According to court documents, Judge John Treadwell signed the decree on March 30, ordering the Hermitage Inn Real Estate Holding Company to pay more than $1.2 million plus $414.25 per day in accrued fees to the former owner and mortgage holder, IVMJA LLC, by April 30 or lose the property.
According to the foreclosure complaint filed in September, the Hermitage failed to pay on a $900,000 mortgage on the inn and property, as well as $39,871.23 in interest and late fees. The judge’s order includes additional interest and late fees, as well as a $226,499 lien placed on the property by Bull Stockwell Allen Architects, and court costs.
If the Hermitage doesn’t pay the $1.2 million by April 30, the court has ordered the property to go to public auction.
In other ongoing court actions, Donald Frechette, has asked the court’s permission to withdraw as attorney for James Barnes and the Hermitage Club in a case alleging defamation by former Hermitage managing director Robert Balewicz. According to Frechette’s motion filed this week, Barnes and the Hermitage “have failed to substantially fulfill an obligation regarding the law firm/Frechette’s services. Plaintiffs have been given reasonable warning that Frechette would withdraw his appearance if plaintiffs did no fulfill their obligation. However, plaintiffs have failed to do so.”
According to the motion, Barnes and the Hermitage would have 30 days to retain a new attorney if the court grants Frechette’s motion to withdraw. Frechette had not responded to a request for comment as of press time.
Several lawsuits have been filed against the Hermitage and James Barnes in Windham Superior Court in the past few weeks. Two of the recent lawsuits appear similar to suits already before the court. TFT Holdings, a New York-based company registered in Vermont, is suing for breach of contract, unjust enrichment, and “breach of the duty of good faith and fair dealing” stemming from a purchase and sale contract for Unit 401 Garmisch Court.
TFT Holdings is listed with the Vermont Secretary of State’s office as a “real estate and rental and leasing”company. According to TFT’s complaint, they entered into an agreement to pay $1,198,000 for Unit 401, a membership, and deeded rights. TFT says they provided the Hermitage with over $1,458,249 in unspecified services, and agreed that the credit for those services would be applied to the purchase of the unit. “Plaintiff owes no additional cost at closing,” according to the complaint.
However, as described by other plaintiffs in complaints filed with the court, the unit is the subject of mechanics’ liens and other encumbrances, for allegedly failing to pay contractors and other service providers. “Despite receiving the entire purchase price, the Hermitage failed to pay contractors who contributed to the construction of the unit. In addition, it has failed to pay the vendors, taxes, and liabilities.”
Although TFT notes they have been able to occupy the unit with Barnes’ and the Hermitage’s permission, they have not been able to close on the property.
“Despite demands by plaintiff and as required by the purchase and sale contract, the Hermitage has refused to close on the sale of the unit and convey to the trust marketable title free and clear of encumbrances and defects in the form of a Vermont warranty deed.”
The Hermitage has not yet filed an answer to the complaint.
In a similar lawsuit, Charles T. Collins and Ana Cladera, of New York, signed a purchase and sale agreement for Unit 402 Garmisch Court in November 2015.
The original purchase price of $1,060,250 included the cost of the unit, a membership, and deeded access rights. A later addendum raised the total price to $1,107,192.99.
Collins and Cladera paid a deposit and several $100,000 “progress payments” as various phases of construction were completed. Eventually the couple had paid a total of $1,065,679.85, and expected to make a final payment of $41,523.14 at closing. “The progress payments were intended to pay the contractors who constructed the unit,” according to the complaint. “Defendants, however used the progress payments to pay other expenses.”
The result, according to the complaint, was “numerous encumbrances including mechanics’ liens, tax liens, and court-ordered attachments.”
As with TFT, Collins and Cladera say they have been able to occupy the unit with the permission of Barnes and the Hermitage, but have not been able to obtain a clear warranty deed on the property they’ve substantially paid for. The Hermitage has not yet filed an answer to Collins and Cladera’s complaint.
Thomas and Elizabeth Armstrong’s lawsuit differs from others. The Greenwich, CT, couple paid only the $300,000 down payment with their purchase and sale agreement on Unit 401 Grenoble Way in April 2015. About a year later, in March 2016, according to their suit, they exercised a provision in the purchase and sale agreement allowing them to terminate the contract if the building permits for the unit had not been obtained by September 1, 2015.
The Armstrongs said they received a partial refund in two payments in September 2016, but were still owed $213,038 plus interest since March 9, 2016.
Following a court finding and order in their favor, as well as a negotiated agreement, Berkshire Bank paid the Armstrongs $40,000 and the Hermitage paid $20,000 and signed over two equity memberships to the Armstrongs until the amount was paid in full. The payment was ordered to be made no later than October 1, 2017, but, according to the Armstrongs’ attorney on October 4, no payment had been made.
Again the court ordered the Hermitage to pay, and another $50,000 was paid as of January 12, with the remainder to be paid by January 31. According to court documents, the case has been closed.
Other lawsuits filed in Windham Superior Court against the Hermitage include a complaint by WW Building Supplies for $145,233.66, the amount due for “construction supplies and materials,” and Key Drilling and Blasting for $66,600 in unpaid drilling and blasting services.