Tuesday, April 15, 2008

Structured Equity responds to O'Sullivan lawsuit

O'Sullivan Industries officials failed to live up to their part of the agreement causing a deal for Structured Equity Advisors to buy the Lamar plant to fall through, according to a counterclaim filed today in U. S. District Court for the Western District of Missouri:

This is an action about O’Sullivan’s attempt to circumvent its responsibilities under a Real Estate Purchase Agreement (the “Agreement”) with SEA and take $1,500,000 in earnest money deposited by SEA pursuant to the Agreement. O’Sullivan failed to honor the terms of the Agreement by: a) failing to maintain the property located at 1900 Gulf St., Lamar, Missouri (the “Premises”) in good and safe condition; b) failing to procure for SEA a lease agreement from Burlington Northern Railroad Company on substantially similar terms to its own lease with Burlington Northern; and c) failing to proceed with a trustee’s sale as required by the Agreement.

The counterclaim was filed by Robert F. Duncan, Inc. also known as Structured Equity Advisors. At one point, the court documents said, the O'Sullivan building was in good shape, but that changed when O'Sullivan officials removed large items from the equipment from the building. "Many of these items of equipment were bolted, secured, or otherwise fastened to the floors, walls, and/or ceilings on the Premises before being removed, including many instances in which the equipment was installed such that it penetrated or was a part of the structure of the wall itself.
As a result of O’Sullivan’s, or O’Sullivan’s agents’, removal of these items of equipment, all of which occurred after the Inspection Period, significant damage was sustained by the Premises.

The counterclaim continued, "This damage included, but was not limited to, large holes in the walls of the Premises; a large number of holes in the roof and ceilings of the Premises; extensive damage to piping and window systems; and extensive leaking and exposure of the Premises to the elements. These damages were especially pronounced where the dust collection system had been located on the Premises, resulting in large gaps and holes in the structure of the Premises. This damage to the roof and ceiling resulted in more than 500 identifiable leaks in early February 2008, when a walk through by the eventual tenant, Polymer-Wood Technologies, Inc., was conducted with Steve Standley, a local contractor. Mr. Standley performed repairs on the Premises for several years during O’Sullivan’s ownership of the Premises. Mr. Standley estimated that as of February 14, 2008, repairs to cure the damages caused by the removal of equipment from the Premises would total more than two million dollars."

Duncan is asking for the $1.5 million in escrow money.

Information about the initial lawsuit can be found in the March 14 Turner Report.


Anonymous said...

The SEA is one guy out of California, and it appears that his financing / cash fell through. Evan Daniels of Polymer-Wood doesn't even own a home in Dallas, Collin or Tarrant County and his firm as of the present time is still a virtual firm with no assets and no bricks and mortar. Frankly, Lamar, probably dodged a bullet on this.

Anonymous said...

Funny how Standley is still trying to suck blood from the corpse!