Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-arwd-2_05-cv-02082/USCOURTS-arwd-2_05-cv-02082-0/pdf.json

Nature of Suit Code: 220
Nature of Suit: Foreclosure
Cause of Action: 28:1332 Diversity-Contract Dispute

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IN TIIE UNITED STATI]S DISTRICT COURT

FOR THE WESTERN DISTRICT Of'ARKANSAS

FT, SMITH DIVISION

LPP MORTGAGE I,TD.

PLAINTIFF,

MID-SOUTH DREDGING COMPANY and

DONALD CITARLNS LINI}, JR.

DEFT,NDANTS

BRENDA S, ALTMA]II, JULIANNE LIND ANd

FIRST NATIONAL BANK OF FORT SMITH

Casc No. 05-?08?

SE,PARATE DEh'ENDAN'I'S

C-O]!SEI{T JUDGMEI{I

on this day, this case came oD to be heard and based upon the pleadings and affidavits on

file hcrein and the aBreemont of the partics, tlte Court finds and detdffiines ds f'ollows:

L t.PI' Mongage is a'l'exas )imiteti liahility partnership with its principal place of

husincss in Plano, Texas.

?. Defentlirnt Mid-South Dredging Company ("Mid-South") is an Arkattsas

corporation with its principal place of business in Ft. Smith, Sebastian County, Arkansas

Dcfcndant Donaid Charles l-ind, Jr. ("Lind") and SeFarate Defendant JuJianne L,ind are residents

of thc State of Florida. Separatc Defendant Brenda S Altman is an individual residont of Ft'

Smith, Sehastian (lounty, Arkarrsas. $eparate lJefendant First National Bank of Fort Smith

("First National") is a national bank with its principal placc of business in Fofi Smith, Scbastian

County, Arkansas.

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3. The property upon which foreclosure is sought is located in sobastian county,

Arkansas.

4. This Court has jurisdiction ovcr this mdttcr under 28 U.S,C. $ 1332, as there ts

completE diversity of citiTenship between the partics and the amouflt in controvefsy excceds

scventy-five thousanrl <tollars ($75,000.00). Vonue propotly lies in this district prttsuanto 28

u.s,c. $ 1392 because tho actio is of rr looal natue and involves properly locatcd sehdstian

County, Arkansas, within the Westem District of Arkansas.

5.Forvaluableoonsiderationandtoohtaiflaloan,Mid-Southexecutedand

delivereti to the Small Business Administration ("SEA") a prornissory Notc dated November 14,

1984, in the origillal principal amount of $350,000.00 and bearing interest at the rate 470 Per

annum (the "Note"). Plaintiff is the cuuent owner dnd holder of thc Note'

6. Conternporaneortsly with the executiofl and delivery of thc Note dnd to secllre

payment of the Note, Lind and Brenda s. Altman (flkla Btenda s. Lind) executed, acknowledged

and dElivorcd to the sBA that Mortgage datcd November i4, 1984 ("Mortgage") covering the

propetly described in the Mortgage including thc following described real property aud

improvements thereon lying in Ft. smith District, sebastian Llo nty, Arkdnsas (the Property

covered by the MortgagE being herein refened to as the "Propeny"):

PART OF'THE S/2 OF THE Nw/4 AND FART OI'THE N/2 OF TIIE

SW/4 OF SECTION 26' TOWNSHIP 9 N(}TTTH OF'RANGE 32 WES'I''

BEING A PART OF LOT 2 OF'BOONE'S SUBDIVISION' DESCRIBEI)

AS: COMMENCING AT THE SOUTHWES'I'CORNER OF SECTION ?6;

THENCE NORTH ALONG THE WEST LINE 'IHEREOF 1350 I'EET;

THENCE EAST 1664'4 FEET; THEN(IE NORTH 0 DEG' 33 MIN IIAST

394.95 }'I]ET TO TTIE NORTII RIGHT-OF-WAY LINE OII.CLAYTON

ITXPRESSWAY FOR THE POINT OF BEGINNING; THENCF) NORTH

5T DEG. 44 MIN. WEST AI,ONG SAID NORTH RIGHT-OF.WAY LINE

524.6 FEN,T; THENCE NORTII O DEG' 33 IVTIN' WEST 675 FEET 1'O

THE SOUTHERLY HIGTI BANK OF THE ARI{ANSAS RIVERi

THENCE SOUTH 55 DEG, 33 MIN. EAST 250 FEET AI,ONG SAII}

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SOUTHERLY HIGH BANKT THENCE SOUTH 69 DEG. rd MIN' EAST

234.9 F'EET ALONG SAID SOUTHERLY HIGH BANKI THENCE

SOUTH O DEG. 33 MIN, WEST 775,3 FEET TO THE POINT OF

BEGINNING. EXCEPT PUBLIC ROADS,

The Mortgage was filed of record in thc Offrce of the Circuit Clerk and Ex-Officio Recorder of

Sebastian Corrnty, Arkansas on Novernber 14, 1984 and re-recorded on November 21, 1984 rn

Record Book 4(i0, Pages 1679-1682. In the Mortgage all rights of redernption afld appraisement

utrder the laws of the State of Arkansas were waived.

