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DJM - Statement of Affairs released


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1 hour ago, Edward Blue said:

So they make Dapol as well.  http://www.shinedew.com/product_show.asp?id=9

 

I suppose if you are selling at the more basic end of the market and happy with an overseas design. its a simple matter of sending photographs and some mesurements? They don't appear to ask for technical or design skill in their customers.

However, such skills would be most useful when reviewing their drawings, artwork and EPs, to make sure there aren’t any “boo boos”.

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4 hours ago, The Stationmaster said:

We don't know what the situation is regarding the CADs but the fact that their 'value' is estimated as £33,000 and the realisable amount is zero suggests to me that nobody has the necessary invoices and receipts to prove that they are unencumbered assets.

Or it means that the liquidators don’t think they can sell them for anything

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2 minutes ago, amwells said:

Or it means that the liquidators don’t think they can sell them for anything

 

Indeed. The book value is what was paid to acquire them. The realisable value is what they’re actually worth. You might spend £10k on a second hand car but due to the fact it was a former write-off and the mileage has been fiddled with its worth £100. What we pay for something isn’t necessarily it’s true value. If it’s not a worthwhile exercise creating tooling based on a CAD (lack of market/inability to recover tooling costs) then that CAD is worthless regardless of the time and money expended in its creation.

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19 minutes ago, amwells said:

Or it means that the liquidators don’t think they can sell them for anything

 

The realisable value came from DJM not the liquidators, as said a few pages back:

 

On 26/06/2019 at 12:19, AY Mod said:

 

The liquidator advised that the realisable value was submitted by the Director when I asked.

 

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20 hours ago, woodenhead said:

Ex gratia payments without accepting liability.

 

The spread and low value of the purchases will probably put the claims under the radar especially with DJM having gone into liquidation, the issuers probably aren't asking too many questions and taking it at face value.

 

just because you've claimed and been paid under S75 doesn't necessarily mean you have a valid claim it's just cheaper to pay out than to argue sometimes.  The actual number of claims in comparison to Chargebacks was quite low in my time, where the claims got interesting and subject to rebuttal were things like bad holidays, dodgy double glazing and building work, high value and subjective arguments.

 

Banks are pragmatic and balanced, so if you put in a claim following a liquidation they are likely to pay out unless there is some blindingly obvious flaw in your argument for a refund or the value of the transaction is high.

 

With DJM all they will see is a model train company that went bust and some people who paid deposits on orders are out of pocket, they don't know DJM's operating model or see his references now to investments and risk.

Indeed it would be bit like employing a missile defense system to shoot down a fly. It would cost the bank more to pay someone to investigate it than it would be worth. An exception would be if someone claiming has a history of making such claims which would be limited to just that person.

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2 hours ago, Edward Blue said:

So they make Dapol as well.  http://www.shinedew.com/product_show.asp?id=9

 

I suppose if you are selling at the more basic end of the market and happy with an overseas design. its a simple matter of sending photographs and some mesurements? They don't appear to ask for technical or design skill in their customers.

 

I doubt that anyone would consider the Lionheart models "the more basic end of the market" as you disparagingly describe it.  Nor is there anything wrong with "overseas design", it's hardly like the ability to manipulate CAD files is something only British people possess. 

 

Looking at the website, they will do the technical stuff such as working out what you can get out of a mold or how you design a mechanism, you have to provide them with the prototype information, then check and approve the results along the way. In theory. If there are the wrong number of rivets on a model, that's down to you but they can make whatever you want, for a price.

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24 minutes ago, Phil Parker said:

 

I doubt that anyone would consider the Lionheart models "the more basic end of the market" as you disparagingly describe it.  Nor is there anything wrong with "overseas design", it's hardly like the ability to manipulate CAD files is something only British people possess.

With respect, new paragraph = change of subject / or an implied disconnection Please don't construct a context or misquote me.  I suppose I may have implied a lack of control in overseas design, hence "happy with" and many people are. Others prefer to design themselves and provide this to the manufacturer. I'm not qualified to comment which is best, many seem to operate both methods. Some more successfully than others.

 

But I'm just the new guy.

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2 minutes ago, Edward Blue said:

With respect, new paragraph = change of subject / or an implied disconnection Please don't construct a context or misquote me.  I suppose I may have implied a lack of control in overseas design, hence "happy with" and many people are. Others prefer to design themselves and provide this to the manufacturer. I'm not qualified to comment which is best, many seem to operate both methods. Some more successfully than others.

 

 I haven't misquoted you - the quote is exactly what you wrote, that's how the RMweb system works. If you can explain to this old guy how your quote differs from what you wrote, go ahead. 

 

You suggested (in the paragraph "I suppose if you are selling at the more basic end of the market and happy with an overseas design.") that the firm shown is only capable of designing for the basic end of the market, yet your example is a 7mm model far removed from this, which leads me to think that they are perfectly capable of working to very high standards.

