NEWRY — The new owner of the Sunday River Golf Club in Newry has filed a lawsuit against the club’s former owner, alleging that owner has continued to sell memberships for the upcoming golf season despite no longer owning the property, according to a report by the Portland Press Herald.
George Marcus, attorney for Newry Holdings LLC, the new owner of Sunday River Golf Club, told the Sun Journal on Wednesday that Harris Golf Inc. of Bath, former owner and parent company of SR Golf Holdings LLC, had also accepted deposits for functions at the club, including weddings.
According to the Press Herald, the civil complaint, filed in Cumberland County Superior Court, alleges that SR Golf Holdings and Harris Golf have refused to hand over assets such as equipment and membership fees they collected since the property was conveyed on Jan. 5 to Newry Holdings as part of a foreclosure action.
The complaint states that Harris Golf has continued to advertise and “collect fees for an upcoming golf season which SR Golf will not be participating in,” and that if “SR Golf is allowed to continue holding itself out as owning and operating the (property), then the number of individuals who will be financially harmed will exponentially increase.”
According to the Press Herald, Harris Golf filed a counterclaim Tuesday alleging that Newry Holdings and a previous creditor, Boothbay Pool I LLC, violated a forbearance agreement that would have enabled SR Golf to use new financing to meet its financial obligations and retain ownership of the golf club.
Marcus told the Sun Journal that the complaint “essentially asks that (Harris Golf) stop selling memberships, tell us to whom they sold memberships to so far, and to stop marketing the golf club as their own property.”
“We’re still trying to get our arms around exactly what has been done,” Marcus said. “One of our concerns is that at this point, we don’t know how many memberships were sold, who they were sold to, or what events were specifically booked.”
He said that once Newry Holdings can “figure out an appropriate course of action,” they could look into helping people who were sold memberships or made deposits with Harris Golf for events.
“Our hope is that we can figure out what we’re dealing with, and work on assisting people who were sold memberships or made deposits,” Marcus added.
Newry Holdings is affiliated with the Black Swan Country Club of Georgetown, Massachusetts, along with two other courses, according to Peter Brown, director of operations for Black Swan.
According to the Press Herald, the complaint states that Newry Holdings is seeking $5.6 million in unpaid mortgage debt plus legal fees, and all remaining golf club assets held by SR Golf, including equipment and new membership fees. The complaint says $5.6 million is the difference between what SR Golf owed on the mortgage ($7.8 million) and the value of the property ($2.2 million).
The complaint also states that SR Golf was given multiple opportunities to “cure” the default situation but failed to do so.
Tom Hallett, the attorney representing Harris Golf, told the Sun Journal on Wednesday that he “couldn’t fully speak to everything going on,” but alleged that the deed to Sunday River Golf Club had been “held in escrow,” and that it was “improperly transferred” to Newry Holdings, making the current sale “void.”
“We’re going to be fighting hard to get the property back,” he said. “We believe that once the court hears our story, they will see that there were real problems in the way that the current owners took possession. That’s certainly the hope.”
Hallett added that “to my knowledge, Harris Golf is not selling golf memberships right now.”
“Everything, I believe, is on hold,” he said.
Newry Deputy Town Clerk Kelly Scott said that the deed for the Sunday River Golf Club “reads as being owned by Newry Holdings LLC.”
“I’m not sure why Harris Golf is still claiming to own it,” Scott said. “The deed is in the name of Newry Holdings.”
Scott added that she has been fielding phone calls from people who said they had paid a deposit to the Sunday River Golf Club when it was still owned by Harris Golf for a wedding or party function and were not being refunded now that the club has changed hands.
“Apparently, some of the brides and grooms were worried about losing their deposits, so they asked to speak with the former owners,” Scott said. “Some of the people who made deposits said they were told (by Harris Golf) that they were adamant they would retain ownership of the club this summer, and that they wouldn’t be refunding the deposits.”
According to Scott, records showed that on Jan. 5, SR Golf deeded Sunday River Golf Club to the holding company Boothbay Pool LLC in lieu of foreclosure.
Boothbay Pool LLC then sold the property to Newry Holdings LLC, she said, with the transfer tax indicating an amount of $2 million.
Since then, new owner Newry Holdings has paid three years of back real estate taxes amounting to more than $150,000, Scott said.
“We’re very happy that these back taxes are finally being paid,” she said.
Other Newry officials said that, for years, the course was regularly late in paying property taxes.
The 18-hole course is off Monkey Brook Road and next to Sunday River Resort property, near the Jordan Grand Hotel.
The Robert Trent Jones Jr.-designed course was built in the early 2000s.
mdaigle@sunjournal.com
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