1. To further sccurc paymcnt of the Note, Mid-South cxecuted and dolivered to thc

SBA that Secudty Agrccmcnt dated November 14, i984. Thc Security Agreement granted a

security intere$t in the following personal propefly (the "Personalty"):

All equiprnent and machinery, including power-driven machinery and cquipment,

now owned or hereafter acquirod, togother with all replacemEnt$ thereof, all

attachfieflts, acccssorics, pa.rts and tools belonging thereto or for use in

cotrnection therewith,

The securily interests have boon perfected by filings with the Secretary ofthe State of Arkansas

8. To fitrther secure payment of the Note, Lind cxecute.rl and dclivered to the SBA

that Guaranty dated November 14, l!)84 (the "Guaranty") pursuant to which Lind

unconditionally guarantccd payment ofthe indebtedness evidenced by the Note.

9, For valuable considcration and to obtain a loan, Mid-South executed and

delivered to the SBA a promissory Note dated November 14, 1984, in the original principal

arnount of $65,000.00 and beffing interesl at the rate 4% per annum ("Notc Two"). The Note

ancl Note Two are colleotivoly rel'erred to herein as the "Notes."

10. Cofltemporaflcously with the exccution and delivery of Note Two and to seoure

payment of Note'Iwo, I,ind executed, acknowledged arrd delivered to the SBA Lhal MortgaEe

dated November 14, 1984 (-'Morlgage Two") covering the Properly. Moflgage Two was filed of

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record in the Offrce ofthe Cirouit Clerk and Ex-Officio Recordef ofSebastiar County, Afkansas

on November 14, 1984 Record Book 460, Pages 1160-1163. in Morlgage Two, all rights of

redemption and appraisement under the laws of the State of Arkansas were waived. The

Mofigage and Mort8age Two are collcctively referred to herein as the "Moftgages."

I l. To further s€oure payment of Note Two, Mid-South executed arrd delivered to the

SBA that Security Agreement ("Security Agrecment Two") dared November 14, 1984, Thc

Security Agreemcnt grantcd a secr[ity interest in the following personal property (the

"Pcrsonalty Two"):

Maclunery and equipment, exoluding automotive, now owned, hereafler acrluired,

or purchased in whole or in part from the proceeds of this loan, anrVor the

procceds of disposition thereof.

The security interests have been perfected by Iilings with the Secretary of the $tate of Arkansas

desct'ibod abovo. The Security Agrcement arrd Security Agreement Two u'e collectively refenerJ

to herein as tlle "Security Agrccments." The Personalty and Personalty Two are collectively

referred to hereiuafter as the "Personalty."

l?. To furthcr secure palrlerlt of Note'l'wo, l-ind executed and deJivered to the SBA

that Ouaranty dated November 14, 1984 ("Guararrty Two") pursuant to which Lind

unconditionally guarantccd pa)fient of the indehtedness evidenced by Note Two. The Cuaranty

and Guaranly Two are collectively refened to hercin as thc "Guarantees."

13. On or about January 6, 1997, the loau evidenced by Note Two was modified and

extended pursuant to the term$ of that Note Modification and Extension Agreement executed by

Mid-South (the "Modification"). The Modiflcation was recorded with the Circuit Clerk and tLxOfficio Rccorder of Sebastiaa County, Arkansas on March I 1, 1997 in Micro Film Reel No, 6i 6,

Pase 41.

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14. On April 1, 1997, Mid-South filed for protootion under Chapter ll ofthe United

States Bankruptcy Code in Case Number 2:97-70296 in the United States Bankmptcy Coutt for

the westem Distflct of Arkansas, Fort Smith Division.

