Small suppliers caught in big designer's liquidation

Designer Liz Mitchell. Photo / Janna Dixon

Dozens of small, trade suppliers have been caught up in the voluntary liquidation of Auckland designer Liz Mitchell.

Liz Mitchell Design Limited, which made clothing for actress Keisha Castle-Hughes and former prime minister Helen Clark, was put into voluntary liquidation in August, owing the Inland Revenue Department $95,000 and other creditors $103,690.

The Herald on Sunday has obtained documents showing a list of 68 creditors, some of whom are upset Mitchell continues to trade under another company.

Mitchell's Ruby Small Holdings bought Liz Mitchell Design Ltd, including the brand, shortly before it went into voluntary liquidation.

One of the creditors, who did not want to be named, had done work for Mitchell a week before she went into liquidation.

Another unhappy creditor is Richie Burling, of Najie Clothing, who is owed $1996. "If someone loses everything, then they should lose everything. If they carry on as if nothing happened it just pisses me off. There seems to be absolutely no recourse."

But others had no problem with Mitchell. Velvet Fabrics owner Nigel Heard said: "I don't think she set out with any malicious intent to defraud anyone."

The Ministry of Economic Development is gathering information about the liquidation to make sure there had been no breach of the phoenix provision in the Companies Act, where a company is sold to another to avoid liabilities.

Liz Mitchell would not comment on the investigation, referring all inquiries to liquidator Iain Shepherd.