HomeMy WebLinkAboutItem T2 Liz Yongue
From: Gomez-Krystal <Gomez-Krystal@MonroeCounty-FL.Gov>
Sent: Tuesday, May 20, 2025 2:29 PM
To: Ballard-Lindsey; County Commissioners and Aides; Kevin Madok; Senior Management
Team and Aides; Liz Yongue; InternalAudit
Cc: Shillinger-Bob; Williams-Jethon; Cioffari-Cheryl; Livengood-Kristen; Rubio-Suzanne;
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Subject: ADD-ON Item T2 05/21/2025 BOCC Meeting
Attachments: AIS 4057.pdf
Good afternoon,
Please be advised,the following Add On Item is set for inclusion day-of meeting prior to the approval of the Agenda:
"Approval of a resolution authorizing the County Attorney to execute a settlement agreement with the U.S. Bankruptcy
Trustee in Case Adv. No. 25-4-rmb and Case No. 22-11191-rmb under which the County would reduce its code compliance
lien in Code Compliance Case CE20010126 against a property on Duck Key by$45,000 in consideration of the Trustee for
offsetting its claim for$45,000 against the County arising out of satisfaction of a SHIP mortgage on a property in Key
West in an adversarial proceeding against a common debtor named Bernard Seidling."
The Agenda Item Summary is attached.Once approved,this will be considered Add On Item T2.
Sincerely,
)V,rystaC crovuez
Executive Administrator
Monroe County Administrator's Office
1100 Simonton Street,Suite 2-20S
Key West, FL 33040
Office:30S-292-4441
Cell:30S-8SO-8694
Courier Stop#1
Notary Public
www.ri"ioriroeco�,,iirity.-fu..gov
gorriez..kry:st,, 1.@ri"ioriroeco�,,iirity..-fl..gov
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BOARD OF COUNTY COMMISSIONERS
COUNTY of MONROE Mayor James K.Scholl,District 3
The Florida Keys Mayor Pro Tern Michelle Lincoln,District 2
Craig Cates,District 1
David Rice,District 4
Holly Merrill Raschein,District 5
Board of County Commissioners Meeting
May 21, 2025
Agenda Item Number:
2023-4057
BULK ITEM: No DEPARTMENT: County Attorney
TIME APPROXIMATE: STAFF CONTACT: Kelly Dugan
AGENDA ITEM WORDING: Approval of a resolution authorizing the County Attorney to execute
a settlement agreement with the U.S. Bankruptcy Trustee in Case Adv. No. 25-4-rmb and Case No. 22-
11191-rmb under which the County would reduce its code compliance lien in Code Compliance Case
CE20010126 against a property on Duck Key by $45,000 in consideration of the Trustee for offsetting
its claim for $45,000 against the County arising out of satisfaction of a SHIP mortgage on a property in
Key West in an adversarial proceeding against a common debtor named Bernard Seidling.
ITEM BACKGROUND:
The County initiated Code Compliance case CE20010126 against the property located at 132 North
Indies Drive, Duck Key, initially owned by King Street Family Ltd. Partnership ("Duck Key
Property"). The Duck Key Property changed ownership several times but with the same underlying
representative, Bernard Seidling. The County initiated foreclosure litigation to enforce the code
compliance lien which was imposed in CE20010126,Monroe County v. Bernard Seidling and Jay Hall
as Trustee of Jay Hall Irrevocable Trust, 23-CA-249-M.
Bernard Seidling filed a petition for relief under Title 11, United States Code, in the United States
Bankruptcy Court for the Western District of Wisconsin, Case No. 22-11191-rmb. Due to the
bankruptcy case, automatic stay provisions pursuant to 11 USC 362 apply to the County's foreclosure
case, and 23-CA-249-M has been stayed accordingly.
In a separate foreclosure matter,Regions Bank v. Griffith, 22-CA-322-K, Monroe County was listed as a
defendant due to an outstanding SHIP mortgage for the property located at 303 Grinnell Street, Unit
404B, Key West("Key West Property"). Following a foreclosure sale, Monroe County received
$45,000 of surplus funds to satisfy the SHIP mortgage. The County's lien against the Key West
Property was released since it had been satisfied.
