Harborview Enterprises files for Chapter 7 - News-Times: News

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Harborview Enterprises files for Chapter 7

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Posted: Saturday, October 5, 2013 11:55 pm

MOREHEAD CITY — The company that operated Harborview Towers, a waterfront, high-rise senior living center that closed Aug. 30, has filed for bankruptcy protection.

Harborview Enterprises LLC filed Chapter 7 bankruptcy Monday in Carteret County Superior Civil Court, effectively halting at least a dozen civil suits against the company alleging breach of contract and seeking to recover deposits paid, which range from about $90,000 for a studio apartment to more than $220,000 for two-bedroom apartments.

Chapter 7 of the U.S. Bankruptcy Code provides for liquidation or the sale of a debtor’s nonexempt property and the distribution of the proceeds to creditors.

Attorneys Jane Gordon and Wesley Collins represent several Harborview Towers residents who had filed the civil complaints against the company. The attorneys went before Judge John Nobles Monday for a hearing on motions for summary judgment. Ms. Gordon and Mr. Collins told the judge that due to the bankruptcy filing, they could no longer pursue their clients’ cases.

The residents, under the terms of their occupancy agreements at the 50-unit facility at 812 Shepard St., were owed 80 percent of their deposits within two years after vacating their units for any reason. Harborview Enterprises LLC representatives had previously said the company was unable to pay the refunds due to its financial circumstances. In July, those representatives told the roughly two dozen tower residents to move out by Aug. 30 because the financial situation forced closure.

All residents moved out, except 102-year-old Constance Browne, who was recently relocated to Carolina House to get needed nursing care. But she’s still hanging on to her Harborview apartment where most of her belongings remain.

On Friday, Ms. Browne called the situation “difficult” and she remains uncertain as to how long her residency at Harborview will be allowed to continue. But she isn’t angry.

“I don’t care to be angry, but I think it’s so unfair,” she said in an interview at Carolina House. “It seems so much more evident to me that they want to grab the most money from everyone else, even to the point of ignoring their previous promises, ignoring what they owe to others.”

The shareholders of the company are members of the Jernigan family – heirs of the founder Doris Jernigan. Her son, J. Ron Jernigan, is the company president.

Mr. Jernigan told the News-Times in August that his family is “devastated” about the situation, which he said was caused not by mismanagement, as some residents have claimed, but by the housing market crash of 2008.

He said when the home market bottomed out, fewer and fewer were able to sell their homes and move into the facility. Although the census kept going down at the facility, overhead costs remained.

“We ran out of money,” Mr. Jernigan said at the time.

Following complaints from residents, the Consumer Protection Division of the state attorney general’s office opened an investigation in August. The Consumer Protection Division is a civil, not a criminal investigative authority.

Former resident Clarence “Slim” Hensley said he wasn’t optimistic the attorney general’s investigation would result in a happy ending for those losing their deposits.

“I don’t see any hope for any money coming out of this mess. The building is not saleable,” he said Thursday.

Ms. Browne’s son Doug Browne said he doubts whether the bankruptcy trustees handling the case will allow continued occupancy, but his attorney has not backed off earlier advice to stay put.

“We haven’t received a definitive answer on that yet,” Mr. Browne said.

News-Times staff writer Mike Shutak contributed to this report.

Contact Mark Hibbs at 252-726-7081, ext. 229; email mark@thenewstimes.com; or follow on Twitter @markhibbs.

  • Discuss

Welcome to the discussion.


  • francis posted at 3:11 pm on Thu, Oct 10, 2013.

    francis Posts: 2763

    Sadly we now see how trusting in others can mess up your life. Feel certain the fine print in the contract held the Jernigan family harmless, hence the LLC. LLC's are created for a reason and that is to protect from liability. It has been said that they are sort of like Jessie James, without a gun. Never get into bed with a LLC, unless you want to find yourself on the floor, before nights end and without even getting kissed.

    Only thing I found was a reference to an engineering company in the Raleigh area that makes emissions testing gear. Might not even be the same guy. Doesn't matter, what is done is done.

  • mtstosea posted at 10:33 pm on Wed, Oct 9, 2013.

    mtstosea Posts: 17

    I wonder what other businesses the J. Ron Jernigan family owns. Their actions go past mismanagement of an opportunistic family, and causes us all to be even more mistrustful of everyone. Unfortunately, most all the residents will probably have passed on by the time this is resolved in the courts. As someone else wrote, the only people getting any money will be the NC court system and the many attorneys or each side.

    We can read the fine print, and have our own attorneys look at documents, but if someone is out to take our money, they will find a way to do so.

    The Jernigan actions are criminal and should be investigated and not hidden behind the skirts of bankruptcy protection.

    The fact that these residents are elderly puts it in the category of Elder Abuse, and there are laws against that. If a child misused the funds placed for the upkeep of their parents and spent them for their own personal wants, the child would be held responsible for embezzlement.

    Why is this situation different?

  • CARTERETISCORRUPT posted at 4:53 pm on Wed, Oct 9, 2013.


    Now this isn't important enough to be on main page anymore. Now it will be out of the public eye. Way to go CCNT, lets not watch this. Lets not let the public opinion be easily seen.

  • CARTERETISCORRUPT posted at 8:57 am on Wed, Oct 9, 2013.


    Shakespeare had it right. Without lawyers, and repeal of their mess, life would be very, very good. Every major problem today is traceable to lawyers. Such is the case here. Simple criminal charges, finding of guilty of theft, estoppel and simple civil jury trial on the facts would end the grief of the elderly here. It isn't rocket science as the lawyer would have you believe.

