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Endresen Says Bill for Bankruptcy Course Went Astray

March 08, 1987|JAMES S. GRANELLI | Times Staff Writer

Donald W. Endresen, whose company owned Butterfield Savings & Loan Assn. before regulators seized it 19 months ago, went to a bankruptcy law seminar in New York last October, and the $1,460 cost temporarily was billed to his old S&L.

Endresen said the mistaken billing would have been corrected without a problem had officers at the Santa Ana savings institution forwarded his mail rather than routinely opening mail addressed to him or his holding company, Butterfield Equities Corp.

The bill and other information came to light last week as Butterfield Equities Corp. filed new disclosures with the U.S. Bankruptcy Court in its December petition to reorganize its debts.

Butterfield Equities owned Butterfield Savings until regulators declared the S&L insolvent, seized it Aug. 7, 1985, and turned it into a federally chartered institution. The holding company was not seized, but it had few other assets.

In its recent filing, Butterfield Equities listed debts totaling $112.9 million and assets of $7.98 million. The debts include the $85.5-million lawsuit that the Federal Savings and Loan Insurance Corp., the receiver for the old Butterfield S&L, filed last summer against Butterfield Equities, Endresen and others.

Most the debts and ownership of much of the assets are hotly disputed in lawsuits and in another bankruptcy court in San Bernardino County.

San Bernardino Action

On Feb. 25, Butterfield Equities' filing for bankruptcy reorganization was transferred to the bankruptcy court division in San Bernardino where a partnership that includes the S&L previously had filed for bankruptcy. Butterfield Equities and the partnership, Pacific Trail Cattle Co., are also suing each other over ownership of a 60-acre ranch in Riverside County. That ranch is the major asset of both companies.

Last October, Endresen said, he attended a Practising Law Institute seminar on bankruptcy law in New York, but he does not know how the bill was sent to the S&L. The S&L sent it back to the institute, which forwarded it to Endresen.

"It was supposed to be billed to Butterfield Equities Corp.," he said. "I'm sure it was a clerical error."

Endresen claimed that officers at the new S&L opened all mail, including certified mail, addressed to him and to Butterfield Equities until a complaint to postal authorities resulted in a warning letter to the officers.

According to the S&L, however, the institute sent the billing statement to Butterfield Savings, not to Butterfield Equities, and used the S&L's billing account.

While a reference on the envelope said 'Attention: D.W. Endresen," the person opening the mail did not know who he was, an S&L spokesman said.

The bill is now part of the debts Butterfield Equities has listed in its bankruptcy filing.

Endresen also ordered books from the institute and went to a second seminar in December, as did his lawyer, Leonard W. Stitz of Santa Ana, but those items were not billed to the S&L.

Stitz said he had to familiarize himself with the law on Chapter 11 reorganizations. A practicing lawyer for 17 months, Stitz said Butterfield Equities's case is his first Chapter 11 case, although he has handled other kinds of bankruptcies.

"It's a baptism by fire," he said.

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