The Fall of Ohinemutu Village Tours: From Tourism Gem to Liquidation Woes
25.01.2025
Article
Ohinemutu Village Tours Limited, once a promising venture in Rotorua’s domestic tourism industry, has officially closed its doors after years of financial turmoil. Documents from liquidators Wendy Somerville and Malcolm Hollis reveal the extent of the company’s struggles, culminating in liquidation ordered by the High Court on March 20, 2017.
The company, founded on March 25, 2009, aimed to showcase the cultural and historical significance of Ohinemutu Village, but financial mismanagement and an inability to meet taxation obligations led to its downfall. The liquidators' final report, dated November 30, 2017, paints a grim picture of the company’s finances, with substantial debts and limited asset recoveries.
The reports highlight that the company ceased trading in March 2017 due to its inability to pay tax debts. At the time of liquidation, the company owed approximately $283,794 in an overdrawn shareholder current account. Attempts to recover these funds, including court actions, were unsuccessful, as the shareholder proved unresponsive and unable to repay. The liquidators eventually abandoned further recovery efforts, deeming them uneconomical.
Adding to the company’s woes, the sole director showed little cooperation during the liquidation process. According to the first six-month report, dated October 6, 2017, the director failed to provide key information or complete a director’s questionnaire. This lack of cooperation complicated efforts to investigate potential avenues for recovery.
Secured creditors were notably absent in this case, leaving unsecured creditors to bear the brunt of the losses. Non-preferential unsecured claims totaled $56,558, with only a partial distribution of $5,656—amounting to just 10 cents on the dollar—being made to these creditors. Preferential creditors fared slightly better, with a full settlement of $4,391 to cover petitioning costs.
Liquidators' fees and expenses consumed much of the available funds. Over $8,800 was spent on liquidators’ remuneration alone, with additional amounts allocated for legal fees and other expenses. By the end of the liquidation process, all proceeds from the company’s limited asset realizations—totaling just over $21,000—had been distributed, leaving no surplus.
Ohinemutu Village Tours Limited is now poised for removal from New Zealand’s Register of Companies. Public notice of this intention was issued on November 30, 2017, with objections to the removal required by January 31, 2018. The liquidators have declared that all avenues for asset recovery have been explored, with no further actions planned.
Despite the cultural and historical value the company sought to promote, its financial mismanagement left a trail of disappointed creditors and unresolved debts. This case serves as a cautionary tale for businesses in the tourism sector, highlighting the importance of robust financial management and compliance with tax obligations. For those who once dreamed of revitalizing Ohinemutu Village’s cultural heritage through tourism, the company’s closure marks a somber end to a venture filled with potential but plagued by mismanagement.