  • francis posted at 5:09 pm on Tue, Oct 8, 2013.

    francis Posts: 2763

    It is the lawyers who write the laws and mostly lawyers who vote to enact them. With that in mind, anyone shocked with the way things work out. Even a man named W. Shakespeare is reputed to have exclaimed, "kill all the lawyers". That was back in the late 1500s I guess. Still rings true today?

  • CARTERETISCORRUPT posted at 4:20 pm on Tue, Oct 8, 2013.


    A current bankruptcy has the debtor making an agreement with the trustee, that to cooperate with the trustee will give the debtor 10% of the proceeds from forced sale of the property. WARNING; a similar thing could happen. This results not only in LESS for the elderly, but rewards the dishonest debtor for their acts. This is real folks. The trustee can make any deal they want, up to and including a very fat reward to the crooks. There is one case now where inherited property is threatened in such a manner, and the innocent are getting screwed by this bankruptcy boondoggle. CHAPTER 7 IS A TOOL OF THEFT!

  • CARTERETISCORRUPT posted at 11:18 pm on Mon, Oct 7, 2013.


    The elderly folks lawyers cannot protect them because of the bankruptcy trumping them. Its the same old story. The dishonest get to walk via bankruptcy, leaving the elderly in the cold. Aren't we great Americans!

  • CARTERETISCORRUPT posted at 11:15 pm on Mon, Oct 7, 2013.


    The lawyers representing the elderly will take what the trustee doesn't. Now there is a crooked bunch of folks.

  • CARTERETISCORRUPT posted at 11:08 pm on Mon, Oct 7, 2013.


    Correct NC Native Son: Why do we allow such a bad law.
    Why is responsibility for one's debt such a bad thing. Have we become a nation where responsibility is legally avoided. It appears such is the case.
    Why do many have to suffer due to the bad acts of a few?
    Why do we allow the trustee strong arm power to take property that does not belong to the debtor?
    Why is the government in this at all?
    Folks who run up debt should be held responsible for that debt, end of story.
    Those who plan to run up debt and then later file bankruptcy are especially abhorrent. These are criminals, pure and simple. This is done everyday across this country.
    All a person has to do to avoid suit in state court is to flee to another state and file chapter 7 bankruptcy, and claim someone else's property belongs to them. The trustee will then try to take the innocent persons property to pay off the bad debts of the debtor, by force if necessary.
    This must stop.

  • NC-Native-Son posted at 5:08 pm on Mon, Oct 7, 2013.

    NC-Native-Son Posts: 170

    If Chapter 7 is declared, the crooked Jernigan family will be drinking champaign cocktails while the trustee for the estate will milk it dry and buy a new yacht. I imagine the secured creditors will only be awarded 10 cents on the dollar. That is standard hocus-pocus in bankruptcy court.

  • CARTERETISCORRUPT posted at 3:08 pm on Mon, Oct 7, 2013.


    Take a good look America at the picture attached to this article. We have allowed a system to victimize this elderly person, as well as many other innocent folks. WHEN WILL WE STOP THE ABUSE OF BANKRUPTCY LAW, AND OF THE ELDERLY IN GENERAL? DOES ANYONE CARE AT ALL?


  • CARTERETISCORRUPT posted at 3:04 pm on Mon, Oct 7, 2013.


    This boondoggle brought to you by the lawyers, enabled by the lawyers, greed of the lawyers, profit by the lawyers.

  • CARTERETISCORRUPT posted at 3:02 pm on Mon, Oct 7, 2013.


    Diablo: You are correct! It could be the perfect crime. Charge up your debt, especially if married and the assets belong to the other spouse, leave the state and file bankruptcy in a remote state. It blocks hearing the case in state court, and is heard using your states law, but in a remote state by a federal court who doesn't know North Carolina law, and further doesn't care. Additionally, the federal government has been trying to usurp states rights and law for a very long time, civil and criminal, witness Zimmerman case and the federal hate crime statue. Federalization of state criminal law. The same exists in civil law. The only way to stop this is congress, and that will take the people to demand change. BUT, even now that folks insurance is skyrocketing, the people will do nothing. The people don't try and stop confiscatory taxation, much less bankruptcy enabled theft. The idea that someone can run up debt, and on purpose, flee the state and file bankruptcy, and screw many others out of their just funds, in our country is amazing. The elderly in the present case WILL get screwed in this instance, and it is ALL our fault for allowing such a system to exist. We have a lot to be proud of, don't we?

  • Diablo Rojo posted at 7:50 pm on Sun, Oct 6, 2013.

    Diablo Rojo Posts: 7

    neat trick, take a bunch of money under apparently false pretenses then file bankruptcy. Is that a way out of fraud?

  • CARTERETISCORRUPT posted at 4:40 pm on Sun, Oct 6, 2013.


    These trustees are absolute sharks, with federal power to destroy.

  • CARTERETISCORRUPT posted at 4:40 pm on Sun, Oct 6, 2013.


    The lawyers will get everything, as is usual.

  • CARTERETISCORRUPT posted at 4:39 pm on Sun, Oct 6, 2013.


    Under chapter 7 the creditors (in this case the old folks) will get thoroughly screwed out of their money. Only the lawyers will get any appreciable amount of money. Chapter 7 is where federal law lets an irresponsible run from their debts and many innocent others left holding the bag, getting little to nothing. Additionally, the lawyer representing the old folks, look out. They will get little to nothing. Why does the law even allow this chapter 7 abomination. Why are the many left to pay for the act of a very few? Also, this tactic is used to avoid state court in divorce, one party moves to another remote state, and avoids facing state law. The state court is best to hear issues of state law. In federal court, especially having to try the case in a remote state court, you incur extreme expense and hardship. Lifting the automatic "stay of proceedings" can be done, but is difficult. The bottom line: Bankruptcy in its present form is absolutely criminal. These elderly will eventually lose big. This Chapter 7 law must be repealed in its present form.


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