BENNINGTON — The bankruptcy court trustee overseeing property liquidation for the former Southern Vermont College is alleging that the operator of a summer youth camp on the campus is in breach of an occupancy agreement and has failed to follow through on a purchase agreement for the campus.
Raymond Obuchowski is seeking in the complaint payment from a $300,000 security deposit posted during the summer by the camp ownership because of “significant” damage to campus property and other costs and related expenses.
Obuchowski, the court-appointed Chapter 7 bankruptcy trustee working to dispose of assets of the former college, filed the complaint late Monday afternoon in U.S. Bankruptcy Court against Moshe Perlstein, operator of the youth camps for Orthodox Jewish teens from the New Jersey-New York City area.
The camp groups had vacated the 371-acre campus and its buildings by early September, town officials have said. The first of two camp sessions began in early July.
Perlstein and Zicrhon Chaim camp entered into a purchase and sale agreement for the campus on June 22 with trustees of the former college, and an occupancy agreement beginning on June 24 was to cover the period of the summer camps.
Perlstein’s Vermont attorney, Carl Lisman, could not be reached Monday evening for a possible comment on the complaint.
NOW ‘IN DEFAULT’According to Obuchowski’s complaint, the occupancy agreement extended through Sept. 22, and the camp operators are now in default regarding terms of that agreement.
Those include failure to maintain the campus property in substantially the same condition; failure to make repairs to maintain the property’s condition; failure to pay or reimburse for the costs of maintaining and operating the campus property; failure to remove personal property, such as air conditioners and beds; and unauthorized removal of real property, such as kitchenware, and failure to reinstall sinks, an ice-maker and other items in the dining hall.
The complaint cites the $300,000 deposit Perlstein and the camp put up before occupying the campus in late June. Obuchowski alleges Perlstein breached the agreement, and he is seeking a judgment from the court against Perlstein “in the amount of $300,000 plus interest, attorney’s fees and costs.”
The security deposit is being held by TPW Real Estate, the complaint states.
Perlstein also agreed to “indemnify, defend and hold [the trustee] harmless from and against any and all liabilities, loses, claims, demands, costs, expenses and judgement of any nature,” arising from any injury, loss or damage to property stemming from the presence of the campers, guests clients or others, according to the complaint.
The complaint, filed on behalf of Obuchowski by attorney John Kennelly, of Pratt Vreeland Kennelly Martin & White of Rutland, states that “significant damage was caused and significant expenses and costs were incurred to or against the [campus] property during [the camp’s] occupancy of the property.”
Obuchowski said estimated costs to repair the damage is “at least $50,000 and the expenses total at least $175,000.”
The complaint states that “during the occupancy, there was extensive damage done to the property, for which Perlstein as purchaser is responsible.”
The agreement also provides that the property was to be restored to its prior condition after the occupancy if the sale agreement was not completed, which did not occur, according to the complaint.
The proposed sale of the campus to Perlstein’s group involved a reported purchase price of $3.15 million.
LIST OF DAMAGEAmong exhibits filed with the complaint is a report provided by contractor Jon Hale, owner of Hale Resources, LLC, of damages to the property found in an inspection.
Hale’s firm had been hired to manage the campus property after SVC closed following the spring 2019 semester. After the departure of the campers, the company did a building by building inspection, he stated.
Specific items are listed for each building, including in the historic Everett Mansion on campus, where the inspection found eight new cracks in a stained glass window; trim board missing in a hallway; a cabinet door removed on the second floor; walls damaged and sink supply lines cut and left in a women’s rest room; and pictures removed, trash left and two chairs broken in the mansion carriage barn.
Similar notations were made by Hale Resources about the other campus structures.
Among the types of damage in buildings noted were “graffiti, removal of pictures, damage to walls and ceilings, disconnection of plumbing, broken sensors, broken outlets, damage or removal of blinds, damage to doors, wooden trim, screens, floors, carpet and furniture,” Hale wrote. “Additionally, garbage was left in many parts of the property.”
He also states that at one point a sprinkler head “was broken off on the third floor of Hunter Hall and before emergency responders arrived and turned off the water off 10,000 gallons of water ran out of the broken sprinkler head and through the first two floors of the building.”
An insurance claim has been filed over that damage, according to the complaint, but the coverage would involve a large deductible amount.