Court overturns demand for MCG Quarries to repay money

BEFORE Krystelle Lemm's Bowen Basin employer Lindley Mining went into administration, the phone was ringing off the hook with businesses seeking hundreds of thousands of dollars in unpaid bills.

One of the companies calling in Lindley Mining's debts was MCG Quarries, south of Moranbah in central Queensland.

In November 2009 Lindley ended up paying MCG the $106,000 and in March 2010 Lindley went into voluntary administration.

It was one year after Ms Lemm had been hired to do the accounts.

Lindley and its liquidators took MCG to court in 2013 to make the quarry return the money, arguing Lindley was insolvent and unable to pay debts during the six months before it went into administration.

Ms Lemm told the court she was having regular conversations about the outstanding accounts during that time.

"Basically it didn't start out too bad," Ms Lemm said.

"By the end of my appointment I was getting phone calls, like copious phone calls per day, looking for payments."

The liquidators' report found Lindley owed $1 million in September 2009, but only had $384,000 in assets and cash to pay debts.

A judge last year accepted the liquidators' and Lindley's insolvency argument and ordered MCG to return the money and pay $32,000 in interest.

But on Monday the Queensland Supreme Court overturned that decision.

MCG had appealed the 2014 decision on the basis they did not know Lindley was insolvent, although they had been chasing the company for the money, in November 2009 were considering legal action to get it in and had been told orally and by email Lindley could not pay.

MCG said various financial documents showed Lindley was not insolvent at that time.

The June 16 judgment granted MCG's appeal and dismissed the previous judge's ruling that the company had to pay Lindley $138,000.

The court found there was not enough proof Lindley was insolvent when it paid MCG.