A physiotherapy company in Poughkeepsie has filed for bankruptcy, attributing financial hardship to landlord-tenant issues and the Covid-19 pandemic.
New York Hand & Physical Therapy PLLC declared $ 30,000 in assets and $ 212,236 in liabilities, in a Chapter 11 petition filed last month in US bankruptcy court, Poughkeepsie.
Patrick Clough, the chairman, did not explain how the landlord-tenant dispute or the pandemic has affected his business. Instead, he says in an affidavit that Mahopac Bank froze bank accounts, “which caused the company temporary but significant delays in its income and its ability to pay its creditors.”
The bank is listed as New York Hand’s largest secured creditor, at $ 132,596. According to the affidavit, Poughkeepsie K Holdings, a Mount Vernon company that sued and obtained a default judgment after the company defaulted on a previous lease, owes $ 77,780.
Mahopac, now part of Tompkins Community Bank, on Jan.10 opposed New York Hand’s motion to continue using bank accounts to operate the business.
Tompkins argues that the funds in the bank account are collateral for a $ 200,000 loan issued in 2015. The bank sued New York Hand in 2020 to recover the collateral, and last January won a judgment of $ 132,596 which claimed since increased, with interest, to $ 143,777.
The bank claims the bankruptcy code does not allow a debtor to use cash collateral, or requires the court to put conditions on the accounts to protect the bank.
Clough says in his affidavit that it is in the best interests of the business and its creditors to continue operating while a reorganization plan is negotiated.
New York Hand recorded profits of $ 15,769 in 2020 and $ 44,078, according to tax records filed with the bankruptcy case.
Clough, of Gardiner, County of Ultster, twice filed for Chapter 13 personal bankruptcy in 2019, with New York Hand as co-debtor. The court dismissed both cases, first for failure to pay the trustee and then for failure to provide income tax returns or come up with a workable plan under Chapter 13.
New York Hand is represented by counsel for Hopewell Junction, Devon Salts.