Mourad Under Oath

Volume: 1 Page: 1-40 Exhibits: None
COMMONWEALTH OF MASSACHUSETTS SUFFOLK, SS.
V&M MANAGEMENT, INC.,
DOCKET NO. 89-6500-E Plaintiff,
v.
BOSTON REDEVELOPMENT AUTHORITY,
V.
COMMONWEALTH OF MASSACHUSETTS,ET AL.
Defendants.

STATEMENT UNDER OATH OF ALPHONSE MOURAD taken before Aida M. Medeiros, a Professional Court Reporter and Notary Public in and for the Commonwealth of Massachusetts, at the offices of Medeiros & Associates, Six Ericsson Street, Boston, Massachusetts on Wednesday, July 27, 1995, commencing at 5:25 p.m.

MEDEIROS & ASSOCIATES
COMPLETE STENOGRAPHIC & VIDEO SERVICES Six Ericsson Street Boston, MA 02122
(617) 282-9101 FAX: (617) 825-1699
*MASSACHUSETTS
*RHODE ISLAND

APPEARANCES COUNSEL FOR THE PLAINTIFF:
James P. Dillon, Esq. One Billings Road North Quincy, MA 02171 (617) 472-6294

INDEX WITNESS EXAMINATION Alphonse Mourad By Mr. Dillon

PROCEEDINGS (Witness Administered Oath By Stenographer)

MR. DILLON: My name is James P. Dillon, Jr., North Quincy, Massachusetts. We're, here today on July 27th to record a statement of Mr. Alphonse Mourad that we want to introduce into evidence, along with certain offers that we'll be making to the Department of Revenue tomorrow on the 28th of July before Judge Turnoff in Middlesex Superior Court. I'm just going to start with some questions for Mr. Mourad which he will answer.

DIRECT EXAMINATION (By Mr. Dillon)

