`baby Jesus' Kidnapped 
From W-b Public Square 
Annual Nativity Scene Missing 
An Important Player

Loretta Christie 
Nov. 20, 1992 
Loretta Christie, Of Main Street, Inkerman, Jenkins Township, Died Friday At 
Home.

Sunday, November 22, 1992 &nbsp;&nbsp;&nbsp;&nbsp;Page: 1A/7A QUICK WORDS: BLUE COAL 





Blue Coal lands sit, rack up debt &nbsp;&nbsp;&nbsp; 
 ******************* &nbsp;&nbsp;&nbsp; FILE PHOTO &nbsp;&nbsp;&nbsp; 
 John G. Doran &nbsp;&nbsp;&nbsp; 
 Law firm is owed more than $900,000 by bankrupt Blue Coal
Corp******************* &nbsp;&nbsp;&nbsp; 
 Even the lawyers have to line up behind other creditors for their million
dollars &nbsp;&nbsp;&nbsp; 
 By CHARLES H. BOGINO &nbsp;&nbsp;&nbsp; 
 Times Leader Staff Writer &nbsp;&nbsp;&nbsp; 
 WILKES-BARRE -- For more than 16 years, the Blue Coal lands -- among the
largest coal company holdings in northeastern Pennsylvania -- have lain idle. &nbsp;&nbsp;&nbsp; 
 Precious little coal has been mined from the Blue Coal lands since the
mid-1970s. &nbsp;&nbsp;&nbsp; 
 The company miners and managers long have been out of work. &nbsp;&nbsp;&nbsp; 
 The future of its assets are in limbo, waiting to be sold to pay off
company creditors. &nbsp;&nbsp;&nbsp; 
 These days only the lawyers, appraisers, bankruptcy trustees and other
professionals are making money from the property. &nbsp;&nbsp;&nbsp; 
 These and other professionals in the case of the bankrupt Blue Coal Corp.
have been paid more than $1.4 million since the company has been in
receivership, according to federal bankruptcy court records. &nbsp;&nbsp;&nbsp; 
 With court approval, more than $900,000 of that money went to the law firm
of John G. Doran, which has been handling the receivership of the coal company
since it went bankrupt in December 1976. &nbsp;&nbsp;&nbsp; 
 Still, during the first two years of the case and for the past two years,
Doran, who charges $175 per hour, has not been paid for his work. &nbsp;&nbsp;&nbsp; 
 Doran, who openly discussed Blue Coal finances this week, said he basically
has been too busy with the case over the last couple years to file paperwork
asking for pay. As with many bankruptcy cases, the first two years of the Blue
Coal case involved some risk. &nbsp;&nbsp;&nbsp; 
 "We worked for a long time with no assurance of ever getting paid," Doran
said. &nbsp;&nbsp;&nbsp; 
 Doran estimates the Blue Coal case is about one-third of the total work in
his firm, which also consists of his daughter, Lisa Doran, and lawyer Robert
C. Nowalis. &nbsp;&nbsp;&nbsp; 
 Despite the amount of money involved, the records that take up precious
courthouse space, and the length of time that has passed since Blue Coal went
belly up, the case is not the most expensive bankruptcy proceeding in Luzerne
County. &nbsp;&nbsp;&nbsp; 
 In October 1990, the Wilkes-Barre-based printing, retailing and
watch-distribution giant Jewelcor filed for protection from creditors and
asked the bankruptcy court to allow it to reorganize under federal bankruptcy
laws. In less than a year, the case had rolled up nearly $750,000 in legal
fees. &nbsp;&nbsp;&nbsp; 
 Nevertheless, trustees handling the Blue Coal estate over the last 16 years
have incurred more than $8.8 million in expenses. Of that sum, more than $5
million went to pay corporate taxes for Blue Coal which, even in receivership,
has had some capital gains from land sales and court settlements. &nbsp;&nbsp;&nbsp; 
 However, the bankrupt coal company's largest sale, a chunk of land sold to
Sears for its distribution center, wound up in the debits column. A court
awarded the $1.4 million from the sale to the Anthracite Health and Welfare
Fund, a pension program that is one of Blue Coal's largest creditors. &nbsp;&nbsp;&nbsp; 
 An appellate court awarded the money returned to Blue Coal, but Doran and
trustee Frank J. McDonnell are waiting for the outcome of a final appeal by
