h Inners Settlement

8/10/2019 h Inners Settlement

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UNITED STATES BANKRUPTCY COURT

SOUTHERN DISTRICT OF FLORIDA(WEST PALM BEACH DIVISION)www.flsb.uscourts.gov

In re: Case No. 11-33802-BKC-PGH

THOMAS G. HINNERS,

Debtor. /

Chapter 7

ORDER PURSUANT TO BANKRUPTCY RULE 9019 APPROVING COMPROMISE

AND SETTLEMENT OF CONTROVERSY BETWEEN CHAPTER 7 TRUSTEE,

DEBTOR, BRIAN HINNERS, CERTAIN OTHER ADVERSARY DEFENDANTS,AND JEROME MANSKE, PATRICK MANSKE AND ARGENT CORPORATION

THIS CAUSE having come before the Court for hearing on December 8, 2014 at 1:00 p.m.

pursuant to Federal Rule of Bankruptcy Procedure 9019 upon the Chapter 7 Trustees Amended

Motion to Approve Compromise and Settlement of Controversies Between the Chapter 7 Trustee,

the Debtor, Brian Hinners and certain other Adversary Defendants,1 Jerome Manske, Patrick

Manske and Argent Corporation (the Motion) [ECF No. 719]; that due and proper notice of the

Motion having been given by the Trustee in accordance with the applicable provisions of the

1Capitalized terms not otherwise defined herein shall have the meaning ascribed to such terms in the

Motion.

ORDERED in the Southern District of Florida on December 9, 2014.

Paul G. Hyman, Jr.Chief United States Bankruptcy Judge

_____________________________________________________________________________

Case 11-33802-PGH Doc 746 Filed 12/09/14 Page 1 of 18


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Bankruptcy Code and the Federal Rules of Bankruptcy Procedure, and that no further notice of the

Motion is necessary; and it appearing that the Trustee, the Debtor, Brian Hinners and certain other

Adversary Defendants, Jerome Manske, Patrick Manske and Argent Corporation through their

respective counsel, have conferred and reached an agreement as to the issues raised in the

Adversary Proceedings, the Amended Objection and Motion and all other matters between the

parties; and the Court having reviewed the Motion, the terms of the Settlement Agreement and

having heard the arguments and representations of counsel for the parties; having considered the

Limited Objection to Trustees Amended Motion to Approve Compromise and Settlement of

Controversies Between Chapter 7 Trustee, Debtor, Brian Hinners, and Certain Other Adversary

Defendants, Jerome Manske, Patrick Manske, and Argent Corporation [ECF No. 742]; and, upon

consideration of the factors set forth in Wallis v. Justice Oaks II, Ltd.(In re Justice Oaks II, Ltd.),

898 F.2d 1544 (11th Cir. 1990), the Court finding that the proposed Settlement is fair, reasonable,

and in the best interests of the estate; and being otherwise duly advised in the premises, it is hereby:

ORDERED THAT:

1. The Motion is GRANTED as set forth herein.

2. The terms of the Settlement Agreement attached hereto as Exhibit Aare approved

and incorporated herein in their entirety.

3. Brian Hinners confirms and represents to the Court that the Settlement Proceeds

will not be paid with funds from Groves of Delray II Ltd., other than from allowed distributions in

accordance with Paragraph 4.2 of the Amended and Restated Agreement of Limited Partnership

of Groves of Delray II, Ltd. dated December 8, 2011. In the event that this representation is

breached, after notice and a hearing, Brian Hinners will be required to indemnify the estate for any

damages it sustains. Any prevailing party moving under this paragraph shall be entitled to its

reasonable attorneys fees and costs.



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4. Any and all claims relating to the real property with a location address of 10625 El

Paraiso Place, Delray Beach, Florida 33446 (Parcel Control Number: 00-42-43-27-05-067-0372)

(the Subject Property) filed by or relating to Jerome J. Manske, Patrick H. Manske and/or Argent

Corporation shall be deemed released, satisfied, and or discharged from the foregoing real

property. As such, if needed, Jerome J. Manske, Patrick H. Manske and/or Argent Corporation

shall assist and cooperate with providing any documents reasonably needed to the closing agent

including:

a. Satisfaction of or Release of the Subject Property from Judgment against Thomas

