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The Wedding Crasher

Engaged couples lose thousands on wedding deposits
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At least 10 couples lost their wedding deposits this March when the man who had claimed to own and reside on the property they booked was evicted following a five-year legal battle. The couples will follow through with their weddings under the new owners of the property, but are not hopeful about getting their deposits back.

Christian Steele, a former physician, author of Mastering the Power of Life, an ascension teacher, and a Tahoe City resident, has been profiting from booking weddings at Bear Paw Lodge, a property he has not owned since 2010.

According to a deed in the name of Bank of America, Steele lost the Tahoe City lodge in a 2010 foreclosure after defaulting on a $4 million loan, but Steele said he continued to live on the property until 2015. When four to five years of multiple bankruptcy filings finally culminated in his eviction by the Placer County Sheriff’s Office on March 17, Steele contacted the couples to inform them he could not honor their reservations. The deposits have not been returned as of July 8, and total $139,300, according to Steele’s estimates shown to a judge.

Sacramento resident Kathrine Abarbarchuk visited the picturesque Bear Paw Lodge, located across the street from North Tahoe High School, last October with her fiancé Steve Kelly. She says Steele showed them the property, represented that he was the owner, booked their wedding for Aug. 14 to 16, 2015, and took a deposit of $5,750. Months later, Kelly accidentally stumbled upon Steele’s name in a Placer County bankruptcy case, and the couple, both practicing attorneys, started to look into Steele’s history.

Abarbarchuk and Kelly are one of 12 couples that gave Steele a deposit to reserve the Bear Paw Lodge for weddings this summer. In March, Abarbarchuk filed a lawsuit in small claims court against Steele to regain her full deposit back. On June 19, a judge ordered that Steele return the deposit, plus expenses back to Abarbarchuk, totaling $5,840, within 30 days. Abarbarchuk said that as of July 8 Steele still has not paid back the deposit and she plans on getting a subpoena for his bank records if he does not do so within the 30 days.

The Bankruptcy Loophole

According to a Placer County court case filed against Steele by the current owners, Vertical Infill, Steele lost the property in a foreclosure on June 16, 2010, at which point Bank of America purchased it in an auction for $2.43 million. The deed was executed eight days later. However, Steele claimed in an email to Abarbarchuk that he had been in legal possession of the property until late March 2015.

Since 2010, Steele and his wife, Shirley Steele, a meditation teacher, have enacted a series of bankruptcy filings intended to achieve the maximum possible “extended stay” allowed to bankruptcy victims to protect them from immediate eviction. Together, they have filed for bankruptcy seven times, but have alternately timed and dismissed their filings in order to block the legal property owner from evicting them, according to an objection made by Vertical Infill in the last motion for extended stay made by Shirley on Feb. 11.

This method of serial filing has become a relatively common practice in spite of certain congressional barriers to multiple filings, according to Laura Bartell, a professor of law at Wayne State University in Detroit and author of numerous articles on the subject of bankruptcy. Newly enacted federal provisions mandate that extended stays can be reduced to only 30 days if an individual has a dismissed case from the previous year.

“This is a typical serial filer case,” Bartell wrote in an email to Moonshine Ink. “At some point, if the debtor keeps filing and dismissing, filing and dismissing, the court sometimes enters an order barring any new filing. But the Steeles haven’t reached that point.”

Although Steele told Moonshine Ink that about 10 couples booked weddings with him for the summer, he showed the small claims court judge on June 19 a list that included 12 couples and their exact deposits, according to Abarbarchuk. The deposits ranged from $5,000 to $16,000.  The father of one of these couples, Donald Guttman, told Moonshine Ink that he gave Steele a deposit of approximately $8,000. Guttman said Steele was a “very nice guy, very charming, and seemingly wanting to help.”

What’s Happening Now

The lodge is currently owned by Vertical Infill L.L.C., a realty investment company that has promised to renovate the lodge and lease it to the same couples Steele entered into contracts with, according to Steele.

“As soon as [the eviction] happened, I contacted everybody and told them not to worry because I would be talking with the investment company,” Steele said. “That was my biggest concern because I know these people. I’ve been running a business out of here for seven years and these are more than just clients; these are friends of mine.”

