Opinion ID: 717547
Heading Depth: 2
Heading Rank: 1

Heading: The Harding Loan

Text: 4 One of Hutensky's business projects was CityPlace Venture (CityPlace). Hutensky, along with Richard Bronson and Preston Harding, were partners in a limited partnership that held a 99% interest in CityPlace. Harding had been a business associate of Hutensky for many years. 5 In 1989, CityPlace began to incur monthly shortfalls, which were covered by another Hutensky entity, Bronson & Hutensky (B & H). By the summer of 1989, B & H had contributed approximately $600,000 to CityPlace to meet the operating expenses of CityPlace property in Hartford, Connecticut. Hutensky and his partners in CityPlace attempted to refinance the Hartford property with Suffield Bank, which held a mortgage on the property, but the bank refused their request. CityPlace apparently was unable to borrow money from other sources. Hutensky stated that we didn't think that we had an ability to go out and raise that kind of money. 6 On August 21, 1989, First Central granted a loan to Harding in the amount of $1,050,000. On the same day, Harding made a loan to CityPlace in the same amount. CityPlace then wrote a check dated August 23, 1989 in the sum of $1,000,000 payable to B & H. Although Hutensky was a director of First Central, he did not notify the board of directors of First Central that the proceeds of the Harding loan would be transferred to CityPlace and B & H, and he did not seek prior approval for the loan. 7 The Harding loan has not been repaid. Hutensky and the FDIC stipulated that the Harding loan would result in a loss of $1,049,480.10 to the FDIC, as Receiver for Central. 2