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Money, politics fought over in church’s bankruptcy case

The Rev. Gregory Groover denies starting any protests.

David L. Ryan/Globe Staff

The Rev. Gregory Groover denies starting any protests.

It was a remarkable moment in the midst of a nasty fight. On the first day of Charles Street African Methodist Episcopal Church’s bankruptcy proceeding in August, a church leader, Dennis Lloyd, greeted Teri Williams, the president of OneUnited Bank, with a polite kiss on the cheek.

Such good will has not been on display since, over many hours of testimony and cross-examination in US Bankruptcy Court in Boston. Charles Street is trying to reorganize nearly $5 million in loans it owes the bank, after OneUnited threatened to auction off the historic church in February and sparked a public battle between the two prominent black institutions.

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Testimony will resume Sept. 19, after­ the judge scheduled extra time to handle the contentious matter.

Last month, on the third day of hearings, a lawyer for the bank hammered the Rev. Gregory Groover with questions implying he had lied when he said the church “never missed a payment” on its loans and accused Groover of organizing community protests to “bring pressure to bear” on OneUnited so it would not foreclose on the historic black church.

In response, Groover acknowledged the church had made dozens of late payments, but he said it always eventually caught up.

Groover also repeatedly insisted that he did not organize the protests against the bank, nor personally call for the help that came from local and national politicians.

“We welcomed anyone, including elected officials, supporting our efforts to block our church from being auctioned,’’ Groover said during a long cross-examination by the bank’s lawyer, Lawrence Edelman, according to a recording of the proceeding.

At one point, Edelman sought to prove that Groover had organized the neighborhood rallies by showing a newspaper photograph in which he appeared alongside the Rev. Eugene Rivers, an activist minister in Boston who was, in fact, one of the organizers of the events.

For all the back-and-forth, the case may boil down, in part, to whether First District AME Church — the Philadelphia-based umbrella organization to which Charles Street AME belongs — can escape the guarantee it offered when OneUnited extended Charles Street a loan to build a community center. The bank’s president has testified that OneUnited would not have made the loan without the guarantee.

OneUnited gave the church several extensions on the construction loan for the Roxbury Renaissance Center but ultimately called in the loan. Another $1.1 million loan came due in November; the church missed its October payment but sent a check in December, which the bank cashed and then returned.

Earlier in the proceedings, a lawyer for First District AME Church grilled Williams on her understanding of the district church’s financial statements. He alleged that she had misread them, despite her MBA from Harvard Business School, and overstated the amount of cash available in the event a guarantee was needed.

Williams and the bank’s lawyers maintained that her reading of the documents was accurate, reflecting $19 million in cash on the books of the organization.

Charles Dale, the lawyer for the district church, said those funds were held across the districts’s 330 member churches and in other entities. The actual cash held by the district itself was $237,000, he said, citing documents filed with the court.

Williams responded that if inaccurate information was provided to the bank, that could take the fight beyond a loan dispute to “potential fraud.”

Representatives for the bank have indicated they felt they prevailed on the day of Groover’s cross-examination. It was a view upheld in a recent report in The Baystate Banner, a weekly newspaper for the African­-American community owned by one of OneUnited Bank’s directors, Melvin Miller. Meanwhile, representatives of the church, begun on Beacon Hill and now in Roxbury, say Charles Street AME came out on top in that session.

Edelman, the bank’s lawyer, suggested in court that Charles Street can’t afford to finish its community center and repay its loans. Its fund-raising forecasts are too sunny, he said. By his analysis, the center would run an annual deficit of about $100,000. The church’s lawyer, Ross Martin, countered that those figures do not include additional­ fund-raising by Charles Street.

Beth Healy can be reached at bhealy@globe.com.

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