“Worst time of my life”: Former Pie Face franchisee left with nothing
A former Pie Face franchisee has tearfully described how she lost everything at the banking royal commission.
Marion Messih on Tuesday told the commission she had bought a Pie Face franchise with her brother and sister-in-law in Werribee in Victoria for $330,000 in 2013.
The trio believed they could earn $50,000 each a year from the business – but it didn’t take long before they realised the business wasn’t profitable.
“If we earned $500 in a week it was a miracle, which was pretty woeful to be honest,” she told the royal commission today.
Ms Messih claimed the former owner had exaggerated the profitability of the shop.
“He had run the business down. By the time we took it over, the clientele wasn’t there,” she said.
Despite that, Ms Messih and her brother and sister-in-law worked hard to slowly boost sales and they were on track to make the business profitable – until Werribee Plaza, where their Pie Face is located, started major renovations.
“People avoided Werribee Plaza with a passion,” Ms Messih said.
The business was struggling as the same amount of rent was still needed to be paid, so Westpac agreed to a payment plan.
However, after Pie Face went into voluntary administration, the bank approved a hardship plan, which meant repayments were stopped to allow Ms Messih to find another job.
But Ms Messih’s mother fell seriously ill at the same. She decided to sell her investment property, for which she received $750,000. She planned to use the money to pay off the remaining money owing on her investment property, her mortgage and her portion of the business loan debt.
According to Ms Messih, Westpac agreed with that plan but the day before the sale settled, the bank reneged and told her they would use the proceeds of the sale to recover the entire debt – including the half belonging to her sister-in-law.
“It clearly shattered me because that was not all my debt,” she said.
Ms Messih’s sister-in-law proposed paying back $50 a week towards her debt, which Westpac “laughed at” and refused.
“When the settlement happened on my property, they took it all,” Ms Messih said.
When she went to the Financial Ombudsman Service she was told the bank able to recoup 100 per cent of the loan, as she had used it as security to secure her half of the loan to begin with.
But Ms Messih said she had lost everything.
“I worked hard to get where I was. I should be retired by now but I still owe money,” Ms Messih said.
“It was overwhelming and stressful. It was the worst time of my life ... and I don’t ever want to go through it again.
“I’ve always paid all my debts upfront and to continually get phone calls from institutions asking when I’m going to make payments ... was really hard.
“My kids paid my bills and my loans for me; that’s not what a mother does.”