According to an article in the Dallas Morning News, real estate investors who say commercial real estate broker Henry S. Miller Commercial has refused to pay $9 million in court judgments against him and they are seeking to force the broker into bankruptcy.
The article said:
“The case revolves around the planned sale of eight apartment complexes and one office building owned by the BNC Real Estate affiliates. Miller Commercial, one of Dallas’ best-known private real estate firms, was acting as agent for the prospective buyer of the properties, Connecticut resident James Flaven. When Flaven failed to complete his purchase, the sellers sued him and Miller Commercial for damages. Attorney Stanley said that Flaven “was actually a truck driver” who didn’t have the resources to make the purchase.”
The circumstances of this forced bankruptcy attempt sound very similar to one of the major factors that caused the foreclosure crisis. During the real estate boom many ordinary citizens with little capital were persuaded that they could become wealthy by purchasing property on leverage (credit). Some of them weren’t quite able to put together the right amount of loans for their purchases but many were able to get the credit regardless of their asset values and many of those people eventually faced foreclosure and bankruptcy.
In this particular case, Miller is fighting the forced bankruptcy which he says was done in “bad faith” and he is waiting on the court of appeals in hopes that they will overturn the money judgments against him.