GARDINER — At the end of October, about two dozen people stood in a parking lot off Brunswick Avenue, waiting for the auction of three foreclosed properties.

After two hours, Maine Capital Group, a private capital lender based in Portland, had placed a winning bid of $2.1 million on 7-8 ABJ Drive, 563 Brunswick Ave. and 55 Industrial Drive.

At the close of the Oct. 30 auction, Shawn Lyden, chief operating officer and commercial loan office for Maine Capital Group, said, “Someone didn’t lose everything today,” after the auction ended.

Asked what the future of the properties would be, Lyden said: “Ask Bill Lovely. He’ll be managing it.”

Those three properties are the locations where Central Maine Meats operated its slaughterhouse and meatpacking operations from 2015 to 2018. Lovely was a partner in the business before the partnership was dissolved and the business was liquidated after filing for bankruptcy protection.

Lovely and his wife owned those properties throughout the life of the business and continued to own them after the business closed until November 2018, when Machias Savings Bank foreclosed on the three properties.

Auctioneer Michael B. Carey asks for higher bids during a property auction Oct. 30 in Gardiner.

The transfer has not yet been completed. At the auction, Mike Carey, the auctioneer for Tranzon Auction Properties, said the transaction could take up to 45 days to be completed, putting the date in mid-December.

Reached after the auction, Lovely said Maine Capital Group was in negotiations to find tenants for the properties.

One of the properties, at 55 Industrial Drive, already has a tenant. Common Wealth Poultry, which is a poultry processing company, has leased space from Lovely adjacent to the Central Maine Meats slaughterhouse in the Libby Hill Business Park.

“To the best of my knowledge,” Lovely said, “Common Wealth Poultry will stay.”

Carrie Yardley, attorney for Common Wealth Poultry, said her client hopes all turns out well.

“They want to continue to employ 50 people, and they are eager to expand in Gardiner,” she said.

In April 2018, then-managing partner Joel Davis assumed control of the company and sought protection from creditors by filing for bankruptcy protection. Initially, he planned to restructure company but finally opted to close it down and liquidate its assets.

The following month, Davis sued Lovely and his company A.B.J. General Contractors in Augusta District Court.

In that lawsuit, Davis alleged he found were longstanding fraudulent dealings by Lovely against him, according to a civil lawsuit filed in Augusta District Court. Lovely would take money out of the company in several ways, using company resources as collateral for loans taken out on his own behalf and on behalf of Lovely’s construction company when that collateral had been pledged for other loans, the lawsuit alleges.

The interior of 55 Industrial Drive, one of the properties sold at auction Oct. 30 in Gardiner.

Davis also claimed among other things that Lovely has claimed equipment owned by Central Maine Meats as his personal property, withheld critical information and quitclaimed property occupied by the meat business to his own construction company that he previously pledged to Davis as collateral for loans totaling more than $450,000 that Davis had made to the company.

Davis sought judgment of $1.9 million plus damages from Lovely and Lovely’s construction company, A.B.J. General Contractors Inc.

Through his lawyers, Lovely has disputed those claims.

In court papers, Lovely alleges Davis failed to perform duties including making filings in a timely fashion with the Internal Revenue Service and other governmental taxing agencies on behalf of Central Maine Meats. He also claims Davis instructed Central Maine Meats staff to withhold tax payments and diverted company funds to other accounts payable and improper payment of his own capital contributions.

Lovely also claims Davis withdrew more than $275,000 from an account where the company’s Community Development Block Grant funds for workforce and economic development were deposited to reimburse himself for his capital contribution. Lovely was not informed of the withdrawal, according to court papers, and the cash distributions violated the terms of the limited liability agreement.

The case was transferred to the Business and Consumer Court in Portland, which handles business and consumer disputes.

The lawsuit had been scheduled to come to trial in October, but Davis died unexpectedly at the end of August.

The lawsuit has been stayed but is expected to be taken up again.

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