15. In ccmrection with Mid-South's Chapter 1l bal*ruptoy, Mid-Stale caused to be

filed its Second Amended Plan of Reorganization as Modified (the "lilan") on June 4' l998 The

Ptan was conhrmed hy Order ofthe Unitcd States Bankmptcy Court entered on Junc 4' 1998

16. Under the Plan, the amounts due the SBA were recognized to be $248'534 68

together with accrued interest of $8,960.87 with intsrest accruing al the rflte of four percent (4701

per annum as of tho Plan filing date. Under thc Plan, Mid'South was to begin making quartcrly

palrneflts ifl the amount of1i5,727.85 over a ltfteen yoar period commencing on the first day o1'

the calendat quarter following pal,rnent in full to Mid-South on the Hickman, Kentucky Projcct

11 . The Notes, Mortgages, Security Agteements, the Guarantees artd the other

docunlenls evitlencing ot sccuring the loan evidence by thc Notes were assigned by the SI3A to

Plaintiff pursuant to those Assignment of Notcs and Liens recorded with the Circuit Clerk and

Ex-tlfficio Recorder of Sebastian County, Arkansa-s, Fort Smith District on Novembtx 19, ?001

as Documeflt Number 7057883 and on December 5, 2001 as Dooument Number 7059314.

18. Mid-South has defaulted in its obligations under the Notes and the Plan nnd

Plaintitf previously exercised its rights to acoeJerate lhe amounts due in connection with the loan

cvidcnccd by the Notes and the Plan. Plaintiffs right to foreclose the Mortgages as wcll as

exercise its rights under the iflstruments sccuring the Notes has hecomc absolute

19. The parties have agced, subjeot to Mid-South's and Lind's right td setisfy the

judgment hereinafter described for a lesser amouflt, that the amount rlue under the Notes fot

purposes of tliis judgment is $370,256.02. By virtue ofthe Notes, the Mortgagcs, the Security

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Agreements, the Guarantees afld the other doouments securing the Notes, Plaintiff has a lien

upon the I'roperty and the Personalty which is first, paramount and prior to the right, title, claim,

lien and intcrcst of all others.

20. As a re$ult ofthe above described default Plaintiffis entitled to recovet jur'lgment

ln rern against thc Propcrty and the Porsonalty and il persoflam against Mid-liouth rurd Lind,

.iointly and severally, in the arnount of $370,256.02 and to tbreclosc its intcrc$ts in the rEal afld

personal propefly securing Notes, subject however, to Mid'South's and Lind's right to satisfy thc

judgment for a lesser amount set forth below,

21. Separate Defendants Brcnda S. Altman (f/k/a Brenda S. Lind) and Julianne Lintl

may claim an interest in the Property or the Personalty by virtue of their status as the cufieflt or

former spouses ofLind. A-try interest ofJulianne Lind in ard to the Property and the Personalty

is subordinatc and inferior to the interests of Plaintiff in the Proporty and thc PersonaltyScparate Defendant Brenda S. Altrnafl has disclaimed any interest in the Property and the

Personalty pursuaflt to thal Disclailner of Interest filed in this nrattut and is hereby dismisscd

liom this action,

23. Separate Defurdant First National may olaim an in interest in thc Propetty or the

Personalty by virtue of verious mortgages, security agreements and assigrumcnts of rents

including, without limitation, the following: (a) LICC Financing Statement filed for record on

April 3, I 985 and recorded under UCC No. 8 5-599 in the records of Sebastian Coullty, A-rkansas;

(b) Mortgagc datod October 6, 1980 and filed for record October 13, 1980 in Book 413, Page

1783 of the records of Sebastian Corrnly, Arkansaseturing the original amounl of$137,604 1l;

(c) Morlgage dated July 1, 1981 and filed for record July 28, l98l in Book 423, Page 908 of the

rccords of Sebastian County, Arkansas securing thc original arnount of $118,4?1.32, said

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Mortgage modified by Modilication Agrcement executed by Don C. Lind d/bia DDC

Enterprises, rccorded in Book 582, Fagc 193 of the records of Sebastian County, Arkdnsas flnd

Modification Agreement exeoutod hy Mid-Sorrth Dredging, Inc., recordcd in Book 582' Page I95

uf the records of Sebastian County, Arkan$as; (d) Morlgage dated October 9, 1993, filed for

record November 3, 1993 in Book 5S4, Page 212 of the records of Sebastian County, Arkansas

socuring the original amount of $622,866.32, being comprised of two flotes in the amount$ of

$507,739.17and$115,127,15,saidMortgagere-tecordedinBook5E4,Pagel26loftherecords

of Sebastian County, Arkansas; (e) Mortgage dated November 17, 1993, filed for record on

Novcmber 19, 1993 in Book 585, Page 33 ofthe records of Sebastian County. Arkansa$ secunng

the original amount of $3()0,000.00; (f) Mortgage dated October 18, 1995, filed for record on

