Administrator Adam Shepard has applied to several parties for additional funding to continue his investigation
Modular Touring and Modular Recordings founder Stephen Pavlovic is 'unlikely' to face recovery action despite the company owing more than $1 million to its creditors, it has been reported.
As explained in a comprehensive breakdown compiled by The Music Network's Poppy Reid, Modular Touring was placed into administration in July 2013, with Sydney firm Farnsworth Shepard being appointed to oversee the liquidation. The company exists as wholly distinct from the Universal Music-owned Modular Recordings, the label at the centre of an ugly stoush that emerged last year over 'missing' royalties that ultimately ended in UMA's favour.
However, with the process nearing its end and $1.3 million in unrecouped debts still marring its ledger, a representative for administrator Adam Shepard indicated to the website that, without further funding, it would be "unlikely" that Modular Touring, or Pav himself, would face any further recovery action for the outstanding amounts.
In emails sent to creditors and acquired by TMN, Shepard sought funding assistance to continue his investigations and pursue "several potential recovery actions" with help from ASIC, the deputy commissioner of taxation, three external litigation funders and the creditors themselves, all of whom have rejected his application for financial assistance.
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In conjunction with a lack of interest in pursuing the case from ASIC, Shepard concludes the limits of his administration may have been reached.
"In this administration, I am unfunded and unable to conduct further enquiries in relation to possible recovery actions detailed in my [previous] report," Shepard wrote in his email. "I have also reported the director's possible misconducts to the Australian Securities and Investments Commission ('ASIC') pursuant to Section 533 of the Act.
"However … ASIC has indicated in this matter that it does not intend to take any further action."
According to TMN, the complete list of creditors includes staff, insurers, equipment vendors and even the taxman (among the leftovers, more than $312,000 is outstanding to the Australian Taxation Office).