An adversarial proceeding, Adv. No. 25-4-rmb, was initiated by the Chapter 7 Trustee against Bernard
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Seidling, Jay Hall as trustee of the Jay Hall Irrevocable Trust, and those parties that received funds
disbursed in 22-CA-322-K, including Monroe County. The complaint alleges that Bernard Seidling
submitted the winning bid in the foreclosure sale of the Key West Property as Kang Street LP and in
payment thereof transferred property of the bankruptcy estate. The Trustee is seeking to recover all
funds disbursed, including the $45,000 issued to Monroe County.
Another adversarial proceeding, Adv. No. 24-50-rmb, has been filed by the Trustee, seeking in part to
recover the ownership interest of the Duck Key Property for the bankruptcy estate. Monroe County is
not a party to this action.
The Trustee is attempting to sell the Duck Key Property, subject to the curing of the code compliance
violations and judgment from the bankruptcy court in Adv. No. 24-50-rmb determining the Duck Key
Property belongs to the bankruptcy estate.
The Trustee has offered the County a settlement in Adv. No. 25-4-rmb and Case No. 22-11191-rmb
with the following terms:
1) Monroe County would agree to reduce the code compliance lien in CE20010126 against the Duck
Key Property by $45,000.
2)In exchange, the Trustee would agree not to seek the return of the $45,000 issued to Monroe County
in 22-CA-322-K, currently a subject of Adv. No. 25-4-rmb.
3) The Duck Key Property will be brought into compliance prior to its sale by the Trustee.
The amount of the fine in CE20010126 as of May 14, 2025, is $145,300.00, and continues to accrue at
$100 per day as the case remains non-compliant. The costs as of May 14, 2025, are $15,681.43.
The County may amend its answer in Adv. No. 25-4-rmb to seek an equitable claim against the
bankruptcy estate, allowing the County to seek recovery of the $45,000 upon sale of the Key West
Property by the estate.
The Resolution will authorize the County Attorney to enter into the proposed settlement agreement, and
further allow the County Attorney to direct outside counsel to do so on his behalf. The Resolution will
authorize the County Attorney to reduce the code compliance lien arising from CE20010126 by $45,000
in consideration of the proposed settlement agreement.
PREVIOUS RELEVANT BOCC ACTION:
11/08/23: Closed session for Monroe County v. Bernard Seidling and Jay Hall as Trustee of Jay Hall
Irrevocable Trust, 23-CA-249-M.
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05/17/23: Approval for litigation as to Duck Key property.
INSURANCE REQUIRED:
No
CONTRACT/AGREEMENT CHANGES:
N/A
STAFF RECOMMENDATION: Approval
DOCUMENTATION:
Reso DGW settlement.pdf
FINANCIAL IMPACT:
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Resolution No. - 2025
A RESOLUTION OF THE BOARD OF COUNTY
COMMISSIONERS OF MONROE COUNTY FLORIDA
AUTHORIZING THE COUNTY ATTORNEY TO ENTER A
SETTLEMENT AGREEMENT IN CASE ADV. NO. 25-4-RMB
AND CASE NO. 22-11191-RMB AND TO REDUCE THE LIEN
IN CODE COMPLIANCE CASE CE20010126.
Whereas, the County initiated Code Compliance case CE20010126 against the
property located at 132 North Indies Drive, Duck Key, initially owned by King Street Family
Ltd. Partnership ("Duck Key Property"). The Duck Key Property changed ownership
several times but with the same underlying representative, Bernard Seidling; and
Whereas, the County initiated foreclosure litigation to enforce the code compliance
lien which was imposed in CE20010126, Monroe County v. Bernard Seidling and Jay Hall
as Trustee of Jay Hall Irrevocable Trust, 23-CA-249-M; and
Whereas, Bernard Seidling filed a petition for relief under Title 11, United States
Code, in the United States Bankruptcy Court for the Western District of Wisconsin, Case
No. 22-11191-rmb; and
Whereas, due to the bankruptcy case, automatic stay provisions pursuant to 11
USC 362 apply to the County's foreclosure case, and 23-CA-249-M has been stayed
accordingly; and
Whereas, in a separate foreclosure matter, Regions Bank v. Griffith, 22-CA-322-
K, Monroe County was listed as a defendant due to an outstanding SHIP mortgage for
the property located at 303 Grinnell Street, Unit 404B, Key West ("Key West Property").
