Baltimore attorney Arnold V. Hawkins filed for a fourth bankruptcy yesterday, stopping a foreclosure sale on a Charles County shopping center about an hour before it was to begin.
Hawkins' company, Green Acres Investments Inc., borrowed $900,000 from Maryland Permanent Bank & Trust Co. to buy the site, the Acton Square Shopping Center in June 1998. But he defaulted on the loan and Maryland Permanent sued.
In February, a judge ordered Hawkins to pay $929,446. But after the judgement, the bank learned Green Acres no longer owned the property. Hawkins had sold it to another company he had an interest in, Midas Realty Investments Inc., shortly after he bought it. Choice Realty Inc., which is owned by Hawkins, owns half of Midas.
Late last month, Choice filed for bankruptcy.
Maryland Permanent's attorneys determined a foreclosure sale was their only option, and planned one for noon yesterday. But before the sale could begin, the Maryland Permanent had to confront Midas' lenders in court.
Midas took out a mortgage on the property, and its lenders had petitioned Charles County Circuit Court Judge Richard J. Clark to stop the foreclosure sale, which would have wiped out their lien. Yesterday morning, the judge ruled the sale could proceed.
However, Maryland Permanent received word that, at 11:08 a.m., Hawkins had filed for Chapter 7 bankruptcy on behalf of Green Acres in Greenbelt.
The bankruptcy filing protects Hawkins' assets, and holds his creditors at bay."We're disappointed that the sale of the shopping center has been delayed," said Timothy McCormack, an attorney with Gordon, Feinblatt, Rothman, Hoffberger and Hollander, who is representing Maryland Permanent. "It's unfortunate because it will mean more expense for us."
Though Midas is the owner of record, Maryland Permanent's foreclosure case is against both Midas and Green Acres.
McCormack plans to petition the bankruptcy court to lift its protection so the sale can proceed, and he hopes that will happen within 60 days.
The Acton case is not the first time Hawkins has co-mingled his troubled business entities. On Friday, U.S. Bankruptcy Judge James F. Schneider approved to sale of a run-down office building at 213 St. Paul Place from Hawkins' Regent Estates Inc. to Midas for $325,000. The property was assessed at $441,000 in 1998, and Hawkins paid $385,000 for it in 1995.
Regent Estates filed for bankruptcy last month. Hawkins filed for personal bankruptcy May 8.
Edmund Goldberg, the attorney for the U.S. Trustee's office who is overseeing the Regent and the Choice cases, called the sale from Hawkins to Midas "unorthodox." But he said he had no objection. Attempts to reach Hawkins were unsuccessful.