Q: First Mr. Mourad could you give your full name, spelling it please?
A: My name is Alphonse, A-1-p-h-o-n-s-e, Mourad, M-o-u-r-a-d.
Q: What is your occupation?
A: I'm president of V&M Management and a manage] of V&M Management.
Q: What is your address?
A: Ten Hammond Street, Roxbury.
Q: And phone number?
A: 445-0650.
Q: Now you state that you are the manager and
the owner of V&M Management, could you tell us the first time you got involved with the Mandela housing complex and formed V&M Management?
A: Yes. Back in December 1981 I had two partners, one by the name of Greg Inge and the other partne by the name Felix Vasquez. So the original corporation was called Inge & Vasquez back in '81 and then it was changed i 1983 or '84 to V&M Management.
Q: Now when you purchased the property could yo tell me please what your knowledge was as to what type of real estate taxes you would be paying?
A: To my knowledge in 1981 when we bought the property I was told we were under Chapter 59 tax which is basically city tax assessment. The budget at that year in 1981 was based on 15 years budget. It had Chapter 59 taxes in the budget.
Q: So then HUD budgeted money to be set aside under the assumption that you were under Chapter 59 taxes?
A: That^s correct.
Q: And that^s the assumption that you bought th( property?
A: It's not an assumption. It was a fact because dollars were based on actual figures for city taxes
Q: When did the dispute as to whether the
property was governed by 59 or by 121 General Laws Chapter 120(c) dispute first arise?
A: It arised when I entered a purchase and sales agreement, the first purchase and sales agreement in 1984.
Q: Who was that with?
A: With Shamir Construction.
Q: What was the agreement?
A: The agreement to sell out V&M Management Corporation to him for $3.7M at that time.
Q: And you entered into a purchase and sale agreement with him?
A: At that time, yes. We had the first purchase and sales agreement.
Q: In order to sell the property did you have to get any permission from the state or the city?
A: That agreement of 1984 was revised in 1996 for the price of $5.5M.
Q: That was 1986?
A: 1986. The buyer asked the question: are you subject to 121(a) excise tax. My response and my attorney^ response: we don^t think so because we^ve been paying taxes under Chapter 59 and we have been receiving bills from the City of Boston under Chapter 59 and we^ve been budgeted under Chapter 59. At the closing back in 1981 there was nothing mentioned that we are subject to 121(a).
Q: Again, did you have to get any approval from any agencies in order to sell this?
A: Only at the request of the buyer for him to be assured we're not subject to 121(a). He said, "I would like to have a document from HUD and then I would like to have some verification from the BRA," for his record. At that time in 1984 I had gone to HUD and asked Ken Saul am I subject to 121(a) and he gave me a statement that I was not subject to 121(a) signed by him.
Q: What was BRA'S involvement in the sale?
A: The BRA never had an involvement until in 1986 my attorney had requested from the BRA, as we did with HUD, are we subject to 121(a). Just a request.
Q: What did the BRA say?
A: At that time the first initial they said we're not sure because HUD has not paid the previous taxes for twelve years and once we settle the taxes with HUD we'l;
make the determination whether you are subject to 121(a) or not. So we applied the pressure on HUD to settle with the BRA which at that time they owed $2.8M and the check was made for $1.2M. So they basically settled for forty cents on the dollar. That was back in 1986 or '87.
Then the BRA said, "Yes you are subject to
the 121(a) and you have to have an approval of the sale in order for the sale to go through. We do have a statute."
Q: So the BRA would have to approve the sale?
A: That's correct.
Q: How long did it take the BRA to approve the sale, if they approved the sale at all?
A: Well the BRA came down to the developments, met with roe and the tenants and explained that they will be processing the sale and their main objective is to protect the tenants and to send an engineer down to take a look at the structure of the buildings to be able to get an estiroat on the rehab work that would be required to bring the developments up to the code before any transfer takes place They were supposed to start that process within a few weeks with the engineers and other officials going to be involvec At that time we never heard from the BRA after that for months, neither V&M Management, myself as the owner, or neither the tenants. Six months went by and there was not response. Finally, I picked up the phone and I called up Mr. Edmund Shamsi and I said, "What's going on? Why we haven't been informed on a day to day process? There's no communication whatsoever." He said to me at that time, "Unfortunately Mr. Mourad we've been negotiating a deal behind your back and you have been paying the price for it
A: That's correct.
Q: And the BRA prevented you from doing so because of these conditions that they imposed upon the sale which were unreasonable?
A: That's correct. They have ten, twelve months before they even gave us -- they took the firs t six months, they had no intention of meeting with us until Mr. Garrity once he received the affidavit from Glen Frank he called up Steven Coyle on that morning and he said to him, "You have committed extortion on my client and therefore I want an immediate meeting. Otherwise, I will sue you and I'll see you in court. Mr. Coyle on that day set up a meeting at 3:00 p.m. and me and Mr. Garrity gone to the BRA office and we waited fifteen minutes because Mr. Coyle was meeting with Mayor Flynn downstairs before he came up to the meeting. Then when Mr. Coyle came upstairs and we were walking through the corridor Paul Garrity said to him, "You know you have committed extortion and those conditions are very serious allegations and damages to my client." Mr. Coyle responded, "Yes, we got caught. Let's work it out. What do you want?"
Q: What was the result of the meeting?
A: The meeting took no more than ten minutes. There was me, Paul Garrity, Steven Coyle. I don't remember the other fourth person's name. Mr. Garrity said, "I want the sale immediately approved." Mr. Coyle looked at me and he said, "We^ll set up a hearing for next Tuesday." I think we met on Thursday. He said to me, "See if you can get some tenants to come and testify on your behalf that the property is in decent shape and I will have this thing heard by the Board and signed and sealed by 5:30 that day of the hearing. Q: And what happened to the sale? A: Because of the public hearing there was a lot of tenants from the outside of Mandela opposed Mr. Shamsi himself to own Mandela and the Board postponed the decision for thirty days. This is where Mr. Garrity walked out and he told the Board "1^11 see you in court." I remember Mr. Walsh, a member of the Board saying, "Mr. Garrity, we're only doing our job. Why are you suing us?" Mr. Walsh was correct. What Mr. Walsh did not understand was Paul Garrity walked in with a promise of delivery from Mr. Coyle and signed and sealed by Mayor Flynn at 5:30 and he did not walk in to wait for further public hearing. This is when he filed the lawsuit against the BRA for $7M the following Tuesday in the Housing Court.
Q; What happened to that suit? A: That suit basically went on for quite some time. Oh, at that time it was put on hold. The attorney,

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Saul Schapiro, for the BRA went in front of Judge Dare and said to him, "Your Honor we have done nothing wrong. All we're looking for Mr. Mourad and Mr. Shamsi to file an application for the 121(a) and they haven't done so. So therefore there's a process that they have to follow and I don't know why we're being sued today. But that was not th< fact because Mr. Shamsi was told no application will be submitted to the BRA until he has met the conditions. So therefore basically Saul Schapiro lied to the judge right there and said, "Why are we here?" In fact, they have to make an application to satisfy the judge that's what's needed and they back-dated the application prior to the first BRA hearing to cover themselves that the fact is then was an application on record. I remember Glen Frank, the attorney for Shamsi, saying "Well we bailed them out. We had to back-date the application." I think Saul Schapiro was involved with it and other attorneys.

