Sunday, March 5, 2017

Stonewall at Stonebridge

A battle over the Stonebridge Public Improvement District is taking place in Hinds County Chancery Court between Secretary of State Delbert Hosemann, a bank, and the Stonebridge developer.   The Secretary of State took possession of 58 Stonebridge parcels after the taxes and assessments were not paid.*  Mr. Hosemann attempted to negotiate a settlement between the state, Rankin County, and the bondholders.  However, the original developer argued its rights were violated and asked the Chancellor to cancel the settlement.
The Rankin County Board of Supervisors authorized the creation of the Stonebridge PID at its December 4, 2006 meeting.  Stonebridge was developed by Green Hills Development Company, LLC.  The company is owned by Ben Turnage.  Stonebridge sold bonds for $22 million in 2007.  The PID eventually defaulted on the bonds.  UMB is the trustee for the bonds.**

Green Hills sued Secretary of State Delbert Hosemann, several Rankin County officials, and several companies owned by UMB Bank.  Green Hills admits in its complaint that the taxes were not paid on the property taxes in dispute:

3.2 On August 31, 2009, and in subsequent yearn, the Subject Property was struck off to the State of Mississippi as a result of unpaid property taxes. These taxes included city, county, and school ad valorem taxes. These taxes also included assessments made by the Stonebridge Public Improvement District ("the PID"), which were assessed (the "PID Assessments") on the real property in the Stonebridge development to benefit the PID pursuant to Mississippi statutory law. On August 31, 2011, when the statutory period for redemption expired, the tax sale on the Subject Property matured.

However, Green Hills claims that it told the Secretary of State it wanted to re-purchase the property. The complaint charges the SOS refused to seriously entertain the offers or provided the information needed for Green Hills to re-acquire the property. Green Hills argues it's right to repurchase the property was violated by the agreement.
Green Hills  also asserts that NMB “knew full well” that Green Hills wanted to re-purchase the property. The plaintiff claimed it “possesses preferential rights to purchase the subject property” under state law.

Green Hills complained the defendants who purchased the property received "favorable treatment"  that was “unavailable to other potential purchasers, including Green Hills.”  Mr. Hosemann, UMB, and the Rankin County officials signed a forebearance agreement that would allow UMB to actually purchase the subject property. The Tax Collector agreed not to collect the PID assessments that are due during the forbearance period. The Secretary of State sold “part or all” of the property to UMB and Kenneth Paul Bradley.

The plaintiffs argued that these actions damage its real estate business and that the defendants interfered with its right of redemption to buy back the property it lost through its failure to pay taxes and assessments. The words malicious and unfair competition are used in the complaint.

Green Hills claims the Mississippi Administrative Code states that the Secretary of State must send a certified letter to the property owner that notifies him that his property was forfeited to the state. The Secretary of State should also make “reasonable efforts” to locate and notify Green Hills of the forfeiture during a thirty-day waiting period. Green Hills charges the State violated its right to due process and equal protection under the law.

Green Hills asks the court to void the sales and allow Green Hills to buy back all or any part of its former property. It also asks the court to award damages against UMB for tortious interference with its business interests.
Strong stuff. Stern stuff. However, Mr. Hosemann fired right back at Green Hills in his response

3.4 After Green Hills’ real property was forfeited to the State of Mississippi, following the two-year period of redemption, Green Hills was notified in writing that its described real property had been conveyed to the State of Mississippi for the non-payment of taxes. Green Hills was further timely notified that if it was interested in obtaining title to the real property, it should complete a written application to the Mississippi Secretary of State’s office on the prelcribed form. This defendant admits Green Hills never made proper written application to purchase all or any part of its real property following the real property’s forfeiture to the State of Mississippi….

Mr. Hosemann argued again that Green Hills “never made application” to buy back part of its former property after the state took possession of it. It appears that the Secretary of State is arguing that Green Hills’ assertions do not coincide with the facts and that his office followed the exact procedures that are required by law.

Green Hills is not exactly the sort of plaintiff who will take its ball and go home if it faces some opposition in court. The company shrugged and asked the court to toss some of Mr. Hosemann’s defenses in a motion to strike. The motion to strike argues that the Secretary of State’s defenses provide insufficient notice to the plaintiff:

The Secretary of State has pleaded sixteen affirmative defenses. The majority of these affirmative defenses fail to provide Green hills with fair notice required by Rule 8 and others have no basis in the law. Accordingly, Green Hills respectfully requests this Court to strike the Secretary of State’s affirmative defenses as set forth herein….

and/or release). In addition, even if the Secretary of State had pleaded facts sufficient to give Green Hills proper notice, Green Hills would still not know what affirmative defenses the Secretary of State is referring to by mere reference to a lengthy provision in the Mississippi Code.

