Caterer's cash crisis claims Dieci e Mezzo
Former ACT Brumby Jeremy Paul will close his restaurant Dieci e Mezzo. Photo: Elesa Lee
Upmarket Italian restaurant Dieci e Mezzo will close today - a casualty of the financial crisis which has engulfed the companies of high-profile caterer Fiona Wright and business partner Jeremy Paul.
Four companies run by Ms Wright owe a total of almost $1 million in payroll tax, penalties and interest to the ACT Revenue Office.
It is believed a separate debt is owed to the Australian Tax Office, which was a party to court proceedings this week but would not comment, citing privacy provisions.
Fiona Wright. Photo: Lyn Mills
And an as yet unknown number of suppliers are also owed money.
Ms Wright also confirmed she had not been able to pay compulsory superannuation contributions to many of her employees because of cash-flow issues which she attributed to problems working at the National Gallery of Australia. That was despite paying $440,000 in back payments to the ATO earlier this year, she said.
The ACT Supreme Court this week ordered four companies run by Ms Wright be wound up on the grounds of insolvency - W Catering, Ten and a Half, Wright's Fine Food and Fiona Wright Pty Ltd.
The court appointed Canberra insolvency expert Henry Kazar as liquidator.
Mr Kazar told The Canberra Times yesterday the only business to close straight away would be the Dieci e Mezzo restaurant in the ground-floor of ActewAGL House in Civic because it had been losing money on a weekly basis.
The plan was to keep the catering contract for the kitchen at the National Gallery of Australia running until mid-November when the gallery expected it could get in another caterer. Similarly, Mr Kazar said Ms Wright's contract to run two cafes at the Department of Defence in Russell would continue to run until a new caterer was appointed.
''Currently I am working with, and have commitments from, the National Gallery of Australia and the Department of Defence sufficient to ensure continuity of service,'' Mr Kazar said.
''I understand approximately 120 staff are presently engaged within the businesses operated by the companies, and I am endeavouring to ensure that their wages and entitlements are secured.
''As I am still investigating the position of the companies and the financial circumstances of the basis for my appointment I am not in a position to comment on any personal liabilities that may be owed by the directors of the companies, nor on the details of the liabilities of the companies or any previous arrangements that may have been entered into prior to my appointment.
''I do not propose to offer any comment on the allegations apparently made concerning the National Gallery of Australia until such time as I have completed my investigations.''
The ultimate aim of the liquidation process was to realise assets and pay off creditors.
Mr Kazar said the four employees still working at Dieci e Mezzo would be redeployed to other arms of the former Wright empire to ensure no job losses. The restaurant opened in September, 2010.
ActewAGL chief financial officer John Knox said it would be looking for another tenant.
''We will seek expressions of interest to continue to use this part of the ground floor of ActewAGL House as a restaurant or cafe area,'' he said.
Documents tendered to the Supreme Court show that Mr Paul, a former Wallabies and Brumbies rugby player, is a director of the W Catering and Ten and a Half companies, with Ms Wright. The amounts owed to the ACT Revenue Office by those companies were $554,599 (Ten and a Half) and $196,246 (W Catering).
The documents show Tony Wright and Fiona Wright are the directors of Wright's Fine Food and Fiona Wright Pty Ltd. The amounts owed by those companies were $206,937 (Wright's Fine Food) and $26,736 (Fiona Wright Pty Ltd).
The total amount owing is $984,518.
Ms Wright said yesterday that her wages bill for Ten and a Half at the National Gallery frequently exceeded its revenue and ''we lost vast amounts of money providing the catering services at the NGA''.
She said Wright's Fine Food loaned money to Ten and a Half ''many times to keep the day-to-day operations afloat and for more than two years we were trying to get the NGA to acknowledge and change their event management practices and assigned to [Ten and a Half]''. Both the employees and the ATO were aware of those problems, she said.
''The [ACT] Commissioner of Revenue was also aware of our revenue stream being too low and could not support the catering operations,'' she said. ''For 32 months out of 36 months we lost substantial amounts of money, a point the NGA would never assist us to correct as they should have done.''
The gallery has declined to comment on the allegations.
A spokesperson for the Department of Finance said individual agencies were responsible for ensuring compliance with the Commonwealth Procurement Rules and the gallery itself had to answer any questions about its adherence to those rules.