G. Hinners in favor of Jerome J. Manske and Patrick H. Manske recorded in O.R.

Book 23965, Page 1649, and Affidavit of Creditor recorded in O.R. Book 23965,

Page 1647, Public Records of Palm Beach County, Florida.

b. Satisfaction of or release of the Subject Property from Judgment against Thomas

G. Hinners in favor of Jerome J. Manske and Patrick H. Manske recorded in O.R.

Book 24387, Page 1630, and Affidavit recorded in O.R. Book 24387, Page 1628,together with Discharge of Lis Pendens, as to subject property, recorded April 5,

2011 in O.R. Book 24442, Page 435, and release of Subject Property from that

certain Case No. 502011CA004893XXXXMB in the Circuit Court of Palm Beach

County, Florida.

c. Record satisfaction of or release of the Subject Property from that certain Final

Judgment recorded in O.R. Book 7728, Page 987, and Affidavit of JudgmentCreditor in O.R. Book 7728, Page 985, Public Records of Palm Beach County,Florida.

5. The Court reserves jurisdiction to interpret and enforce the terms of the Settlement

Agreement and of this Order, and further reserves jurisdiction to enforce the terms of the

Settlement Agreement.

###

Submitted by:

Nicole Testa Mehdipour, Esquire

Law Office of Nicole Testa Mehdipour, PA

200 East Broward Blvd. Suite 1110

Fort Lauderdale, FL 33301

(Attorney Mehdipour shall serve a copy of the signed Order on all interested parties and file with the

Court a certificate of service conforming with Local Rule 2002-1(F)).



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Case 11-33802-PGH Doc 719 Filed 10/14/14 Page 21 of 37Case 11-33802-PGH Doc 746 Filed 12/09/14 Page 5 of 18

TIIOMAS

G.

HINNERS,

Debtor.

UNITED ST TES B NKRUPTCY COURT

SOUTHERN

DISTRICT OF FLORID

WEST P LM

BE CH

IVISION

CASE NO. 1133802-PGH

CHAPTER?

SEJTLEMENT GREEMENT

This Agreement is entered into

as

the result

of

mediation held

on

Friday, September 4, 2014

among Nicole Testa Mehdipour, Trustee ( Trustee ), Tom Hinners ( T. Hinners and/or Debtor ),

Auburn Development, LLC ( Auburn Development ), Auburn Management, Inc. ( Auburn Mgmt'' ),

Auburn Trace, Ltd. ( Auburn Trace ), Brian Hinners ( B. Hinners ), Groves of Delray, Ltd.

( Groves ), Village

of

Delray Ltd. ( Village ) and Walden Pond, Ltd. ( Walden'') (collectively the

Adversary Defendants ) AND Jerome Manske and Patrick H Manske (hereinafter Manskes ) and

Argent Corporation ( Argent ).

PROCEDURE ND

F CTU L

HISTORY

. On September 24, 1987, Manskes obtained a judgment against T. Hinners in the state

ofWisconsin, Case Number, 652-696.

2. Subsequent thereto, the Manskes attempted

to

domesticate that judgment

in

the state

of Florida under Case Number: 93-7358-AH, in the Circuit Court

in

and for Palm Beach County,

Florida (the Florida Action ).

3. The Florida Action resulted in an order

on

October 13, 1994 ruling that the Wisconsin

judgment was unenforceable

in

florida, on statute

of

limitations grounds.

4.

On or about May 17, 1995, Manskes filed a motion with the Wisconsin

e 0urt

seeking

to

renew the judgment under Wisconsin law. On or about February 11, 1997, the Wisconsin court


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entered a renewed judgment in favor o the Manskes

and

against T. Hinners in the. amount o

239,354.10,

plus

interest at 12% per annum,

from June

18, 1987.

5 In or about May of2010, the Manskes conveyed to Argent the right to collect on the

subject judgment.

6.

In or about September, 2010, Argent filed amotion with the Wisconsin court to renew

the judgment under Wisconsin law. On

or

about January

24,

2011, the Wisconsin court renewed the

judgment against T.

Hinners in

favor o Manskes/ Argent

for

collective

damages

in the amount of

878,463.25. On or about March 3, 2011, Manskes/Argent recorded the

2011

judgment

in

the state

o

Florida.

7.

On

or about April

1, 2011

T. Hinners filed

a

Notice o Lis Pendens and Complaint to

Stay

Foreign Judgment in

the 15'

circuit court

in

and

for Palm Beach

County,

Case Number:

50201

ICA004893XXXXMB.

