RECEIVERSHIPS: National Note of Utah, LC

WAYNE KLEIN, RECEIVER FOR
National Note of Utah, LC

10 Exchange Place, 502
Salt Lake City, UT 84111
(801) 456-4591

This site contains updates and filings related to the National Note of Utah Receivership. Updates are posted chronologically with the relevant links. This information is summarized quarterly by the Receiver in a status update to the court. The latest quarterly report can be found here.

Claims Process
Initial Claims Report

Recommended Allowed Claims

Recommended Reduced Claims

Recommended Disallowed Claims

Property Auction and Sale Notices
Byron, MN – Block 2 Lot 1 – Auction: 5/24/2016 at 9:00 a.m.

Expressway Land

Current (2016) Events

May 6, 2016 Reply to Claim Objection of Olson, Shah. The Receiver filed his reply to the objection filed by Olson and Shah, in which they oppose the Receiver’s recommendation to deny their claims. The Receiver recommends that the Court find that Olson and Shah’s continued reliance on assignments of beneficial interest that they hold disqualify them from also seeking recovery from funds that have been recovered. A copy of the Receiver’s reply can be found here.

May 6, 2016 Motion for Sale of Expressway Property. The Receiver filed a motion today recommending to the Court three options for selling the Expressway Business Park property in Spanish Fork, Utah. The first option would be to accept a cash offer of $250,000, which would net the Receivership about $25,000 after paying accrued property taxes and closing costs. The second option would be to accept an offer for the appraised value of $1.25 million, but where the buyer will have eight years to pay the full purchase price. The third option would be for a joint venture between the Receivership and a developer where the Receivership would receive 40% of the net proceeds from development of the property over the next ten years. The Receiver is recommending option #2. A copy of the motion can be found here.

May 5, 2016: Response to Katana Objection. The Receiver filed a response today to the claim objection by FT Holding Trust—Katana. The Receiver argues that Katana’s claim should be denied because it was filed almost four months after the claims deadline and that adequate notice was given to Katana of the claims process. A copy of the Receiver’s response can be found here.

May 2, 2016: Fee Application Filed. The Receiver filed a fee application today seeking approval for fees and expenses for the six month period from October 2015 to March 2016. A copy of the application can be found here.

April 29, 2016: Status Report Filed. The Receiver filed the quarterly status report for the period ending March 31, 2016. A copy of the report can be found here.

April 26, 2016: Summary Judgment Granted Against Andreasen. The Court today granted the Receiver’s motion for summary judgment against Max and Melanie Andreasen. The Court found that the excess profits paid to M&M Andreasen Investments, Inc. were paid to Max and Melanie Andreasen and therefore must be repaid to the Receiver. A copy of the ruling can be found here.

April 12, 2016 Notice of Sale Results. The Receiver filed a notice containing a summary of the results of the public sale of five industrial lots in Byron, Minnesota. The net proceeds from the sale were $270,963.57. A copy of the notice can be found here.

April 12, 2016: Motion to Disallow Late Claim (McCullough). The Receiver filed a motion today seeking to disallow a claim filed after the Initial Claims Report was filed with the Court. The Receiver’s motion noted that the new claim was filed four months after the claims deadline and recommends that the Court disallow this claim. A copy of the motion can be found here.

April 11, 2016: Report on Disallowed Claim Recommendations. The Receiver filed a report today on the status of claims where he recommended that the claims be disallowed. The report notes that no objections were filed for 36 of the 46 claims which the Receiver recommended be disallowed and asks the Court to enter an order disallowing these 36 claims. The Receiver will file separate responses with the Court regarding the ten claims where objections were filed. In addition, the report notes that one additional claim was filed after the Initial Claims Report and indicates that the Receiver will file a separate motion seeking disallowance of that claim. A copy of the report can be found here.

April 11, 2016: Receiver’s Response to Objection on Reduced Claim. The Receiver filed his response to the one objection that was filed opposing the recommendations that claims be approved at reduced amounts. In the response, the Receiver argues that since National Note has been found to have been operating as a Ponzi scheme, the claim should be allowed in the amount of net principal losses—$37,938.64—instead of the $440,000 sought in the claim. A copy of the response can be found here.

