Tamarack Foreclosure Process Moves Forward
In a recent letter to Tamarack Homeowners Steven Lord, TMA attorney, summarized the recent filings by the state court on the forecloure.
MEMORANDUM
TO: Tamarack Municipal Association Membership
FROM: Stephen J. Lord, Attorney at Law
RE: Foreclosure Litigation
DATE: May 11, 2011
Judge Owen filed and released for public distribution his "Omnibus Findings and Conclusions Re: Validity, Priority and Amount of Various Lien and Mortgage Claims," on May 11, 2011.
A copy of that decision has been uploaded and is available on the newly-built Tamarack Municipal Association website.
The document itself is nearly 100 pages in length, and is a fairly heavy read. In addition, understanding all of the footnotes requires a fairly detailed knowledge of events that have led to this point. However, in summary, this omnibus decision, in conjunction with prior partial summary judgments, established the following:
The following claimants and their claims have a lien position prior and senior to Credit Suisse.
1. Kessler Construction, $14,446.72.
2. MHTN $464,600.98.
3. EZA, Inc. (Oz Architecture) $719,552.94.
4. Tri-State Electric, $1,216,466.39.
5. Banner/Sabey, $5,504,042.97 (plus amounts for protection pay applications and minus amounts of Tri-State's senior lien).
6. BAG, $1,500,000.00 for Whitewater and Belvedere Ridge parcels and $500,000.00 for the B21/B22 parcel.
The total dollar value of the liens adjudicate in this decision that are senior to Credit Suisse, not including North Lake Recreational Sewer and Water District, is approximately $8,238,042.63
The decision determined that the following claimants have junior liens in the amount of:
1. Teufel, $122,066.98.
2. YMC, $1,499, 223.45.
Secesh Engineering proceeded through trial but settled with Credit Suisse before the court issued this omnibus decision.
A senior lien is likely to be fully paid from any proceeds of a sheriff's sale. Credit Suisse will receive whatever is left from the proceeds of a sheriff's sale after the sheriff pays the senior lien claimants. A lienholder that is junior to Credit Suisse will not likely receive any proceeds from a sheriff's sale.
The omnibus decision does not include analysis of other decisions made previously by the Court regarding, for example, the superior lien position of North Lake Recreational Sewer and Water District. However, that lien claim has also been granted senior status in prior rulings by Judge Owen. It is unclear whether the dollar value of the North Lake lien includes only those portions of the North Lake assessments that are due and unpaid or whether the bond proceeds for the entire bonded debt are due and payable. Past due amounts are in the 2 to 3 million dollar range. The entire bonded debt is several tens of millions.
Except for North Lake, most of the other senior lien claims are limited to specific parcels of land, e.g., the Belvedere Ridge and B21/B22 lots for BAG, Village Plaza for Tri-State, Kessler and Banner/Sabey, and Village Plaza and Lake Wing for OZ and MHTN.
A consequence of this omnibus decision is that a new buyer (either in the open market or at a sheriff's sale) has the potential to evaluate the claims, determine whether the senior claims can or cannot be purchased, make purchase offers to those senior lien claimants and whether or not those senior liens present opportunities to foreclosure of some or all of the Credit Suisse interest.
Credit Suisse's title insurer may have some duty to pay some or all of the senior liens.
Although this concludes the largest part of the foreclosure's substantive issues, much remains in a procedural context, such as calculation of interest, attorney's fee, and entry of final judgments of disclosure.
Parties that did not prevail in the omnibus decision or who lost prior summary judgments may ask for reconsideration. After final judgment is entered, losing parties may appeal.
Assuming no other sale, a Sheriff's Sale will be held probably late Summer or early Fall 2011. An appeal may result in a stay or other delay of a sheriff's sale.
OZ and Hedrick had a dispute over lot 122 in the Trillium townhomes. This lot is not subject to the Credit Suisse Mortgage. The omnibus decision determined that OZ and Hedrick have the same priority and therefore share pro rata in any sale proceeds from lot 122.