Potential insolvent trading probe after modular builder's closure

The WA Consumer Protection Commissioner is calling on clients of a modular home building company which abruptly closed last week to lodge formal complaints so it can investigate further.

Bella Modular, a Perth-based manufacturer of transportable granny flats and home office buildings, wrote to all its customers on August 19 to say it would not be able to complete their outstanding projects.

In an email sent to clients last week, the company said, "Due to unforeseen and significant financial difficulties, Bella Modular is unable to complete your project directly."

The letter said a new manufacturer had agreed to take over existing contracts and complete the projects but did not provide the new firm's details.

Bella Modular has already closed its premises in Hopeland on Perth's southern fringe.

WA Consumer Protection Commissioner Trish Blake told 102.5 ABC Perth she wanted anyone affected to lodge a formal complaint with the department.

"I will be asking the team to investigate further and to look into it," she said.

"I'm also keen to link in with ASIC, because my concern is there may have been some trading whilst insolvent, questions that need to be answered."

Consumer rights apply

Dozens of customers have paid deposits, some more than $100,000, but have not received their buildings which are months, and in some cases, years overdue.

"Often with these companies, particularly if you've got a letter that says 'we're in financial hardship, we can't deliver your product', that tells me that something very wrong potentially has gone on in the background, which is why I want to refer things to ASIC as well," Ms Blake said.

Because the homes are manufactured off-site and clients independently arrange for them to be transported and place on sites, the contracts are not covered under building indemnity insurance which covers losses when a building company goes out of business.

However, Ms Blake said customers still had rights under Australian Consumer Law.

"There is an offence for wrongly accepting payment and not delivering," she said.

"Particularly … taking payment when they know they don't really have a reasonable chance of delivering.

"We want to look into all of this, which is why we need as many complaints as we can get, so that we can get across the entire fact scenario of this one and see what action we can take."

At this stage, Ms Blake said it was unclear whether the agency would be able to get customers' deposits refunded.

A Credit Watch report shows the company has a debt to the Australian Taxation Office of $576,614.68.

It is also facing three court actions for other payments totalling just over $170,000.

Customers in limbo

Peter Elliot, who ordered a granny flat intended for his parents in May 2025, and which is now months overdue, said he was shocked to receive the letter.

Mr Elliot paid a $90,000 deposit, which was 50 per cent of the cost of building, to guarantee a three-month completion time and had been hoping to have his parents living in his backyard by Christmas 2025.

"This was a disability-ready home for them to move into as they progress further in their lives," Mr Elliot said.

He said he was uncertain how another company would complete the build.

"I can't envisage another company taking on, effectively, the 50 per cent debt against the buildings that are either underway or promised to be underway,"

he said.

Fellow concerned customer Steve Evans has paid almost $160,000 towards a customised home from Bella Modular.

He initially paid a deposit of $28,000, then was contacted by the company four weeks ago to ask for a further $130,000, which he paid.

"I feel like a bit of a patsy … and I've got a horrible pit in my stomach that I've lost the money," Mr Evans said.