A palace's battle royal

Sister Anne Lythgoe at Elstowe Manor, one of two mansions on the Elkins Estate's 42 acres. The Dominican sisters sold the Cheltenham estate in 2009 for $8.5 million but now seek to eject the buyer over nonpayment.
Sister Anne Lythgoe at Elstowe Manor, one of two mansions on the Elkins Estate's 42 acres. The Dominican sisters sold the Cheltenham estate in 2009 for $8.5 million but now seek to eject the buyer over nonpayment. (CHARLES FOX / Staff Photographer)
Posted: October 29, 2012

Harrison Ford is gone. So, too, the Victoria's Secret models, and the $2.5 million emerald-and-ruby bra.

They had supplied the summer's marquee moments at the Elkins Estate, a pair of storied Gilded Age mansions set on 42 verdant acres in Elkins Park.

For two weeks, Ford strode through the manly paneled rooms of Chelten House for the movie Paranoia. Over at Elstowe Manor, models in filaments of lace and satin posed in the marble corridors for a Christmas catalog.

In opulent spaces not occupied by production crews, newlyweds popped champagne at swank receptions.

Then, before summer even wound down, the bustle stopped. And a battle resumed, with renewed animus, over the $8.5 million Montgomery County landmark - among the region's best-preserved turn-of-the-century architectural treasures - and who is its rightful owner.

Is it a 58-year-old Hare Krishna follower who helped build one of Philadelphia's oldest homeless charities and put at least $3.5 million of its cash into his quest for the estate?

Or is it a Catholic congregation of religious sisters whose resolute, 61-year-old leader is on a mission to eject him from the property?

Sister Anne Lythgoe and David Dobson have never been introduced or even seen each other, except across a courtroom. But there, they've seen each other quite a lot.

In 2009, needing money to ensure their ministry's future, the Dominican Sisters of St. Catherine de Ricci sold the estate, their retreat for 75 years, to Dobson and his newly created Land Conservancy of Elkins Park. The sisters were happy to have a buyer who wanted to preserve their beloved sanctum - happy at least until he stopped making payments on the $6.9 million mortgage they themselves had financed.

Declaring him in default, they reclaimed the deed.

Dobson, who was renting out the homes as tony event venues, refused to leave.

Early this year, Lythgoe turned to Montgomery County Court to have him and his conservancy removed. He, also in court, accused the sisters of stirring enough trouble to put both his nonprofits on the road to ruination, and render them as irreparable as "Humpty Dumpty."

Now, the dispute over who goes and who stays resides with a Norristown judge, while back at the estate, hostage to the impasse, grass grows long and bookings have dried up.

Both with roots in spiritual austerity and service to the poor, Lythgoe and Dobson are unlikely combatants for a property that bespeaks late-19th-century excess as grandiloquently as any in the country.

But no matter how each got to this place, neither appears willing to cede it.

Hubris to Depression

If nothing else, Lythgoe and Dobson share this: Both fell under the spell of the Elkins Estate the moment they passed through its hand-forged, wrought-iron gates.

In the 1890s, drawing on vast wealth from oil and streetcars, William Lukens Elkins carved out the expansive setting for his summer home from a tree-lined neighborhood in Cheltenham. His son, George, already lived there in Chelten House, a 30,000-square-foot Tudor mansion of timber and stone designed by society architect Horace Trumbauer.

For the patriarch, wood and Wissahickon schist would not do. He directed Trumbauer to create the eye-popping centerpiece, then named Elstowe Park.

Even given Gilded Age ethos, it took some hubris to erect a 64,000-square-foot Italian Renaissance palace with a marble-pillared, two-story reception hall, frescoes and resplendent chandeliers just miles from a city teeming with poor immigrants and seething with labor unrest.

But came the Great Depression, and even the Elkins dynasty felt its vicissitudes. The two mansions and acreage went up for sale.

In 1932, the Dominican sisters, whose mission was to serve the spiritual needs of Catholic women, bought Elstowe for $100,000. As a gift, the family gave them an intricately carved, 12-foot-tall antique hall clock. They picked up Chelten House in 1948, when a cigarette-maker sold it for an undisclosed sum.

At their retreat's peak, the sisters hosted 10,000 visitors a year. Among them in 1964 were Anne Lythgoe and her twin sister, West Catholic High School freshmen whose mother sent them to a weekend for single women.

She can pinpoint the spot on Elstowe's elliptical staircase where she tripped and hurt her foot. She can recall exploring the nooks - like the secret panel in the library that, pushed just so, opened.

A decade later, she joined the Dominican order, which currently has 6,000 members and 20 congregations around the country. In early 2010, she would return to Philadelphia as the local community's president - and step into a crisis.

The congregation's sale of the Elkins Estate preceded Lythgoe's return by a year, but trouble had been percolating for years. Like Mass attendance in Catholic parishes, interest in retreats had waned. The congregation had three to maintain, including two in New York and Virginia.

Another financial stressor was its aging membership, less able to do the hard labor of upkeep, more and more in need of costly health care.

By 2006, with three dozen sisters living at the estate, the decision was made to sell.

