CLOSTER — The borough has hired an Englewood-based bankruptcy attorney to try to get Closter Plaza’s owners to pay their 2010 property taxes sooner rather than later.
The attorney, Gary Norgaard, will file a motion in U.S. Bankruptcy Court in Newark asking the judge to allow the borough to hold a tax lien sale on the property to collect approximately $688,778.91 in 2010 municipal taxes.
Closter Plaza’s owners, Aspi and Bakhtaver Irani of Franklin Lakes, filed for Chapter 11 bankruptcy protection from creditors on Dec. 8, two days before the borough planned to hold a tax lien sale on the property.
In court documents, Bakhtaver Irani said the petition was filed on Dec. 8 “primarily to avoid the tax foreclosure sale.”
The Chapter 11 filing automatically stopped the borough from proceeding with the sale on the property.
The council’s decision to hire Norgaard was made after a closed session of the Borough Council on Wednesday.
“For the sake of the taxpayers of Closter, it is important we fight as aggressively as possible to get the money that is owed to the borough,” Councilman John Kashwick said in a press release Friday announcing the hiring.
Norgaard, of the law firm Stern, Lavinthal, Frankenberg Norgaard LLC, is an expert in bankruptcy and debtor-creditor law, according to biographical information on the firm’s website.
Norgaard, a senior bankruptcy partner at the firm, is an adjunct professor of bankruptcy law at Seton Hall University and chairman of the debtor-creditor section of the Bergen County Bar Association.
Daniel M. Stolz, the Iranis’ bankruptcy attorney, said in an interview last week that hiring a bankruptcy attorney may be irrelevant because the Iranis are working on finalizing a deal to pay the borough.
Stolz said at the time that the Iranis were in the final stages of negotiations with Hekemian Co., a property management and development company in Hackensack, to take over the management of Closter Plaza and to lend the Iranis enough money to pay the back taxes to the municipality.
Hekemian confirmed last week that they were in discussions with the Iranis.
A Hekemian representative said Friday that nothing had changed and declined to comment further.
Stolz was not immediately available for comment Friday afternoon.
In the interim, LGH Closter LLC, which took over the mortgages on Closter Plaza that were held by Wilshire State Bank, has filed a motion in the court asking the judge to stop the Iranis from using rents from Closter Plaza.
A hearing on the motion is scheduled for Wednesday.
The Iranis’ attorney had earlier filed a motion asking to use “cash collateral” or rents from Closter Plaza to continue to operate their businesses.
Councilman David Barad said hiring a bankruptcy attorney was not simply about collecting money owed to the town.
“Revitalization of Closter Plaza is a central part of our vision for the borough,” Barad said in the release. “We must be proactive to see that the project continues to move forward. If the Iranis can no longer afford to do this, then perhaps another developer will be able to step up to the plate.”
The Iranis’ bankruptcy petition listed both assets and liabilities of between $10 million and $50 million.
The Iranis planned to upgrade Closter Plaza, a shopping center of about 40 shops on Vervalen Street. Part of the upgrades included bringing a Whole Foods Market to the center.