Saturday, November 18, 2017
Business

Judge throws out $458,000 condo sale, says Clearwater attorney tricked bidders

RECOMMENDED READING


CLEARWATER — Pinellas County Circuit Judge Jack St. Arnold on Monday threw out the $458,100 sale of a gulf-front condo because of what he called an "unscrupulous" and "conniving" scheme to trick bidders at a foreclosure auction.

His ruling means that the owners of Orlando Realty Group will get back the money they bid on what turned out to be a second mortgage held by a company connected to Clearwater attorney Roy Skelton. Only later did the bidders discover that a different lender had a superior first mortgage and could soon foreclose, leaving them with no condo and out nearly a half million dollars.

While he rapped Orlando Realty for not doing sufficient due diligence before bidding, St. Arnold had especially harsh words for Skelton.

"Clearly you set a trap for unwary buyers," the judge said.

Skelton said after the hearing that he would either sell the unit in the Ram-Sea Condominiums on North Redington Beach or try to pay off the first mortgage.

"While I respectfully disagreed with the judge's decision, I will respect it and will not file an appeal," Skelton said.

PREVIOUS COVERAGE: Florida couple stunned to learn $458,000 paid for gulf-front condo may be for nothing

Two years ago, Skelton's Outbidya, Inc. paid $157,8000 for the condo at a homeowners association foreclosure auction. Last year, shortly after Wells Fargo began foreclosing on the first mortgage, Skelton created Deutsche Residential Mortgage — no relation to the giant German bank — and took back a second mortgage from Outbidya.

In February, while Wells Fargo's case dragged along, Skelton's Deutsche obtained a final judgement of foreclosure on its second mortgage and set the stage for the contested June auction.

The sole witness at Monday's hearing — which was held on an emergency motion to set aside the sale — was John Houde, who owns Orlando Realty Group with his wife.

Houde testified that he thought the auction involved a first mortgage because the only lis pendens initial notice of foreclosure — he saw was filed by Wells Fargo. Before bidding, he said, he reviewed public records including the docket in the bank's case.

"I've done quite a number of these," Houde said, referring to online foreclosure auctions. "This (review) is to make sure which mortgage is foreclosing."

But under questioning from Skelton, Houde acknowledged that he had not read the entire final judgment, which showed that Deutsche Residential held the mortgage being foreclosed. Skelton also accused Houde of committing fraud by indicating in the online auction process that he had thoroughly read all documents in the case even though he had not.

"He comes with unclean hands," Skelton said.

Skelton and Matthew Weidner, one of Houde's lawyers, traded sometimes dense legal and technical arguments in the 90-minute hearing — which included a brief recess to watch the eclipse. But another of Houde's attorneys, Jon McGraw, was more straightforward in his remarks.

"It's a very cunning plan by Mr. Skelton and his group," McGraw said and one in which Orlando Realty "stands to lose a substantial amount of money."

Before ruling, St. Arnold said Houde's company had failed to do its due diligence "in a competent manner," and added that he had little sympathy for bidders at foreclosure auctions who "pick on the bones" of people who lost their homes.

But, calling it a case of "complicit versus conniving," the judge said in effect that he found Skelton's actions much more egregious. The mortgage company Skelton set up "was not a legitimate lender," St. Arnold said, and its sole purpose was to further a scheme to reap "an unconscionable profit."

PREVIOUS COVERAGE: Another Pinellas foreclosure auction fools bidders, raises questions

Skelton, who conceded that his Deutsche Residential never made a single loan, is involved in a similar case in which a person thought he was bidding on a first mortgage on a Largo townhome owned by another of Skelton's companies. That buyer forfeited a $5,000 deposit rather than go through with the $112,000 purchase.

Despite the judge's criticism of him, Houde was relieved to be getting his money back.

"You shouldn't be allowed to create a scheme to defraud buyers," he said.

