The owner of the Van Dyck Restaurant & Brewery has lost his shield in bankruptcy court, further exposing him to creditors who have been lining up to foreclose on his properties in Schenectady, Saratoga and Washington counties.
U.S. Bankruptcy Court Judge Robert Littlefield on Thursday dismissed N. Peter Olsen’s Chapter 11 case. The dismissal follows creditors’ mounting complaints that Olsen lacked the financial resources to restructure what they called a “non-existent business.”
Prior to Thursday’s dismissal in the Albany court, Olsen’s 11-month-old case had been rapidly unraveling. In August, Littlefield refused to block Berkshire Bank’s attempt to foreclose on the Van Dyck, a famed jazz club on Union Street in Schenectady.
That property closed in March 2007 and should hit the auction block in spring.
Over the last three months, the court has also allowed two separate foreclosure actions to commence on Olsen’s office and rental property at 110 Center Road in Eagle Bridge. The foreclosures were initiated by Berkshire and the Washington County treasurer.
The dismissal will likely allow Ballston Spa National Bank to commence a foreclosure action on Olsen’s home at 90 Lake Ave. in Saratoga Springs. Bank attorney Thomas Peterson did not immediately return calls Friday seeking comment.
Olsen’s financial woes stem from his attempts to keep the Van Dyck afloat. But the jazz club remained unprofitable and he fell behind on payments for both the business and his personal obligations, including the mortgage for his home, according to court documents.
In January 2007, Ballston Spa National Bank moved to foreclose on Olsen’s home because he had stopped making payments on a $460,000 mortgage the bank issued in 2004.
Wanting to stop the foreclosure on his home, Olsen filed for Chapter 11 in March 2007. But Littlefield in January dismissed Olsen’s disclosure statement that details his reorganization plan.
Olsen and his attorney, Richard Weisz, did not immediately return calls Friday asking for comment.
“His proposal to ‘restructure’ a non-existent ‘business’ has been shown by the Debtor’s own (in)actions to be a sham and an abuse of the bankruptcy code, and should be dismissed,” BSNB attorney Thomas Peterson said in a Jan. 24 motion.
Olsen recently revived his marketing and public relations business. In early February, he said he should have a projected monthly business income of $10,000, according to court documents.
Pressures from the bankruptcy proceedings also prompted Olsen last year to sell his stake in a Martha’s Vineyard home.
Olsen initially said he closed the Van Dyck for temporary repairs. But prior to its closure, he defaulted on a $250,000 loan from Berkshire and a $200,000 loan and line of credit from the Schenectady Metroplex Development Authority.
In early 2007, both Berkshire and Metroplex foreclosed on Olsen. After filing for Chapter 11, he initially put the Van Dyck on the market for $1.6 million. He reduced that price to $1.48 million.
Metroplex Chairman Ray Gillen said the dismissal of the Chapter 11 case will not affect the forthcoming auction of the Van Dyck.