The construction of 1,700 dwellings is in limbo after builder Porter Davis Homes collapsed. Of these, about 250 homes were close to completion, according to the liquidator Grant Thornton.

Although several companies wanted to buy some of Porter Davis Homes’ assets, no buyers were willing to buy all the assets and complete the homes.

In May, Grant Thornton announced they had sold the intellectual property owned by Porter Davis separately.

When a company is liquidated, any income, including from the sale of assets, is applied to settle the debts. There is a specific order in which they’re settled, starting with liquidation costs, secured debts, unsecured debts and then members or owners.


In Victoria, builders are required to take out domestic building insurance for work valued at more than $16,000. If the builders go bust, their clients can claim against this insurance to recover their losses.

In the Porter Davis Homes case, some clients paid deposits without Porter Davis Homes taking out insurance for their builds.

The Victorian government announced a compensation payment scheme for these specific customers on 20 April.

But in general, clients without insurance would have to submit a claim with the liquidators and would become unsecured creditors. If there are sufficient funds to pay the unsecured creditors, they’ll receive some or all of their money back.

In Victoria, you should ask your builder to give you a DBI policy number and certificate of insurance before paying a deposit. You can check that the insurance is valid on

Freya Southwell is a property lawyer and principal of Sutton Laurence King Lawyers.

For expert advice on property law and conveyancing contact Sutton Laurence King Lawyers today on 03 9070 9810 or