Lavington Sportsground contractor Depan Group enters into voluntary liquidation

More than 10 sub-contractors who have worked on the creation of an additional playing field at the rear of the main oval have been caught up in Depan Group's decision to enter voluntary liquidation late last week.

But, Albury Council is adamant ratepayers won't be out of pocket with works still to be completed to be covered by a bond in line with contractual arrangements agreed to in 2017 between Depan Group and council.

Melbourne-based Depan Group had only been in existence for two years when it was awarded the $2.7 million job with its tender $472,000 cheaper than the next highest bidder, Joss Construction.

Council general manager Frank Zaknich said the move into voluntary liquidation had come close to it reaching "practical completion" with the outstanding works including lighting, earthworks and certification of services installed in the area.

"The funds council still holds under the contract will enable the work still required to be done," he said.

"It's really disappointing in terms of the outcome for the project to date.

"It came as a surprise.

"We had offered to support the contractor in terms of some payment of practical completion items direct to sub-contractors.

"It's always difficult when you've not been paid for the works undertaken as part of the contract."

Mr Zaknich defended the decision to appoint Depan Group ahead of three other contenders for the works.

"We were very keen and very focused on ensuring there was due diligence in terms of their capacity to deliver the project," he said.

A council report from 2017 also states:  "Depan Group Pty Ltd has provided a letter of financial guarantee for the security provisions of this contract from a third party financier in the form of Fifo Capital Financial Solutions.

"Accordingly, the relatively lower score allocated to Depan Group Pty Ltd is primarily related to the limited available financial surety.

"In the context of this overall project, the risks with regard to project delivery are deemed low."

It indicated about 90 per cent of materials, subcontractors and professional consultants would be sourced from Albury-Wodonga.

The sportsground redevelopment has encountered numerous hurdles including the discovery of unsuitable soil on the new sportsfield area which led to a $3.2 million blowout.

In late 2017, councillors ripped up plans for changerooms on the new sportsfield area because of concerns about the design and another $800,000 was needed to make the main oval grandstand totally safety compliant.

The council is presently assessing two tenders for the next two stages of the redevelopment works with a decision expected later this month.