Council writes off bad debt

COLLAPSE: The wreckage of Milano’s on the Lake, the Pelican Marina restaurant that partially collapsed in February. Lake Macquarie City Council has written off $100,000 in debt on the adjacent car park. Picture: Max Mason-HubersLAKE Macquarie councillor John Gilbert has called forstrictercriteria onleasing council land,after the council wroteoff $100,000 in bad debt onaPelican Marina car park.
Nanjing Night Net

Councillors determined on Monday to write off the debt after five years in whichLake Macquarie council sought unpaidrenton the car park next to Pelican Marina from the marina’s then-lessee, Ben Ensor.

“For the first six months, this fellow was just about getting away scotfree,” Cr Gilbert said.

“I think the council’s response should have been more timely and more aggressive.It left us exposed.”

In March 2011, Mr Ensor bought Elidock Pty Ltd, thecompany leasingthe car park fromthe council.

The rent set on the car park was $20,000 a year, not including rates.

But six months after Mr Ensor became thelessee, a councilreport says, the councilwrote to him sayinghe was $12,000 in arrears.

Mr Ensor proposed a 10-week payment plan for the debt, but the council said it only received $1,600the following month.

In February 2012staff met with Mr Ensor and, the council reports, it was agreed that Mr Ensorwould apply for a rent donation through financial hardship.

In the interim he would repay $500 a week.

Mr Ensor repaid $4000 between February and May 2012, but the council rejected his financial hardship application because he didn’t provide the required audited financial statements and, the council says, those he did provide were inconsistent.

The council resolved in July 2012 to terminate Mr Ensor’s lease on the car park.

But it needed theNSW government’s consent forthetermination, because the site under lease was Crown Land under trust to the council.

Under the terms of the trust, the councilhad to make the landaccessible to the public at all times.

Thatwas why, thecouncil says, it couldn’t simply have locked Mr Ensor out of the car park.

“The write off of the sundry debtor account over [the Pelican car park land]results from auniqueset ofcircumstancesthat are unlikely to arise again,” a council spokeswoman said.

An order was finally served on Elidock Pty Ltd on December 1, 2015, and the lease over the car parkwas terminated on December 31.

By then the debt was $100,003.

Following the write-off of the debt on Monday night, Mr Ensor toldthe Heraldthe Pelican car park had beenused by the public and not just users of the marina.

“As such, reputable valuers put a realistic rental charge at under a third of what council charged,” Mr Ensor said.

In February, following the partial collapse of the marina restaurant Milano’s on the Lake, Mr Ensor said he hadspenthis own money repairing piers around the building forthe past five years.