Q: What happened to the purchase and sale agreement?
A: After twelve months and several hearings wit] the BRA, finally it was approved and then it was sent down to the Mayor, Mayor Flynn to be signed for the final signature. Under the 1221(a) the Mayor has the final approval or disapproval regardless of the board. He has
ultimate signature.

Mayor Flynn, because the tenants so strongly
opposed the sale, couldn't basically automatically approve it because the Board already had approved it. He had to find an out on how to justify the approval. So therefore he
hired Hale and Dorr, Vince McCarthy, to find a creative way of law why he should approve the sale because of all the publicity on the buyer. Hale and Dorr, Vince McCarthy, meet with the tenants and the tenants said they didn't want this
to be approved. Me and my attorney, Paul Garrity, met with Vince McCarthy and we said: we don't care whether you approve it or disapprove it. We could refinance this development but we're hostage to that purchase and sale agreement. So you could make the decision of approving or
disapproving. We're not pressing here now for the approval.

We're pressing for a decision because with that agreement cannot refinance, we cannot do anything with it until there's a finalized decision by the Mayor. He understood that. He also understood at that time I was bankable to still maintain the developments of refinancing. But they cannot basically back out of that agreement because they
were caught to Mr. Shamsi backroom deals. Mr. Shamsi had a lot on them so they had no choice but to go forward and approve it. So the approval was the basis on a statute on the Roxie home that if the property goes into foreclosure that the tenants will lose the 121(a) within one year and therefore it will jeopardize 1,500 tenants and therefore the subsidies will be jeopardize section 8. So therefore the Mayor have no choice whether he like to buy it or not, but to approve the sale in order to protect the residents.

Q: Did he approve the sale?
A: It took him four months to approve it. Because of the delay also again attorney Paul Garrity filed a lawsuit against Mayor Flynn for $10M by going beyond the thirty days as a requirement by statute.
Q: What was the outcome of the sale, was the property sold?
A: Finally the property was approved for sale but because of the delay of eighteen months and because the BRA right now vindictively really, they could have got it. They said, "You are under 121(a) tax." When we came to a closing to calculate the closing costs of the closing, instead of basing the closing on Chapter 59, which my taxes was all paid up up to 1985, now overnight we become faced with almost triple taxation of $800,000 overnight which was never allowed in the budget of the purchase and sale agreement. So therefore my attorneys after doing a calculation for paying 121(a) tax versus Chapter 59 tax they realized we're being victimized overnight by $800,000 between interest and penalties and then go back to 1981 and make up the difference between Chapter 59 and Chapter 121(a).

Q: So on the day when you were supposed to execute the sale a new tax liability of $800,000 came up for the first time?
A: That's correct.
Q: And this is because the state or the City went back to 1981 and charged you for 121(a) taxes?
A: That's correct.
Q: Even though you had paid up to that point in time under Chapter 59 taxes?
A: That's correct.
Q: So this was the first time that the BRA and the City undermined your ability to sell the property and pay the back taxes?
A: That's correct.
Q: Now, a few years later did you attempt to refinance the property and also pay off your back taxes?
A: Well let me finish the transaction why the sale did not go through with Mr. Shamsi. We were short about close to $220,000 even with the 121(a). My attorney have begged the State Revenue: could you at least give us discount on the interest and penalty so we could make this closing pass and we'll take our losses, although you doubled the taxes. There wasn't enough cash. Out of $5.5M I think the cash at that time was close to $4.2M. All we needed was to waive interest and penalties and still pay the 121(a) and then take our action later against HUD for misrepresenting the 121(a) to me to make up the difference of lawsuits. We said to the BRA, if you're giving HUD a break, forty cents on the dollar and you settled 121(a) from $2.8M to $1.2M, why not give at least overnight a break to V&M so we could close this deal only over $220,000 or $230,000 and it's a done deal. Everybody walks away. They said, "Nothing doing."
Because of that day at the Registry we did not have the additional $220,000 or $230,000 the buyer was no longer feasible for him to buy the property because of the delay and the condition. Then he did not appear to the Registry of Deeds to show up that day and we asked for three weeks to discount our note which I was taking back as a second mortgage for $1.3M and come up even with the money for the 121(a). So therefore he files a suit against me for not being able to close because of the shortage on the 121(a) on the taxes. And then when he sued he sued for specific performance and not the property. Now I become a hostage to a lawsuit and I couldr^t refinance and I couldnt do anything until the outcome of the court decision. The fact is who is going to be the owner of the property at the outcome of the lawsuit.

