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Collins alleged in the lawsuit that the “buyout provisions”
of the partnership agreement, which allowed for a liquidation of
a partner’s interest on the basis of the appraised values of
HCMP’s assets, were not applicable but that the applicable
provisions were those in paragraph 12 of the partnership
agreement. Collins also alleged that Sunroad Asset was not
allowed by the partnership agreement to distribute the marina to
itself or to an entity under its control but had to sell the
marina in the public market and divide the net proceeds among the
partners in accordance with their applicable percentages as set
forth in the partnership agreement.
On November 18, 1998, Sunroad Asset, in its capacity as a
general partner of HCMP and Sunroad limited partnership, formally
assigned the rights, title, and interest in the marina lease from
HCMP to Sunroad limited partnership. The document underlying
this assignment was not executed by either Collins or the Port
District. Approximately 3 weeks later, on December 8, 1998,
Sunroad Asset sent to Collins a check for $389,662; i.e., the
amount that Sunroad Asset maintained was the value of Collins’s
interest in HCMP as ascertained using the aforementioned
appraised value of the marina. Collins did not cash this check
upon receipt but deposited it with the trial court pending
resolution of the lawsuit.
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