Mayfair Cellars: creditors uncertain of fortunes
- Thursday 6 July 2006
Those whose wine was sold on by finance director Dominic Smith are unlikely to get any money back.
The 200 Mayfair clients with some 5,300 cases currently worth around £2m currently being stored by Vinotheque in Burton-on-Trent are now able to access their wine, despite unpaid storage charges of £15,000.
David Hogg of Vinotheque explained that they are offering Mayfair’s customers a special storage deal that covers both the arrears and storage to the end of 2006.
Hogg also said that Vinotheque had suggested to Mayfair directors David Searle and Dominic Smith that it would be safer to open individual customer accounts rather than keep all the wine under Mayfair’s umbrella account. The suggestion was not taken up.
En primeur customers, however, face a more uncertain time.
Mayfair received orders and payment for 2002, 2003 and 2004 en primeur wines. However, of the 1061 cases ordered, and currently held in France, 306 cases have been paid for by Mayfair; 105 cases are part-paid and 400 cases remain unpaid. Administrator Grant Thornton is still seeking to establish the status of the remaining 250 cases.
The UK representative of negociant Nathaniel Johnston & fils told decanter.com that Mayfair had ordered but never paid for 2002en primeur wines. Mayfair was due to pay Nathaniel Johnston €40,000 in September 2003. In the end, Mayfair’s 2002s went back into Nathaniel Johnston’s stock.
‘I chased both Searle and Smith for payment for two years until the company collapsed,’ said the representative. ‘We didn’t ship the 2002s and refused to supply Mayfair with 2003. David Searle was well aware of the fact but appeared to be doing nothing about it. It was extraordinary. Dominic Smith appeared to have complete autonomy and was not accountable to anyone. It was clear that something was badly wrong and the word was out in Bordeaux about Mayfair’s position.’
Searle has so far refused to add any comment to that made at the creditors’ meeting on 20 June.
‘I was phoned about a month before the collapse,’ he said. ‘I thought the bill had been paid in 2005 – prior to that they had been chasing for payment. You have to remember that the Bordeaux négociants are quite relaxed about payment as they have the wine, so have the whip hand.’
There remains the question of who holds title to the en primeur that Mayfair did pay for but the initial legal view is not good news for Mayfair’s customers. Grant Thornton says it is ‘seeking a definitive legal view…the initial opinion is that title has not passed from Mayfair Cellars.’