Q: What was that outcome?
A: I won the case after twelve months of litigation and Judge King found in my favor. The finding was very clear, was time is of the essence. In Judge King^ findings if that transaction, the purchase and sale agreement, took eighteen months but also he has acknowledge in eighteen months because of the delay because the normal approval of the BRA and the City on the average is six months, it has cost V&M tremendous legal and additional taxes. Therefore, they were short to close but asking for three weeks to discount the note and still come up with the money to pay all the taxes was not unreasonable. It was th time was not the essence. The case was based on if you waited eighteen months, whales another three weeks. So therefore Judge King found in my favor on that basis. Within three weeks we were able to discount the note and we were able to go to the Registry of Deeds and we had a full closing with the state revenue, everyone one there to get paid, except Mr. Shares! did not show up on that day because he felt I broke the agreement by not showing up the first day of the closing, which was three weeks prior. That was his argument.
Also, Judge King was brave enough, frankly I was shocked, to list the conditions that were imposed by the BRA on the sale where they were not relevant to V&M Management or to the tenants. Those deals, if they had gone through, would have benefit other developments and they were illegal. They were conditions not subject to my purchase and sale agreement specifically. He names them in his twenty page fact finding and he says step one, the BRA were hostile to the sale and he put the condition on the Buchminster to sell to a non-profit. They wanted the St. Alphonse apartments rolled back to the Rent Equity. Therefore it was a lengthy process of eighteen months and therefore the deal was no longer profitable for Sharosi or Mourad. But he also said both parties, Mourad and Shamsi, acted in good faith. It is the BRA who was hostile. It is the BRA who has created eighteen months so this deal fell apart. So they were responsible technically for all that occurring to the buyer and the seller. Worst of all, they deceived the tenants totally when they told the tenants that the deal will not be approved. In fact, when they got caught in the lawsuit with me in order to come up with a gimmick publicly they said we got to allocate seed funds for the tenants of $200,000 in 1986. It was approved by the Board. A lawsuit coming out of the Back Bay Restoration Development and the potential of this lawsuit will accumulate to $2M or in excess and therefore the tenants will have seed funds.
(Off the Record)

MR. MOURAD: The tenants were happy that BRA right now is considering tenant cooperative. Unfortunately, recently we found out through investigation again the bad faith of the BRA. They never established Westminster Willard fund of 1986. There was no account opened under Westminster Willard for $200,000. In fact, they have received out of the Back Bay Restoration lawsuit in excess of $900,000 and they have used those funds to pay Saul Schapiro in order to cover up for their backroom deals and pay other insurance agencies, but none of it went to affordable housing. So this is a real sham and I believe th< tenants have been having many demonstrations and there's been a class action suit filed by V&M and the tenants the $2M which is essential for the tenants to use in emergency situations and buy their own home. So clearly the BRA has deceived the tenants, V&M and deliberately have bankrupted V&M as a corporation and intentionally.
Now once I won the lawsuit and settled the
situation, then I started to concentrate on refinancing.

Q: What exactly did you do and when did you do it to refinance?
A: I believe in 1989 I seeked with $2.5M or $3M secondary financing out of Graystone Company, a funding company out of New York. We worked for about four months with them. I put I believe maybe $10,000 at that time non-refundable, plus legal fees, plus appraisals. It was a ful package. Graystone finally, after several months, have approved the loan but again we were short a few hundred thousand dollars on the 121(a) tax. My attorney, Jim Friedman, asked Graystone -- the state revenue if they wouli be willing to take $500,000 that year of the taxes. I think the full taxes was like $700,000. I'm not sure but that's what I think. And would they subordinate $200,000 until we go into consolidation of financing within a period of two years or so. The state revenue at that time agreed that they will accept the $500,000 toward Chapter 121(a) and the will subordinate $200,000 and we could go ahead and close the loan.
Q: So in the beginning then the Department of Revenue agreed to work with you and subordinate $200,000 in order for you to refinance and pay off the back debt?
A: Absolutely. Not only agreed with me, in fact they put it on their own stationery. We have a document from the state revenue department saying we will accept the principal of $500,000 toward the 121(a) and we will also subordinate the $200,000 of this loan and they signed on it. In fact, it was signed by Arthur Chaparas, C-h-a-p-a-r-a-s.
Q: So he's the one who agreed to subordinate the money?
A: That's correct.
Q: Did you end up refinancing?
A: In fact I think he agreed on possibly in December '89. I'm not sure of the date. We had a closing at Gray stone on December 21, '89 at New York at 9:30 for me and my attorney to fly to New York and close a deal. Now, I remember on December 20th '89 the DOR said they changed their mind and they're not going to subordinate the $200,000. Therefore, this financing fell through overnight.
Q: So you're saying that the Department of Revenue changed its mind the day before the closing?
A: That's correct.
Q: Was that also Mr. Chaparas?
A: I don't have the documents in front of me. From memory, I would presume.
Q: So again the state or the government in general undermined your ability to refinance to pay off the

