CREDITORS of embattled community broadcaster Channel 31 have opted to give its directors time to strike a deed of company arrangement.
The station’s directors now have up to 60 days to put together the deed that, if accepted by creditors, could secure its long-term viability.
The station was put into voluntary administration on January 13 after its directors became aware there was a risk it could have been trading while insolvent.
Some creditors at the meeting indicated concern that the station may have been trading while insolvent much earlier.
Audio Visual Developments representative Tom Tapping said the station had owed AVD a significant debt since April last year.
Channel 31’s administrator Melsom Robson partner George Lopez said there had been an indication that the station may have been trading while insolvent.
“While we believe that the company was insolvent some time in October, there were issues about what debts were due at that time. The directors had been able to move some of those debts back,” he said.
One contentious issue within the administration has been a claim from one of the station’s major content providers, CTV Perth.
CTV Perth is seeking $592,000 for money it claims it is owed through a broadcast agreement struck between itself and Channel 31.
However, Channel 31 is counterclaiming that CTV Perth has not lived up to its part of the broadcast agreement.
Mr Lopez said the broadcast agreement was not a commercial arrangement.
He said that, under the agreement, CTV was to be paid more than one quarter of all the revenue drawn from a show.
“But the broadcast agreement also says that CTV doesn’t have to be paid unless the Channel 31 board agrees to it.”