While there was much interest in the well-preserved manor homes, firm bids were few. Westrum Development Co. wanted to build a residential community for older adults on the tract, with the mansions as the focal point. But the deal collapsed.

In April 2008, the sisters went ahead with an auction of antiques and housewares.

Dobson, who worked nearby, saw their signs on Ashbourne Road and ventured in, hoping to buy a chair. He was amazed by the estate, he said, and aghast that it might be chopped up by construction.

"I wondered," he recalled in an interview, "if there was some way to save this."

He and his wife, Ettel, ran Food For All, a housing nonprofit that had gotten its start operating homeless shelters in the city in the 1980s.

In the Elkins Estate - specifically the sisters' 225 retreat rooms and three commercial kitchens - Dobson saw opportunity. He envisioned turning the bucolic campus into housing for the elderly or veterans, with a health and wellness center.

"I couldn't think of a better place," he said. Saving the mansions "was an ancillary benefit to the community."

At the two-day auction, the Dobsons used funds from Food For All to acquire 284 items for $433,624.94.

They bought cast-iron garden urns, an oak banquet table, and a Persian rug; candelabras, 100 pieces of gold-band stemware, and an Arts and Crafts rocker. Outbidding a collector calling from Chicago, they snagged for $310,000 the piece de resistance: the massive clock that the Elkins family gave the sisters.

By that September, Dobson reached an agreement with the congregation to buy the estate. But with the economy crumbling, he had trouble getting a loan. He again dipped into Food For All's coffers to put down $1.6 million.

The sisters gambled, and gave him a seller-financed mortgage for $6.9 million.

On Feb. 23, 2009, Dobson and Lythgoe's predecessor, Sister Carolyn Krebs, signed an agreement of sale putting the estate in the Land Conservancy's name.

'Other avenues'

The Elkins venture took Dobson far from his roots serving the homeless.

He grew up in Toronto, one of seven children in a Catholic family that had him pegged for the priesthood. But with the advent of hippies and antiwar protests, Dobson, an altar boy until he was 16, "started looking at other avenues," he said.

The one he chose was the Hare Krishna movement, founded in New York in 1965 and grounded in traditional Hindu scriptures. In Toronto, he joined other devotees handing out meals to homeless men on the waterfront.

At a Hare Krishna gathering, he met Charlotte Sorlien McLaughlin, a member of a temple in Mount Airy. She had started Food For All, also known as Food For Life, in 1983, when Philadelphia streets were overwhelmed with indigent. She asked Dobson to help run her men's shelter on South Broad Street, and one for women and children on North Broad. When she moved away in 1989, he took over.

Dobson began refocusing the nonprofit, away from operating shelters to creating housing - rowhouses for low-income families; halfway houses for parolees; a transitional shelter for veterans; federally funded apartments for senior citizens.

In one major deal in 2004, for instance, Food For All bought for $5 million a shelter for men on Woodland Avenue in Southwest Philadelphia and leased it for $515,000 a year to the city, which in turn hired another nonprofit to run it.

Dobson relocated Food For All's offices to a Tudor manor on Old York Road, and eliminated its outward affiliations with Hare Krishna.

In 2010, in the most recent IRS financial statement available, the nonprofit had revenue of $1.8 million and $66,534 in losses. Its two voting directors - Dobson and his wife - made, respectively, $262,865 and $102,365.

Dobson, in an interview, said he was "undercompensated." He added: "There should be more David Dobsons in the world, people willing to put their lives on the line to help thousands. I could have made millions."

When Dobson emerged as a potential buyer for the Elkins Estate, it was initially under the auspices of Food For All. That made Cheltenham Township officials nervous.

"He had always been involved in services for underprivileged people," said Harvey Portner, a township commissioner whose ward includes the Elkins property. Having Catholic church retreats there "is one thing, but what he was involved in . . ."

Even before the sale was made final, the zoning board barred any use that would include shelters, transitional housing, group homes, or halfway houses.

Dobson maintains his plan for senior housing also was stalled - a point on which Portner and other township officials disagree.

"If anything, we need more senior housing," Portner said. "We have an older population."

For Dobson, the rezoning was evidence of "prejudice in this community" against the Hare Krishna. "We're completely nondenominational, and to have my faith thrown in my face, it just really stinks," he said.

Portner has a different recollection: "I don't know that [Hare Krishna] was ever part of the picture."

Despite the setbacks, Dobson went ahead with the deal.

He formed a separate nonprofit, the Land Conservancy of Elkins Park, to handle the transaction and operate the estate. He put up a plan to rent it out for special events and educational programs.

Nine months after the sale, Dobson got more bad news.

Both the Cheltenham Township School District and the local government ruled that the conservancy, now functioning as a rental venue, did not qualify for the tax-exempt status the sisters enjoyed.

Starting in 2010, it would have to pay property tax - about $400,000 a year.

A deal next door

Although he was paying monthly interest of $37,375 to the sisters, Dobson's first principal payment - $250,000 - was due only in February 2010.

The deadline came and went. Nothing. Trying to accommodate him, they offered to accept the Elkins clock as collateral until he could pay. He didn't take them up on it.

Unbeknownst to them, Dobson was working on another deal next door.

