Gunning's set to be sold at auction Unpaid loan spurs bank to foreclose

January 22, 1993|By Timothy J. Mullaney | Timothy J. Mullaney,Staff Writer

A Laurel savings bank has scheduled an auction of Gunning's Crab House in the Brooklyn section of South Baltimore. The foreclosure sale would close the door on a 3 1/2 -year struggle to save the well-known restaurant from financial problems stemming from a fire at its Ocean City branch.

Alex Cooper Auctioneers is scheduled to auction the restaurant's South Hanover Street building Feb. 10, after the owners failed to repay a loan that an attorney for Laurel Federal Savings Bank said exceeded $200,000.

"They have known it was coming," the attorney, Robert Sloan III, said. "They tried to salvage the business and they couldn't."

The restaurant has been in financial trouble since a 1989 fire at the Ocean City Gunning's. Gunning family members have said they were under-insured against that fire. The restaurant also lost income because the fire occurred in August, forcing it to close during the busiest part of the vacation season.

The restaurant filed for Chapter 11 bankruptcy court protection in March 1991, but the building nearly went to auction in June of that year because the building and the restaurant business were owned by different partnerships.

The entity that owned the building had not sought court protection, which included an automatic court order halting any creditor actions to collect their money, the company's attorney, Howard Heneson, said at the time.

A last-minute arrangement between the Gunning family and the bank headed off the 1991 auction. Mr. Heneson could not be reached yesterday, and there was no answer at the restaurant. Ed Gunning, one of the founders of the restaurant, could not be reached.

An employee of a nearby business said the restaurant had been closed for at least several weeks. Another neighbor said the crab house, unlike others, has not closed for the winter in the past.

Andrew Gunning and his son, Ed, opened Gunning's Crab House in South Baltimore in June 1969. The two had no experience in the restaurant business before Andrew left his job as a city supervisor and Ed left his job as a Baltimore policeman.

The crab house, with its red-and-white checkerboard tablecloths and paneled walls, has grown in popularity and was picked as having the "World's Best Crab Cakes" by Esquire magazine in 1989.

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