8.

On

or about August 26,

2011

Argent

filed

an involuntary bankruptcy petition against

T. Hinners which is the case at bar. T. Hinners initially contested the involuntary petition until March

2,

2012

at

which time

T.

Hinners

filed

a

motion

to

convert the case to

a

case

under Chapter

11. The

order for reliefwas granted on March 5, 2012 (ECF

59).

9.

Extensive litigation

and

motion practice continued during the Chapter i l between

Argent, the Manskes and the Debtor, which included two appeals to the District ourt (Case

Numbers: 9:12-CV-80684-KMW and 9:12-CV-80930-KAM).

10.

On or about August 30, 2012, T. Hinners filed a complaint against Argent and the

Manskes, Adversary Case Number: 12 1872.

11. On or about October 24, 2012, T. Hinners filed a motion to reconvert the case to

Chapter?.


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12. On or about October 30, 2012, the bankruptcy court entered an order re-converting

the case (ECF No. 399). On October 31, 2012, Nicole TestaMehdipour was appointed as the Chapter

7 Trustee (ECFNo. 401), and became the pennanent Trustee

in

the case after

the

341 Meeting was

held and concluded.

13.

On

or about Janumy 28, 2013, Argent filed an adversary proceeding against T.

Hinners (Case Number: 13-1077).

14. The rwo adversary proceedings - Hinners

vs

Argent and Argent vs. Hinners were

consolidated for

trial

15.

On

or about July 31, 2013 the court granted partial summary judgment

on

the

counts

under 11 U.S.C. 523 detennining the debts were non-dischargeable. The court deferred ruling on

whether the judgment was enforceable based upon the 1994 circuit court action and referred the matter

back to the state court for determination, which matter is still pending.

16

An appeal was taken to the U.S. District

Court

Case Numbers: 13-80900,

and

13-

80901. These appeals were consolidated into Case Number: 9:13-CB-81297-KAM . An order

affinning the bankruptcy court's judgment was entered on

May

19, 2014.

17. An appeal was taken to the

11th

Circuit Court

of

Appeals, Case Number: 14-12693,

which matter is still pending.

18. On or about February 3, 2014, the Trustee filed an Objection to Debtor's Claimed

Exemptions and Scheduled Valuation ofProperty and Motion for Turnover of

Estate

Property (ECF

No. 609), and subseqnently filed an Amended Objection to Debtor's Claimed Exemptions and

Scheduled Valuation

of

Property and Motion for Turnover

of

Estate Property (ECF No. 616) (the

Amended Objection/Motion ).

19. n or about February 20, 2014, and March 5, 2014, the Trustee filed multiple


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adversary proceedings against insiders o T. Hinners (the Adversary Defendants ). These

adversaries include: Trustee v. B. Hinners (14-1207); Trustee v Walden (14-1261); Trustee v Groves

(14-1262); Trustee v Auburn Trace (14-1273); Trustee v Auburn Development (14-1264); Trustee v

Auburn Mgmt (14-1265); Trustee v Village (14-1270) (collectively, with the. Amended

Objection/Motion, the Trustee Contested Matters ).

20. All o he Trustee Contested Matters remain pending.

21. During the Chapter 11 case, a mediation was held between

T.

Hinners

and

Argent,

which proved unsuccessful.

22.

On or about July

18,

2014, a mediation was held between the Trustee and all o the

parties

to

this agreement, other than Argent, and the Manskes, which resulted in an initial settlement

being reached (ECF

No.

688). A motion to approve that settlement was initially filed before the

bankruptcy court

and

objections were filed by Argent and the Manskes (ECF

No.

696).

23. There are CtJrrently still multiple motions requiring evidentiary hearings before the

court betwet. ll all parties to this agreement.

24.

In

an

effort

to

globally resolve all

_pending

actions, contested motions and litigation

before this court and all other courts, the parties held a global mediation on September 4,

2014.

This

mediation lasted over eight hours. Coupled with the preccdiug mediations, the Agreement that was

reached on September th is a culmination o over

20

honrs o mediated time.

