Hidden Ridge, Citizen reach deal in $1.6M lawsuit
TRAVERSE CITY – Citizens Bank has dropped its $1.6 million lawsuit against Hidden Ridge Development LLC in Peninsula Township after the parties reached an undisclosed out-of-court settlement.
Frederick Bimber, the Traverse City attorney who represented the investment firm, declined to offer details on the deal, adding only that the matter "has been resolved."
The suit had been heading toward a hearing before Circuit Court Judge Philip E. Rodgers Jr. in June after Citizens Bank submitted a motion for a summary judgment in the matter.
The bank had charged that co-defendants Joseph Zimmers, his wife Janet Zimmers, Ronald Williamson and Randall Williamson, all area residents, were responsible for repayment of a $1.5 million Hidden Ridge loan, plus other expenses, since they had personally guaranteed it.
In its complaint, Citizens also said that Hidden Ridge failed to make its principal payments of nearly $270,000 in December 2005 and June 2006. The bank loaned the money to the firm on Jan. 3, 2005.
Zimmers, a Hidden Ridge principal, formed the firm in 2001, and its 26-acre project in the township's southeast corner won approval from township trustees that same year. Its building sites, ranging in size from about a half acre to a full acre, were billed as "private, pristine lots" offering a "a beautiful bay view."
At one point, Bimber argued in recent filings that the "the mortgaged lots have a value greater than the debt on which the plaintiff is suing."
"The plaintiff has the mortgage collateral it bargained for at the outset of this loan," he wrote in one of his filings. "There is no imminent risk of loss or nonpayment to the plaintiff that somehow requires a 'rush to justice.'"
That argument about the value of the property found some support when Hidden Ridge received an offer to buy one parcel for $110,000 right in the midst of the court proceedings earlier this spring.
"The defendants have offered that the net proceeds of that sale be applied entirely to the plaintiff's debt," Bimber wrote. "The net amount is such that a series of similar sales of the remaining mortgaged lots would fully pay the amount claimed by the plaintiff." The sale was allowed to proceed.
Coldwell Banker Schmidt is currently listing 15 lots, ranging from about $90,000 to $126,000 in price, advertising their municipal water and sewer and deeded access to East Bay as selling points. Based on the listings, the total value of available Hidden Ridge lots is $1,950,000. BN