DJ Models: company wound-up and liquidation closed

[Tricky-CRS]

A good amount of cash must have been in the account at somepoint to earn £5.02 in interest you don't get that of £0.10 in a year.

[John M Upton]

Ah, I can hear the Angry Mob sharpening their pitchforks once more....

[Markwj]

11 minutes ago, John M Upton said:

Ah, I can hear the Angry Mob sharpening their pitchforks once more....

Mine didn't need sharpening -it's never blunt!

[PJT]

I must admit, I look at these posts and the pdf report and it sends a shiver down my spine.  I'm the sole employee of my own business; after watching this slow-motion tram smash from the sidelines I'm left thinking, 'Good God, this is awful, this is what happens if you get it all wrong.' 

 

And I'd curl up and die inside to see the contents of my washing basket being picked over by all those who, very justifiably, still feel so very aggrieved. 

 

An example for all us self employed people to remember if we're ever tempted to play fast and loose or rob Peter to pay Paul.

 

Pete T.

 

Edited June 3, 2020 by PJT
Missed out 'is' in the first paragraph.

[LaGrange]

13 minutes ago, John M Upton said:

Ah, I can hear the Angry Mob sharpening their pitchforks once more....

 

Or the humored mob who did nothing but laugh at him.....and his more easily led followers

[Chris M]

I paid the initial deposit for a king. I didn't bother registering a claim because it was obvious there would be nothing to be retrieved. There are probably many like me.

 

The problem I have is that Dave Jones must have realised there was virtually no hope for his enterprise when he asked everyone to send him the deposits for the king. He must have pretty much run out of cash when he asked for the deposits and just used our cash  to keep him from going under for a while.  It seems toe there was no real prospect of our money being paid to a Chinese factory to make the tooling. Some folk here did try to warn us off. I thought that, as I had registered an interest, it would be bad form to not pay the deposit and decided to trust Dave. That was a mistake. It's no big deal, there's a lot worse happening in the world today, but I don't expect to see Dave at any exhibitions when they restart.

[pheaton]

1 hour ago, Markwj said:

Yes where did the money go -why just 10p left- a simbolic number once the rest had been moved elsewhere? A bad taste joke on his part?

The 10p was left there to keep the account open, we can all mull over this till the cows come home, its not going to change anything.....the only figure I note is that if there were only 178 unsecured creditors (assume these or the vast majority were modellers) it proves that the APT didn't have a hope in hell of making it to production, yet right until the end it was suggested all was going well.

 

the investigation into the director conduct would make for interesting reading I'm sure but. its not a public document.

 

 

Edited June 3, 2020 by pheaton

[gazwire]

I'm furious after receiving the liquidators letter. I was unable to recover my £250 and thought this letter may be the last hope, but not to be as the bank will only reimburse up until 18 months.

 

I contacted the liquidators to retrieve further info and was told they were unable to obtain many, many documents, which leads me to believe that Dave Jones has basically swindled us. I strongly suspect he knew the inevitable were to happen, yet nafariously persuaded us to part with our hard earned money. I just wish this could be opened as a fraud case and Dave Jones face justice. I don't know how this low-life can ever show his face again - despicable, deceptive character he is.

Edited June 3, 2020 by gazwire

[Mel_H]

From another site

 

DJModels liquidation claims were £174K

 

Fledgling manufacturer DJModels Ltd, which collapsed a year ago, has left outstanding claims for £174,428 after being put into voluntary liquidation by its sole owner and director, Dave Jones.

 

In its Final Report published yesterday (2 June 2020) ahead of the company’s formal dissolution, Manchester-based liquidators CG&Co say that no funds are available for distribution to creditors.

 

The £174,428 is due to 41 unsecured creditors - including people who had paid deposits for models that were to be produced - and had lodged an official claim with the liquidators.

 

In addition, 178 other people told the liquidators that they made claims through their banks and credit card companies to receive a refund under the insurance protection they offered.

 

The value of these claims is not known, nor does the report state how much in deposits had been collected for models yet to be produced.

 

It is understood that the total number of people who had paid deposits was much higher, but as they have not contacted the liquidators, the figures are not known.

 

It is normal practice for liquidators to deal with claims made, not to analyse the records of the failed company to establish who might be eligible, as this would simply incur additional cost.

 

The liquidators’ main role is to realise as much money from the sale of any assets, and collect any monies owed to a failed company.

The report adds: “A significant amount of time was spent dealing with the claims of unsecured creditors,” adding, “there are a significant number” of individuals who had “paid a deposit for goods not provided.”

 

At the time of the firm’s collapse, Liverpool-based DJ Models was in the early stages of producing a 4mm scale model of BR’s 1980s Advanced Passenger Train prototype (APT-P), and a 2mm GWR 4-6-0 King class.

 

Development work had progressed from a June 2018 laser scan of the surviving vehicles at Crewe Heritage Centre, to an initial CAD drawing of the driving car and an early 3D test print of it, before the company, owned by Dave Jones, ran out of cash on 4 June 2020.

