Newest Federal's Lawsuit Implicates Eddy Benoit in $2,456,472.45 Commercial Real Estate Loan Default

Case 7:12-cv-00019-HL Document 1
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IN THE UNITED STATES DISTRICT COURT FOR THE MIDDLE DISTRICT OF GEORGIA VALDOSTA DIVISION BANK OF THE OZARKS, Plaintiff, v. AMBLING GROVE HOLDINGS, LLC, AMBLING COMPANIES, INC., AMBLING DEVELOPMENT HOLDINGS, LLC, MICHAEL H. GODWIN, RHETT J. HOLMES, R. RYAN HOLMES, EDDY BENOIT AND KENNETH BLANKENSHIP, Defendants. ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) )
Civil Action File No. __________________
COMPLAINT Plaintiff Bank of the Ozarks (Plaintiff or the Bank) hereby files its Complaint against Defendants Ambling Grove Holdings, LLC (Ambling), Ambling Companies, Inc. (ACI), Ambling Development Holdings, LLC (ADH), Michael H. Godwin (Godwin), Rhett J. Holmes (Rhett Holmes), R. Ryan Holmes (Ryan Holmes), Eddy Benoit (Benoit) and Kenneth Blankenship (Blankenship) (collectively, the Defendants), showing this Court as follows:
I. PARTIES, JURISDICTION, AND VENUE 1. Plaintiff is a banking entity created under Arkansas law and having its
principal place of business located in Little Rock, Arkansas. 2. Ambling is a limited liability company organized and existing under
the laws of the State of Georgia. Ambling may be served through its registered agent, Michael H. Godwin, at 348 Enterprise Drive, Valdosta, Georgia 31601, or otherwise in accordance with applicable law. 3. Ambling Companies, Inc. is a corporation organized and existing
under the laws of the State of Georgia. Ambling Companies, Inc. may be served through its registered agent, Michael H. Godwin, at 348 Enterprise Drive, Valdosta, Georgia 31601, or otherwise in accordance with applicable law. 4. Ambling Development Holdings, LLC is a company organized and
existing under the laws of the State of Georgia. Ambling Development Holdings, LLC may be served through its registered agent, Michael H. Godwin, at 348 Enterprise Drive, Valdosta, Georgia 31601, or otherwise in accordance with applicable law. 5. Michael H. Godwin is an individual and resident of the State of
Georgia. Mr. Godwin may be served with process at his home address of 3018 Wendover Road, Valdosta, Georgia 31602, or wherever he may be found. 2
6.
Rhett J. Holmes is an individual and resident of the State of Georgia.
Rhett Holmes may be served with process at his home address of 4842 Oak Arbor Drive, Valdosta, Georgia 31602, or wherever he may be found. 7. R. Ryan Holmes is an individual and resident of the State of Georgia.
Ryan Holmes may be served with process at his home address of 2519 Jerry Jones Drive, Valdosta, Georgia 31602, or wherever he may be found. 8. Eddy Benoit is an individual and resident of the State of Georgia. Mr.
Benoit may be served with process at his home address of 3858 Spalding Wood Drive, Norcross, Georgia 30092-2629, or 2170 Heathermoor Hill Drive, Marietta, Georgia 30062, or wherever he may be found. 9. Kenneth Blankenship is an individual and resident of the State of
Georgia. Mr. Blankenship may be served with process at his home address of 610 Hampton Bluff Lane, Alpharetta, Georgia 30004-3075, or wherever he may be found. 10. Pursuant to 28 U.S.C. 1332, the Court has subject matter jurisdiction
over this action because complete diversity exists between the parties and the amount in controversy exceeds the sum or value of $75,000.00, exclusive of interest and costs. Specifically, the Bank is a banking entity created under Arkansas law and having its principal place of business located in Arkansas. 3
Ambling is a Georgia citizen because it is created under Georgia law, has its principal place of business in this State, and, upon information and belief, is not owned by any individual or entity which is a citizen of Arkansas. Ambling Companies, Inc. is a Georgia citizen because it is created under Georgia law, has its principal place of business in this State, and, upon information and belief, is not owned by any individual or entity which is a citizen of Arkansas. Ambling Development Holdings, LLC is a Georgia citizen because it is created under Georgia law, has its principal place of business in this State, and, upon information and belief, is not owned by any individual or entity which is a citizen of Arkansas. Godwin is a Georgia citizen because he is domiciled in Georgia. Ryan Holmes is a Georgia citizen because he is domiciled in Georgia. Rhett Holmes is a Georgia citizen because he is domiciled in Georgia. Eddy Benoit is a Georgia citizen because he is domiciled in Georgia. Kenneth Blankenship is a Georgia citizen because he is domiciled in Georgia. As shown below, the amount in controversy exceeds the sum of $75,000.00. Accordingly, jurisdiction is proper under 28 U.S.C. 1332. 11. Pursuant to 28 U.S.C. 1391(a), venue is proper in this Court
