March 11, 2003
CAMDENTON – Windermere is in legal and financial trouble.
The Pathway has learned that a major construction project that has never been widely disclosed by Windermere trustees has ground to a halt because of failure of the general contractor to pay millions of dollars of sub-contractors’ invoices. Now creditors are banging on the door of the Baptist conference center in Roach, Missouri, with a fistful of unpaid bills. So far, they’ve come away empty handed. Soon they may start knocking on the court house door for relief.
Windermere was one of five Missouri Baptist Convention institutions that filed corporate legal documents with the Secretary of State in 2001 to become self-perpetuating boards, independent of the MBC. The MBC has filed a petition for declaratory judgment in Cole County Circuit Court, asking the court to rule that the five agencies broke Missouri corporate law by amending their charters without convention approval. The case is in the pre-trial discovery phase and attorneys are scheduled to reappear in court in June to report to the judge on their progress and to set a trial date for late this year.
Research by The Pathway shows that the general contractor for the retreat center located at Lake of the Ozarks is apparently failing to make timely payments to subcontractors on a multi-million dollar project launched last year.
Frank Shock, Windermere president, has refused to discuss the project with The Pathway, but other sources have supplied some details on the project. Richard Hicks, owner of Hicks Constructions Inc., Niangua, says the project includes a large gymnasium, a multipurpose building and 15 dormitories. The Pathway revealed last October that work had started on the project.
Meanwhile, records filed at the Camden County Recorder of Deeds office show that deeds of trust or mortgages securing future advances and future obligations totaling $8.65 million have been signed by Shock with two lending institutions – First National Bank of Camdenton and U.S. Bank, Oshkosh, Wis.
Five different deeds of trust signed by Shock are on file. According to Hicks’ attorney, Brian Wade of the Springfield law firm of Husch and Eppenberger, mechanics’ liens are being prepared and may be filed with the court and served on Windermere officials soon.
According to Hicks, who has attended meetings with other subcontractors, Windermere’s general contractor owes current debt estimated to be about $3.5 million.
Windermere officials continue to be tight-lipped about the project. When contacted by the Pathway last October, Shock, refused to discuss construction plans. He said a news release would be issued explaining the project, but the release was never issued to the Pathway.
Three calls by The Pathway to Shock asking for comments on the sitution were not returned.
Hicks’ company was awarded the contract to do excavation work for the Windermere job.
"They (Windermere) advertised for bids," Hicks said. "It was bid through Walton Construction. They were the managers of the job. Walton Construction was the construction agent for the group of people that came to them wanting to do the project. The head of this group was Bill Jester, a developer out of Springfield. Walton was working for Bill Jester and the board at Windermere."
Jester is owner and principal of RDI of Springfield, the same firm that named Jim Hill its president and CEO after he resigned as MBC executive director in October 2001. Jim Hill’s brother, Jerry Hill, has worked for RDI even before his brother left the MBC. Jerry Hill now serves as senior consultant and general counsel. RDI has also organized two limited liability companies, RDI, LLC, for which Jim Hill is the registered agent, and Construction Resources, LLC, for which Jerry Hill is the agent.
"We worked daylight to dark six days a week. We even worked some on weekends, regardless of what the conditions were," Hicks said. "It was nothing but ‘pedal to the metal.’ At the time we left the job, we were two weeks ahead of schedule."
Records show that Hicks Construction gave notice Dec. 1 that it was pulling off the job because of no pay.
Hicks said other subcontractors expected to get paid every two weeks when they took the job.
"This particular job was set up for draws every two weeks," he said. "We turned in our request based on work completed. We have yet to get a paycheck. Pretty well all the people we bought material from to do the work have been paid, but I’ve had to pay it all out of my pocket.
"For those materials and work performed, they owe use right now over $400,000. That is what our mechanic’s liens will be for. That’s what they owe Hick’s Construction," he said.
Hicks’ attorney says that alleged amount on the mechanic’s lien for Hicks Construction will be $406,902.60.
To date, Hicks said, there is about $3.5 million worth of work that has been done for which sub-contractors have not been paid.
The MBC advised Walton Construction Oct. 17, 2002, that a lawsuit involving Windermere was pending.
"We have been informed that your company is involved in a construction project at Windermere Baptist Conference Center," said the letter signed by Bob Curtis, MBC president at the time.
"The suit alleges that the corporation has unlawfully changed its charter to avoid MBC governance, but that such changes are legally void. We allege that the trustees elected by the convention are the only lawful trustees of Windermere. The suit further asks for an injunction against the putative board as to any transactions, expenditures or encumbrances that are outside the ordinary course of business.
"We do not have access to all the details of your transaction with this putative board, but we are acting based on facts which are public or in the public record. We urge you to consult with your legal counsel and to proceed at your own risk regarding further business transactions with the putative board," Curtis said in the letter.