Steele is the director and president of a nonprofit company, Center of Consciousness, which he has been running out of the lodge since 2008. According to GuideStar, a website that compiles nonprofit financials, Center of Consciousness was created in Sarasota, Fla. by Steele in 2006, and is filed as a Protestant church.

An employee for Vertical Infill said Steele has removed much of the furnishings from inside of the lodge, and Vertical Infill has spent more than $80,000 refurnishing the property in order to prepare it for summer.

Vertical Infill has promised to make the lodge available for couples who entered into contracts with Steele, but will be requesting original deposits. The Vertical Infill employee, who wished to remain anonymous, claimed to be worried about Steele entering into future contracts to lease out the venue although he does not own the property, and said Steele came to them recently with another couple booked for October.

After being evicted in March, Steele moved with his family into the house directly next to the lodge, according to Abarbarchuk and the Placer County Sheriff’s Office. The house next door is also vacant due to foreclosure, but was sold to new owners in 2014. Steele and his family have permission from the current owners to stay there, according to Placer County Sgt. Michael Lyke.

Steele says his top priority right now is getting everybody their money back, which he hopes to do through a settlement from one of the lawsuits he is engaged with against both Bank of America and Vertical Infill.

These lawsuits cite four causes of action against Bank of America and Vertical Infill, claiming they used unfair business practices in the transactions following the foreclosure. The lawsuits seek rescission of the deed from Bank of America to Vertical Infill, performance on an offer by the Steeles to buy the property for $2.2 million, and compensation for attorney fees.

In his lawsuit against Vertical Infill and Bank of America, Steele claims that Bank of America refused his “bonafide [sic] all cash offer” of $2.2 million in July 2014, and instead sold the property to Vertical Infill for $800,000 less. According to the lawsuit, Bank of America offered to sell the house to Steele if he would pay back $1.6 million in past due payments and reassume his original $4 million loan, which he defaulted on, leading to the original foreclosure in 2010. Steele refused the offer.

Although Steele offered $2.2 million to Bank of America in July 2014, he told Moonshine Ink that he would have to wait for the results of the lawsuit in order to acquire the funds to repay the couples’ deposits.

“I expect to fully win this lawsuit and take back possession again but it’s going to take some time,” Steele said.

Meanwhile, the couples who booked weddings with Steele wait to receive their deposits back and attempt to piece together their shattered wedding plans.

“I just can’t believe how someone could do this to people who are excited,” said Abarbarchuk.

 
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Reader comments so far...

memememe | Truckee
We got married at Bear Paw lodge (the house in question) last year so this could have happened to us... sympathy to the couples who might lose deposits. This is a sad story all around. It's worth adding that this well written piece's author probably couldn't find past customers but if they had it would likely have captured Christian Steele's genuine and deep concern about client's wedding being all they hoped... He was more than fair through the whole process of our wedding. He was honest (except about the house having been foreclosed upon... not that we asked) and the opposite of greedy. He even offered to send us more than our deposit back on accident. He lived there with a large family... his kids gave up their rooms and moved their pet rat for the weekend. We guess he is/was in a desperate spot and justified not telling couples of the foreclosure by assuring himself that he wouldn't lose control of the house. It doesn't make it ok, but having dealt with him, it's clear to us that the motivation was probably desperation rather than greed. I'd say the new company that owns Bear Paw is being aggressive almost to the point of greed by forcing the couples to pay deposits again. At this point, it's probably too late for Vertical Infill too book other weddings so the company would likely make more money charging only the remainder payments. Why not take into account the fact that the couples are in a tough spot and give them a discount? Doing otherwise is basically using the desperate situation these couples find themselves in against them to charge more.

kat.abarbarchuk | Sacramento, CA
I think the issue is not whether Christian Steele did this out of greed or desperation, but the fact that he was dishonest with dozens of people and profited thousands of dollars from this situation. Now innocent couples that have nothing to do with Christian's situation with the bank are out thousands of dollars, at a time when they should be the happiest. In fact, even once he was evicted, he was still dishonest, telling us everything was fine. Had my fiance not stumbled on his case in the court house, researched the situation himself, and informed the other couples, we all may not have found out about the situation until it was too late to salvage out wedding plans. I also do not see why the new owners should operate at a loss because of Christian Steele's dishonesty. They renovated the home and are now hosting our weddings, which they should be compensated for, as businesses usually are.

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September 14, 2017