The APT model’s development cost was financed by customers paying instalments as the project progressed. It was also possible to pay the entire amount ‘upfront’.

 

The project had initially been advertised as a ‘crowd funded’ model, with the price of a full 14-car model being £995.95. Models were to be sold in 5, 6, 7, 10 and 14-car formations.

 

The first 25% deposit (£248.99) was collected in early 2018. A further three deposit payments were due to be made as the project progressed through development stages, but the project did not reach the second deposit stage.

 

Although tooling of the APT-P had not started, DJ Models owned the Intellectual Property (IP) rights for two other models it had produced directly for its retail customers.

 

Both in 4mm, they are understood to be the Southern Region Class 71 electric and Hunslet Austerity 0-6-0ST steam locomotive. These IP rights were sold by the liquidators on 15 January 2020 for £2,300. Agents were used to provide a valuation of the IP.

 

While not revealing the IP buyer’s identity, the liquidators confirm that it “was not a connected party,” meaning it was not Mr Jones.

 

Other models made by DJ Models were completed as contracts for suppliers, such as Merseyside-based Hattons Model Railways, for which it made a 4mm GWR 0-4-2T 14XX class steam locomotive. In these cases, IP ownership rests with the specifier.

The company did not have any employees, nor any other assets.

 

It appears that the tooling for DJM’s two ‘in-house’ models was not owned by the company, although the report is silent on the subject, other than recording a ‘nil balance’ against ‘tooling, laser scans/plans’.

 

The status of the tooling - typically costing around £250,000 for a locomotive - is unknown. It is believed that the tooling remains in China at the factory that made it.

 

The liquidators received £4,000 ‘cash in hand’ from Mr Jones to pay for the liquidation, plus the £0.10 that was in the firm’s bank account. Mr Jones also deposited £800 with the liquidators to “cover the remaining costs of liquidation.”

 

 

[AY Mod]

1 hour ago, gazwire said:

Potentially libellous comments removed. 

 

In which case you need to contact the police. AFAIK he has not been charged or found guilty of any criminal act so you leave yourself open to claims of defamation or libel if you use such phrases. Don't be dumb and play into his hands!

[Joseph_Pestell]

20 minutes ago, Mel_H said:

 

 

The liquidators’ main role is to realise as much money from the sale of any assets, and collect any monies owed to a failed company.

 

 

Sadly, in my experience, the main role of liquidators (insolvency practitioners) is to make sure that they get paid themselves at a very decent hourly rate. Creditors come a distant second.

 

In fairness, I think that this one will not have been a success for them.

[Mel_H]

Just a couple of facts that may, or may not, be of interest:

 

According to official figures (the Gazette), in 2019 there 122,181 companies that went into insolvency, an increase for the fourth consecutive year and a rise of 6.0 per cent compared to 2018.

According to Companies House there were 672,890 new companies registered in 2018/19. This is an increase of 8.5% compared to last year and the highest number of incorporations since 2009 to 2010.

 

[Colin_McLeod]

1 hour ago, John M Upton said:

Ah, I can hear the Angry Mob sharpening their pitchforks once more....

 

Just to comply with social distancing, make sure they are over two metres in length.

[gazwire]

34 minutes ago, AY Mod said:

 

 

 

34 minutes ago, AY Mod said:

 

In which case you need to contact the police. AFAIK he has not been charged or found guilty of any criminal act so you leave yourself open to claims of defamation or libel if you use such phrases. Don't be dumb and play into his hands!

Thanks for the heads up, I have edited the post.

 

If anyone read my post pre-edit: I'd like to clarify my unwavered believe that he is an honest, trustworthy, genuine person. So much so that I'm putting him forward for business person of the year. To do this though I'll need your support and I'm sure you'll all be happy to help this through with a deposit of only £250 out of the £1000 I will ultimately need from each one of you; just to show you what a good deal your getting and that you can trust me. 

Edited June 3, 2020 by gazwire
Change

[MarkSG]

2 hours ago, Enterprisingwestern said:

£225.79 an hour isn't a bad wage.

 

It's a bit misleading to cite it as a "wage", because it isn't any individual's take-home pay. It's the rate charged by the accountancy firm for the work, and, as well as providing take-home income to the partners of the firm, it's also covering their fixed costs such as rent, rates, overheads and salaries of anyone else who works for them such as office staff, cleaners, etc.

 

I charged £250 recently for a job which took me about 20 minutes to actually do. But the point is that I don't get jobs like that every day. But having the ability to do that job on request means paying to maintain facilities every day,

[charliepetty]

9 minutes ago, gazwire said:

 

 

Thanks for the heads up, I have edited the post.

 

If anyone read my post pre-edit: I'd like to clarify my unwavered believe that he is an honest, trustworthy, genuine person. So much so that I'm putting him forward for business person of the year. To do this though I'll need your support and I'm sure you'll all be happy to help this through with a deposit of only £250 out of the £1000 I will ultimately need from each one of you; just to show you what a good deal your getting and that you can trust me. 