February 12, 1997, in tsook 634, Page 1876 of the records of Sebastian County, Arkansas

securing the original amount of $283,542.79; (g) UCC Financing Statement fltlcd for record on

July 25, 1997 in Book (r42, Page 909 of the records ofSebastian Corrnty, Arkansas; (h) Mortgage

datetl May 20, 2005 and recorded on May 31,2005 as Document No. 7163381 ofthe rccords of

Sebastian County, Arkansasecuring thc original amount of$196,834,92; and (i) Assignment of

Rcnts dated May 20, 2005, filed for record on May 31, 2005 as Document No. 7163382 of thc

rccords of Sebastian County, Arkansas. Any intetest claimed by lirst National in and to the

Pruperty and the Personalty is subordinatc and inferior to the interests oll Plaintiff in and to the

Property and the Personalty.

IT IS, THEREFORE, ORDERED ADJI.IDGED AND DECREED as follow:

A. Plaintiff shall have and recover judgrnent against Mid-South and Lind, jointly and

severally, and, in lem against the Property and thc Personalty in the amount of $370,256.0?. T.lte

ahounts awarded under this Jutlgment shall bear interest at the rate of 8.75% per annum.

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B. Pursu:rnt to thc a$oement of the Pafiies, Mid-South and Lind shall havo the right

to satisfy this judgment by paying the sum of $270,000.00 in accordance with the following

terms and conditionsl (i) Mid-South and Lind shall deliver to Plaintiff within the thirty (10)

riays from the date of this judghcnt the sum of $30,000.00 in good f'unds; (ii) Mid'South and

Linrl shall dcliver to Plaintiff within onc (1) year from the dete of this judgment, the rtdditional

sum of $240,000.00 plus interest accrued and unpaid fiom and after the last inslilllfirent of

interest paid all in good funds; (iii) intelest shall accruc on the $?a0,000.00 at the rate of four

pcrcent (4sld per annum ftom and after the date of this judgrnent with pal'rnents ofl accrued

interest due Plaintiff in good funds on March 1, 2007, June I, 2007, Septembfi 4, 2()07 and thc

iinal interost payment due on thc date which one (l) year from the date ofthisjudgment; and (iv)

Lind shall pay all real estate taxes due with respecto the Propctty. In the ovent ofany defatrlt in

thc forcgoing pflyment obligations, this paraEgaph shall bo ofno furthcr force and effect and the

fulI amount ofthejudgrncnt set forth in paragraph A shall bc duc and payable less any credits for

any arnounts paid pursuanto this paragraph.

C. The ftrregoing judgment by virtue of the Mortgages and Security Agreemenls

constitutes the first and prior liens on the I'toperLy and the Pcrsonalty and are superior to all other

ipterests held or claimetl in and to the Property and the Personalty including without litnitation,

any and all interests clairnod by the Defe dants and Soparate Defcndants, all rights or

possibilities ofdower or homestead, appraisement, any rights ofredcmption and the rights oi any

and all pcrsons claiming under the foregoing.

D. tJpon thc earlier of: (i) a failure to perform the obligations under paragraph B

above; or (ii) onc (l) year from the ddte of this Judgment, the Llircuit Clerk of Scbastian County,

Arkansas, who is horehy appoiflled Comtnissioner, shall sell the Froperty and thc Personalty d1

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the door of the Sebastian County Courthousc in Fort Smith, Arkansas, at public auction, to the

highcst biddcr, the date and hour ofsuch sale to bc fixed by said Commissioner. Upon such sale

all rights, titles, iflterests, Estates and equity or possibilities of dower, redemption, curtesy,

homestead or appraisement of the Defendants and Separate Defendants in the Property and thc

Personalty, or any one claiming by, through or under them shall bc forccloscd and forcver

barrcd.

D. The Commissioner will give notice of such sale once a week for at least four (4)

consecutive weeks prior Lo the sale in at lcast one nevr'spaper regularly issued and of genctal

circulation in Sebastian County, Arkansas, where the Propcrty and the Personalty are situated.

