GEORGETOWN — The president of the Georgetown Club has filed bankruptcy, leaving scores of employees suddenly without work, creditors on the hook for about $10 million and perhaps two dozen brides without a place to hold their wedding receptions.
According to court documents filed by club owner Peter Wojtkun on Sept. 11, the filing for protection under Chapter 11 of the bankruptcy code included three legal entities listed as debtors: The Georgetown Golf Club, Inc., New England Golf Partners, Inc. and Georgetown Links, LLC, all of which Wojtkun runs. The holdings concern the 18-hole golf club, its clubhouse and function facility at 258 Andover St., in Georgetown.
The documents advise the court the three debtor organizations started running into problems in early spring, when they experienced cash-flow problems due to things "beyond their control, including, among other things, the weather and the economy."
At the club yesterday, no one was answering phones in the function office or restaurant, or returning messages, and the voice mail at the golf professional's extension held a message it was "no longer in service."
Yesterday, a phone call placed to Wojtkun, a dentist, at his practice in Andover was not returned.
Along with concern for the 15 salaried and more than 100 hourly employees who are left unemployed, worries have been expressed all over town for the brides who booked the banquet halls at the clubhouse for their upcoming wedding receptions.
"I got a call this morning from the mother of a bride who was supposed to have her wedding reception at the Georgetown Club on Oct. 4," said Georgetown police Chief James Mulligan. "Unfortunately, we can't do anything to help people get their deposits back. It's a civil and not a criminal issue, so it's out of our jurisdiction. But it's just awful. She was understandably very upset."
Ivonne Donnelly, of Lynnfield, said her daughter, Shannon, is "devastated." Early yesterday morning, two calls came in telling of the closure of the Georgetown Club, one from one of the wedding's vendors who worked through the Georgetown Club, and one from a friend who heard of the closing. Donnelly called the club immediately, and though it took time, someone finally called back to confirm the club was closing after one last function planned for last night, she said.
"Needless to say, right now we are scrambling to find someplace to hold a wedding for 175 people at 4 p.m. on Sunday, Oct. 4," Donnelly said. "We really need to keep that same date and time. We have people coming from all over. The plane tickets have been purchased; hotel rooms booked. And also, some of the vendors we were using were through the Georgetown Club, and they haven't been paid."
In the partial wedding package, Donnelly booked the florist, disc jockey and the baker of her daughter's wedding cake through the Georgetown Club, putting down a deposit of about one-third of the cost of the reception in advance.
"From what I understand, if they put the deposit in an escrow account, we might be able to get that money back," Donnelly said. "But if they didn't put it in an escrow account, it's lost, all of it.
"This story is truly heartbreaking because although parents are helping, my (28-year-old) daughter and her fiance are paying for their own wedding. Their deposit was in the vicinity of about $10,000," Donnelly said. "This is not only an emotional burden, but it's financial. It's a sad, sad, sad story; these are hardworking people trying to do their best, and it's gone. We're telling my daughter that we're going to get through this, and it's going to be all right, but she's wondering how."
Donnelly heard that as many of 24 brides may be in the same situation as her daughter.
In his petition to the court for protection from his creditors under Chapter 11, Wojtkun said the three debtors "collectively owe approximately $10 million to their creditors." Wojtkun added he disputes many of the claims made against his three corporations. Those claims include demands by about a dozen former Georgetown Club members who say he owes them a combined total of more than $180,000 in the form of nonreturned initiation membership fee deposits they were supposed to be repaid upon leaving the club.
When filing bankruptcy, filers must prove their liabilities (debts) exceed their assets, making repayment impossible at the face value of debts. When filing for protection under Chapter 11 of the bankruptcy codes, filers must provide a reorganization plan that the court and the creditors must approve, which proves they can run successfully after reorganization.
According to Wojtkun, he believes he can improve his cash flow and operations, by "among other things, rejecting several agreements which are unprofitable."
According to the assessor's office, the total appraised value of the golf club's properties is more than $10 million; however, the town assesses the properties at about $6.4 million under Chapter 61B, a special appraisal exception granted to recreational facilities.
If bankruptcy under Chapter 11 isn't approved, Chapter 7 bankruptcy — a total liquidation of the assets to pay off creditors — may follow.
As a search of the Massachusetts Superior Court files of Essex County indicate, often those who started off working with Wojtkun ended up in court battles, either being sued by, or suing, him. Legal fees, court rulings and legal challenges account for a large number of the creditors listed in Wojtkun's bankruptcy documents. Aside from about $6.6 million owed to mortgage holders, on both first and second mortgages, almost $562,000 are listed owed to three law firms.
In addition to the more than $180,000 claimed owed them by former members, an $80,000 legal judgment against Wojtkun won years ago in lawsuits waged and won by Beverly Enos is also listed on his creditors list, although Wojtkun disputes it.
Also listed is money owed to vendors, such as accountants, a paving company and golf-related services.
The town of Georgetown itself stands to lose tens of thousands in back taxes and electric costs.
"The Georgetown Club is one of our largest taxpayers," Georgetown interim Town Administrator Mike Farrell said yesterday.
According to the information in the tax collector's office, this year's tax bill for the club was almost $65,500, of which Wojtkun still owes about $17,000. The town put a lien on the property for 2009's unpaid balance, but first quarter taxes for 2010 are past due for $16,677, with second quarter's taxes due Nov. 1 for another $16,369.
Also owed to the town is more than $29,000 to the Georgetown Electric Co.