the pension fund operators who want the money back. &nbsp;&nbsp;&nbsp; 
 "It's in Treasury bonds right now. We think it's pretty safe," Doran said. &nbsp;&nbsp;&nbsp; 
 The estate still comes out ahead, Doran said, between court settlements and
the interest earned on money from land sales the trustees have invested. Over
the 16 years, those figures top $3.8 million. &nbsp;&nbsp;&nbsp; 
 "All of our attorneys' fees haven't equaled all the interest we have
earned," Doran said. &nbsp;&nbsp;&nbsp; 
 Doran's statements are backed up by the filings that he and the trustee
must do to spend any of the estate's money. Creditors, who were still owed
money by Blue Coal when it filed for protection, can object to the expenses,
and the bankruptcy court must approve expenses. &nbsp;&nbsp;&nbsp; 
 For example, the last filing Doran, Nowalis and Doran made, in October
1990, contains 47 attached sheets with a detailed accounting of minutes spent
on Blue Coal work. &nbsp;&nbsp;&nbsp; 
 In all, the estate has taken in more than $10 million since bankruptcy
first was declared. Some of the additional money came from royalty payments to
mine coal and leases several businesses pay for the use of access roads that
run across sections of the nearly 16,000 acres of Blue Coal land. &nbsp;&nbsp;&nbsp; 
 Doran, Nowalis and Doran achieved what basically was a receivership
windfall when, in 1987, a $20 million mortgage on the Blue Coal property was
struck down in an appellate court. &nbsp;&nbsp;&nbsp; 
 A $20 million mortgage would have had to been paid off first before any
other creditors could have collected any money. &nbsp;&nbsp;&nbsp; 
 That, Doran explains, is part of the reason the sale of the land has been
held up. &nbsp;&nbsp;&nbsp; 
 Doran said a trustee's responsibility is to get the best possible price for
the remaining assets in order to pay off as many creditors as possible. &nbsp;&nbsp;&nbsp; 
 Doran has weathered criticism from a potential buyer in recent days for
saying as much during testimony at a hearing in bankruptcy court last Monday. &nbsp;&nbsp;&nbsp; 
 The Earth Conservancy, a non-profit environmental venture founded by U.S.
Rep. Paul E. Kanjorski, D-Nanticoke, has offered to pay $12.5 million for all
the land. An appraiser testified that the land would be worth close to $30
million if it were sold in parcels over a three-year period. &nbsp;&nbsp;&nbsp; 
 Trustee McDonnell has been leaning toward the bulk sale because there's no
guarantee that the appraiser's plan will work, and that, in the long run,
$12.5 million may be the best Blue Coal can do. But Doran has balked. &nbsp;&nbsp;&nbsp; 
 The division between the two was evident at the conclusion to Monday's
hearing, when McDonnell snapped at Doran because he was trying to talk to
reporters to explain his position. &nbsp;&nbsp;&nbsp; 
 While no one is truly sure how much is owed to creditors in the case,
estimates simply of the back taxes owed are close to $11 million. &nbsp;&nbsp;&nbsp; 
 Therefore, for the lawyers and the trustee, Doran said it serves their
interests to keep their expenses down and to try to gain more assets for Blue
Coal. &nbsp;&nbsp;&nbsp; 
 Despite what may appear to be high pay, much of what bankruptcy lawyers do
is a gamble -- especially if they haven't filed to get paid for a while, as in
the case of Doran. &nbsp;&nbsp;&nbsp; 
 Now, Doran, Nowalis and Doran will be lining up behind several other
creditors to be paid the remainder of what they are owed. &nbsp;&nbsp;&nbsp; 
 "We're still unsecured creditors," Doran said, flashing a grin. Lawyers
generally get their money after all the secured creditors and most of the
taxes are paid, depending on the case. &nbsp;&nbsp;&nbsp; 
 The fact that Doran still is owed money by the estate may be the reason
he's still on the job.

Blue Coal Lands Sit, Rack Up Debt ******************* File Photo John G. Doran Law Firm Is Owed More Than $900,000 By Bankrupt Blue Coal Corp.