Contact Susan Taylor Martin at [email protected] or (727) 893-8642. Follow @susanskate

 
Comments
Parents, children welcome downsized MOSI in Tampa

Parents, children welcome downsized MOSI in Tampa

TAMPA — Avery, 6, slid his sneakers up the side of 200-pound rubber tire from the space shuttle Columbia and sat on top.His father, Ilder Jeannot, called for him to get off of it — usually climbing on museum displays is frowned upon. But in the new M...
Updated: 29 minutes ago
Sunday Conversation: Tona Bell invites customers to enjoy a ‘digital detox’

Sunday Conversation: Tona Bell invites customers to enjoy a ‘digital detox’

Like so many small businesses, Saturday will represent a special day for Paper Seahorse owner Tona Bell. Bell’s cozy bungalow business at 211 S Howard features paper and stationery, specialty pens, vintage typewriters and crafts classes. It will offe...
Updated: 5 hours ago
Florida jobs recover from Irma, unemployment rate drops

Florida jobs recover from Irma, unemployment rate drops

As economists predicted, the tough hit that Florida jobs took from Hurricane Irma was not long-lived. The state added 125,300 jobs in October, almost breaking even from the 127,400 jobs it lost in September. According to state figures released Friday...
Published: 11/17/17
Apple will postpone release of  HomePod

Apple will postpone release of HomePod

The Washington PostApple said Friday that it’s pushing back its plans for a Siri-powered smart speaker until sometime early next year.The HomePod speaker was announced in June, with an initial launch date set for December. Apple said that its smart s...
Published: 11/17/17
HSN, Good Housekeeping pick five contest finalists

HSN, Good Housekeeping pick five contest finalists

ST. PETERSBURG — Good Housekeeping and St. Petersburg-based HSN have chosen five finalists for their entrepreneur competition. The partners are searching for a novel item to promote as endorsed by the Good Housekeeping Seal, denoting reliability and ...
Published: 11/17/17
Trigaux: State of Tampa Bay startups? Disconnected we falter but there’s a plan to fix that

Trigaux: State of Tampa Bay startups? Disconnected we falter but there’s a plan to fix that

How are we doing?That was the Big Question posed more than once this past week in Tampa Bay. First, the Tampa Bay Partnership and USF debuted in-depth and new ways to measure Tampa Bay across a wide range of indicators to gauge whether we are gaining...
Published: 11/17/17
Tesla’s latest creation: An electric big rig that can travel 500 miles on a single charge

Tesla’s latest creation: An electric big rig that can travel 500 miles on a single charge

The main course was expected: a pair of sleek silver Tesla semi-trucks that get 500 miles per charge, go from zero to 60 mph in five seconds and — if the hype is to be believed — promise to single-handedly transform the commercial trucking industry.B...
Published: 11/17/17
We ask Tampa Bay startup leaders how best to advance entrepreneurial ecosystem

We ask Tampa Bay startup leaders how best to advance entrepreneurial ecosystem

What one thing could be added to the Tampa Bay startup community to help it grow and prosper?The Tampa Bay Times reached out to these leading area entrepreneurs and startup experts for answers.RELATED COVERAGE: Trigaux: State of Tampa Bay startups? D...
Published: 11/17/17
Before you hit the mall: here are some key holiday shopping hours

Before you hit the mall: here are some key holiday shopping hours

Plotting a shopping strategy for the holiday weekend? Here’s a look at holiday store opening hours for some major retailers:Thanksgiving8 a.m.: Kmart1 p.m.: JCPenney4 p.m.: GameStop5 p.m.: Best Buy, Macy’s, Toys "R" Us, Kohl’s6 p.m.: Old Navy, Target...
Published: 11/17/17
Electric, autonomous vehicles featured at Tampa auto show

Electric, autonomous vehicles featured at Tampa auto show

TAMPA — The two biggest trends in the automotive space are ones you’ve likely heard of: electric vehicles and autonomous cars. Both will feature prominently at the Tampa Bay International Auto Show today through Sunday. The event at the ...
Published: 11/17/17