SETI LEMENT TERMS

25. In consideration o he promises

and

mutual covenants and WJdertakings contained

herein

and

other good and valuable consideration,

the

receipt

and

sufficiency

o

which

is

hereby

aclrnowledged by the parties, the parties agree to the following

t rms

a11d conditions as full and


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complete

settlement o ll ctions between all of the p rties wherever located

as

set forth in

more det il below

a. B. Hinners shall pay

to the

Trustee the total

sum

o Seven HW1dred

Thousand Dollars ($700,000.00) in

complete and total

settlement

o

ll claims asserted or that could

have

been asserted in

all

Trustee Contested Matters set forth above ( Settlement Proceeds'').

b. The Settlement Proceeds shall be paid s

follows:

1)

bree

Hundred

Thousand Dollars ($300,000.00) upon approval o

he

Settlement Agreement

by

the bankruptcy

court;

2)

Fifty-Thousand Dollars ($50,000.00)

on

or before January 1, 2015; 3) Three Hundred

Fifty-Thousand Dollars ($350,000.00)

on

or before March 1, 2015.

c.

In

addition to

the

above, B. Hinners and/or T. Hinners shall make payments

directly to Argent/Manskes ( Manske Payments''),

c/o

o their

attorney,

Allison Friedman, totaling

One Hundred Thousand

Dollars

($100,000.00) on the following schedule: 1) Twenty-Five

Thousand Dollars ($25,000.00) upon approval

o

he Agreement by the

bankruptcy

court; 2)

Twenty-Five Thousand Dollars ($25,000.00) on or before

March

1, 2015; 3) Twenty-Five

Thousand

Dollars ($25,000.00)

on

or before December 31,

2015;

4) Twenty-Five Thousand Dollars

($25,000.00) on or before the later

o

June l, 2016

or

upon distribution by

the

bankruptcy Trustee of

the

proceeds o he estate, pursuant

to

a Trustee's Final Report ( TFR ) it is contemplated in this

Agreement that this payment may come from a

partial

assignment o a Chapter 11 administrative

claim, as will be described herein).

d. Upon payment o he initial installment of the Settlement Proceeds, the

Trustee shall

dismiss all o

he adversary proceedings against

the

Adversary Defendants, with

prejudice, each party bearing its

own

attorney's

fees

and costs associated with the adversary

proceedings and exchange general releases

o

any and

ll claims

between the Trustee and the


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j.

The Adversary Defendants proofs of claim numbered

18, 19,

20, and

21

are

disallowed.

k. The parties

agree

to a

One HlUldred Thousand

Dollar

( 100,000.00)

carve-

out from the estate for

payment

to

Argent. Argent shall otherwise

participate

with the other general

unsecured

creditors in

distributions by

the

estate.

l. Upon payment o he initial instalhnent ofthe Settlement Proceeds,

T.

Hinners shall receive his

discharge. The

Trustee

may

seek to

revoke the

discharge if

there is

any

default in

making

the remaining

installments of

he Settlement Proceeds.

m.

Upon

payment

of

he

full

Settlement

Proceeds,

all

assets

listed on T.

Hinners

bankruptcy schedules (excluding

those

assets which were previously turned over to the

Trustee

and liquidated) shall

be

adjudicated exempt and any non-exempt assets may

be

transferred

to B.

Hinners.

n. Upon payment of he initial installment of the Settlement Proceeds, the

Trustee

shall submit a proposed greed Order resolving

the Amended

Objectioll/Motion

and

requesting

that

the

Court

reserve

and

retain jurisdiction

to

enforce the

terms

of this

settlement

Agreement as provided for herein.

o.

All parties

to

this agreement stipulate that they have reviewed any filed

administrative claims and

are

aware

of

he amounts

of

he un-filed administrative claims and will

not file

objections to any administrative claims herein; provided, however, the Trustee

may,

in her

discretion, object to/seek to

modify

the amount offees sought by the professiOllals

she

engaged.

p.

Any

and all pending

motions

between the

parties

not otherwise

specifically

delineated

herein shall

be

either withdrawn or

denied.


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q. Any and all payments to Argent/Manskes under this agreement, including

distributions as a general unsecured creditor, shall not exceed Four Hundred Thousand Dollars

( 400,000.00) collectively.

r. n the event

that

Argent receives or will receive

in

excess

of

Four Hundred

Thousand Dollars ( 400,000.00), the first Twenty-Five Thousand Dollars ( 25,000.00)

of

any

amount

in excess

of

Pour

Hundred

Thousand Dollars ( 400,000.00) shall be offset against

the final

payment owed

by

T. Hinners to Argent. The next Twenty-Five Thousand Dollars ( 25,000.00)

of

any

excess to be received

by

Argent will be credited to the estate.

