A construction company responsible for developing several subdivisions in the Salt Lake area is being forced into bankruptcy by nine creditors who claim the company owes them hundreds of thousands of dollars.
Creditors for Lichtie Construction and Development Corp., Midvale, have filed a petition for involuntary bankruptcy against the company in U.S. Bankruptcy Court, claiming the company owes the creditors approximately $390,000. All but about $10,000 of the debt is due and payable in full, according to the petition filed with the court.Officials with Lichtie could not be reached for comment.
Lichtie was the major developer in seven subdivisions across the valley: River Oaks, 68th South and Seventh West; Murray Oaks, 59th South and Seventh West; High Point, 10th East and 78th South; Silver Ridge, 110th South and 13th East; Altara Heights, 110th S. Seventh East; Lone Peak, 110th South and Ninth East; and Sunrise, 13th North and Main, Farmington.
The subdivisions were developed over a period of 21/2 years, said Ted Norton, president of Norton Warehouse and Supply. Lichtie owe's Norton's company nearly $100,000 for siding material and labor.
The construction company stopped paying its bills about two months ago, Norton said. Most of the creditors filing the petition are unsecured creditors, said David Ward, attorney for the creditors.
"It's up to Lichtie to contest the bankruptcy," Ward said. "They have 20 days to file an answer. If they do not file an answer, then the company automatically goes into bankruptcy."
The creditors petitioned for a Chapter 7 bankruptcy, seeking liquidation of all of the construction company's assets. The creditors have also sought to put Lichtie Holding Co. in bankruptcy in an attempt to liquidate its assets.
The creditors decided to file a petition for bankruptcy when they learned that Western Mortgage Loan Corp. had commenced foreclosure on homes being built by Lichtie, said Ward.
The loan company extended construction loans to Lichtie, Ward said. "But the loans are overdue to to the bank, so they've called the loans due." The company took trust deeds on newly constructed homes as security for its loan. It are now foreclosing on those deeds, Ward said.
The creditors who have filed the petition for bankruptcy and the amounts they claim due them are: Bonneville Heating Inc., $54,066.78; O'Brien Glass Products Inc., $15,384.48; Norton's Warehouse and Supply Construction, $97,062.73; Utah Mechanical Contractors Inc., $45,087.54; Reid's Concrete Services Inc., $51,146.14; Silver Ridge Estates, $44,298.45; Vander Veur Insulation, $16,179.26; Reynolds Brothers Inc., $47,306.24; Home Builder's Inc., $17.330.88.