This case was getting nowhere in state court and a foreclosure sale on valuable property was on the horizon. An agreement that satisfied all parties had yet to be reached. It was time to seek out other options in a different court.
West Palm Beach, FL (PRWEB) January 05, 2016
Bankruptcy attorney, Craig Kelley, Managing Partner of Kelley & Fulton, P.L. in West Palm Beach, had a very big win this month. Kelley was able to settle a dispute through Chapter 11 bankruptcy for less than 10 percent of the opposing parties’ initial demand.
The case had very sluggish progress while in litigation in the state court and federal court dating back to 2009. As a result, on June 14, 2015, Reflections Holding Co., LLC and Reflections Commercial, LLC filed for protection under Ch. 11 bankruptcy in the United States Bankruptcy Court located in West Palm Beach under Case Number 15-21413-PGH, to save valuable real estate holdings along U.S. Highway 1 in Vero Beach, Florida.
Craig Kelley was able to reach a settlement of $450,000.00 on an original demand of $7.5 million by the opposing party through a mediation process called a “judicial settlement conference,” which is a successful program often used in the in bankruptcy courts. In this program, a bankruptcy judge, who is not assigned to the particular case, serves as the “facilitator” to assist the parties in reaching a resolution. “The greatest advantage of a judicial settlement conference is that the parties get the unbiased perspective of a federal bankruptcy judge,” says Kelley.
There were a half-dozen parties and all their counsel present at the judicial settlement conference. At times, Kelley was in one room negotiating with one group of parties while the facilitator was in another room negotiating with a different group. Kelley and the facilitator would pass each other in the hall as they switched rooms and parties. After more than ten (10) hours, an agreement was finally reached, and a settlement document was drawn up and signed before Kelley would allow the judicial settlement conference to be adjourned.
“This case was getting nowhere in state court, and a foreclosure sale on valuable property was on the horizon. An agreement that satisfied all parties had yet to be reached. It was time to seek out other options in a different court,” says Palm Beach bankruptcy attorney, Craig Kelley.
The Reflections entities planned to utilize their property in Vero Beach, Florida, to build an assisted living facility, but a dispute broke out between the various parties involved. Among other issues, one party maintained that it had a mortgage on the Reflection’s property. That party claimed that they held a two-million dollar mortgage on the property dating back to 1981 and were now owed $7.5 million dollars, with interest accrual, costs, and fees. Reflections claimed the mortgage was no longer valid under the Statute of Repose, which is an older law that terminates stale and old mortgages or contracts. Other significant issues existed with the property owners association regarding land use rights, ownership of the lake and easements. “If all parties decided to go to trial, then not only would it be more expensive, but the time spent litigating the case would cause significant delays and the ability to proceed under a pending joint venture agreement to build the assisted living facility would have been in breach and become a lost opportunity.” The location of the property in Vero Beach is in desperate need of such a facility, and it will create jobs in the community. “The better option was to go to a judicial settlement conference through Chapter 11 bankruptcy to obtain a faster and more cost-effective resolution, which is usually the case in bankruptcy versus state court,” says Kelley.
In Case Number 15-21413-PGH, an agreement was reached to the satisfaction of all parties involved, which successfully put an end to six (6) years of litigation. Craig Kelley was able to save his client over $7,000,000 through this process and open the door for the joint venture to build a much-needed assisted living facility on the vacant land off U.S. Highway 1 owned by the Reflections entities. “I wish I had hired Craig Kelley and his team years ago; they are remarkable at what they do,” said Thomas Scott, owner of both Reflections entities.