Form Structures Collapse: 108 Creditors Owed $4.65M — What Queensland Subcontractors Must Do Now

In mid-May 2026, Form Structures and Labour Pty Ltd — one of Queensland’s major formwork contractors, also known as KO Form — entered liquidation, abruptly ceasing trading and leaving 108 creditors chasing debts of $4.65 million. The collapse came six weeks after the company was removed from multiple Brisbane and Gold Coast high-rise projects for failing to pay subcontractors and workers.

If you are a subcontractor, supplier, or employee caught up in this collapse — or a principal contractor managing affected projects — you need to act immediately. The construction insolvency process is time-sensitive, and creditors who move quickly are materially better positioned than those who wait.

What Happened: The Form Structures Collapse

Form Structures operated as a formwork subcontractor on major high-rise developments in Brisbane and the Gold Coast. The warning signs emerged before the final collapse: furious subcontractors, citing widespread non-payment, refused to continue work, and head contractors removed the company from multiple active projects.

Six weeks after those removals, the company entered liquidation. According to reports in The Courier-Mail, the company now owes money to 108 creditors totalling $4.65 million — a figure that includes unpaid subcontractors, suppliers, and employees.

The collapse has an added dimension of concern for creditors: director Belinda Osborne’s husband, Conor Kearins, separately ran a formwork company — Kear-Form Group — which collapsed in 2025 owing creditors nearly $7 million. Ms Osborne also directs KO Form Pty Ltd, which is not in liquidation but has been rated an “impaired risk” by credit reporting agency CreditorWatch.

Liquidators will be required to investigate the full circumstances of the Form Structures collapse, including any transactions with related parties, any insolvent trading by the director, and whether the liquidator has grounds to pursue any recovery claims.

What Happens to Creditors When a Company Enters Liquidation?

When a company is wound up, a licensed insolvency practitioner (the liquidator) is appointed to take control of the company’s affairs. Under the Corporations Act 2001 (Cth), the liquidator’s role includes:

• Identifying and realising the company’s assets
• Investigating the company’s affairs and any potential misconduct
• Distributing the proceeds to creditors in the priority order set out in section 556 of the Corporations Act
• Pursuing voidable transactions and insolvent trading claims where appropriate

The priority order for distribution is:
1. Costs of the liquidation (liquidator’s fees first)
2. Employee entitlements (wages, leave, superannuation up to statutory caps)
3. Unsecured creditors (subcontractors, suppliers, tax debts)
4. Shareholders

In most Queensland construction insolvencies, there is insufficient money to pay unsecured creditors in full — or at all. That is the reality. But taking the right steps immediately can significantly improve your outcome.

I’m a Subcontractor or Creditor — What Should I Do Right Now?

If you are owed money by Form Structures, here is what you must do immediately:

1. Lodge a Proof of Debt

Contact the liquidator and lodge a formal proof of debt as soon as possible. You will not receive any dividend distribution unless you are a registered creditor. Gather all documentation: invoices, contracts, delivery dockets, site records, and communications confirming the amounts owed.

2. Check Your PPSR Registrations

If you supplied goods to Form Structures and registered a Purchase Money Security Interest (PMSI) on the Personal Property Securities Register (PPSR) before the collapse, you may be entitled to recover those goods or receive priority payment over other unsecured creditors. Act fast — the liquidator will be assessing assets. If you failed to register, you are likely an unsecured creditor.

3. Preserve Your Records

Document everything immediately. Photograph site conditions, preserve emails, retain copies of all contracts and purchase orders. If work was in progress, document the state of incomplete work and any materials left on site. Disputes about what is owed are common in construction insolvencies.

4. Do Not Deal with the Director

Once a liquidator is appointed, the director has no authority to deal with company assets or settle debts. Any agreement you reach with the director directly may be unenforceable. All communications should go through the liquidator.

5. Get Legal Advice if Your Exposure Is Significant

If you are owed a significant amount, engaging a commercial insolvency lawyer early can make a material difference. A lawyer can review whether you have any priority claims, advise on proof of debt strategy, identify any claims against directors personally, and assess whether the liquidator is acting in creditors’ interests.

What Are the Phoenix Company Red Flags — and Why Does This Matter?

