Former Lighthouse co-managing directors file court documents seeking interim receiver

Court documents filed last week in Court of King’s Bench by two former Lighthouse co-managing directors call for an interim receiver to take over the financial operations of the Lighthouse and Blue Mountain Adventure Park.

Both Twila Reddekopp and Jerome Hepfner are asking the courts to appoint MNP LLP as the interim receiver.

“I am of the view that MNP LLP is well situated to step into the role of interim receiver to ensure that the assets of the Lighthouse are managed and that the debts are paid, and that every effort is made to preserve the value in the Lighthouse for the benefit of the community,” Reddekopp wrote in an affidavit.

The matter is to go before a judge on Thursday.

Reddekopp suggested in an affidavit that by the end of March there could be up to 49 employees laid off at the Lighthouse.

She also indicated she’d been in contact with the Lighthouse’s primary secured creditor, and the organization owes more than $2.7 million, including a mortgage for more than $2.3 million, and a line of credit for $350,000.

In the court filing, it’s alleged the Ministry of Social Services is withholding payments from the Lighthouse to the tune of more than $100,000 because the organization is “unable to provide” the necessary financial documents.

The filing also alleges that the board of directors can’t make decisions at this time, including financial ones, “in the best interests of the corporation,” that Affinity Credit Union believes the Lighthouse is “insolvent,” and that receivership proceedings will begin in the near future.

The Lighthouse has been mired in conflict for some time.

In December 2021, Justice David Gerecke removed then-executive director Don Windels after he was found to be using the charity’s funds for his own benefit. The documents were sealed for six months, until June 2022.

After the publication ban was lifted, court documents showed Windels used $60,000 of the charity’s funds to purchase a home for his daughter.

While Windels viewed the transaction as a loan, the judgment stated no loan was entered on the Lighthouse’s books, and the house was instead treated as a capital asset despite Windels having exclusive possession of the property.

According to Reddekopp’s affidavit, Windels appealed, but because the Saskatchewan Court of Appeal has not yet made a decision in the matter, his appeal was automatically stayed.

“On February 1, 2023, Mr. Windels attended at the Lighthouse along with a new individual Gale LaRose, who has been introduced as the General Manager. Mr. Windels advised staff that he was the executive director,” Reddekopp wrote.

Prior to the removal of Reddekopp and Hepfner as co-managers at the end of January, Hepfner’s affidavit expressed concern that “forensic software” had been installed on the Lighthouse’s internal email system in late 2022.

He also wrote that accounting programs QuickBooks and Intuit — both of which were required for daily Lighthouse operations — were inaccessible.

Other concerns listed by Reddekopp include the Lighthouse using a service called “Telepay” for payroll and other expenses.

However, no documentation was kept for payments through that system, and payments for actual expenses or the veracity of payroll amounts couldn’t be reconciled.

There were apparently withdrawls from the Lighthouse’s investment account with RBC Dominion Securities for $5,468 over the last year, and since 2016 it had been $91,299.

According to Reddekopp’s information, the approximate value of real estate owned by the Lighthouse including lands associated with Blue Mountain total $11,955,200.

The estimated value of furnishings and equipment is $1,280,900.

Outstanding creditors at this point include the Saskatchewan Housing Corporation, Affinity Credit Union, and other unsecured creditors.

Reddekopp wrote she no longer believed the Lighthouse was able to serve the community without intervention..

650 CKOM has contacted Reddekopp’s lawyer for comment, and has also reached out to Windels for comment.