$32.7 million is a colossal amount at a personal level, even for the booming Reno or Las Vegas. For us, here in Tennessee, such an amount at a personal level is nearly unheard of. Yet that is the amount a small-time property developer has listed as his gross liability in a personal bankruptcy filing.
In a filing made at a U.S. Bankruptcy Court, the property developer has also indicated a massive net debt of about $29.8 million. Among the developer’s six creditors, the lion’s share is purportedly owed to Huntington Bank. The developer had obtained loans (now valued at $27 million) from Huntington for the purpose of building an industrial park, ‘Corridor 75.’
The bankruptcy filing has brought to light a few interesting side-stories about minor players; however, it is evident that the major combatants are the property developer and his company in one corner, and Huntington Bank in the other.
Punch and counterpunch have flown between these two combatants. The bank has alleged unpaid loans on part of the developer and even seized one of his individual retirement accounts. The developer said to the media that he has “made every mortgage payment to date,” and his bankruptcy filing indicates that he intends to sue Huntington for an unknown amount for “interference with business decisions.” The whole mess appears to have arisen from the developer having made a loan guarantee to Huntington when applying for the loans.
Perhaps the developer had been poorly advised when he gave a bank a loan guarantee. Now, the developer must ensure that he gets good advice as he works toward keeping assets and avoiding foreclosure. .
There are various types of bankruptcies that can be filed, depending on an individual or business’ situation. Legal advocates typically specialize in one or more of these specific bankruptcy types. This troubled developer would likely be well served to consult with a personal bankruptcy attorney who would evaluate his needs, and perhaps help him fend off the bank that seems to be ‘out to get him.’
Source: The Business Courier, “Developer Rob Smyjunas files Chapter 11 bankruptcy,” Sept. 1, 2011