Manchester developer Colin Shenton is attempting to stave off the winding up of at least one of his 17 companies.
The 31-year-old developer faces a petition for unpaid tax brought by the Inland Revenue against The Shenton Estate Company. According to Companies Court in London, a second petition has been brought by Customs & Excise against Ivory Property Investments, a company Shenton says he no longer owns.
Shenton confirmed the legal wrangle with the IR is over corporation tax assessment. He said: “There is a petition. It all stems from a reverse premium that was paid to us by a client. We treated it as income, but the IR says it should be treated as a capital receipt.”
Shenton said discussions were continuing: “Both sides need to agree the amount to be paid.” The next court hearing is scheduled for 4 October.
A hearing is also scheduled for Ivory Property Investments, which is listed as one of the Shenton group’s subsidiaries on its statement of accounts, for 4 September.
Shenton said: “Ivory is now a dormant company and in different ownership – we don’t now own it. None of our group owes any VAT. We have no outstanding legal proceedings with Customs & Excise for any companies in our group.”
Financial backing for the Shenton family’s companies comes from the family itself and there are no outside shareholders or backers. The group owns 17 companies, which are all special purpose vehicles. The company is behind between 15 to 20 schemes across the UK and, according to Shenton, has an annual turnover of around £10m. It had net assets of £1.1m as at year ending March 1998, while profits for six of its subsidiaries stood at £246,272.
In addition, Shenton faces legal difficulties from local architect Shepherd Gilmour, which claims that Shenton owes the practice money. Charles Birch, md, said: “We’re taking legal action against Shenton Estates. We were appointed to market Shenton Court. He then decided he didn’t want to use us anymore. He owes us £8,000.” Shenton denied he owed the architect any money.
Shenton also has a disagreement with investment agent Lewis Ellis & Partners over Shenton Court: “We’ve had a major falling out. They’re suing us and we’re suing them. We’ll win the fight and they’ll be severely embarrassed about it,” he said.
Lewis Ellis has not confirmed that legal proceedings are taking place but LE’s Nick Casson said: “We were involved in the purchase and sale of Shenton Court.” Shenton Court is a 16-apartment building located on Booth Street.
Shenton remained optimistic about the future and confirmed the group’s expansion: “We’ve set up a new residential development company called Living Space. We’re working up five schemes at the moment – four in Manchester and one in Scotland. We’re looking to build 150 to 200 units per year over the next three years.”
EGi News 23/08/00
