Photo by Whitehorse Star

SILENT AND EMPTY - The Little Paws day care on Range Road closed last week.

Day care can't issue former staff final cheques

The Little Paws day care, closed last week after being evicted by Borud Enterprises for non-payment of rent, notched another failure this week, announcing it can no longer pay its former staff their final wages.

By Jason Unrau on December 18, 2008

"I just learned this morning (Dec. 17) that Borud Enterprises used an old rent cheque to empty Little Paws' bank account ..." interim director Andrew Robulack alleged in an e-mail sent to the Star.

"The Borud brothers saw fit to ... essentially seize Little Paws' remaining capital assets without notice ... the staff's paycheques have already started to bounce and it's doubtful the centre will have sufficient funds to reimburse workers."

But according to David Borud - co-owner of Borud Enterprises with his brother Stanley - the day care still owes his company money, and it and former day care staff are not the only Little Paws creditors.

"There's lots of people owed money around town; everybody out there is looking for money from these guys," Borud told the Star this morning.

"It's no different from ourselves, and it's unfortunate. The fact of the matter is there's not the money to go around, and if you start pointing fingers at us, we're still owed a lot of money. We don't have it and don't know if we're ever going to get it."

Problems started for Little Paws in June 2007, when it was forced to find new digs and its rent increased 300 per cent, to $12,000 a month from $4,000.

Enter the Yukon government, whose Health and Social Services department cut a $50,000 cheque to keep the day care in business.

The money was classed a grant, and no repayment was necessary, contingent on Little Paws remaining open for 24 months. When its doors closed last week, Little Paws came up six months short on the deal and now owes the government $12,500.

Borud would not reveal how much Little Paws owes Borud Enterprises except to say it is "a considerable amount."

"I thought this thing was over; now (Robulak's) going back and forth ...they're out of the building and we're left with a building and a mess to clean up," Borud told the Star.

Attempts to contact Robulack were unsuccessful as of press time this afternoon.

Approximately 45 day care students and 15 staff were impacted by Little Paws' closure.

While former day care staff will likely be short a paycheque before Christmas, they can likely be reimbursed through an application to the government's labour services branch.

According to the Yukon Employment Standards Act, employees who believe they are owed money from an employer can appeal to labour services officials to investigate the conduct of a business and in most cases, are compensated for unpaid work.

Comments (10)

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Just another parent on Dec 24, 2008 at 10:28 am

Anonymous: I can totally understand your frustration. I'd probably be feeling pretty upset too if my kids were still at Little Paws when it was shut down.

QC: thanks for the explanation.

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QC on Dec 24, 2008 at 4:00 am

Yes they can speculate about whatever they want on a public forum, it's called "Freedom of Speech and Expression" and it's guaranteed by the Charter of Rights and Freedoms.

However, as a first-hand player in this situation, Robulack does open himself up for a civil defamation suit, particularly if he's conveying potentially damaging information that isn't necessarily true.

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Anonymous on Dec 23, 2008 at 9:57 pm

Andrew Robulack is trying to sway public opinion in his favor by repeating rumors around town and therefore should be worried about a defamation lawsuit. I, on the other hand, was charged daycare fees for a month. Then I was given a letter stating that I had until the end of December to find a new daycare spot as Little Paws would be closing. Then I had to read in the newspaper that it would be closing in one day leaving me with no daycare spot and out the money as I had to try to find a new daycare and pay the fees all over again.

I feel he lied to me and yes, I have the right to speculate publicly about how truthful he was and I think it warrants an investigation. I'd also like to point out that when all this was taking place Andrew Robulack was always around to be interviewed by the press but when I came to pick up my child on the last day of "daycare" he was nowhere to be found. Ridiculous.

I feel bad for the staff as well because he issued them cheques most likely knowing that they weren't going to go through. The man should be ashamed of himself.

Merry Christmas, Robulack.

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Just another parent on Dec 23, 2008 at 3:56 am

Apparently Andrew Robulack has been threatened with a defamation lawsuit for repeating "rumours around town" on his blog. So why is it okay for "Anonymous" to do the same in this Comments section? Because someone witholds their name, does that mean they can speculate publicly about whatever they want?

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Dee Mains on Dec 23, 2008 at 2:28 am

It's seems to me that someone pulled the wool over the landlords eyes. Why would smart business men rely on a shaky lease/business plan for income for their building? I don't really think that is the case here. If a proper business plan was presented to the landlord, it looked feasible and realistic, it is then up to the daycare to go through with that plan, the landlord is then relying on the expertise of the daycare directors to follow through with the plan, they are the experts in the daycare business, not the landlord(s). I really think the old board has some explaining to do. And shame on Mr. Robulack for getting so far out of control with this. It is a landlord tennant dispute, they didn't pay their rent...so goodbye.

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Robert on Dec 22, 2008 at 5:09 am

Funny thing though, Anon.....Borud's lawyers are leaning hard on Robulack over on his blog. Sending him strong arm letters, he has deleted all but one entry on the topic. If anyone is hiding something, it aint Robulack.

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Hiding behind my computer on Dec 20, 2008 at 8:45 am

Dear Anonymous and the people "around town",

I don't know if he got paid, but I know for a fact if it wasn't for Mr Robulack, the families of 45 children and 15 staff would not have had quality daycare or a place of employment up until now.

Little Paws was doomed the moment the new lease was signed.

A smart landlord would take only as much money as they could without putting the tenant out of business. A smart landlord would not build a building without knowing if the tenant could pay.

Mr. Robulack has spread the blame between the old board of directors (rightfully so) and government. He pretty much kept the Boruds out of it, except for letting everyone know that they evicted children from their daycare a week before Christmas.

In my opinion the Boruds are 90% to blame, they must have known the finances of Little Paws before building the new building, they must have known the strain a 300% rent increase would put on a non-profit organization.

I think the government should withhold the $50000, and call it a lesson learned.

Also, if the government does "reward" the Boruds for mismanagement, they should also investigate the relationship between the the Borud Bros. and the old board of directors, who after signing a terrible lease, all resigned.

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LP on Dec 19, 2008 at 4:09 pm

Everyone who has been short changed by this organization should pursue the directors who made the decision to sign a $12k/month lease. This organization had been mismanaged for some time, and although it is much more difficult to sue a non-profit organization and pursue the directors for wages, it can and should be done because it was this negligent decision (probably one of many) that drove this organization into the ground.

As for the landlords, they had a contract with the organization, although for a ridiculous amount of rent. They should not be criticized for holding the society to the terms of the contract, but I am curious as to why nobody is questioning the $26k bonus they get to keep after the 2 months' rent was paid from the security deposit supplied by you and I (via the government)?

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Anonymous on Dec 19, 2008 at 11:06 am

I'll bet Andrew Robulack got his final paycheck and I'm not the only one around town wondering just how truthful this "interim director" was with everyone.

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sheryl wagner on Dec 18, 2008 at 1:15 pm

This article doesn't state many details but i very much doubt that the rent being paid to the Borud Bros or not, will have any impact on the type of Christmas they might or might not have.

However in all likelyhood the folks that didn't get their final paycheques will truly feel the pinch of not getting those cheques. In a situation like this i feel it would have been a LOT more respectable of the Borud Bros

to wait to make their cash grab until all the employees got their paycheques.

Shame on business greediness. Best wishes for a good Christmas to the chequeless ex-employees and perhaps the Boruds will do the right thing and make some huge donations to organizations that assist those that have less to have happy a Christmas also.