April 11, 2016: Report on Reduced Claim Recommendations. The Receiver filed a report today on the status of claims where a reduced amount was recommended by the Receiver. The report notes that no objections were filed for 81 of the 82 claims for which the Receiver recommended reduced claim amounts and asks the Court to enter an order allowing these 81 claims at the amounts recommended by the Receiver. The Receiver will file a separate response with the Court regarding the claim where an objection was filed. A copy of the report can be found here.

April 11, 2016: Order Approving Receiver’s Motion on Allowed Claims. The Court issued an order today approving the recommended claim amounts for 133 claimants with approved claim amounts and 205 claimants who had stipulated to reduced claim amounts. The Court found that none of the 338 claimants filed objections and therefore approved the Receiver’s recommendations. A copy of the Court order can be viewed here.

April 11, 2016: Auction Approved for Minnesota Property. The Court signed an order approving the sale of Block 2, Lot 1 in Byron Minnesota at auction. The Receiver has obtained an initial bid of $280,000 and set an auction date of May 24, 2016 at 9:00. If no other bidders qualify for bidding before the auction, the auction will be canceled and the property will be sold to the initial bidder. A copy of the order can be found here.

April 4, 2016: Motion for Sale of Minnesota Property. The Receiver filed a motion seeking court approval to sell a plot of industrial land in Minnesota at public auction. The Receiver has an offer of $280,000 and intends to hold an auction to see if any other higher bids are offered. A copy of the motion can be found here.

March 16, 2016: Toquerville Property Sale Approved. The Court approved the sale of Lot A-2 in Toquerville, Utah to Rural Housing Development Corporation. A copy of the order can be found here.

March 16, 2016: Settlements Approved. The Court today approved settlements with Kim Colin and The Church of Jesus Christ of Latter-day Saints. A copy of the order approving the settlements can be found here.

March 15, 2016: Motion to Approve Settlements. The Receiver filed a motion seeking court approval of two settlements he has recently reached. One will release $103,000 from the real estate holding account, with $50,000 being paid to the holder of liens on receivership real estate. The second will result in the return of $210,000 in religious contributions that Palmer made since 1998. A copy of the motion can be found here.

March 14, 2016: Motion to Disallow Claims. The Receiver filed a motion recommending that 46 of the claims filed in the claims process be disallowed. These claims asserted a total of $6,508,798.29 in claims. A copy of the motion can be found here. Any claimant whose claim is being recommended for disallowance who wants to object to the Receiver’s recommendation must file an objection with the court by April 8, 2016.

March 14, 2016: Motion to Approve Recommendation for Allowed Claims at Reduced Amounts. The Receiver filed a motion today recommending that the Court allow 82 claims as allowed claims, but in amounts less than the amount asserted by the claimants in their Proofs of Claim. The Receiver is recommending the reductions based on his belief the claimants inflated the amount they sent to National Note, seek recovery for interest that was promised, did not deduct distributions received, seek recovery for net profit interests in ore, seek recovery for higher values of precious metals, or are vendors who are not owed as much as they claim. A copy of the motion can be found here. A copy of the motion and the claim report will also be sent to each claimant affected by this motion. Any claimant whose claim is being recommended for allowance at reduced amounts who wants to object to the Receiver’s recommendation must file an objection with the court by April 8, 2016.

March 14, 2016: Judgment on McDonald. The court entered a judgment against Analee McDonald in the amount of $8,500 plus costs and fees incurred by the Receiver in collecting on the judgment. McDonald had previously entered into a settlement agreement with the Receiver, but had failed to make all payments required by the settlement, resulting in the Receiver seeking this judgment. A copy of the judgment can be found here.

March 14, 2016: Fee Application Approved. The court approved the fee application for the Receiver and his counsel for their work from July to September 2015. At the request of the judge, additional deductions were made in the fee application and the order reflects those deductions. A copy of the order can be found here.

March 11, 2016: Notice that Claim Amount is Not Amount that will be Paid. The Receiver filed a notice with the Court to clarify that the Receiver has only recovered sufficient funds to pay a portion of allowed claims and that a distribution plan will be proposed at a later date regarding how the recovered funds should be distributed to claimants. The Receiver will be sending a copy of the notice to all claimants where the Receiver is recommending that the claims be allowed in the amount claimed or where claimants have accepted the Receiver’s recommendation. A copy of the notice can be found here. This caution is applicable to all approved claims.