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back taxes?
A: There's no question about it because I don't believe the whole agenda of the state they wanted the money as much as they had an agenda with the Boston Redevelopment Authority. They wanted to control the land and they wanted Mandela because from a business point of view, financial point of view the risks they were taking all along, including the BRA, which most judges have not asked that question and they should know that and I'm going to educate them for a change. The 121(a) is a junior mortgagor. It's not like Chapter 59. So if they come behind four or five million dollars of debts and there's an auction tomorrow, they would lose every penny, unless the property of the value is there. Where if there was a city tax then they don't have to compromise because they will be first lienholder and they will get paid every penny even before the bank who is the first mortgagee. So I question what kind of business sense when DOR gambles after millions of dollars into an auction and come up with zero for taxes when they had a guaranteed $500,000 to collect on a cashier's check and $200,000 to collect within two years. So that doesn't tell me they were interested in the money. They had other agendas.
Q: So twice in three years you put up tens of
thousands of dollars to pay off the back taxes, either through a sale or through refinancing, and both tiroes the BRA and the Department of Revenue sabotaged those attempts to do that?
A: That's correct.
Q: Did you try any other types of financing fo pay off the taxes and to bail out Mandela?
A: Yes. The other type of financing I have tried is the 223(f) loan which is a HUD insured loan. And because of the taxes and the legal has cost me in order to fight the litigation of the backroom deals of the BRA --
Q: How much have you spent on litigation?
A: I would say as of today a minimum of $1.2M t $1.5M, which frankly that could have paid the taxes on its own if they wanted to work with me. So therefore again their agenda is not about money. It's about takeover of a receivership and a conspiracy between the City, the BRA, th state and HUD. You got four agencies working together in one chain here and unfortunately the court has been biased to me and the tenants and have given them every motion in their favor carte blanche. You can call it American Express. Unlimited credit and those judges have smiled every time the saw the state, the BRA and twenty attorneys. It's a question of what do you want. It's a rubber stamp. Go and get it. Bury Mr. Mourad. Don't worry about it.
Q: So getting back, what were the other type of financings that you tried to arrange for?
A: Well HUD said how could we set up financing if we don't know what the amount of the 121(a) is because then the 121(a) becomes another formula and there was a lawsuit, I believe, by Victor Aronow on the 121(a) on what the bottom figure is because the 121(a) originally -- oh to back up.
We didn't know whether we were 121(a) or not and I was frozen to 1989 to Judge Todd's ruling that I am 121(a) and it runs with the land. That's the only ruling he ruled on. I remember Judge Todd saying how wonderful Chapter 121(a) because when he was with Hale & Dorr he helped draft the 121(a), his firm. And that was the most wonderful statute designed for developers. Unfortunately, Judge Todd was living in the dark ages because if Judge Todd was updated on the 121(a) he would understand that since Proposition 2 1/2 became in effect in 1980 that 121(a) becomes triple taxes. Therefore, it will put affordability out of business. But unfortunately he did not focus on the formula in front of him to see whether the 121(a) would put V&M out of business and put them in receivership. Why should V&M pay excess taxes than Chapter 59 and since HUD have allocated only funds for Chapter 59. So how could Judge Todd say overnight: Mourad, go out and bring another $1.5M to the table out of your own pocket, although HUD doesn't give it to you and nobody else does, but keep affordable housing surviving.
Q: So the 121(a) taxes were developed because they were supposed to be cheaper for low income tenants, but because of Proposition 2 1/2 are in fact three times higher than everyone else's tax debt?
A: That is correct.
Q: You've talked about the problems with the BRA, the Department of Revenue. Haven't you also had problems with the code enforcement agencies of the city?
A: Mandela, I believe, in the history of the City of Boston and if they could give me another development who has gone through the same process, I would voluntarily walk in to any judge and give him the key. Good luck to him. I would like to know when was the last development in the City of Boston that has been coded by the City of Bostoi Inspectional Services, by the Boston Redevelopment Authority, by the Attorney General who admitted in their owi discovery they have never done it. It's the first time ever. Now HUD does their own physical report because they're entitled to it. HUD has a right to inspect on a 2-yearly basis because they * re the only agency who pays the subsidies for the Section 8 and that's part of the HUD contract and I respect that.
Q: So HUD does its own code enforcement to make sure that the project is up to code?
A: Every year because they pay for each unit anc they have responsibilities.
Q: And it's despite of this the Attorney General, the BRA and the City of Boston all on their own sent code enforcement officers to check for code violations!
A: That is correct. Basically I'll go further. I'm a developer. I've been in the real estate business for twenty-five years and owned a lot of apartment buildings. What I'm seeing here is for the first time the Attorney General is saying that Inspectional Services for the City ol Boston aren't competent to code and protect affordability and therefore HUD is not competent to protect their own Section 8 that they're paying for and he is the champion of consumer protection and then he becomes the authority to overrule all these agencies and be the crusader for Roxbury. But in the meantime, Archie Par is one of the worst developers in the City of Boston that needs $35M and where was Scott Harshbarger? Mission Hill, Senator Kennedy just brought $50M for rehab, where was Scott Harshbarger? So
there is Franklin I and II needs $13M, where is Scott Harshbarger? So I'm going to take this on a flyer to the residents of Roxbury and tell them from here on you got a new protector. Don't call Inspectional Services. Don't call up HUD. Let's set up a hotline 1-800 directly to Scot-Harshbarger and let's save affordability before the electio;
comes.
Q: I believe you stated that under oath and discovery the Attorney General's office admitted that they had never sent an inspectional officer to investigate any other project. Yours is the only one?
A: That is correct. Not only admitted, they hai to hire a private inspection which he was demolished in summary judgement. The poor inspector didn't even know wha' he was doing. You could take a look at Judge White's summary. My attorney, Victor Aronow, he said what this casi is about is nuts and bolts and those were supposed to be a criminal violation. That's the best the Attorney General was able to come up with but I'll go a step further. The tenants were so upset with the coding that they filed a class action suit in the federal court against the Attorney General not to intrude and force their way into the units after hours, on Saturdays, on Sundays and knock on their doors without proper notices. They stopped that and they filed a suit.
Q: So you're saying that the Attorney General went on a witch hunt and, in fact, in court Judge White found no basis whatsoever for their findings?
A: No.
Q: For the Attorney Generates findings of code violations?
A: Nothing I know of. In the summary judgement it said they have no credible witnesses and the violations were very minimum and they were corrected in five days, so how bad could the violation be. But then the Attorney General when they went in on violation then they wanted to seek a receivership. The key point here is was the Attorney General using abusive power doing a favor to the BRA because they had unlimited influence on the judges of the Superior Court because clearly if the Attorney General was sincere or their allegations in their complaint and they weren't going to put me on receivership in the state court on that same week. I received, frankly, a phone call and they said: Mr. Mourad, on Friday you'll be in receivership. I'm not going to mention that judge right now in this deposition. I askec my attorney to go file a motion and find out what is Friday's motion about. I thought it was going to be a simple TRO and the code violations has been corrected and
the case will be dismissed. The judge said, "We'll be deciding receivership and I'll give each side fifteen minutes," and I wasn't going to have a trial. In fact, the judge said to the Attorney General, "Bring me three names o receivers on Friday and I will decide." Then I knew the property on that day was gone. So I asked my attorney to find a way to get me into federal court to seek help and refuge. Hopefully, the federal judge will be more sympathetic to the truth. In fact, Judge Harrington in federal court did protect Mandela, if Mandela survives in the future, because of the federal court. Then they reversed from violation to stealing the money. When they said "He stole $2M," then Judge Harrington said, "If he stole Section 8 funds of $2M, then he belongs in my court. That's federal money. Then let's settle the trial in three weeks." Then they never went forward. It took them several months, dropped all the federal complaints, took it back to the state court and then allocated the same complaint in th< state court. In the meantime, they denied in the federal court. So why were they afraid to go to trial in the federal court, because they did not have their favorite judges? That's why they didn't go forward.

