While small construction businesses rebound from the effects of the COVID-19 pandemic, even multiple decades of operation aren’t enough to keep some companies afloat. New Hampshire’s Corbell Development, LLC — which notes over 50 years of experience — and its sister company EyeCor Construction, LLC, both declared Chapter 7 bankruptcy in October of 2021.
Despite the businesses’ significant background in the New Hampshire area, it can be difficult to overcome debt — and there is $17,629,721.55 in debts spread between the two companies at the time of reporting.
Corbell Development owes $6,424,049.01 in total liabilities, while EyeCor Construction owes a total of $11,205,672.54.
Previous years have shown varying levels of success for both companies: Corbell Development saw gross revenues upwards of $2.5 million in 2018 and 2019 fall to $33,437.50 in 2020 and $0 in 2021, while EyeCor Construction actually dealt with a loss of $1,527,436 in 2019.
However, the two companies have attracted their fair shares of controversy. Corbell Development’s Google presence attracted a 2.6-star rating, and EyeCor Construction received a 1-star rating — albeit on only one review.
One Google review of Corbell Development claimed that the company’s issues stem from the owner, alleging that “owner Earney A Mayo owes thousands of dollars, doesn’t pay back and makes up lies trying to avoid paying.”
Corbell has had to spend a significant amount of time paying others back — as well as dealing with outstanding debt. Corbell Development lists a total of 147 secured and unsecured creditors in its bankruptcy filing, while EyeCor Construction owes to 131 different parties.
A major part of this debt for both companies is large liabilities to contractors throughout New Hampshire and the greater Northeast, with a number of affected contractors in Massachusetts, New York, and Pennsylvania making claims ranging from just a few hundred dollars to upwards of $300,000.
Both companies’ Chapter 7 filings could make it difficult for a number of its creditors to receive payment, however. Bankruptcy documents for both Corbell Development and EyeCor Construction state that the company does not expect to have funds available to unsecured creditors after administrative expenses are paid.
Chapter 7 bankruptcy is known as “liquidation” bankruptcy, as it doesn’t allow for reorganization, instead requiring a company to sell its nonexempt assets in order to pay off its creditors, basically closing its operations.
Even with the difficulty of Chapter 7 bankruptcies, contractors like those dealing with Corbell Development and EyeCor Construction can still take action to maximize their chances of getting paid — and Levelset’s Indispensable Guide to Mechanics Liens In Bankruptcy can help.
Struggles with subcontractors may have significantly contributed to both bankruptcies
Though it’s unclear what caused so much financial stress for both companies, reactions to the companies online have painted a picture of Corbell Development as possibly struggling with subcontractors.
A review from sub Kevin Perron stated “Subcontractors beware. You may wait 90 days to be paid, all they do is lie. HOMEOWNERS BEWARE…. make sure they pay [the people] who built your house. Earney Mayo will threaten to bond liens (I have the texts) […] he literally insults everyone, threatens bonds on liens, makes up lies.”
“…they tell you they are going to pay you so much for site work then they negotiate it down. They nickel and dime you,” added a review from Lisa Brabant. “They owe us money for over two month [sic]. Pay your bills. Return phone calls. Good luck to people who buy there [sic] houses. Not very good management; they pass the buck and blame each other.”
On top of major debts and possible subcontractor problems, both companies are embroiled in legal actions. Corbell Development is dealing with 45 pending legal cases, while EyeCor Construction has 22 pending cases on its bankruptcy filing, with a number of the cases being filed against both companies at once.
A number of these cases — some of them involving other contractors — have contributed to the company’s significant list of liabilities. For example, Corbell Development lists lawsuit claims of $99,975 stemming from a lawsuit filed by Bruce Ronayne Hamilton Architects, $148,211.34 claimed by Classic Exteriors in court, and $325,541.95 from a lawsuit filed by Cairns Equipment — alongside dozens more for similar sums of money.
It seems that at least some of these claims stem from the lack of response given by the companies. Documents surrounding a February 21, 2020, action filed by Equipment East, LLC to recover damages over “failure to pay for construction equipment rentals” went unanswered by both companies, failing to appear in court and resulting in a total judgment of $496,226.95 owed between the two companies.
These issues help show the importance of prequalifying contractors for jobs. Levelset has a number of resources, like Tom Scalisi’s Guide to Prequalifying a General Contractor, that can help you protect your interests and navigate any potential risks on a project. If you’re looking to prequalify a general contractor, you can look at Levelset’s Contractor Payment Profiles for help.