I thought you got praise when you did well!    Charlie

[Colin_McLeod]

51 minutes ago, AY Mod said:

 

In which case you need to contact the police. AFAIK he has not been charged or found guilty of any criminal act so you leave yourself open to claims of defamation or libel if you use such phrases. Don't be dumb and play into his hands!

 

Now that the original post has been changed, that leaves just your own post Andy with the potentially defamatory comments quoted.

[Dixie Dean]

Perhaps it's finally time to press the Delete key on this whole unsavoury episode (including deleting this entire section of the forum).  I personally hope I don't accidentally bump into him on my travels as I might be tempted to give him a "Kirkby" kiss! (don't ask).

[Mel_H]

6 minutes ago, gazwire said:

 

 

Thanks for the heads up, I have edited the post.

 

If anyone read my post pre-edit: I'd like to clarify my unwavered believe that he is an honest, trustworthy, genuine person. So much so that I'm putting him forward for business person of the year. To do this though I'll need your support and I'm sure you'll all be happy to help this through with a deposit of only £250 out of the £1000 I will ultimately need from each one of you; just to show you what a good deal your getting and that you can trust me. 

 

I don't hold a candle for Dave Jones, but there is no suggestion fraud at all. If so, it would have been picked up.

 

The business simply ran out of cash and he, correctly, put it into liquidation rather than 'trading while technically insolvent', which is what many firms (in other sectors) do.

 

Indeed, if he was on the make, or trying to push it too far, he could have put out a call for the next deposit payment etc.

 

The sad truth is that he was a one-man band, trying to do too much, with too little capital and too little ability in some areas. 

 

Few people have all the talents to be the project leader, advertising manager, sales manager, PR manager, customer service manager and financial controller et al, although for small businesses, that's what many have to be.

 

The bedrock of the business should have been quality all the way through in everything, with solid delivery of everything.

 

Things might have been different if Dave Jones had taken on board the good advice and assistance that I understand he was offered (in some cases for free) - something that other players in the market have done.

 

Running a business is a tough gig, especially when it comes to relationships with your investors who also happen to be your customers. Let us all hope that we've all learned something from this (suppliers and customers/commentators) alike. 

 

Although it's cold comfort, it's probably best that DJM collapsed when it did, rather than after the 2nd and 3rd deposits had been taken for example.

 

I know that's not great if you are one of the many who lost money, but it's probably time to accept things as they are and take the final report as 'closure'.

 

Tin Hat on, I'm running for the shelter now....

 

 

 

 

[Joseph_Pestell]

No names, no pack drill. But I recall another small, under-financed (at that time) model manufacturing business that did not appreciate the difficulties of manufacturing in China.

[AY Mod]

9 minutes ago, Mel_H said:

The business simply ran out of cash and he, correctly, put it into liquidation rather than 'trading while technically insolvent

 

My understanding is that the issue was forced by a creditor rather than voluntarily. I believe that, ultimately, reduced further consumer creditor sums. 

[mdvle]

4 minutes ago, AY Mod said:

 

My understanding is that the issue was forced by a creditor rather than voluntarily. I believe that, ultimately, reduced further consumer creditor sums. 

 

No knowledge of the DJM case, but this seems to be the general pattern regardless of business - they never voluntarily end the business but rather try to keep going day to day hoping to turn things around until either a creditor forces the issue or a key supplier/contractor refuses to do business with them anymore.

 

Thus, as a random example, the very public cases of travel companies that are taking bookings etc. right up until they go to court and then leave customers stranded.

[MAURICE040947]

As reported earlier from 'another place'

Both in 4mm, they are understood to be the Southern Region Class 71 electric and Hunslet Austerity 0-6-0ST steam locomotive. These IP rights were sold by the liquidators on 15 January 2020 for £2,300. Agents were used to provide a valuation of the IP.

 

so it wasn't for the Shark and King then that the  £2300 was paid over to the Liquidators .

[PMP]

2 hours ago, LaGrange said:

 

I'm not sure that’s quite right, if I might offer an alternative perspective.

 

How Dave Jones sees himself ....

 

 

How other people see him .....

[spamcan61]

3 minutes ago, MAURICE040947 said:

As reported earlier from 'another place'

Both in 4mm, they are understood to be the Southern Region Class 71 electric and Hunslet Austerity 0-6-0ST steam locomotive. These IP rights were sold by the liquidators on 15 January 2020 for £2,300. Agents were used to provide a valuation of the IP.

 

so it wasn't for the Shark and King then that the  £2300 was paid over to the Liquidators .

That's what it states, although that seems bizzare on two counts:-

 

Why would anybody buy the IPR for models duplicated by Hornby?

 

The IPR for the King and Shark were reported as purchased, maybe that was from the actual source and not DJM?