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Building firm hit with fines files Chapter 7

Last modified: 8/8/2012 12:00:00 AM
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Summer and Winter Construction LLC, a Concord contractor facing large fines from state and federal regulators, filed this week for bankruptcy liquidation.

The company was fined $18,000 by a Merrimack County judge in February for mishandling asbestos, and a federal appeals court in June ordered the firm to pay fines from the federal Occupational Safety and Health Administration totaling nearly $102,000.

But Monday's Chapter 7 bankruptcy filing indicates the company's debts, including those fines, won't be paid off in full. The company listed liabilities totaling between $100,001 and $500,000, including money owed to the Internal Revenue Service, but less than $50,000 in assets.

Summer and Winter's lawyer, Charlie Russell, blamed the bankruptcy on ''basically a tough economy. And there's no business, low business, and the income isn't there, the cash flow isn't there to pay the debts. . . . You can look for a lot of other construction companies, mom-and-pop construction companies, that went under during the recession.''

Company owner Walter Jensen didn't file for personal bankruptcy.

Concord-based Summer and Winter Construction was established in 2003, according to state records, and is the latest iteration of Jensen's construction business.

An earlier company, Sharon and Walter Construction Inc., was formed in 1995 and filed for Chapter 7 bankruptcy liquidation in 2004. Jensen had earlier filed for Chapter 11 bankruptcy reorganization in 1990 and emerged in 1991, but filed for bankruptcy again in 1994, with that case ending with liquidation in 2000, according to court records.

Russell described Monday's bankruptcy filing as ''a skeleton petition,'' and it didn't include the detailed lists of assets and debts that are required in bankruptcy cases. Those must be filed by Aug. 20.

''We'll comply with that,'' Russell said.

An initial meeting with creditors is scheduled for Sept. 6 at the U.S. Bankruptcy Court in Manchester.

In its filing, the company listed the IRS, the state Department of Environmental Services and OSHA as its creditors, as well as Travelers Indemnity Co., two Concord residents and one Manchester resident. Russell said the company was facing court judgments involving those individuals and hearings to compel payment were approaching.

In a Chapter 7 bankruptcy case, a company's assets are sold to pay creditors at least some of the money they're owed. None of Summer and Winter's creditors are so-called ''secured'' creditors who would be first in line to be paid, Russell said, but he said tax bills typically come before other debts in order of repayment.

He said he didn't know the details of the IRS debt - ''They're listed because they're owed some money,'' he said.

The $18,000 in fines imposed by Merrimack County Superior Court Judge Richard McNamara in February were for improper disposal of asbestos removed from two Concord homes in 2005 and 2006. McNamara found the carcinogenic material was taken to a Rochester landfill without properly notifying the facility, creating a potential risk to public health.

At the time, Senior Assistant Attorney General Allen Brooks said the relatively mild fines may have reflected a concern by McNamara ''about the viability of the business if he fined much more than that.'' Brooks didn't return a message yesterday seeking updated information.

The $101,550 in OSHA fines stem from 16 citations against Summer and Winter Construction and its earlier iteration, Sharon and Walter Construction, for issues at worksites in Concord, Hanover, Manchester and Pittsfield between 2000 and 2009.

The Department of Labor, which includes OSHA, said earlier this year that the fines hadn't been paid, and on June 7 the 1st U.S. Circuit Court of Appeals in Boston issued a judgment ordering Summer and Winter to pay the money within 30 days.

Ted Fitzgerald, a Department of Labor spokesman, said yesterday that Summer and Winter hasn't paid up.

''The department may file a proof of claim with the bankruptcy court,'' he wrote in an email. ''If so, the department would be in line with other unsecured creditors.''

(Ben Leubsdorf can be reached at 369-3307 or bleubsdorf@cmonitor.com or on Twitter @BenLeubsdorf.)'


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