The high-profile Sydney yoga studio at the centre of a decidedly un-zen scandal

Egg of the Universe claims to “inspire and celebrate community”,offering an “urban sanctuary” to activate the body and the mind.

But the high-profile Rozelle yoga studio now finds itself at the centre of a decidedly un-zen scandal,accused in a scathing statutory report of trading while insolvent,owing tens of thousands of dollars in superannuation while plunging further into debt and making generous loans to founders Bryony and Harry Lancaster under their now-ceased leadership.

Yoga instructor Jacqueline Lastra outside Egg of the Universe,which she says owes her $9000.

Yoga instructor Jacqueline Lastra outside Egg of the Universe,which she says owes her $9000.Oscar Colman

The company’s assets have been sold to a new entity and the studio continues to trade;with a liquidators’ report finding there is no money to pursue legal action,there is likely no recourse for unpaid creditors who are owed close to $2 million in total by a complex web of legal entities running the yoga studio and affiliated cafe selling “high vibration wholefoods”.

Holding company Sohum Yoga Rozelle,which ran the Rozelle yoga studio,was $618,762 in debt with no means of repayment when it went into liquidation in the dying days of 2022,according to a liquidators’ report obtained by theHerald.

While the COVID pandemic contributed to the business’ failure,“poor strategic management … as a result of the Company funding the operations of related entities and providing apparent loans to the Directors while unable to meet its own liabilities which were due and payable”,said the liquidators’ report by Smith Hancock obtained by this masthead.

The loan to the Lancasters,both previously directors of Sohum Yoga Rozelle,was $376,311.

‘An industry that claims to preach values,ethics and morality is stealing from its own teachers.’

Jacqueline Lastra,former yoga teacher

“From my investigations,it is my opinion the company has traded while insolvent since at least 1 January 2022,” said the December 2022 report.

Directors can be personally liable for funds lost by creditors while trading while insolvent,with ASIC also able to impose fines and prosecute directors for insolvent trading.

The “funds to date have been insufficient to cover the cost of winding up”,meaning no further action can be taken for those owed money,unless they fund it themselves.

The Lancasters said in a statement:“We expanded our business significantly in the months just before the first COVID lockdown hit in 2020,after running a successful and respected enterprise for 14 years.

“Like many other businesses,ours was unable to recover from the debilitating effects of consecutive COVID lockdowns.

“The creditor’s report was lodged with ASIC,which has advised it does not intend to conduct any further investigations.”

An email sent to devotees at the time when only people vaccinated against COVID-19 were allowed to access businesses said that Egg of the Universe would not reopen at the earliest possible opportunity because “we feel that if we were to open before everyone was allowed to return,that a fundamental aspect … could be lost”.

The yoga studio business was sold to another entity,Samavaya Pty Ltd,one day after Samavaya was incorporated with Harry Lancaster as director.

He has since relinquished control of the business to Byron Bay man Daniel Kurlapski,who is now the director of Samavaya,its shareholder company and its ultimate holding company. Kurlapski is not accused of any wrongdoing.

‘Like many other businesses,ours was unable to recover from the debilitating effects of consecutive COVID lockdowns.’

A statement from the Lancasters

“We maintain a connection with Egg of the Universe,but are now trying to start again with a new life away from Sydney,” the Lancasters said.

Both Harry and Bryony Lancaster have declared personal bankruptcy.

The Egg of the Universe website still lists Bryony as a co-founder;the studio will hold a retreat in Bali later this year for participants to be “held and guided by experienced teachers,Jo and Bryony”.

Yoga teacher Jacqueline Lastra has left the industry because of her experience teaching at Egg of the Universe.

“It’s affecting my mental health,it’s leaving such a bad taste in my mouth. It really saddens me that this is the state of the industry,” said Lastra,who told this masthead she is owed about $9000 in unpaid wages and superannuation by Egg of the Universe.

Her claims are backed up by the liquidators’ report,which says the company owed $70,870 to the Australian Taxation Office for the superannuation guarantee charge – as well as at least $516,319 to ordinary unsecured creditors – at the time it wound up.

“An industry that claims to preach values,ethics and morality is stealing from its own teachers,” Lastra said.

Egg of the Universe’s affiliated wholefoods cafe also came to an ignominious end in 2022 when unpaid rent led the landlord to change the locks.

According to Smith Hancock’s liquidation report into the cafe’s parent company Living Wholefoods Pty Ltd,it traded while insolvent from April 2020 until it closed.

“The company had no estimated realisable assets and estimated liabilities of $1,385,262,” the report said.

Correction - An earlier version of this story said that the Lancasters owed $70,870 in unpaid wages. That amount was actually due to the Australian Taxation Office for the Superannuation Guarantee Charge.

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Sally Rawsthorne is a crime reporter for The Sydney Morning Herald.

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