March 4, 2015: Motion to Approve Allowed Claims. The Receiver filed a motion today seeking Court approval of the 133 claims that the Receiver is recommending be approved at the full amount of the claims (for a total of $13,354,795.26) and an additional 205 claims that the Receiver is recommending be approved in amounts less than the original claim, but where the claimants have agreed to accept the lower amount being recommended by the Receiver ($23,202,520.67). A copy of the motion can be found here. Motions will be filed in the coming days on other categories of claims where the receiver is recommending that claims be allowed at reduced amounts or disallowed. Any claimants whose claims are being recommended to be allowed in today’s motion have a deadline of April 1, 2016 if they want to object to the Receiver’s recommendation.

March 4, 2016: Report on Claims Process Filed. The Receiver filed his report today on the claims process. The report summarizes the 466 claims submitted to the Receiver. These submissions asserted claims for $67 million. The Receiver is recommending that 420 of these claims be allowed in the total amount of approximately $45 million. Exhibits to the report list the Receiver’s recommendations for each claim. A copy of the report can be found here. The Receiver will be filing motions in the next few days asking the Court to approve his recommendations for each group of claims. The motions explain what a claimant must do if the claimant wants to object to the receiver’s recommendation. The Receiver will be sending copies of the report and motion to each claimant.

February 16, 2016: Motion to Sell Minnesota Property. The Receiver filed a motion today seeking Court permission to hold an auction to determine whether any buyer is willing to pay more than $448,300 for five industrial lots in Minnesota. If no bidders at auction offer to pay more than $448,300, the Receiver seeks permission to accept an offer to purchase the property for $448,300. A copy of the motion can be found here.

February 13, 2016: Minnesota Property Sale Approved. The Court approved the Receiver’s motion to sell five industrial lots in Minnesota for $448,300, subject to getting higher bids at a public auction. The auction is set for March 29, 2015. Any persons interested in submitting a higher bid for these lots is invited to contact the Receiver. A copy of the order can be found here.

February 11, 2016: ABI Default Granted. The Court entered an order today granting a default judgment against Michael Walden. The judgment declares the assignment of beneficial interest granted to Walden void. Out of the 349 ABIs in existence when the Receiver was appointed, only six remain that have not been released or declared invalid. A copy of the Court’s order can be found here.

February 10, 2016: Motion to Sell Toquerville Property. The Receiver filed a motion seeking approval to sell a 5-acre parcel of property in Toquerville, Utah for $148,200. This represents 95% of the appraised value. Notice of the proposed sale will be published in the newspaper. Higher bids are encouraged. A copy of the motion can be found here.

February 9, 2016: Property Sale Approved. The Court signed an order today approving the sale of five residential building lots in Toquerville, Utah. A copy of the order can be found here.

February 4, 2016: Judgment Entered. The Court entered a judgment against Secure American Gold Exchange, LLC (SAGE) in the amount of $112,000. The judgment was entered after SAGE agreed to entry of the judgment. The Receiver will seek to recover funds from the assets of SAGE. A copy of the judgment can be found here.

January 26, 2016: Judgment Entered Against Slaughter. The Court entered judgment for the Receiver today against Carol Slaughter in the amount of $104,254.33, which includes $18,800.05 in prejudgment interest. A copy of the order can be found here.

January 25, 2016: Status Report Filed. The status report covering the period of October to December 2015 was filed today. A copy of the report can be found here.

January 15, 2016: ABI Judgment. The Court today entered a default judgment against Michael Bryant, declaring the assignment of beneficial interest recorded for him on the Expressway property to be void. A copy of the judgment can be found here.

January 15, 2016: Property Sale Approved. The Court issued an order approving the sale of two residential building lots in Toquerville, Utah. A copy of the order can be found here.

January 8, 2016: Notice of Sale Results: Ogden. The Receiver filed a notice describing the results of the sale of the Ogden office building. After paying eight years of property taxes and closing costs, the 49.2% share of the building owned by the Receivership netted $241,836.67 to the Receivership Estate. A copy of the notice can be found here.

January 5, 2016: Publication of Notice of Sale of Almond Heights Lots. The Court today approved the publication of notice of the planned sale of 5 lots in the Almond Heights area of Toquerville, Utah. The Court also set a hearing on the Receiver’s motion to sell the property for February 8, 2016 at 1:30 p.m. A copy of the order can be found here.