E. The Property and the Personalty shall be sold on a credit of thirty (30) days; the

purchaser will be required to exccute a bond, with a commercial corporatc surety, bearing

intcrcst ftorn the date of sale until paid at the rate oflen percent (10%) per arnum, the payneht

of said purchase pnce to be secwed by a lien upon the purchased property; provided, however,,

that if the Plaintiff becomes thc purclnser at the sale for an amount not in exccss of its judgment,

inlerest and costs hereih, in Iieu of giving bond, it may credit the amount of its trid, less the cost

of these proceedings, including the Clommissioner's f'ee, on the judgment herein rendered at the

tinre of oonfirmation of such sale, which credit shall bc an extinguishmcnt of its judgment wjth

respecto the Property and the Personalty to the extent ofsuch credit; and provided further thaL if

its bid shall excced the amount of the Judgtrent, interest and costs, it should be required to give

bond only for the overplus. Any such overplus ftom thc salc of thc Propcrty afld thc Pcrsonalty,

over and above the Plaintiffs Judgment, intcrest, and costs shall be paid over to the registry of

the court and anyone who claims an equitablc or legal interest in and to all or a portion of thc

ovcrplus shall petitiofl the Court for a determination of each party's priority of interest and

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aliquot shares or proration, if any, thereunto raid surplus. Should any suooeesful bidder fail to

perfbrm under the instructions of the Commissioner at tinre of sale, then that bid shall be vojd

and sct aside. Thc Commissioner thereafter shall find that the Proporty and the Personalty bc

awarded to the next successive higher bidder, until perforrnance is rerrdcrcd.

l. Srtch sale of the Property and the Fcrsonalty shall constitute a perrnanent bar to

and shall forcclosc all rights of rcdemption, dower, curtcsy, homestead zurd appraisernent and all

other riglrt, title, claim and interest in the Property which llefendants and Separate Defendants,

as well as theit heirs, porsonal representatives, sucoessors or assigns or anyone claiming b'

through or undor the forogoing, may olaim with respeot to the Property and the Fersonalty.

G. The Commissioner will reDorto the Court all actiorm taken hersunder.

IL h the event the Judgment herein awarded is not paid as directed afld thc Propetly

and the I'ersonalty are sold by the Commissioner at a foreclosure sale, thcn upon application to

the Clerk of this Court by the successful foreclosure sale purchaset, or the purchaser's attorney,

showing that the possession of the purchased properly has been withheld frorn such purchaser,

the Clerk will issue and delivcr forthwith to the Shcrilf of Sebastian Ciounty, Arkansas, a Writ of

Assistancc to enforce dclivcry ofpossession ofthc purchased property to the purchaser.

Based upon her Disclaimcr of lnterest, Scparatc Defendant Brencla S. Altman is

hereby dismissed from this action.

IT IS SO ORDHRED.

wrsl**sHDJflffifrcno*?5ft sns

Nov? | ffi

(,'llf\lii it. "l ill$llt{, CLEBK

]Y

DEFIITY ILFI{(

STATES DISTRICT JUI]GE

DArE: -_1+I l-Zt'Ato

1 0

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ll-20-2!06 03,37Pt1F ROI,I.IiA RI1ER , Sl|ITH. & HARRIS ATTORIIEYS

AOBEED:

PRYO& ROBERTSON & BARRY, PLLC

P. O, Drawer 848

Fort Smith, Arkanses 72902-0848

Ben T. Barry, #73005

,{rronreys./or Mid*So uth Dr edgi ng Co nparry,

Donald Charles Lind, Jr. and Jullanne lind

FRIDAY, ELDREDGE &CLARK, LLP

400 West Capitol, Suite 2000

Lirtle Rock AR 72201

Harry A. Light, #89222

Attorneys for LPP Mortgage Lrd,

WARNER, SMITH & I-IARzuS PLC

P. O. 8ox 1625

4797820841

By:

By'

#911 r6

for First National Bank ol Fttrt Smith

T-4er p,00?/00? FEs0

Case 2:05-cv-02082-RTD Document 39 Filed 11/21/06 Page 11 of 12 PageID #: <pageID>
0v.20. 2 0 No, liir --F 2-p_0. .,el

A9&EED;

PRYOR, RQBERTSON &BARRY, PLLC

F. O. I)r,rw* 848

Fort limith, ArkirflFe-e 72902-0848

sy,- :Uaq -64^a*tIten'1. rlarry. #?1005 U 

t

Attrtrntys lbr Mitl-South Drdgtug Company,

Do ahl (hi cr Lihd, Jr. and Julianne Lind

itttttttvy:t Jor LPP Morlgdgt l,td.

WAJLNER, SMTTH & IIA&RIS PL(]

P. O. Box 1626

Itod Smith, AR 7?902

KathryD A. Stockt, #91 I 16

Attonrcys for I'irtt Nat.ional Bank oJ fort Smith

Friday, Eldrcdgc & cluk, I.I.P

400 Wc$l Capitgl, Suift 2000

Litle Rock,r!ff ??201

By:

Harfr VLiEhr#8q222

l2

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