Any arnoWlts

thereafter shall be

oftSet

again:>'

the

obligations

of

he

estate and Hinners on a pro-rata

basis.

s.

n the event that Argent receives in

excess of

Four

HWldred

Thousand

Dollars

( 400,000.00) owing to

the

timing

of he

payments,

it

shall remit any such excess to

the

parties

Wlder

the fonnula set forth above.

t. n the event that Argent does not receive a combined Four Hundred

Thousand Dollars ( 400,000.00) from payments under this agreement, Les Osborne

and

the firm

of

Rappaport Osborne Rappaport,

P.L.

agree to assign

up

to 25,000.00

of

heir Chapter

11

administrative claim as payment directly to Argent on the TFR. n the event this payment is made,

the

final

payment

due

from T. Hinners directly

to

Argent, on or before June

1,

2016, will be deemed

satisfied.

u

In the event

of

any defaults on any

of

he payments of the Settlement

Proceeds or

Manske

Payments

as

provided herein, the Trustee and/or Argent/Manskes

shall

provide

notice

to

Les

Osborne at [email protected] and [email protected]

and

Brad Shraiberg

l

[email protected]

AND by calling Les Osborne at 561-368-2200 and Brad Shraiberg l

561-

443-0800.


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v. T.

Hinners, B. Hinners and/or any Adversary Defendant

sh lll

have five

(5)

business days from receipt

of

notice to cure ny default.

n

the event the

default

is

not cured,

judgment

sh lll

be entered against B. Hinners and

T.

Hinners, jointly and severally, in the amolUlt of

One

Million Dollars ($1,000,000.00), less credit for any payments made

out of he

settlement, in

favor of

he Trustee.

w

n addition

to

the above, Argent/

Manskes

shall be entitled

to a

non-

dischargeable

judgment

against

T. Hinners for

the amolUlt

set

forth

in their

claim,

11-1 less any

payments made under the Settlement.

x. This

agreement

is subject to

approval by the

bankruptcy court n the

event

the

bankruptcy

court does not approve this

Settlement,

nothing contained herein shall be deemed a

representation or admission by any party.

y. The court shall reserve jurisdiction to enforce the tenns of this

Settlement.

26.

This agreement was prepared

and

approved by counsel for all parties herein

and

there will be

no

presumptions

against the

drafter.

27.

t ls

the

h1tent

of

this

agreementto

settle

all issues

between

all parties het'llin and in

the

event

any specific

action

or proceeding

has

not

been

specifically set forth, the parties shall

acl

to

resolve that action or

proceeding

to the intent of his agreement.

28.

This

Agreement

may be signed in cotmter-parts.

~ ; ~

T. Hinners _/ ..

Les

Osborne

/


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B Hinners (mdividually

and

as authorized agent

o Adversary Defendants)

z ~ ~

Jerome

Manske

PatrickH a n s k ~

Argent

Allison

Friedman

Nicole TestaMehd pour,

Trustee

Michael Foster

RlckReyes


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B.

Hi Ulers

(individually

and

as

authorized

agent

of

Adversary

Defendants)

Brad Shraiberg

.'crome

Manske

Argent

_ t J ~

Allison

Friedman

Nicole Testa Mehdipour, Trustee

Michael Foster

Rick Reyes


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B.

Hinners

individually

and

as

authorized agent

o

Adversary Defondants

Brad

Sb.raiberg

Jerome

Manske

Patrick H Manske

Argent

Allison Friedman

Nicole

Testa

Mehdipour, Trustee

Michael Foster

Rick Reyes


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B.

Hirmers

individually and

as

authorized agent o

Adversary

Defendants

Brad

Shraiberg

Jerome

Manske

Patrick H

Manske

Argent

Allison

Friedman

Nicole Testa

Mehdipour,

Trustee

Michael Foster

Rick Reyes


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B.

Hinners

individmuly

and

as

authorized

agent

of

Adversary

Defendants

Brad Slm1iberg

Jerome Manske

Patrick H

Manske

Argent

Allison Friedman

Rick

Reyes

h Inners Settlement

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