'Visionary' defaulted on business rates twice in 35 years

EXCLUSIVE by OUR BUSINESS UNIT

Scottish Borders Council has had to write off almost £32,000 of unpaid taxes due by the same company chairman who defaulted on his rates while running a textile business in the region 35 years earlier.

As previously reported here, the Borders local authority is on a long list of creditors owed money by debt-ridden Orrdone Farms Ltd., previously called Avocet Farms and chaired by 'visionary entrepreneur'/now bankrupt Martin Frost. No details as to the nature of the debt had been given in progress reports by insolvency specialists.

But in response to a Freedom of Information request, SBC has now confirmed it submitted a claim for £31,932.79 to the administrators of the Avocet firm in May 2020 in respect of  business rates and council tax arrears accumulated prior to the company's collapse.

The council explained: "These balances were initially pursued as part of routine recovery. As part of routine Council Tax and Business Rates administration, the outstanding balances are shown as ‘written off’ on the appropriate accounts. However, if a payment is received from the administrators the funds will be offset against the write off transactions."

Ironically, while the amount due to the local authority was piling up before 2020, Avocet's "revolutionary" agricultural methods on a trio of Berwickshire farms drew praise from one of SBC's leading councillors.

Mark Rowley, who was executive member for business and economic development in 2018, told the Berwickshire News after visiting one of Avocet's farms: "The model is fascinating, I hope it will bring significant investment and employment to the Borders. It is exciting that such new and innovative techniques are now being pioneered by Avocet here in the Scottish Borders".

The last set of annual accounts for Avocet Farms (covering 2017) which were signed by Mr Frost, showed net liabilities of £3.889 million, up from £1.618 million in the previous year. The largest creditor was said to be parent company Avocet Infinite PLC, owed in excess of £7.8 million. Infinite, also headed by Mr Frost, would later plunge into compulsory liquidation.

According to the accounts: "The directors have prepared consolidated forecasts for the group for a period well in excess of that required for a going concern review by the legislation, which show positive cash flow and profitability, however, achieving the results set out in the forecasts is dependent on the parent company successfully completing the funding round it is currently undertaking".

It was also stated: "The company has entered into discussions to sell the largest of its farms which will allow long-term debt to be significantly reduced and provide further funds for working capital".

Orrdone Farms' failure to pay business rates mirrors a similar default by a textile business operated by Mr Frost in 1985.

On that occasion SBC's predecessor Borders Regional Council [BRC], responsible for local government services in the area from 1975 to 1996, initiated punitive legal action after being unable to collect £5,000 in business rates from A Hall (1982) Ltd. based in a Victorian spinning mill across the road from council HQ in the village of Newtown St Boswells.

As part of a crackdown on defaulters, BRC petitioned the Court of Session to have Mr Frost's company placed in liquidation and wound up.

Prior to its demise, plans were announced by A Hall (1982) for expansion of the mill including the creation of 45 jobs and the establishment of the Scottish Woollen Craft Village which was to transform the local tourist industry. 

However, in November 1984, all of the workers at Hall's Langlands Mill were made redundant.