Q: So in summary, you have since you've owned Mandela, been victimized repeatedly by the Department of Revenue, by the BRA, by the City of Boston, and by the Attorney General's office?
A: And by the judges. The judges have been biased to V&M because the judges have held me hostage under that complaint, 93A and the BRA and therefore I cannot refinance. I cannot sell the property until there is a trial and it's been five years. Since 1990 this thing started and this is '95 with the Attorney General alone. With the BRA it started in 1986. This is '95. So why is everyone afraid to go to trial?
Q: So it's your contention that they don't want to go to trial and you've repeatedly asked for trial dates?
A: Not only repeatedly, the last time -- first of all, the Attorney General has access to walk into the judge's chambers and get an ex-parte. I was found in contempt. I was sanctioned without my attorney present, without me knowing. Second, I won all those on appeals. I have won many motions on appeal but I have lost every motion in front of these judges. So I've been living on appeals and get my sneakers and run fast to the federal court, if I can get in. That's the name of the game. That's why I believe in the future, hopefully, we will elect judges by the people so they represent the people and not appointees to go ahead and be biased to the politicians. I believe that and I will make that public statement and hopefully some day CNN and 60 Minutes, which I'm going to send the Mandela documents nationally and to the President of the United States. There*s got to be justice. When Governor Weld says three strikes out, only the black youth of Roxbury with this system is going to out. I question if one of his children with three strikes out would go to jail. There's no justice in the City of Boston. I'm very disappointed in all these judges for all these years, millions of dollars, none of them have asked the common question: what is this case about that it needs eight, nine years? This is a very simple case.