The term “phoenix company” refers to a pattern where a company is wound up with debts — and then a substantially similar business rises from the ashes, operated by the same or associated individuals, but free of the previous debts. Illegal phoenixing is a serious problem in the Australian construction industry and is actively targeted by both ASIC and the ATO.

Under the Corporations Act 2001 (Cth), liquidators are required to investigate any pre-liquidation transactions that may benefit related parties at the expense of creditors. These include:

• Unfair preference payments (section 588FA): payments made to creditors — including related parties — in the six months before the winding up, when the company was insolvent
• Unreasonable director-related transactions (section 588FDA): transactions that benefit a director or their associates that a reasonable person in the company’s position would not have entered into
• Insolvent trading (section 588G): a director who allows a company to incur debts when it was already insolvent may be personally liable to creditors

When creditors become aware of patterns involving related parties — family members, associated entities in the same industry — it is entirely appropriate to raise those concerns with the liquidator and ask what investigations are being conducted. The liquidator works for the creditors.

On 31 August 2021, new creditor-defeating disposition provisions were introduced into the Corporations Act (sections 588FDB and 588FE(6B)), specifically targeting phoenix activity. ASIC also has direct powers to pursue directors involved in illegal phoenixing.

What About My Employees and the Fair Entitlements Guarantee?

If you are a former employee of Form Structures with unpaid wages, annual leave, or other entitlements, you should:

• Lodge a claim with the liquidator as a creditor (employee entitlements have priority over unsecured creditors under section 556)
• Consider a claim under the Fair Entitlements Guarantee (FEG) scheme — a Commonwealth government scheme that can advance unpaid wages and entitlements when an employer enters insolvency. Claims must be lodged within 12 months of the liquidation date
• Contact the Department of Employment and Workplace Relations for FEG information

Lessons and Action Points for Queensland Subcontractors and Creditors

The Form Structures collapse is another example in a long line of Queensland construction insolvencies in 2025–2026. Whether you were caught up in this particular collapse or are concerned about another project, the following lessons apply:

1. Act within days, not weeks. The creditors who move first are best placed to preserve assets, lodge early, and influence liquidator decisions.
2. Always register on the PPSR before supplying goods or equipment to a contractor. An unregistered security interest is almost certainly an unsecured debt in a liquidation.
3. Know the warning signs: payment delays, project removals, word-of-mouth about non-payment. If a head contractor is being removed from projects for non-payment, the risk of collapse is high. Stop supplying on credit immediately.
4. Understand the Security of Payment regime. Queensland’s Building Industry Fairness (Security of Payment) Act 2017 (Qld) gives subcontractors the right to make adjudication applications for payment of progress claims — even after a company collapses, this may assist in establishing the debt.
5. Attend the creditors’ meetings. As a creditor, you have the right to attend meetings, vote on resolutions, and — if the liquidator is not pursuing claims aggressively enough — apply to the court for directions.

How Boss Lawyers Can Help

Boss Lawyers regularly acts for subcontractors, suppliers, and creditors caught up in Queensland construction insolvencies. We understand the Construction insolvency process, the Security of Payment regime, and what it takes to maximise your recovery when a contractor collapses.

If you are owed money by Form Structures — or any other construction company that has entered administration or liquidation — we can:

• Advise on your creditor rights and how to lodge a proof of debt effectively
• Review whether any PPSR registrations or retention of title clauses protect your position
• Identify whether any insolvent trading or phoenix claims may be available
• Represent you at creditors’ meetings and in any court proceedings
• Advise on Security of Payment adjudication claims where applicable

For strategic commercial legal advice, call Mark Harley on 1300 267 711 or contact us online. Construction insolvencies move fast — the earlier you seek advice, the better your position.

Frequently Asked Questions

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About the Author: Mark Harley is the Principal Solicitor of Boss Lawyers, a Brisbane-based commercial litigation and insolvency firm. Mark was admitted to practice in July 2008 and has 17+ years of experience acting for directors, shareholders, creditors, and insolvency practitioners in the Queensland Supreme Court, Federal Court, NSW Supreme Court, and WA Supreme Court. Boss Lawyers has advised across commercial disputes, insolvent trading matters, director liability claims, and building and construction insolvencies.

This is general information only and is not legal advice. You should obtain professional advice specific to your circumstances. Boss Lawyers Pty Ltd | ABN 38 143 136 645 | Level 27, Santos Place, 32 Turbot Street, Brisbane QLD 4000 | 1300 267 711