Mr. Hosemann claims that Green Hills did not follow the law and thus forfeited its property and its rights to the property. Green Hills complains that he didn’t cite any actual facts to support his defense and asks the court to dismiss the defense.

The Secretary of State asked the court to dismiss Green Hill’s motion to strike and wasted no time in throwing punches at Mr. Turnage’s company. He stated in the first sentence:
Green Hills’ motion to strike certain affirmative defenses is both procedurally and legally meritless, as well as factually inaccurate. Green Hills wrongly and repeatedly claims the SOS asserted fifty-three (53) affirmative defenses…
The two sides have filed subsequent responses that repeat the same arguments. This dispute within the dispute has not yet been adjudicated by the court.  

Mr. Hosemann also asked the court to dismiss the case or transfer it to Rankin County in December. The law apparently states that these types of suits must be filed in the county of the land in dispute. Stonebridge is in Rankin County. Thus, the Secretary of State wants to transfer the case to the Rankin County Chancery Court (The Rankin County Chancellors are just salivating to get this Flying Dutchman of a case. The Stonebridge PID has been the subject of several lawsuits over the years.).  The Chancellor has not ruled on the motion.

Attorney Michael Heilman represents Green Hills.   The case is assigned to Judge Patricia Wise.

*The number of parcels is taken from the plaintiff's complaint.  

** However, UMB stated in a  June 2015 letter to bondholders:

The Trustee has formed three special purpose entities (the “SPEs”) for the purpose of owning, managing, maintaining and disposing of the tax forfeited Developer Property proposed to be acquired from the State. Subject to obtaining Court authority, the Trustee caused the SPEs to submit applications to purchase a total of 106 specifically-identified parcels (the “Applications”) comprising all of the Developer Property that has been struck off to the State. The aggregate purchase price of the property proposed to be purchased in the Applications is $862,780.00, which was determined per parcel based on State’s tiered pricing system. The Trustee believes that recovery of the Developer Property as sought in the Applications is necessary for the orderly and efficient disposition of this property, to maximize its value and to preserve value for holders of the Bonds. If the Trustee is successful in acquiring the property as contemplated by the Applications, the Trustee proposes to market and dispose of the property in accordance with directions received from the Majority Holder pursuant to the Indenture.

Recent Comments

Search Jackson Jambalaya

Subscribe to JJ's Youtube channel


Trollfest '09

Trollfest '07 was such a success that Jackson Jambalaya will once again host Trollfest '09. Catch this great event which will leave NE Jackson & Fondren in flames. Othor Cain and his band, The Black Power Structure headline the night while Sonjay Poontang returns for an encore performance. Former Frank Melton bodyguard Marcus Wright makes his premier appearance at Trollfest singing "I'm a Sweet Transvestite" from "The Rocky Horror Picture Show." Kamikaze will sing his new hit, “How I sold out to da Man.” Robbie Bell again performs: “Mamas, don't let your babies grow up to be Bells” and “Any friend of Ed Peters is a friend of mine”. After the show, Ms. Bell will autograph copies of her mug shot photos. In a salute to “Dancing with the Stars”, Ms. Bell and Hinds County District Attorney Robert Smith will dance the Wango Tango.

Wrestling returns, except this time it will be a Battle Royal with Othor Cain, Ben Allen, Kim Wade, Haley Fisackerly, Alan Lange, and “Big Cat” Donna Ladd all in the ring at the same time. The Battle Royal will be in a steel cage, no time limit, no referee, and the losers must leave town. Marshand Crisler will be the honorary referee (as it gives him a title without actually having to do anything).

Meet KIM Waaaaaade at the Entergy Tent. For five pesos, Kim will sell you a chance to win a deed to a crack house on Ridgeway Street stuffed in the Howard Industries pinata. Don't worry if the pinata is beaten to shreds, as Mr. Wade has Jose, Emmanuel, and Carlos, all illegal immigrants, available as replacements for the it. Upon leaving the Entergy tent, fig leaves will be available in case Entergy literally takes everything you have as part of its Trollfest ticket price adjustment charge.