Q: Would you like to add anything else?
A: Yes. I think right now this case is into a levy. I believe the state is afraid to go to trial and the BRA. They don't want to expose Mayor Flynn, Steven Coyle, Peter Dreirer, previous attorney general Shannon. They don't want to link who the favor is on the state level. I believe there is developers involved to protect Parcel 18. As we've seen recently, there has been city and state officials have ownership of Parcel 18; lower Roxbury being genified; the police headquarters is moving down there; the Four Star Hotel. What this fight is about for the BRA is about the land. It's the control of the five and a half acres of land where it's going to be the new downtown extension for Fanueil Hall. That^s why the BRA has to have Mandela. This is not about 1,500 blacks and Hispanics. This is not about money. This is about a new city and Mandela is in the way, so they have to control it. I'm the only private owner in lower Roxbury. MFHA, BHA and HUD controls all the rest of affordable housing. So then can wheel and deal among themselves and pass and genify as they please when the time is right. With Al Mourad, he's private, and they have to see it in receivership controlled by MFHA or the BRA and eventually let it go into foreclosure, blame Al Mourad that he stole money and that^s why the property went to auction. Then the developers will get hold of it and genification here it comes. I have written about genification. I have lived in the South End. I have been kicked out of the South End by red lining. I own ten rooming houses. The BRA came in with a gimmick. They got a $3,000 grant if you qualify for a loan. They coded all these buildings and the first one who qualified for $1M was Paul Garrity, Judge Garrity living on Worcester Street and all the yuppies and professors and you know what happened to the South End. You know what happened to the West End. So what this judge here on this case has got to decide is the future of 1,500 tenants and the future of 34 Roxbury and the gateway to Roxbury; whether he's going to allow them to genify Mandela into new developments and to create revenue for the city and the state and the higher taxes under 121(a). It's unfortunate because right now all that judge has to do instead of levying my account and put me out of business and I'm going to give him the answer from a business point of view and economic point of view. He should go ahead and base what amount of dollars is owed. The question is -- there's two formulas here. I've been victimized by receiving bills by the City of Boston. The state revenue never billed me under 1212(a) for '85. HUD never told me I was under 121(a). The state revenue kept quiet and they know nothing. So here's four agencies being responsible administratively and none of them have been victimized.

The scapegoats here to the judge is Al Mourad. Now, if there was a fair judge he should say, wait a minute. How could you bill the man five years? He could have gone for rent increases right from year one if he knew. HUD would have paid it. The state revenue, where were you for five years? Under 121(a) in 1989 the money is not in the budget. There's no way to come up with it. So you're all in the wrong so why should Mr. Mourad alone pick up all the tab by himself where you all had an obligation from day one to catch the mistake. So therefore I think Mr. Mourad,
although he is 121(a), I'm going to base his taxes because he's victimized here and protect 1,500 tenants. I'm going to base this tax not to exceed Chapter 59 from '81 to today. I'm going to waive interest and penalties and I'm going to give Mr. Mourad ninety days to come up with all the money, or partial. I have in excess of $1M surplus with HUD. Then I could go to federal court, pay all my taxes, probably don't have to go in receivership. I don't have to go into Chapter 11 nd the tenants will be protected and everybody is happy. The question is,is the judge going to think that way, or is the judge going to go ahead and be biased and thinking what the BRA agenda and the Attorney General and the City. This is what this judgement is about. But good luck to this judge because that is going to be a media case.

