The Carson City Convention and Visitor's Bureau voted Wednesday to settle for a lower sum of tax money owed by former Ormsby House owner Barry Silverton.
The bureau will accept $4,000 from Silverton by Dec. 18, despite a default judgment that should mandate a $8,592 payment. The money is related to a lawsuit brought by the bureau because Silverton did not pay his room taxes at the 200-room hotel/casino for December 1996.
During the same period, Silverton defaulted on a loan that led him to file for bankruptcy protection. The default judgment awarded the bureau $7,062 in back taxes, plus $1,500 in attorney's fees.
Charles Cockeril, attorney for the bureau, has been negotiating the terms of the settlement.
"Even understanding how the board feels in principle about the judgment, the cost of going forward and prosecuting this would exceed the benefit," he told the board of directors.
Legal fees could eat up to one-third of the $4,000 settlement, Cockeril said. A California collections attorney was previously dispatched by the bureau.
Board members were reluctant to agree to the compromise, arguing that Silverton should be held liable for the full amount. But in the end, the board voted unanimously to accept the offer - contingent on Silverton sending a certified check.
"I'm 99 percent sure this check would bounce," said member Brian Smith. "It's not a fair and equitable settlement.
"Once again the parasites of the world win."
For the record, Chairman Don Quilici added that "Mr. Silverton still has a moral obligation with the difference."
Silverton has argued that he was not liable in the lawsuit, and even if he was, he was not properly served with court papers, a point that Silverton's lawyers argued through the negotiation.
Silverton bought the Ormsby House out of bankruptcy in February 1995. He owned it until September 1997, when it was sent into foreclosure.
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