Proof of Debt: How to Preserve a Claim Against the Failed Building Company

Identify the correct company

Use the legal name and ACN from the contract and ASIC records. Building groups may have separate construction, development and sales entities; lodge against the entity that owes the relevant debt, and obtain advice if more than one may be responsible.

Do not address the proof only to the trading name. Keep evidence of the liquidator's appointment and the submission method required.

Calculate the claim transparently

Possible components include payments for unperformed work, paid variations not delivered, undelivered materials, refundable amounts and provable damages. Avoid simply claiming the entire replacement contract price without explaining the contractual loss.

Prepare a schedule showing date, payment, invoice, contractual stage, work actually received and amount claimed. State whether figures are estimated, contingent or subject to the HBCF assessment.

Attach primary evidence

Include the signed contract, variations, progress claims, invoices, receipts, bank records, termination correspondence, inspection evidence and relevant quotations or reports. Number the documents and cross-reference them to the calculation.

ASIC describes a proof of debt as the prescribed form setting out how the debt arose and the amount. The liquidator may ask for further material or adjudicate the claim before a dividend or creditor vote.

Monitor the adjudication

Ask for acknowledgement of receipt. Read creditor reports and respond to requests by the stated deadline. If a proof is rejected or admitted for a lower amount, the notice may carry a limited period for challenge, so obtain advice promptly.

Update the proof if the loss becomes clearer, but retain every version and explanation. A controlled version history prevents different totals circulating without reconciliation.

Practical takeaway: A persuasive proof of debt is a documented calculation against the correct company. Even where a dividend is unlikely, failing to lodge can remove the owner from the creditor process entirely.

How ARK Houses can help

Where required, ARK Houses can supply measured completion and rectification costs, issue schedules and evidence of physical progress for the proof-of-debt calculation. We keep those figures reconciled with, but distinct from, the HBCF claim and replacement contract.

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