because, inter alia, a substantial part of the events or omissions giving rise to the Banks claim occurred in the Middle District of Georgia. Pursuant to L.R. 3.4(b), 4
venue is proper in the Valdosta Division of this District because a substantial part of the events or omissions giving rise to the Banks claim occurred in Lowndes County, which is in the Valdosta Division, and because certain of the Defendants, as identified above, reside in the Valdosta Division. II. FACTUAL BACKGROUND The Note 12. On or about September 20, 2010, Ambling executed and delivered a
Promissory Note in favor of The Park Avenue Bank (PAB) in the principal amount of $2,456,472.45 as a renewal of prior indebtedness (hereinafter the Note). A true and correct copy of the Note, with Allonge, is attached hereto as Exhibit A and is incorporated herein by reference. 13. The Note obligates Ambling to timely pay PAB, or PABs successor,
all amounts due under the Note, including principal, interest, and other charges due and payable thereunder (collectively, the Indebtedness). 14. The Note further provides for payment of the costs and expenses of
collection of the Indebtedness, including court costs and fifteen percent (15%) of the remaining principal plus accrued interest as attorneys fees under O.C.G.A. 13-1-11.
15.
Amblings repayment and performance under the Note is guaranteed
through that certain Guaranty executed and delivered by Ambling Companies, Inc. on September 20, 2010 (the ACI Guaranty). A true and correct copy of the ACI Guaranty is attached hereto as Exhibit B and is incorporated by reference herein. 16. Amblings repayment and performance under the Note is guaranteed
through that certain Guaranty executed and delivered by Ambling Development Holdings, LLC on September 20, 2010 (the ADH Guaranty). A true and correct copy of the ADH Guaranty is attached hereto as Exhibit C and is incorporated by reference herein. 17. Amblings repayment and performance under the Note is guaranteed
through that certain Guaranty executed and delivered by Michael Godwin on September 20, 2010 (the Godwin Guaranty). A true and correct copy of the Godwin Guaranty is attached hereto as Exhibit D and is incorporated by reference herein. 18. Amblings repayment and performance under the Note is guaranteed
through that certain Guaranty executed and delivered by R. Ryan Holmes on September 20, 2010 (the Ryan Holmes Guaranty). A true and correct copy of the Ryan Holmes Guaranty is attached hereto as Exhibit E and is incorporated by reference herein. 6
19.
Amblings repayment and performance under the Note is guaranteed
through that certain Guaranty executed and delivered by Rhett J. Holmes on September 20, 2010 (the Rhett Holmes Guaranty). A true and correct copy of the Rhett Holmes Guaranty is attached hereto as Exhibit F and is incorporated by reference herein. 20. Amblings repayment and performance under the Note is guaranteed
through that certain Guaranty executed and delivered by Eddy Benoit on September 20, 2010 (the Benoit Guaranty). A true and correct copy of the Benoit Guaranty is attached hereto as Exhibit G and is incorporated by reference herein. 21. Amblings repayment and performance under the Note is guaranteed
through that certain Guaranty executed and delivered by Kenneth Blankenship on September 20, 2010 (the Blankenship Guaranty). A true and correct copy of the Godwin Guaranty is attached hereto as Exhibit H and is incorporated by reference herein. The ACI Guaranty, ADH Guaranty, Godwin Guaranty, Ryan Holmes Guaranty, Rhett Holmes Guaranty, Benoit Guaranty and Blankenship Guaranty are referred to collectively as the Guarantees. 22. The Note is secured by that certain Real Estate Deed to Secure Debt,
Assignment of Rents and Security Agreement (With Future Advance Clause) from 7
