Utah County developer Gary Brinton will not challenge a move by Wells Fargo Bank to pursue foreclosure proceedings against his real estate empire, to seek payment on some $47 million in defaulted loans.
Brinton appeared in U.S. Bankruptcy court in Salt Lake Friday for a hearing on a motion for relief from stay, filed by Wells Fargo Bank. Other creditors, including Wells Fargo Bank, have sought to force Brinton into involuntary bankruptcy in an effort to collect on millions of dollars worth of debt. According to court records, Key Bank and Bank One claim Brinton also owes them millions of dollars in default loans.
Typically when a bankruptcy claim is filed a judge orders a stay on all property, essentially freezing any pending court claims or financial actions. Attorneys for Wells Fargo said they wanted to continue to pursue foreclosure action against Brinton's properties, while being party to the bankruptcy action.
Brinton owns the popular Seven Peaks Water Park and Trafalga, which are also in foreclosure. He also owns several Utah County apartment complexes and housing developments, which are entangled in a complex straw-buyer scheme.
According to a lawsuit filed against Brinton in 4th District Court by Wells Fargo, Brinton colluded with three bank insiders to defraud the bank using 499 residential loans totaling $47 million.
In court Friday, Brinton's attorney Charles Hannah, said the developer's bankruptcy attorney dropped Brinton last week and he (Hannah) was not prepared to challenge Wells Fargo attorneys.
Judge Glen Clark said the law required a ruling within 30 days of the motion being filed. Hannah said Brinton had tried to hire another bankruptcy attorney to represent him but many are affiliated with the banks he has issues with.
In a separate hearing, Clark ruled Thursday that Brinton can maintain control of his assets for the time being. Several creditors have requested Brinton's assets be placed with a trustee. Clark said he found evidence that Brinton was trying to put his affairs in order, although he said he had serious doubts whether Brinton would be able to pull himself out of debt.
Given the circumstances Friday, Hannah said Brinton would not challenge Wells Fargo Bank. Wells Fargo attorneys said they plan to seek other avenues to collect on Brinton's debt, including foreclosures and civil suits. Brinton continues to have no comment in the matters.
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