Smiths City owner declared bankrupt at High Court

The owner of collapsed large retailer Smiths City has been declared bankrupt.

Colin Ashley Neal was adjudicated to be bankrupt by Justice Rob Osborne at the High Court at Christchurch just after 10am on April 1.

Bankruptcy proceedings were called by Tower Rail Precinct Limited against Mr Neal over a breach of contract.

His plight follows Smiths City going under, owing many unpaid creditors more than $26million.

More than 200 creditors were found to be owed money after liquidators Colin Gower and Diana Matchett from BDO Christchurch examined the company’s assets and debts in their first report.

They believed it unlikely, at that stage, unsecured creditors would see their money back.

Initially put into voluntary administration, the company went into liquidation after a meeting of creditors last October.

Founded in 1918, the Christchurch institution operated nine stores mainly in the South Island with a focus on furniture, electronics and appliances.

About 130 staff were employed before the company wound down operations and closed its doors.

Mr Neal’s company Polar Capital LP is the sole shareholder of Smiths City Holdings (2020) Ltd which bought Smiths City in 2020.

Last December Associate Judge Dale Lester ordered Mr Neal pay just over $1.03m with interest to Tower Rail.

Mr Neal had taken no steps after being served with a summary judgement application on October 21.

Tower Rail’s claims included outstanding rent and costs to reinstate the premises as a result of a guarantee provided by him for Smiths City Holdings (2020) which was the tenant of a property owned by Tower Rail.

Smiths City ceased trading and vacated the premises.