Tentative settlement reached in fire department bankruptcy case

The Conneaut Lake Volunteer Fire Department and Mercer County State Bank, the fire department’s main creditor, have reached a tentative settlement agreement in an effort to resolve the fire department’s Chapter 11 bankruptcy case.

The fire department and Mercer County State Bank reached the agreement during an all-day mediation session last Wednesday, according to an article published by Firehouse.

Read more: Bankruptcy Attorney, Pennsylvania

A report on the settlement was filed with U.S. Bankruptcy Court in Erie by Norman Gilkey, the court-appointed mediator.

“As a result of the session, details of the settlement agreement are being drafted and will be reviewed before being submitted to the court for approval, according Gilkey’s report, which was filed with the court Friday,” the article reads.

In January of last year, Conneaut Lake Volunteer Fire Department filed for voluntary Chapter 11 bankruptcy protection. The department did so in an attempt to reorganize its debts, which include more than $1.6 million to Mercer County State Bank, and also to remain in operation.

The bank filed a mortgage foreclosure action in Crawford County Court of Common Pleas in December 2015.

“U.S. Bankruptcy Court Judge Thomas Agresti of Erie approved a consent order on Jan. 19 allowing the fire department and Mercer County State Bank to try federal mediation after both sides has asked the court to do so,” the article reads.

The Chapter 11 bankruptcy filing halted any foreclosure action by the bank and other creditors. Bankruptcy rules prohibit legal actions by, for, or against a corporation unless approved by a federal bankruptcy judge.

“The bankruptcy filing has not affected Conneaut Lake Volunteer Fire Department’s ability to provide fire protection. The department’s primary service area is the borough of Conneaut Lake and the southern and eastern portions of neighboring Sadsbury Township,” the article reads. “The fire department operates a social club equipped with a restaurant and liquor license adjacent to its fire station.”

The post Tentative settlement reached in fire department bankruptcy case appeared first on Young, Marr & Associates.

from Young, Marr & Associates http://ift.tt/2nSM7Vg
via IFTTT