Donna Ladd of The Jackson Free Press will give several classes on learning how to write. Smearing, writing without factchecking, and reporting only one side of a story will be covered. A donation to pay their taxes will be accepted and she will be signing copies of their former federal tax liens. Ms. Ladd will give a dramatic reading of her two award-winning essays (They received The Jackson Free Press "Best Of" awards.) "Why everything is always about me" and "Why I cover murders better than anyone else in Jackson".

In the spirit of helping those who are less fortunate, Trollfest '09 adopts a cause for which a portion of the proceeds and donations will be donated: Keeping Frank Melton in his home. The “Keep Frank Melton From Being Homeless” booth will sell chances for five dollars to pin the tail on the jackass. John Reeves has graciously volunteered to be the jackass for this honorable excursion into saving Frank's ass. What's an ass between two friends after all? If Mr. Reeves is unable to um, perform, Speaker Billy McCoy has also volunteered as when the word “jackass” was mentioned he immediately ran as fast as he could to sign up.

In order to help clean up the legal profession, Adam Kilgore of the Mississippi Bar will be giving away free, round-trip plane tickets to the North Pole where they keep their bar complaint forms (which are NOT available online). If you don't want to go to the North Pole, you can enjoy Brant Brantley's (of the Mississippi Commission on Judicial Performance) free guided tours of the quicksand field over by High Street where all complaints against judges disappear. If for some reason you are unable to control yourself, never fear; Judge Houston Patton will operate his jail where no lawyers are needed or allowed as you just sit there for minutes... hours.... months...years until he decides he is tired of you sitting in his jail. Do not think Judge Patton is a bad judge however as he plans to serve free Mad Dog 20/20 to all inmates.

Trollfest '09 is a pet-friendly event as well. Feel free to bring your dog with you and do not worry if your pet gets hungry, as employees of the Jackson Zoo will be on hand to provide some of their animals as food when it gets to be feeding time for your little loved one.

Relax at the Fox News Tent. Since there are only three blonde reporters in Jackson (being blonde is a requirement for working at Fox News), Megan and Kathryn from WAPT and Wendy from WLBT will be on loan to Fox. To gain admittance to the VIP section, bring either your Republican Party ID card or a Rebel Flag. Bringing both and a torn-up Obama yard sign will entitle you to free drinks served by Megan, Wendy, and Kathryn. Get your tickets now. Since this is an event for trolls, no ID is required. Just bring the hate. Bring the family, Trollfest '09 is for EVERYONE!!!

This is definitely a Beaver production.

Note: Security provided by INS.

Trollfest '07

Jackson Jambalaya is the home of Trollfest '07. Catch this great event which promises to leave NE Jackson & Fondren in flames. Sonjay Poontang and his band headline the night with a special steel cage, no time limit "loser must leave town" bout between Alan Lange and "Big Cat"Donna Ladd following afterwards. Kamikaze will perform his new song F*** Bush, he's still a _____. Did I mention there was no referee? Dr. Heddy Matthias and Lori Gregory will face off in the undercard dueling with dangling participles and other um, devices. Robbie Bell will perform Her two latest songs: My Best Friends are in the Media and Mama's, Don't Let Your Babies Grow up to be George Bell. Sid Salter of The Clarion-Ledger will host "Pin the Tail on the Trial Lawyer", sponsored by State Farm.

There will be a hugging booth where in exchange for your young son, Frank Melton will give you a loooong hug. Trollfest will have a dunking booth where Muhammed the terrorist will curse you to Allah as you try to hit a target that will drop him into a vat of pig grease. However, in the true spirit of Separate But Equal, Don Imus and someone from NE Jackson will also sit in the dunking booth for an equal amount of time. Tom Head will give a reading for two hours on why he can't figure out who the hell he is. Cliff Cargill will give lessons with his .80 caliber desert eagle, using Frank Melton photos as targets. Tackleberry will be on hand for an autograph session. KIM Waaaaaade will be passing out free titles and deeds to crackhouses formerly owned by The Wood Street Players.

If you get tired come relax at the Fox News Tent. To gain admittance to the VIP section, bring either your Republican Party ID card or a Rebel Flag. Bringing both will entitle you to free drinks.Get your tickets now. Since this is an event for trolls, no ID is required, just bring the hate. Bring the family, Trollfest '07 is for EVERYONE!!!

This is definitely a Beaver production.

Note: Security provided by INS