Bank of America, N.A. v. Northwood Shoppes Two, LLC et al
Filing
52
OPINION AND ORDER denying 46 Motion to Intervene by Movant National Development Partners LLC, granting 45 Receiver's Motion for Aurthorization to Sell Real Estate and Approval of Sale. The Court APPROVES the sale of the Montgomoery Place property for $1,250,000.00. Signed by Judge S Arthur Spiegel on 5/18/2011. (km1)
UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF OHIO
WESTERN DIVISION
BANK OF AMERICA, N.A.,
:
:
Plaintiff,
:
:
v.
:
:
NORTHWOOD SHOPPES TWO, L.L.C.,:
et al.,
:
:
Defendants.
:
NO:
1:10-CV-00097
OPINION AND ORDER
This matter is before the Court on the Receiver’s Motion
for Authorization to Sell Real Estate and Approval of Sale (doc.
45), the Motion of National Development Partners LLC (“NDP”) to
Intervene
(doc.
46),
the
Objection
of
National
Development
Partners, LLC to Receiver’s Motion for Authorization to Sell Real
Estate and For Approval of Sale (doc. 47), Plaintiff’s Response in
Opposition to NDP’s Motion to Intervene (doc. 48), and NDP’s Reply
(doc. 50).
For the reasons indicated herein, the Court GRANTS
Receiver’s motion and DENIES that of NDP to intervene.
Per this Court’s March 24, 2010 Order, the Receiver in
this matter, Towne Development Group, Ltd, was authorized to sell
Defendants’ assets with approval of the Court (doc. 45).
At issue
before the Court is Receiver’s proposal to sell the Montgomery
Place property, Auditor’s Tax Parcel 603-4-8 in Hamilton County,
Ohio
(Id.).
Receiver
has
obtained
three
appraisals
of
the
Montgomery Place property and proposes a sale of such property to
a third party for $1,250,000.00 (Id.).
National
preferred
Development
membership
Partners,
interest
in
LLC
Defendant
(“NDP”)
holds
Montgomery
pursuant to a 2005 Purchase Agreement (doc. 46).
a
Place
NDP seeks to
intervene in this matter (doc. 46), and opposes the sale (doc. 47).
In NDP’s view, the sale is contrary to the Court’s previous Order
and Ohio law (Id.).
Plaintiff opposes NDP’s motion to intervene (doc. 48).
Plaintiff contends NDP solely desires to intervene so as to delay
Plaintiff’s efforts to collect on the matured and defaulted loan,
and has attempted to extract a $100,000.00 payment from Plaintiff
in exchange for not interfering with the sale (doc. 48). Plaintiff
contends NDP has no real legal interest in the Montgomery Place
property (Id.).
Plaintiff states NDP owns a limited liability
company membership interest in Montgomery Place, and Montgomery
Place owns the property (Id.).
Plaintiff argues NDP’s legal
interest is in the LLC and not in the property, and that Ohio law
is clear that a shareholder has no legal interest in the assets
owned
by
the
company
(Id.
citing
FirstMerit
Bank,
N.A.
v.
Washington Square Enterprises, et al., No. 88798, 2007 Ohio App.
LEXIS 3561 *15 (August 2, 2007)).
NDP replies that the Court
should construe its interest in the LLC liberally and allow
intervention, and that its settlement discussions with Plaintiff
should not be framed as nefarious or improper (doc. 50).
2
Having reviewed this matter, the Court finds Plaintiff’s
position well-taken that NDP lacks any real legal interest in the
subject property that could justify intervention.
Under the
Federal Rules of Civil Procedure, an outsider to a lawsuit may
intervene as of right when the outsider "claims an interest
relating to the property or transaction which is the subject of the
action and the applicant is so situated that the disposition of the
action may . . . impair or impede the applicant's ability to
protect
that
interest,
unless
the
applicant's
adequately represented by existing parties."
24(a).
interest
is
Fed. R. Civ. P.
The only potential interest that NDP has here is an
indirect economic interest in any surplus equity remaining from the
sale
of
the
creditors.
property
after
payment
to
all
lienholders
and
Because the value of the property as determined by
three independent appraisals, is at least $1,150,000.00 less than
the amount owed to Plaintiff in connection with the mortgage, there
is no equity available to inure to the benefit of NDP.
Plaintiff
correctly states that NDP has not even alleged the appraisals are
wrong
or
that
the
sale
price
is
too
low.
Under
these
circumstances, the Court finds that intervention would only delay
the sale of the property and the resolution of this matter.
Accordingly, the Court DENIES the Motion of National Development
Partners LLC (“NDP”) to Intervene (doc. 46), GRANTS Receiver’s
Motion for Authorization to Sell Real Estate and Approval of Sale
3
(doc. 45), and APPROVES the sale of the Montgomery Place property
for $1,250,000.00.
SO ORDERED.
Dated: May 18, 2011
/s/ S. Arthur Spiegel
S. Arthur Spiegel
United States Senior District Judge
4
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