Ambling, as grantor, to PAB, dated May 26, 2005, recorded in Deed Book 17562, Pages 21-43, DeKalb County, Georgia Superior Court records as may have been modified, amended, and assigned (the Security Deed). The Security Deed provides for protective advances and other amounts paid by PAB to protect its collateral position to be added to the principal balance and collected as part and parcel of the Indebtedness. A copy of the Security Deed is attached hereto as Exhibit I and is incorporated by reference herein. 23. 24. Plaintiff has made protective advances for property taxes for 2011. During the pendency of this action, Plaintiff may advance and pay ad
valorem taxes, insurance premiums, and other costs to protect its security interest in the collateral. In the event such costs are paid by Plaintiff, Plaintiff is entitled to reimbursement therefore in accordance with the terms of the Security Deed and other Loan Documents. 25. PAB extended funds in excess of $75,000.00 to Ambling subject to
the terms of the Note. 26. disbursed. 27. Ambling is in default under the terms of the Note for failure to make Ambling received and has enjoyed the use of the funds that PAB
payments on the Note when due. ACI is in default under the terms of the ACI 8
Guaranty for failure to make payments on the Note when due. ADH is in default under the terms of the ADH Guaranty for failure to make payments on the Note when due. Godwin is in default under the terms of the Godwin Guaranty for failure to make payments on the Note when due. Ryan Holmes is in default under the terms of the Ryan Holmes Guaranty for failure to make payments on the Note when due. Rhett Holmes is in default under the terms of the Rhett Holmes Guaranty for failure to make payments on the Note when due. Benoit is in default under the terms of the Benoit Guaranty for failure to make payments on the Note when due. Blankenship is in default under the terms of the Blankenship Guaranty for failure to make payments on the Note when due. Transfer of Loan Documents to Bank of the Ozarks 28. On or about April 29, 2011, the Georgia Department of Banking and
Finance closed PAB, and the Federal Deposit Insurance Corporation was appointed receiver thereof. 29. The Federal Deposit Insurance Corporation as receiver for PAB
(FDIC-R), succeeded to all rights, titles, powers, and privileges of PAB, pursuant to 12 U.S.C. 1821(c)-(d). As such the FDIC-R stood in the shoes of PAB with respect to all matters.
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30.
Also on or about April 29, 2011, the FDIC-R and Bank of the Ozarks
entered into a Purchase and Assumption Agreement (the Purchase Agreement) whereby Bank of the Ozarks purchased for value and took physical possession of the loan documents at issue in this action. Plaintiff remains in possession of the original Note, Guarantees, Security Deed, and related Loan Documents. 31. On or about April 29, 2011, the FDIC-R, acting through its duly
appointed attorney-in-fact, executed that certain Assignment (effective by its terms April 29, 2011) which is recorded in Deed Book 22485, at Pages 415-427, DeKalb County, Georgia, Superior Court records, evidencing the transfer of the Note and all related Loan Documents at issue in this action to Bank of the Ozarks effective as of (the Assignment). A true and correct copy of the Assignment is attached hereto as Exhibit J and is incorporated by reference herein. 32. In Bank of the Ozarks purchase of the assets of PAB from the FDIC-
R, the FDIC-R completely transferred any and all interest it had in the Note and related Loan Documents involved in this action to Bank of the Ozarks. Bank of
the Ozarks is the holder of the Note and related Loan Documents at issue in this action with all rights to enforce same.
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Notice of Default 33. Ambling breached its obligations under the Note by failing to make
payments on the Note when due. 34. On or about December 29, 2011, the Bank provided written notice of
the default to Defendants under the terms of Note and Guarantees with notice that the Bank intended to enforce the attorneys fees provisions of the Loan Documents pursuant to O.C.G.A. 13-1-11. A true and correct copy of the December 29, 2011 letter is attached hereto as Exhibit K and is incorporated by reference herein. 35. On or about January 6, 2012, the Bank made certain protective
