The $1.6 million collapse of Perth Floor Centre, a timber flooring business, has left customers out of pocket with little chance of getting their money back. The company shut its four retail outlets in the metropolitan area last month and did not notify customers. Source: The West Australian
The company operated by brothers Steve and Robbie Howley has since gone into liquidation.
The retailer has debts of $815,000 and its wholesaler Pulsewood Australia has debts of $773,000, according to information received from the companies by liquidators Melsom Robson. The businesses’ assets are estimated to be well below $100,000.
According to the West Australian newspaper, 117 customers paid deposits for timber flooring of up to 50%, worth a combined $540,000, and have nothing to show for it.
Under consumer laws, it is illegal to demand a deposit of more than 6.5% for this product. There are also at least five employees owed about $50,000 in wages and superannuation.
State Government agencies have come under fire from the timber flooring industry for failing to act sooner over complaints against the retailer.
The Australian Timber Flooring Association (ATFA) revoked Perth Floor Centre’s membership in May because of the excessive deposit taking. ATFA inspectors have made about a dozen adverse findings about the retailer’s floors.
ATFA president Paul Kiely said authorities were first made aware of the problems about a year ago. “It’s terrible for the industry,” he said. “It’s terrible for those who do the right thing.”
Perth Floor Centre stores were located in Belmont, Balcatta, Jandakot and O’Connor and closed their doors on July 16, 2012. It is understood they were taking deposits from customers up until the closures.
The business failure follows disputes in court and the State Administrative Tribunal between Perth Floor Centre and homeowners unhappy with the quality of flooring supplied by the company.
Commissioner for Consumer Protection Anne Driscoll said the store closures highlighted the dangers of paying too much upfront for goods and services.
The Howley brothers could not be reached for comment.
