Kitchen House owes $2.4m, say receivers

ROELAND VAN DEN BERGH
Last updated 05:00 24/02/2012

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Kitchen House owes creditors, including customers and staff, about $2.4 million, the company's receivers say.

Kitchen House closed all its six North Island outlets on Monday with the loss of 35 jobs and leaving customers who had paid for their kitchens in the lurch.

Receiver Grant Graham from KordaMentha said it was unlikely that Kitchen House would resume trading, given that staff had been sent home on Monday.

Customers who had paid deposits on kitchens and appliances were being treated as a priority, Graham said.

Margot Southgate was one of the lucky ones after insolvency lawyer Justin Toebes negotiated a settlement with Wellington trucking company MoveSmart to deliver her kitchen on Wednesday.

Toebes said he understood MoveSmart was holding some kitchens in lieu of money it was owed by Kitchen House for previous deliveries.

Several completed kitchens were either in transit to customers or about to dispatched from the factory, Toebes said.

He did not know if any other kitchens had been delivered as a result of a deal struck between Southgate, Kitchen House director Brian Smaill and MoveSmart.

Southgate agreed to pay the $500 transport costs again to MoveSmart even though it had been included in the purchase price.

It was important to get the kitchen delivered and worry about who owed what later, Toebes said.

"If you don't get the kitchen you have lost everything," he said.

Smaill also agreed to pay MoveSmart an unknown amount towards its debt.

Normally ownership of a kitchen, paid for in full, passed to the buyer the moment it was put on a truck from the factory with delivery instructions, Toebes said.

Transport firms did not usually have the right to hold goods in lieu of payment for previous deliveries, he said. MoveSmart did not return a call yesterday.

Southgate said the kitchen had been due to be installed last Tuesday. "We were all excited. We were getting our brand-new kitchen and we can finish and tidy up our house, and it'll look awesome."

She would now have to save again to pay to have them installed and also replace appliances paid for last Sunday which were unlikely to be delivered.

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