He had teamed with a local builder, the Mignatti Group, to buy Temple University's Tyler campus and develop a 55-plus retirement community with hundreds of new units, said Richard Rumer, Temple's associate vice president of business services.

But with the real estate market faltering, Mignatti dropped out. Dobson could not come up with financing to go it alone, Rumer said.

By June, according to the conservancy's bankruptcy filings, even interest payments to the sisters ceased.

Dobson maintained in court filings that he had not defaulted on the mortgage. He cited disagreements over the interest level, and credit for payments to cover repairs.

Nonetheless, on Nov. 1, 2010, the sisters took back the property, recording the deed with Montgomery County.

The same day, the Land Conservancy filed for protection from its creditors in U.S. Bankruptcy Court.

Legal bills rising

The Elkins Estate had become a popular venue for weddings and retreats, concerts, theater productions, and educational programs.

Even so, the operation was being propped up with Food For All's money - as much as $60,000 a month, Dobson told a bankruptcy judge.

His efforts to keep the estate drew support from the Wyncote Foundation, endowed by members of the Haas family. To help the conservancy out of bankruptcy, it gave a $1.4 million grant for paying lawyers, making repairs, and settling debts with small creditors, Dobson said.

But the sisters wanted their money, too.

Their legal bills were running toward a half-million dollars. And without the investment income, the congregation was dipping into savings to care for its elderly, who were relocated to a central Pennsylvania retirement community. Other sisters moved to a house in Upper Darby.

Dobson entered into a $6.2 million loan agreement with Atlantic Rim Funding. He put down a $600,000 deposit, using part of the Wyncote grant. But by July, Atlantic Rim had not come through.

"No one was more shocked and surprised than us when the transaction didn't close," said Edmond George, the Land Conservancy's attorney.

So Dobson had to revise his settlement with the sisters: He would pay them $300,000 by Dec. 31, 2011, with installments to follow. If he didn't live up to the terms, he would leave the property.

He expected to get his deposit back from Atlantic Rim and use it for the first payment. But Atlantic Rim returned nothing, according to court records.

On New Year's Eve, Lythgoe waited nervously for a wire transfer into the congregation's bank account.

"Have we heard?" she kept asking her finance officer.

The answer kept coming back: no.

Calling in a former mayor

It wasn't until January that Dobson got his deposit back. But by then, it was too late.

Last Feb. 21, U.S. Bankruptcy Court Judge Eric L. Frank signed an order saying the congregation "has a right to immediate possession of the property."

Given the OK to proceed with their effort to eject Dobson and the Land Conservancy, the sisters headed straight for Montgomery County Court. "You can't stay on a property you don't own," Lythgoe said unequivocally in an interview.

Yet, Dobson held on, telling the bankruptcy judge that new financing was in the wings. He planned to use as collateral a Food For All complex for low-income residents near Harrisburg.

In the spring, he reached out to the Rev. W. Wilson Goode Sr. The former Philadelphia mayor knew Dobson from the 1980s when Dobson ran shelters and was impressed, Goode said in an interview, by his "tenacity and drive."

Dobson wanted him to be a mediator with the sisters and the township, said Goode, who agreed to visit the estate.

"But it never got to the point with me where I was able to understand . . . how it could get fixed," he said. "[Dobson's] idea of it being fixed was, we'd talk to the nuns, and we'd talk to local elected officials to change their minds about taxes."

By then, the taxes owed to the school district and township amounted to $1.3 million.

Without tax relief, the conservancy would fail, and Food For All would be forced into bankruptcy by year's end, he told Judge Frank. "I don't see how . . . we'd ever be able to put Humpty Dumpty back together again."

More than 500 homeless or low-income people, he said, rely on the nonprofit for housing each night.

Early this month, the conservancy dropped its bankruptcy proceeding, saying it would focus its fight on Montgomery County Court. A hearing in that battle is set for Nov. 14.

The sisters are ready to move on new plans for the estate "the minute we have full control," Lythgoe said, and are talking with potential partners. It could become a community cultural center, or remain an event venue, though any plan likely would entail developing part of the tract while using the mansions for a public purpose.

Dobson, too, continues to plan for the estate's future. He is trying to arrange financing so he can go back to the sisters with another proposal.

"To bow out at this point would be a waste of resources," said George, his lawyer. But he acknowledged, "If I showed up with an offer for $6.8 million, there's nothing I can do to force her to take that money."

Lythgoe has steadfastly maintained that "we're not cooperating with the Land Conservancy."

"We've been forced into an adversarial relationship for 21/2 years," she said. "They need to move on, and move on quickly."

On a recent sunny afternoon, she sat on Chelten House's back porch and considered the "horrific distraction" from her life's purpose. "I spend a lot of sleepless nights, and a lot of time strategizing and reading, trying to bring some resolution to this," she said.

Looking out at duck ponds and ancient oaks, she added: "We own this. And we're going to act like owners."


See a video about the Gilded Age mansions at www.philly.com/elkinsestate


Contact Jeremy Roebuck

at 215-854-2620, jroebuck@phillynews.com, or follow on Twitter @jeremyrroebuck.

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