Following a foreclosure sale, Monroe County received $45,000 of surplus funds to satisfy
the SHIP mortgage. The County's lien against the Key West Property was released since
it had been satisfied; and
Whereas, an adversarial proceeding, Adv. No. 25-4-rmb, was initiated by the
Chapter 7 Trustee against Bernard Seidling, Jay Hall as trustee of the Jay Hall Irrevocable
Trust, and those parties that received funds disbursed in 22-CA-322-K, including Monroe
County. The complaint alleges that Bernard Seidling submitted the winning bid in the
foreclosure sale of the Key West Property as Kang Street LP and in payment thereof
transferred property of the bankruptcy estate. The Trustee is seeking to recover all funds
disbursed, including the $45,000 issued to Monroe County; and
Whereas, another adversarial proceeding, Adv. No. 24-50-rmb, has been filed by
the Trustee, seeking in part to recover the ownership interest of the Duck Key Property
for the bankruptcy estate. Monroe County is not a party to this action; and
Whereas, the Trustee is attempting to sell the Duck Key Property, subject to the
curing of the code compliance violations and judgment from the bankruptcy court in Adv.
No. 24-50-rmb determining the Duck Key Property belongs to the bankruptcy estate; and
Whereas, the Trustee has offered the County a settlement in Adv. No. 25-4-rmb
and Case No. 22-11191-rmb with the following terms:
Monroe County would agree to reduce the code compliance lien in CE20010126
against the Duck Key Property by $45,000.
In exchange, the Trustee would agree not to seek the return of the $45,000 issued
to Monroe County in 22-CA-322-K, currently a subject of Adv. No. 25-4-rmb.
The Duck Key Property will be brought into compliance prior to its sale by the
Trustee.
Whereas, the amount of the fine in CE20010126 as of May 14, 2025, is
$145,300.00, and continues to accrue at $100 per day as the case remains non-
compliant. The costs as of May 14, 2025, are $15,681.43; and
Whereas, the County may amend its answer in Adv. No. 25-4-rmb to seek an
equitable claim against the bankruptcy estate, allowing the County to seek recovery of
the $45,000 upon sale of the Key West Property by the estate.
Now therefore, be it resolved by the Board of County Commissioners of
Monroe County, Florida that:
1. The above-stated recitals are incorporated herein as findings of fact.
2. The Board of County Commissioners hereby authorizes the County Attorney to
enter into the proposed settlement in Adv. No. 25-4-rmb and Case No. 22-
11191-rmb as outlined herein. The County Attorney may direct outside counsel
to do so on his behalf.
3. The Board of County Commissioners hereby authorizes the County Attorney to
reduce by $45,000 the currently accruing code compliance lien arising from
CE20010126, which the County is seeking to recover in 23-CA-249-M in
consideration of the settlement agreement reference in and authorized by
Paragraph 2.
PASSED AND ADOPTED by the Board of County Commissioners of Monroe County,
Florida, at a regular meeting held on the 21 st day of May, 2025, held in Key West, Florida.
Mayor James K. Scholl
Mayor Pro Tem Michelle Lincoln
Commissioner Craig Cates
Commissioner David Rice
Commissioner Holly Merrill Raschein
(SEAL) BOARD OF COUNTY COMMISSIONERS
Attest: KEVIN MADOK, Clerk OF MONROE COUNTY, FLORIDA
By: By:
As Deputy Clerk Mayor
Approved for form and legal sufficiency
5/19/25
Kelly Dugan
Assistant Monroe County Attorney