits Commission (ACNC) on 18 June.