I can see the headline:

MOURAD HAD A SURPLUS OF A BUDGET $2M, WAS SENT TO WASHINGTON, MANDELA WAS LEVIED, PUT INTO FORECLOSURE OR RECEIVERSHIP WHERE OTHER OWNERS WILL PAY POCKET MONEY TO EXTEND SECTION 8 MILLIONS OF DOLLARS.

The last developments they get $80M out of HUD as pocket money to protect affordability. Here I'm protecting affordability with my own money. So shouldn't this judge basically give me the chance on the following week, which will be like August the 28th and be able to say;
let's agree on a figure and let Mourad file a motion in federal court, him and his attorney, and go after the surplus money and see if the federal judge rejects it. Let the foreclosure or receivership come to a federal judge, because this way here at least HUD wold have been a decisio on the survival or affordability because that's my money. That is V&M money. Why should a state judge risk his reputation and the state to put a development in receivership when I have my own money that I could go to federal court and pay my taxes, provided my taxes do not exceed Chapter 59. That's a very clear deal. Here they're looking for six weeks trial. What's the trial for? That could be negotiated in no more than twenty minutes and no need for a trial. So Saul Schapiro has been able to manipulate this whole case for nine years. He probably mad about a million dollars. He has outplayed the judges. He has lied and if the judge puts me under oath to tell him when he lied and I changed papers with him personally. So he's been the real sleeze here. I question, if the judges are innocent, if they believe him and they were conned by him or the judges knew the agenda and they were biased. In either case, me and the tenants are victimized here. It's as simple as that. So now here we have a solution. I get over $1M. I could pay all my taxes. I need a chance to gc to federal court. I believe the judge should go ahead and say: go get your money and I'm going to decide what the formula is. This is the bottom line. This is the settlement and from here on you pay your taxes monthly as part of the HUD check and everybody goes home. That's whal the judge should rule. Anything less than that I would say the judge is biased to me and the tenants and therefore the want to take over the property. That's the third time the} don't want the money. If the judge is concerned how to pa} them, he should give me that opportunity. If he doesn't give roe that opportunity, that means this deal is in the b< just like anything else. Good luck.
(Off the Record at 6:25 p.m.)
_______________________________
COMMONWEALTH OF MASSACHUSETTS
Re: V&M MANAGEMENT, INC. V.
BOSTON REDEVELOPMENT AUTHORITY
V. COMMONWEALTH OF MASSACHUSETTS, ET AL.
ROCKET NO. 89-6500-E

I, ALPHONSE MOURAD, do hereby certify that I have read the foregoing transcript of my testimony and further certify that said transcript is a true and accurate record of said testimony.

Dated this 27th day of June_____, 1995 under
the pains and penalties of perjury.

ALPHONSE MOURAD
__________________________
ERRATA SHEET

RE: V&M MANAGEMENT, INC. V.

BOSTON REDEVELOPMENT AUTHORITY
V. COMMONWEALTH OF MASSACHUSETTS, ET AL.
DOCKET NO. 89-6500-E
Page Line
Number Number Deposition Reads Should Read

CERTIFICATE COMMONWEALTH OF MASSACHUSETTS RE: V&M MANAGEMENT, INC. V.
BOSTON REDEVELOPMENT AUTHORITY
V. COMMONWEALTH OF MASSACHUSETTS, ET AL.
DOCKET NO. 89-6500-E

I, AIDA M. MEDEIROS, a Professional Court Reporter and Notary Public in and for the Commonwealth of Massachusetts, do hereby certify as follows:

1. that ALPHONSE MOURAD, the witness whose testimony is hereinbefore set forth was duly recorded and transcribed by me;
2. that such testimony is a true record of the testimony given by said witness to the best of my knowledge, skill and ability; and
3. I further certify that I am neither attorney or counsel for, nor related to or employed by, any of the parties, or financially interested in this matter.

IN WITNESS WHEREOF, I hereunto set my hand and notarial seal this 28th cay of July, 1995.

AIDA M. MEDEIROS, Notary Public My Commission Expires: 6/6/95