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Prospect Auction Rooms: £80,000 debts revealed
AN Alresford auction house collapsed owing more than £39,000 to 300 people, the Chronicle can reveal.
The full extent of Prospect Auction Rooms’ liabilities, some £80,000, is outlined in documents seen by this newspaper.
They relate to the bankruptcy of Gemma Sharp, said to be the ‘auctioneer’ in charge of the business, based in Prospect Road, until it closed last autumn.
The Chronicle has reported how hundreds of mainly elderly people were owed money including from cherished family heirlooms. Scores of people attended the business to try to get their money or retrieve unsold goods in December.
Anger has further mounted after Charles Evans, who claims to only have been the manager of Prospect, has won planning permission from the city council to convert The Furniture Warehouse in Easton Lane, Winnall, into another auction house.
Mr Evans, also known as Mr Barney-Evans, claims he was never the owner of Prospect although his planning application clearly shows he viewed it as his business. He says he plans to employ 15 staff in what are much larger premises.
The Official Receiver report into Ms Sharp said: “She traded as an auctioneer between November 2009 and October 2012 with another. She left the business full-time in September 2010 due to childcare issues and the auction room was run by her business partner and an employee.
“As a consequence of Sharp’s absence, management of the business became far less structured and its affairs became untidy.
“From November 2011 her business partner (Mr Evans) became seriously unwell and his involvement was reduced significantly. Sharp spent fewer hours at the premises and virtually left her employees to operate the business until October 2012 when it ceased trading.
“The cause of insolvency can be attributed to poor business management, a loss of customers and finally an inability to trade when Sharp reached her overdraft limit. Her creditors consist of business utilities, credit cards and an aged loan. The majority of her debt is to unpaid customers which accrued between June and October 2012,” the report said.
In a ‘statement of affairs’ lodged at the county court, Ms Sharp said difficulties started in March 2012: “Stock was not coming into the salesroom, our outgoings therefore overtook our incomings. Buyers also stopped coming. Sales were not covering costs.”
But whether the extent of the debt is accurate is unclear. Susanna Lyle said she is owed some £20,000 but the creditors’ list drawn up by Ms Sharp says it is only £7,884. Ms Lyle said: “That is on the low side. I had Waterford Glass that was insured for £14,000.”
The Chronicle has inspected documents available at Winchester County Court which show that there were total debts of £80,130, comprising £31,350 to banks; £3,021 to local authorities; trade and expense £5,500; public utilities £519, and miscellaneous debts of £39,739, mainly to customers.
The report by the Official Receiver said Sharp, 34, now unemployed, of Station Road, Alresford, has no assets, apart from a W-reg Land Rover Freelander valued at £500. There is no chance of any creditor getting any money back. No creditors’ meeting will be held.
An insolvency practitioner, who asked not to be named, said: “It really annoys me that businesses like these have a bank account but they don’t have a client account, as estate agents are forced to do to keep the customers’ money separate.
“I have lobbied MPs but they didn’t think making client account compulsory was practical. If Prospect had had a client account this would never have happened. They used other people’s money to keep trading for a long time.”
“I would not be surprised that they were insolvent after 12 months but kept going for three years.”
Ms Sharp was unavailable for comment.