Dream kitchen turns into nightmare for Timaru couple

Monday, 18 March 2024

It was meant to be the key to Kay and Peter Dellow’s retirement.

After the installation of their new almost $26,000 kitchen, set to be complete by December 2023, the Timaru couple would be able to wind down, give up work and relax knowing their home needed very little maintenance.

Instead it has become a nightmare, after the company they paid to design and build it was placed into liquidation.

Now $17,634.40 out of pocket, the couple fear they will never see their money or the kitchen.

“We’ve both worked so hard to save for that and have been putting money aside for the past about eight years,’’ Peter Dellow said.

“We knew we were going to have to do something to the kitchen before we retired and it was a huge amount of money.’’

Long-running Kitchens Direct (NZ) Ltd, which traded as Kitchens Direct, started in 1970 and was involved in the design, manufacture and installation of kitchens in Timaru.

It was put into liquidation on October 10, along with Kitchen Direct Appliances Ltd, Kitchens Direct IP Holdings Ltd and Kitchen Direct Franchising Ltd.

Working for many years as a courier driver in the region, Kay Dellow said she had dealt with director and shareholder of all three companies Karl Te Raki.

Having found him good to deal with, she said they chose to deal with Kitchens Direct after getting quotes from three companies.

“I dealt with Karl years ago and and we had a good rapport, and I trusted him.

“He was a bit cheaper [than the other two companies] and was saying all the right things, and that they’d have the kitchen in by Christmas.’’

The work was authorised on September 20 and she said she paid the deposit the following day - $17,634.40, 70% of the total price.

“You pay 50% when you book a kitchen, but I was told by Karl if I paid a 70% deposit I’d get a 5% discount.’’

The couple said Te Raki visited their home with “an offsider’’ and took the final measurements for the kitchen on October 9.

“He shook my hand and told me the kitchen would look really great,’’ Peter said.

“I took him on that. As far as I’m concerned, I’m old school and a handshake is a trust thing between two people.’’

The following day, the companies were placed into liquidation. Kay went into the King St showroom to talk about handles for the drawers, and spoke to Te Raki.

“I was in a moon boot at that stage, as I had broken a bone in my foot, and I told Karl ‘I’m so excited because by the time my moon boot’s off, I’ll have my new kitchen’.’’

That night the Dellows drove home past the showroom and noticed a sign on the door saying it was closed for business.

“That night I didn’t sleep,’’ Kay said.

“The next morning and I started ringing the office and it just rung and rung. I started to think ‘what have we done?’’’

Having no luck, she tried a Kitchens Direct office in Ashburton and was informed the Timaru business had been placed in liquidation.

“I was beside myself and just kept thinking ‘how am I going to tell my husband?’’’

Since then, they had made contact with the liquidator, Mohammed Jan​ of Liquidation Management, and said they had felt let down in the process.

“You trust somebody to do something,’’ Kay said.

“We paid the deposit and have seen nothing - it must be refundable surely. I just can’t believe someone could do this to people.”

She said she had approached Te Raki and he had given her his word those affected would be paid back, and that she could expect this within the next three months.

“It’s gut wrenching,’’ she said.

Te Raki earlier told The Timaru Herald he would ensure creditors were paid and customer issues were resolved.

On Friday, he said “everything is in the hands of the liquidator, they are still in the process of realising all the company assets’’.

“The liquidator will communicate with creditors and myself on completion and that is expected in the near future,’’ Te Raki said.

In his first liquidator’s report, Jan said Te Raki told him the companies had failed because of a variety of factors.

Those included a “steady loss of customers over the years, an increase in material and labour costs/shortages, profit margins not achieved, profit plagued by debts, suppliers stopping credit due to non-payment and the ongoing effects of Covid-19”.

On Friday, he said at the moment there was not enough money to pay out unsecured creditors.

“However, there are other recover options which we will be pursuing for the benefit of creditors,’’ Jan said.

He said more information on the recover option would be in the next report due on May 8.

That report would have all updates up to the six-month period, he said.

“The company assets have been sold through an auction house,’’ he said.

“Funds have been receipted in the liquidator’s trust account. Only the rent has been paid until it was disclaimed. This was agreed between the liquidator and landlord so that the assets can be auctioned and retrieved from the site.

“Apart from that, no distribution has taken place. The remaining funds are in the liquidators’ trust account.’’

While Peter said paying the money to a business that likely knew it was in trouble at the time was bad enough, he said the actions of the owner “have destroyed my faith in human nature’’.

“I don’t trust anybody now.

“I just want to know where the money went.’’