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Long after Ginn-LA (Tesoro) Bankruptcy, Property Owners are Hounded for Delinquent Club Dues

Sarasota-based The Monticello Group purchased the unpaid deposits, dues, fees and other amounts relating to membership in The Tesoro Club. Now they're trying to collect.

By Toby Tobin
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Palm Coast, FL – July 28, 2010 – [Updated July 29, 2010] In the aftermath of real estate developer Ginn-LA's (Bobby Ginn and financial partner Lubert-Adler) bankruptcy of the Tesoro and Quail West projects, property owners are still trying to pick up the pieces. Sarasota-based The Monticello Group, LLC (TMG) is not making that process any easier. They purchased Ginn/Tesoro assets including delinquent club payments. Now they are trying to collect.
 
According to bankruptcy documents, Member Receivables totaling $8,866,611.69 were among assets transferred to Credit Suisse for $40,000. Receivables were subsequently acquired by TMG.
GoToby.com has heard of at least three Tesoro property owners recently contacted by TMG. A June letter put one owner on notice that a lien would be placed on their property if the outstanding balance (exceeding $45,000) was not paid within 45 days. The owner had resigned from the Club in late 2008. Another owner raised the issue of the uncompleted Beach Club.
The issue is not simple. Tesoro Club membership documents state that member deposits would be held in an escrow account until the completion of the Club amenities. The amenities were not completed. The promised Beach Club does not exist. Neither does the escrow account. Nor do the membership deposit funds.
Property owners should understand that TMG reportedly purchased the accounts receivable on an "as-is where-is" basis, without warranty of any kind as to its enforceability and subject to all defenses held by all of the account debtors. If TMG persists in efforts to collect, owners should consult an attorney.
Meanwhile, in a separate action, bankruptcy trustee Drew Dillworth is pursuing funds totally approximately $330 million allegedly transferred fraudulently to Ginn and Lubert-Adler from proceeds of the $675 million Credit Suisse loans that precipitated the bankruptcy. The lawsuit was recently amended to add Lubert-Adler investors to whom funds may have been distributed to the list of defendants. They are:
  • President and Fellows of Harvard College
  • University of Michigan
  • Catherine T. MacArthur Foundation
  • Maryland State Retirement and Pension System
  • Ohio Police and Fire Pension Fund
  • Pennsylvania Public School Employees' Retirement System
  • Pennsylvania State Employees' Retirement System

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reader comments
Reply to John
Posted by Toby
Nov 16, 2013, 3:23 pm
This is just the beginning. Wait until the foreclosure dust settles. Then the lenders and collection agencies will have time to run down deficiency judgments. Many who were foreclosed or sold via short sale believe they are off the hook. In Florida, lenders have five years to file a deficiency judgment. Even private mortgage insurance (PMI) companies can file against defaulted homeowners to recoup their payment to lenders.
Same for Tesoro Preserve owners
Posted by Rene
Jul 30, 2010, 8:00 am
Tesoro Club is trying to collect social club dues from Tesoro Preserve owners and threatening with liens for those not paying. Just got threatening collection letters from the club itself. Once again, same thing goes as the amenities were not completed so why should owners have to pay $500 per month for social club membership dues?
When will it stop?
Posted by John
Jul 29, 2010, 9:42 am
This is so terribly sad for so many people. I wish the Tesoro Club owners the best of luck in fighting the group trying to enforce the dues.

PS - It just struck me but I would imagine that the suite against Ginn/LA may be priced a bit high. If I understand the CS loan it was used to fund other projects too, not just Tesoro. If that is the case I would think the other clubs have a right to any money recovered??

 
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Don "Toby" Tobin is a licensed real estate professional affiliated with Take Action Properties LLC. Toby is a member of the Flagler County Association of Realtors®, the Florida Association of Realtors, Enterprise Flagler, Flagler Home Builders Association, and the National Association of Realtors.

GoToby.com proivdes real estate news, commentary, and analysis for Palm Coast and Flagler Country Florida, as well as Realtor® referrals and consultation to buyers, sellers, and developers.