Holiday park investors paid back fraction of lost money
- Credit: Archant
Investors who spent their life savings on holiday lodges which were never built will get back a fraction of their money - seven pence for every £1 they lost.
Walsham Chalet Park Limited, which traded as Dream Lodge, owned holiday parks across East Anglia, including in North Walsham, Bury St Edmunds and near Ely. Investors bought lodges on the promise of a guaranteed return.
But in January 2019 the company went into liquidation owing 1,100 investors more than £25.6m - including millions of pounds for holiday chalets which were never built.
Liquidator Deloitte has been investigating the collapse and said it had now reached a settlement with the owner - the Moir family, headed by the company’s director Simon Moir.
The deal will mean that the directors will no longer face trial for wrongful trading and instead will have to pay back £1.8m. It means unsecured creditors, including the hundreds of people who bought lodges will get back 7pc of their money.
In a letter to creditors Deloitte said: “Following extensive investigation work carried out by the liquidators, actions were brought against the directors for wrongful trading and misfeasance under the Insolvency Act 1986.
“Detailed negotiations have been held with the directors over the last few months and although we cannot discuss the terms of the settlement agreement, we are pleased to report that the directors have agreed a settlement of £1.8 million in settlement of all claims brought against them by the liquidators.
“We believe that this settlement is likely to be considerably higher than what may have been achieved if the claim against the directors proceeded to trial in November 2021, taking account of the potential legal spend to trial of both parties.
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"In addition, this outcome gives us more certainty and allows us to pay a dividend to unsecured creditors much sooner than expected."
Deloitte added there was a "possibility" of investors being paid another 2p for every £1 in the spring.
Mr Moir was banned earlier this year by the Insolvency Service from running companies for 14 years.