At GPS we have a culture of transparency and disclosure. If we make a mistake or do something embarrassing (such as watching an episode of The Bachelor – guilty!) we make the admission, take the best shots from the rest of the team, deal with the issue and then get back to business.
Here goes for me.
GPS had a long association with Mitchell Brandtman who performed much of our Quantity Surveying work over the years. My association with them goes back to when I was a lawyer.
In 2015 I wrote an article (I am too old to “blog”) praising them on their professionalism. Shortly after my article, Mitchell Brandtman prepared a report for a project GPS was looking at funding.
The project turned out to be problematic at best. There was a failure of the builder. GPS had to step in and work with the borrower to complete the project.
As you would expect from GPS, our primary concern was the best interests of the GPS investors. We put up a considerable amount of money (seven figures) to get the project completed, marketed and sold. There was no loss of capital or interest to GPS investors.
GPS didn’t fare as well. Accordingly, once we had looked after our investors we further investigated what had gone wrong as this situation is quite unusual for us.
It was discovered that Mitchell Brandtman in addition to acting for GPS also acted for the failed builder. They provided him with an assessment of the build cost at roughly the same time as they prepared their report for GPS.
While I was concerned when I found out about the report for the failed builder I was more so when I found out that the assessment of the build cost for the failed builder was for a considerably greater amount than certified to GPS.
Suffice it to say had Mitchell Brandtman disclosed the report prepared for the failed builder to us we wouldn’t have proceeded with the loan. This is all part of the well repeated GPS adage of “We would sooner not take investors money than not give it back”.
GPS takes potential conflicts of interest very seriously. In this matter we received two representations of independence from Mitchell Brandtman.
Mitchell Brandtman has, of course, been removed from the GPS panel of Quantity Surveyors. We have also initiated Supreme Court proceedings against them. This is the first time GPS has sued one of our consultants.
I would like to say more but I am limited as to what I can say as the Court proceedings haven’t been concluded.
A positive aspect to all of this is the way the team at GPS conducted themselves. The focus remained on working with the borrower and doing whatever had to be done, whenever it was required to be done to protect the interest of the GPS investors. They simply got on with it with as good humor as was possible in the circumstances.
We should all take pride in the commitment of the team at GPS which produced the best result for everyone in the circumstances.
I will think twice now about praising a consultant in an article.
Richard Woodhead – Managing Director
Comments are closed.