Building Stays in Elks Family
Roland McKinney, a Hartford Elks Officer from Hartland, Vt., shakes hands to congratulate Richard Daniels after he was the sole bidder on a foreclosure auction for the building which houses the Elks Lodge in Hartford, Vt., on Oct. 4, 2013. Valley News - Sarah Priestap Purchase photo reprints »
Hartford — Friday’s foreclosure auction of the Hartford Elks Lodge on Route 14 resolved none of the long-standing legal and financial entanglements of the organization.
Richard Daniels, an Elks member who initiated the foreclosure and is owed about $1.1 million as the mortgage holder, was the only bidder at Friday’s brief auction, which proved to be little more than a formality. The club has not been making payments on the mortgage.
Daniels’ attorney, Nicholas Burke, of Lebanon, proposed an opening bid of $1.8 million, the estimated amount needed to pay off the mortgage and all the debt associated with a sex discrimination suit the Elks lost in 2005 for denying several women membership. Not surprisingly, the offer was met with silence. Burke immediatly dropped it to $500,000 and Daniels accepted.
Burke said earlier this week that if no one else bid, Daniels would retain the property and decide what to do with it.
“I’m not planning on doing anything until I meet with the lodge and talk about what we want to do and can do,” Daniels said outside the lodge immediately following the auction. “Maybe we’ll try to get it (the debt) restructured and see where it falls. It has been going on way too long.”
Richard Blodgett, the lodge’s exalted ruler, attended the auction with a few other Elks Club members, but would not speculate on what might come next.
“I can’t comment because I just don’t know,” said Blodgett, one of five Lodge members being sued individually in an attempt by the plaintiffs to enforce the original settlement.
A status conference is scheduled for October 17 in Superior Court in Montpelier in the case.
Because the lodge lost its incorporation status in 1989 for failing to file an annual report as required under state law, creditors are allowed to sue members individually for liabilities incurred during that period.
Ten years after the Elks national organization lifted its ban on admitting women as members, a Washington Superior Court jury awarded seven women, who were denied membership, about $7,000 each in damages from a sex discrimination suit filed in part by the Vermont Human Rights Commission. The Elks lost an appeal of the case to the Vermont Supreme Court in 2008.
As of today, roughly $700,000 is owed in damages, interest and substantial attorneys fees. Ted Hobson, of Burlington, an attorney for some of the women, is owed a large chunk of that money.
The result of Friday’s foreclosure auction did not surprise Hobson, who continues to insist the organization is not as broke as it claims to be.
“It is an all cash operation,” Hobson said Friday. “It looks like more than $100,000 went through there this year according to their records. They are quite a profitable entity.
“Some say we should feel sorry for them or they don’t know what they are doing. They know what they are doing and are doing a very good job of it,” Hobson said.
Elks members have denied in court that the club is hiding cash.
Hobson said he has been stymied trying to get more information on the organization’s finances.
“There is no real record that we’ll ever see.
“We have other options. We have enough creditors to put them into Chapter 7,” he said.
Chapter 7 of the federal bankruptcy code is defined as liquidation.
“They continue to ignore the consequences of the discrimination suit and this (foreclosure auction) is another chapter. At some point, there has to be an end game.”
Patrick O’Grady can be reached at firstname.lastname@example.org