advances for real property taxes under the Security Deed in the total amount of $19,719.00 (Protective Advance). Defendants are hereby notified that unless the full amount of 19,719.00, plus accrued interest thereon, is paid in full within ten (10) days from the receipt of this Compliant, Defendants are required to pay additional attorneys fees on the Protective Advance in accordance with O.C.G.A. 13-1-11 and the Note. 36. As of January 19, 2012, the Indebtedness, exclusive of the Banks
collection costs, includes outstanding principal of $2,476,191.45, accrued interest of $121,414.20, late charges of $12,024.76, appraisal fees of $1,200, and appraisal 11
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Review Fees of $300.00. Interest continues to accrue on the unpaid principal at the rate of $429.84 per diem from January 20, 2012 through the date of judgment, with post-judgment interest to accrue under applicable law. 37. 38. Guaranty. 39. Guaranty. 40. To date, Godwin has failed to cure his default and breach of the To date, ADH has failed to cure his default and breach of the ADH To date, Ambling has failed to cure its default and breach of the Note. To date, ACI has failed to cure his default and breach of the ACI
Godwin Guaranty. 41. To date, Ryan Holmes has failed to cure his default and breach of the
Ryan Holmes Guaranty. 42. To date, Rhett Holmes has failed to cure his default and breach of the
Rhett Holmes Guaranty. 43. Guaranty. 44. To date, Blankenship has failed to cure his default and breach of the To date, Benoit has failed to cure his default and breach of the Benoit
Blankenship Guaranty. III. CAUSES OF ACTION 12
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COUNT I BREACH OF NOTE (Against Ambling Grove Holdings, LLC) 45. The Bank incorporates by reference the averments in paragraphs 1
through 44 above as if fully stated herein. 46. Through its default and by failing to pay the amounts due under the
terms of the Note, Ambling has breached its contractual obligations to the Bank. 47. As a result of Amblings failure to pay the outstanding Indebtedness
in full, the Bank is entitled to the entry of judgment against Ambling in an amount equal to the Indebtedness as of the entry of judgment. COUNT II BREACH OF GUARANTY (Against Ambling Companies, Inc.) 48. The Bank incorporates by reference the averments in paragraphs 1
through 44 above as if fully stated herein. 49. Through his default and by failing to pay the amounts due under the
terms of the ACI Guaranty, ACI has breached his contractual obligations to the Bank.
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50.
As a result of ACIs failure to pay the Indebtedness, the Bank is
entitled to the entry of judgment against ACI in an amount equal to the Indebtedness as of the date of entry of judgment. COUNT III BREACH OF GUARANTY (Against Ambling Development Holdings, LLC) 51. The Bank incorporates by reference the averments in paragraphs 1
terms of the ADH Guaranty, ADH has breached his contractual obligations to the Bank. 53. As a result of ADHs failure to pay the Indebtedness, the Bank is
entitled to the entry of judgment against ADH in an amount equal to the Indebtedness as of the entry of judgment. COUNT IV BREACH OF GUARANTY (Against Michael Godwin) 54. The Bank incorporates by reference the averments in paragraphs 1
through 44 above as if fully stated herein.
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55.
Through his default and by failing to pay the amounts due under the
terms of Godwin Guaranty, Godwin has breached his contractual obligations to the Bank. 56. As a result of Godwins failure to pay the Indebtedness, the Bank is
entitled to the entry of judgment against Godwin in an amount equal to the Indebtedness as of the entry of judgment. COUNT V BREACH OF GUARANTY (Against R. Ryan Holmes) 57. The Bank incorporates by reference the averments in paragraphs 1
terms of Ryan Holmes Guaranty, Ryan Holmes has breached his contractual obligations to the Bank. 59. As a result of Ryan Holmes failure to pay the Indebtedness, the Bank
is entitled to the entry of judgment against Ryan Holmes in an amount equal to the Indebtedness as of the entry of judgment.
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COUNT VI BREACH OF GUARANTY (Against Rhett J. Holmes) 60. The Bank incorporates by reference the averments in paragraphs 1
