Administrators for prolific womenswear brand Little Joe have confirmed unsecured creditors, many of which are trade suppliers, will not recoup losses as the company resumes business under its original director.
Bradd Morrelli and Roderick Sutherland of Jirsch Sutherland were appointed as joint administrators of the company on February 2012, as it struggled to trade under tough retail conditions. Morelli confirmed that at a meeting of creditors late last month, resolutions were passed under a Deed Of Company Arrangement (DOCA) which would see the company restructured and returned to director Gail Elliott. The DOCA was executed on March 27, with Morelli and Sutherland becoming Deed Administrators of the firm.
“My role now is to monitor the director’s compliance with the terms of the DOCA,” Morrelli said.
Morrelli confirmed secured creditor NAB had recouped losses through the assignment of property from Little Joe co-founder Joe Coffey. While Morrelli said trade creditors were set to receive “zero” funds, employee entitlements had been paid in full, signalling a better outcome than if the company had been placed in liquidation.
As reported in the previous edition of Ragtrader, a register from the first meeting of creditors revealed eight pages of unsecured creditors. The Australian Taxation Office ($72,102), China Chain ($107,640), Fashion Network ($83,862), Sally Burleigh Public Relations ($18,421), Westfield Sydney ($87,461) and Marina Mirage ($32,561) were amongst those affected.
Little Joe has not returned queries from Ragtrader since the appointment of administrators.