 

I'm not sure why working with people in a different country should be an issue either. CAD files will be moved by e-mail, so that doesn't matter. The only issue might be that some discussions are easier to have face-to-face, but even this can be solved with technology. Ultimately, the design appears to be down to the person commissioning the model if the website is to be believed. We can be sure this works, as many models have been designed and produced this way. 

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44 minutes ago, DavidH said:

 

The realisable value came from DJM not the liquidators, as said a few pages back:

 

 

 

True, but the job of the Liquidators is to establish financial fact from fiction - and report.  

 

They earn their money by seeking sources of information, checking them for facts and only then presenting the results of their enquiries.  They merely state where their information origin is - what that original claim may have been is not reported.  Had the statement of Realisable value come from Harvey Wallbanger, they are responsible for checking the voracity of the  information - and an appropriate judgement!   The statement of remaining Realisable Assets is not something which could possibly be a fantasy assessment from an MD, without further investigation to ensure it is realistic.  The Statement is a result of DJ putting forward his assessment of the possible value - and the Liquidator's judgement of how much of that might be realistic Realisable Value.  What the MD put forward is not stated - and completely irrelevant, in the circumstances.  The result of the Liquidator's assessment is what is in their statement.

 

Regards

 

Julian

 

Apologies for the bolds to emphasise certain points, but were used to pin relevant factual matters, away from mere speculation.

 

 

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I think there is ample evidence that Chinese model train factories can design and manufacture to extraordinarily high standards, world class in fact. They will offer their clients a range of specifications and options depending on how much the client is willing to pay and no doubt the level of QA has a significant impact on cost.

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I've not read the entire thread on this matter as it doesn't really concern me but i make the following observations:

as I mentioned on the "other" DJM thread I had a bus company that went tits up in 2003 and that had a turnover of about £2m. It wnet broke for several reasons, one was the loss of rail replacement contracts when Connex lost their franchise and Go-Ahead took it over and done rail replacement in-house; Surrey County Council bus service cuts caused a huge loss of business. We had a fleet of Optare Solo buses some of which were remarkably unreliable despite being new; the payment for them was based on them being available 24/7 with days off for planned maintenance. They'd go out in the morning on daytime bus services for SCC, then onto evening bsu services for SCC and most nights a couple would do SWT rail replacement. Finance was with the major bus financiers, absolutely nothing through the bank apart form an overdraft. Drivers fiddling fares turned out to be a major problem.

 

My cash flow projections forecast the company would run out of money on a certain date and it did. So it closed down. there were all sorts of allegations of fiddling by former staff and a couple of suppliers but the only fiddling was from the staff! Any company ought to have a cash flow forecast in place and this should apply to small companies such as DJM. It may be that he had one.

 

In my case buses had been re-financed to keep the business going; I personally lost about £93k, my partner at the time about the same and various small shareholders lost about £50k. Come liquidation time nobody got a penny except the liquidators, and there was nothing for them to have either which is why it took them 15 years to close the company. 

 

In the case of DJM, if there's very little to have then nobody will get a penny I'm sorry to say. CAD designs are only worth what somebody is willing to pay for then and the UK model railway business appears to be thriving but also suffering. If I may go back to a chance with Dave Skelton of W&H Models in the early 1970s at a Toy Show, he said the problem with the UK market is that it is 1/76 scale. Make a new UK model and you make sell a couple of thousand. (with today's livery variants this could be more) make a new model to 1/87 and it will sell tens of thousands all round the world.

 

That I would suggest is still the killer with the proliferation of new products for the UK, heavy tooling costs and a limited market.

 

Meanwhile don't hold your breath about getting anything back. By the way, Funding Circle send me offers almost every week and they insist on a personal guarantee for their funds, so DJM could well lose his house over this one/

 

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To reply to jcredfer's post above, the CADs are only worth what someone if anyone is prepared to pay for them. I expect if anyone here offerd £50 for them it would be accepted.

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15 minutes ago, roythebus said:

Meanwhile don't hold your breath about getting anything back. By the way, Funding Circle send me offers almost every week and they insist on a personal guarantee for their funds, so DJM could well lose his house over this one/

A lot has been said about FC, and I've kept quiet because I'm not familiar with them. But a friend of mine is CEO of another P2P business lender, and they also ask for collateral before lending. I thought it odd that FC wouldn't.

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9 minutes ago, roythebus said:

To reply to jcredfer's post above, the CADs are only worth what someone if anyone is prepared to pay for them. I expect if anyone here offerd £50 for them it would be accepted.

 

Thanks for your reply, with which I agree totally.   I am certain that the discussions with the MD will have covered that in some considerable detail.  Any possible value of CADs to DJM, however, will have been included in the overall assessment of the Realisable Assets of DJM.

 

Regards

 

Julian

 

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48 minutes ago, roythebus said:

If I may go back to a chance with Dave Skelton of W&H Models in the early 1970s at a Toy Show, he said the problem with the UK market is that it is 1/76 scale. Make a new UK model and you make sell a couple of thousand. (with today's livery variants this could be more) make a new model to 1/87 and it will sell tens of thousands all round the world.

