On December 28, 2020, New Hampshire electrical contractor Veracity Construction Group, Inc. and the company’s president, Robert C. Cimon, Jr., both filed for Chapter 7 bankruptcy.
The filings list a combined 26 contractors, material suppliers, and equipment lessors as creditors, according to the US Bankruptcy Court for the District of New Hampshire.
Veracity Construction Group, based in Nashua, New Hampshire, claims in their bankruptcy petition that they owe between $1–$10 million in liabilities to 92 creditors — of which 23 creditors are contractors, suppliers, and equipment lessors. The electrical contractor also lists their estimated assets range between $100,000–$500,000.
Neither Veracity Construction Group’s bankruptcy filing nor Cimon’s filing has yet to include a schedule of creditor types or amounts owed. Additionally, two subcontractors currently listed as creditors in both filings have filed suit against Veracity.
Robert C. Cimon Jr.’s Chapter 7 bankruptcy petition states he owes between $1–$10 million in liabilities with between $0–$50,000 in assets.
Under Chapter 7 bankruptcy, a debtor must undergo the liquidation of their assets in order to pay the creditors’ claims. During the process of filing for Chapter 7 relief, a trustee is appointed to convert the debtor’s nonexempt property into cash to be paid out to the creditors.
While neither bankruptcy filing lists the creditors as having secured or unsecured claims, a secured creditor is generally first to be paid with funds made available by a trustee. Any unsecured creditors can then only receive money after the secured claims have been settled.
Of the 26 contractors, material suppliers, and equipment lessors listed as creditors in both bankruptcy filings, two creditors — PLDD Construction and Tri-Wire Engineering Solutions — are listed on both petitions.
Cimon’s bankruptcy filing lists three additional construction companies as creditors: Interval Construction Corp., Pitt Construction Corp., and Veracity Construction Group, Inc.
The Veracity Construction Group petition lists the following 21 contractors, suppliers, and lessors as creditors:
- Ahern Rentals, Inc.
- Ambrose Equipment Co.
- Badger Daylighting Corp.
- Boston Properties
- Care Supply Company
- Custom Truck
- Direct Connect Transport
- East Hartford Sand & Gravel, Inc.
- Ford Motor Credit
- Going in the Right Direction, LLC
- GPRS, LLC
- Graybar Electric Corp
- In Terra Innovation, Inc
- Infrastructure Solutions Group
- Jennings Excavation, Inc.
- Keohan Fuels
- Mobile Mini
- Old Castle Infrastructure
- Pennichuck Water Supply
- Tesmec USA, Inc.
- Waste Management,Inc.
Additionally, a Homewood Suites by Hilton located in Manchester, New Hampshire, is also listed as a creditor in Veracity Construction Group’s petition.
Two subcontractors file suit against Veracity Construction Group
As of the bankruptcy filing dates of both Veracity Construction Group and its president, two subcontractors currently listed as creditors in both filings have filed suit against the electrical contractor. Both legal battles are still ongoing as of the December 28, 2020 filing date.
On June 3, 2020, PLDD Construction filed a complaint against both Veracity Construction Group and Cimon.
According to complaint documents filed with the US District Court for the District of New Hampshire, PLDD Construction sought to “to recover damages for breach of contract, breach of the covenant of good faith and fair dealing, unjust enrichment, conversion, fraud, negligent misrepresentation, and violation of the Consumer Protection Act.”
PLDD Construction is also seeking $585,000 in capital contributions from Veracity Construction Group, which also carries a 10% annual interest rate. According to the complaint, Cimon agreed with PLDD Construction’s manager to pay back the capital contributions. However, the complaint states “Veracity and Cimon failed to live up to that promise.”
The case is still ongoing, and was last heard in November 2020.
In February 2019, Tri-Wire Engineering Solutions filed suit against Veracity Construction Group.
According to the lawsuit filings published by the Middlesex County clerk’s office in Massachusetts, the case type is listed as “contract/business case” with “services, labor, and materials” as the “initiating action.”
The case will next be heard in court on March 16, 2021.
As of January 4, 2021, no unpaid construction work claims, also known as mechanics liens, have been filed associated with the suit, according to the Middlesex County clerk’s office.