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Litchfield Plantation: Civil suit intersects with grand larceny charge
By Charles Swenson
Claims against the former developer of Litchfield Plantation could increase by $95,000 now that a Circuit Court judge has allowed him to join a suit brought by five residents against the development company, according to court records.
Scott Trotter, who was president of Litchfield Plantation Co., faces a charge of grand larceny after residents said in June that he assigned $926,881 worth of mortgages and promissory notes that were payable to the homeowners association to his company, the Litchfield Plantation Buyout Group.
Trotter represented himself as the president of the homeowners association, according to the arrest warrant. The plaintiffs say Trotter was voted out as president at a special meeting in February, the same meeting at which they were elected to the board.
The development company was sold and Trotter stepped down as president of Litchfield Plantation Co. in March. A month later, he assigned the promissory notes and mortgages to his buyout group, signing the documents as president of the homeowners association.
Court documents show Trotter disputes the election of the new association board. In July, after Circuit Court Judge Larry Hyman ordered Trotter to turn over all the Litchfield Plantation Co. records to the new owner, Trotter filed a motion to intervene in the suit between the homeowners and the development company. Trotter is described as “now or formerly a member of the association.”
Hyman ruled in Trotter’s favor last week over the objections of the homeowners.
The plaintiffs – Joseph E. Johnston, Thomas Eckard, Carol E. Kirby, Robert F. McMahan and Thomas M. Phillips – claim Trotter sought to intervene “to further his defense in a pending criminal action.”
Trotter asked to intervene “to inquire as to the validity of the special meeting and any actions purported to have been taken during the special meeting.”
The homeowners, who are represented by McMahan, argued that Trotter’s motion would delay the proceedings, and that it was unnecessary because the new owner is defending the suit.
Noting that he waited over four months to act, the homeowners say “the only event that has occurred that explains Trotter’s interest in this case is his arrest for grand larceny.”
As a party to the civil suit, the homeowners say he can use the rules of discovery to obtain information for his defense of the criminal charges. At a hearing on discovery motions last week, Hyman said the plaintiffs would be allowed to take Trotter’s deposition. But the plaintiffs say he could invoke his Fifth Amendment right against self-incrimination in the civil suit because of the pending criminal case.
The homeowners also said in a court filing that they may have to assert a claim for $75,000 they say Trotter took from the association in 2008 and $20,000 taken by “his fellow board member” in 2009. Court records show Jeffrey W. Van Treese was the only other association board member during Trotter’s tenure, and he was also voted off in February.
The association got “certain notes that are believed to either be worthless or not executed at all,” the homeowners say.
Judge sets deadline for ruling
By Charles Swenson
During a break in last week’s hearings in Courtroom 3A at the Georgetown County Judicial Center, two workers brought in a ladder and replaced a wall clock that hangs over the door. Down came a simple, institutional clock; up went a wood-framed clock.
Circuit Court Judge Larry Hyman set that clock ticking for attorneys representing the current and former developers of Litchfield Plantation to act in a suit brought by homeowners in March. The five plaintiffs who say they represent the properly-elected board of the homeowners association were in court last week asking for a ruling that would allow them to collect assessments to operate the amenities within the private community.
A ruling in their favor could also impact the new owner of the Litchfield Plantation Co., which would no longer have control over the homeowners association and would have to pay assessments on the undeveloped property.
The homeowners say they were elected to the board at a special meeting in February, at which property owners also ousted the former president of the Litchfield Plantation Co., Scott Trotter, as president of the homeowners association. They want the court to affirm that vote, which Trotter claims is invalid.
Trotter had a buyout agreement with the original developer of Litchfield Plantation, Louise Parsons, that put him in control of the development company. But Parsons sold the property in April to John Miller of DeBordieu, who became president of Litchfield Plantation Co.
Miller hired Mark Neill, an attorney in Murrells Inlet, to defend the homeowners’ suit, but Neill was unable to get company documents from Charles Nation, the company attorney during Trotter’s tenure.
The parties met in Hyman’s chambers July 22, and the judge ordered Nation to turn over the documents by Aug. 17. But the formal order was only signed Aug. 12, and Neill told Hyman at last week’s hearing that the transfer of 20 boxes of records that cover five years had only begun the day before.
Robert McMahan, attorney for the homeowners and one of the association board members elected in February, asked Hyman for a summary judgement that the time, known as the Class B share period, when Litchfield Plantation Co. can either cover the deficit in the association budget or pay an assessment on its property ended Jan. 1. He said Litchfield Plantation Co. has offered no argument that the money has gone unpaid.
“That’s one of the serious issues in this case,” Neill told the judge. It has not been addressed because of “our inability to obtain our company documents from Mr. Trotter.”
Neill said he would like time to review the documents once the transfer is completed, and told the judge he is working with Nation to sort through them.
The issue with the unpaid funds to the homeowners association arose before Neill’s client was involved, he noted. “We’ve got a lot of legal issues that go down that road,” he told the judge.
Financial records show there was a $35,000 surplus in the homeowners association account, Neill said.
McMahan said Litchfield Plantation Co. has offered no proof of that. “They have to come forward and show there’s some factual dispute,” he said.
The homeowners have filed an affidavit from Trotter saying Litchfield Plantation Co. was unable to fund the shortfall or pay an assessment to the homeowners association, which they say ends the Class B share period. Under the deed restrictions for the plantation, the Class B share period gives the company control of the homeowners association by giving it one more vote than all the other owners.
McMahan told the judge they are pressing the issue because the bylaws require an annual meeting to be held in November.
“How long is it going to take?” Hyman asked Neill.
“Not very long,” Neill said.
“I’m going to give you until Sept. 26 to provide me with a counter-affidavit or exhibit,” Hyman said.
The judge said he would rule on the summary judgement motion at the end of that week.
Neill filed a subpoena in May to get the Litchfield Plantation Co. documents. Nation sought to quash the subpoena asking, among other things, for proof that Parsons had sold her interest in Litchfield Plantation. Hyman reviewed sale documents in July before ordering Nation to turn over the documents.
But Nation told Hyman last week one item the judge didn’t address was “the question of my time and effort and expenses.” Nation said he hasn’t been paid for his work for Litchfield Plantation Co.
Hyman asked Neill if the company plans to pay Nation.
“My client bought the company with the plan of restructuring the debt,” Neill said. He doesn’t want to pay debts incurred by the previous owner for legal work.
“Then, Mr. Nation, I would just hand them over and say, ‘Here you are,’ ” Hyman said. If the new owners need help sorting them out, they may be willing to discuss compensation, he said.
Neill also subpoenaed documents from Trotter. Nation said those documents contain propriety information Trotter obtained to develop property at Litchfield Plantation through Trotter’s other businesses. He said Trotter planned to be reimbursed by the Litchfield Plantation Co.
“Litchfield Plantation Co. doesn’t even want to pay me,” Nation said.
“Mr. Trotter was doing a lot of self-dealing,” Neill told the judge, and said he believes Trotter has information that will help defend the suit.
Hyman ruled that Trotter must turn over any documents related to Litchfield Plantation, but said they are only to be used in the lawsuit and must be returned after the litigation.