terms of Rhett Holmes Guaranty, Rhett Holmes has breached his contractual obligations to the Bank. 62. As a result of Rhett Holmes failure to pay the Indebtedness, the Bank
is entitled to the entry of judgment against Rhett Holmes in an amount equal to the Indebtedness as of the entry of judgment. COUNT VII BREACH OF GUARANTY (Against Eddy Benoit) 63. The Bank incorporates by reference the averments in paragraphs 1
terms of Benoit Guaranty, Benoit has breached his contractual obligations to the Bank.
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65.
As a result of Benoits failure to pay the Indebtedness, the Bank is
entitled to the entry of judgment against Benoit in an amount equal to the Indebtedness as of the entry of judgment. COUNT VIII BREACH OF GUARANTY (Against Kenneth Blankenship) 66. The Bank incorporates by reference the averments in paragraphs 1
terms of Blankenship Guaranty, Blankenship has breached his contractual obligations to the Bank. 68. As a result of Blankenships failure to pay the Indebtedness, the Bank
is entitled to the entry of judgment against Blankenship in an amount equal to the Indebtedness as of the entry of judgment. COUNT IX UNJUST ENRICHMENT IN THE ALTERNATIVE (Against All Defendants) 69. The Bank incorporates by reference the averments in paragraphs 1
through 44 above as if fully stated herein.
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70.
The Defendants have directly benefited and have been unjustly
enriched through receipt of loan funds wrongfully retained and for which they are jointly and severally liable to the Bank in the amounts set forth above. COUNT X ATTORNEYS FEES AND EXPENSES PURSUANT TO O.C.G.A. 13-1-11 (Against All Defendants) 71. The Bank incorporates by reference the averments in paragraphs 1
through 44 above as if fully stated herein. 72. Plaintiff is claiming its attorneys fees under the Promissory Note,
Guarantees, and Georgia law, proper notice having been given pursuant to O.C.G.A. 13-1-11. WHEREFORE, Bank of the Ozarks prays: a. That the Court enter judgment against the respective Defendants on each count of this Complaint; b. That the Court award compensatory and actual damages as a result of Defendants conduct; c. That the Court award Plaintiff its attorneys fees and costs pursuant to O.C.G.A. 13-1-11; and d. That the Court award Plaintiff such other and further relief as is just and proper. 18
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Respectfully submitted this the 20th day of January, 2012.
/s/ John R. Richard JOHN R. RICHARD Georgia State Bar No. 603989 jrichard@taylorenglish.com MARK B. CARTER Georgia State Bar No. 114570 mcarter@taylorenglish.com TAYLOR ENGLISH DUMA LLP 1600 Parkwood Circle, Suite 400 Atlanta, Georgia 30339 Telephone: 770-434-6868 Facsimile: 770-434-7376 Attorneys for Plaintiff Bank of the Ozarks
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Newest Federal's Lawsuit Implicates Eddy Benoit in $2,456,472.45 Commercial Real Estate Loan Default

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Newest Federal's Lawsuit Implicates Eddy Benoit in $2,456,472.45 Commercial Real Estate Loan Default

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Civil Action File No. __________________

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Rhett J. Holmes is an individual and resident of the State of Georgia.

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Amblings repayment and performance under the Note is guaranteed

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Amblings repayment and performance under the Note is guaranteed

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Blankenship Guaranty. III. CAUSES OF ACTION 12

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As a result of ACIs failure to pay the Indebtedness, the Bank is

through 44 above as if fully stated herein.

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As a result of Benoits failure to pay the Indebtedness, the Bank is

through 44 above as if fully stated herein.

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The Defendants have directly benefited and have been unjustly

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Respectfully submitted this the 20th day of January, 2012.

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