Owners of a Rockland construction company are trying to stop two former partners from using bankruptcy court to escape paying a $1.4 million court judgment.
Thomas and Louis Bertussi, of Pearl River, sued John Raymond Cervini and his father Eugene Cervini, of West Nyack, in two lawsuits filed on March 6 in U.S. Bankruptcy Court, White Plains.
The Cervinis should not be allowed to discharge their debts in bankruptcy court, the Bertussis argue, “based on acts of defalcation” while they were officers in a joint venture.
The Bertussis own Bertussi Contracting Inc. in Pearl River. John Cervini owns Grace Contracting & Development, in Blauvelt, and employs his father.
In 2015, the construction companies began working together informally. In 2016, they made the arrangement official, by forming B&G Contracting Ltd., owned 60% by the Bertussis and 40% by the Cervinis.
The co-venture worked on eight construction projects. But in 2018, according to the bankruptcy complaints, the Cervinis used Grace Contracting to submit winning bids for projects in Port Jervis and Goshen.
The Cervinis allegedly caused B&G’s labor force to leave the joint venture, “effectively shutting down B&G’s operations.”
The Bertussis sued the Cervinis for breaches of fiduciary duty and to dissolve B&G Contracting, in lawsuits filed in Rockland Supreme Court.
In December 2023, Rockland Supreme Court Justice Serri L. Eisenpress ruled in favor of Thomas and Louis Bertussi and for the estate of their brother, John, who died in 2022.
The Bertussis were awarded $1.6 million. The judgement was later offset by funds received in the dissolution of B&G Contracting, leaving $1.4 million owed.
Then John Cervini petitioned for Chapter 11 bankruptcy protection, declaring $552,721 in assets and $5,116,795 in liabilities. His father, Eugene, petitioned for Chapter 7 protection, declaring $770,290 in assets and $1,928,459 in liabilities.
The bankruptcy actions automatically stopped creditors from trying to collect debts outside of bankruptcy court.
The Bertussis claim that the Cervinis may not use bankruptcy to get out of paying the $1.4 million court judgment. Bankruptcy law, for example, does not allow a debt to be discharged if it resulted from acts of fraud or defalcation while the debtor is acting in a fiduciary capacity.
The Rockland court found that the Cervinis had usurped corporate opportunities from B&G Contracting, while acting in a fiduciary capacity as officers, directors and shareholders of the firm.
The Bertussis also allege that John Cervini made false statements in his bankruptcy petition, “with fraudulent intent in an effort to render himself  ‘judgment proof.'” And he allegedly looted Grace Contracting — by making $1.7 million in undocumented and uncollectible loans to himself, family members and friends — “in an effort to reduce its value.”
Eastchester attorney Julie C. Curley was withholding comment on the allegations against John Cervini, pending approval by her client.
White Plains attorney Wendy M. Weathers did not reply to a message asking for Eugene Cervini’s side of the story.
The Bertussis are represented by White Plains attorneys Brian T. Belowich and Jeffrey A. Reich.