I don't think that's entirely true. If it were Lima would have cleaned up the UK coach market with their H0 Mk.1 & Mk.2 coaches. Would a South Australian Railways Class 520 loco sell in thousands around the world just because it was H0? If it were the standard product of say EMD or Alco that defianitely would sell better in H0 than 00. Horses for courses really.

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1 hour ago, roythebus said:

. If I may go back to a chance with Dave Skelton of W&H Models in the early 1970s at a Toy Show, he said the problem with the UK market is that it is 1/76 scale. Make a new UK model and you make sell a couple of thousand. (with today's livery variants this could be more) make a new model to 1/87 and it will sell tens of thousands all round the world.

 

Rivarossi did H0 UK stock and it bombed!

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3 hours ago, jcredfer said:

The result of the Liquidator's assessment is what is in their statement.

 

Interesting. As far as I originally interpreted it, it's the initial statement as provided by and signed off by DJM.

 

The pdf on companies house says clearly it is the director's statement, and Andy York clarified it as well. It's dated 30 May (see below); the company voted to wind up on 4 June; the liquidator was confirmed on 4 June (these other two dates are all on companies house); the liquidator's signature on this document is then 5 June. Are you saying that the liquidator did all the bold stuff in your posting before their (official) appointment and then signed it off as the director's statement?

 

 

image.png.55a5b03a4a3563fcd11d7f28d6a5748e.png

Edited by DavidH
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Talking of statements and while it was up on my screen just now, I noticed the tick boxes. I thought we were working off the assumption that Dave had called in the liquidators? Apologies if I missed the discussion. Appointment was made by the/one of the creditors.

 

image.png.921b2dc7d1dfbaf78f409763318aa3d9.png

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3 hours ago, DavidH said:

Talking of statements and while it was up on my screen just now, I noticed the tick boxes. I thought we were working off the assumption that Dave had called in the liquidators? Apologies if I missed the discussion. Appointment was made by the/one of the creditors

 

3 hours ago, chris p bacon said:

Either hattons got fed up or Funding Circle decided time was up. It's likely that FC had asked for personal guarantees (usually a property) for their lending.

 

I Am Not A Lawyer, but might this not be a bit of a red herring as Dave Jones is both a major creditor of the company and sole director of the company and could therefore have placed the company in liquidation either way?

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10 hours ago, Phil Parker said:

I'm not sure why working with people in a different country should be an issue either. CAD files will be moved by e-mail, so that doesn't matter. The only issue might be that some discussions are easier to have face-to-face, but even this can be solved with technology.

 

There have been a number of instances (think Bachmann Modified Hall) where silly mistakes have been made and not picked up where the CAD designer is not familiar with the subject matter except through a set of drawings, and cannot just go and look at the real thing in preservation if a feature is unclear. I would have thought these are more likely if the designer is Chinese and is not a UK railway enthusiast. Discussions are also naturally more difficult if the two parties do not speak a common language fluently.

 

Chris

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On 27/06/2019 at 10:45, The Stationmaster said:

Now that really is a competence issue although as already pointed out he did say that he had the capacity to take on more projects.  If we look at where he was on the various live projects in April he had four live N gauge projects and two live 00 projects (one of which was of the same class of loco as one of the N gauge projects).  Two,  probably all four,  of the N gauge were, according to his website, about to go to tooling with delivery dates on two of them.  One of the 00 gauge projects would appear to have been almost at that stage (the Class 92) while the other was still in the very early stages of CAD development.

 

The only truly time consuming work among all of that was CAD checking and I don't belittle that task one bit (I've been involved in such a task myself) but most of the others were at a relatively simple process management stage until EPs arrived for checking,  and also livery details were needed to be prepared.   Easy to deal with in a 5 day working week with perhaps a bit of weekend work if anything was slipping or urgent answers were needed by the factory; 40 hours a week should have eaten that lot with time to spare (and don't forget he in effect said he had time to spare).  

 

If a project manager can't juggle that few balls at once, including the associated financial balls, then I would agree whole heartedly with folk who say he was out of his depth or lacked competence but if that really was the case then he would probably have gone out of business long before.

 

Believing you have the spare capacity (and/or ability), and whether you actually do are not one and the same thing.

 

Chris

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56 minutes ago, Chris Higgs said:

 

There have been a number of instances (think Bachmann Modified Hall) where silly mistakes have been made and not picked up where the CAD designer is not familiar with the subject matter except through a set of drawings, and cannot just go and look at the real thing in preservation if a feature is unclear. I would have thought these are more likely if the designer is Chinese and is not a UK railway enthusiast. Discussions are also naturally more difficult if the two parties do not speak a common language fluently.

 

Chris

 

I believe with the modified Hall it was more a mix up of tooling in the manufacturing rather than a CAD fault.  Perhaps down to the selecting of the right tooling and not being familiar with the prototype.

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