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Home New Cases Miami Debtor Files Lawsuits to Resolve Priority of Lien Battle

Miami Debtor Files Lawsuits to Resolve Priority of Lien Battle

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July 10, 2022, US Bankruptcy Court for Southern Florida – 942 Penn RR, LLC (“Debtor”), brings adversary proceedings against five Defendants including Creative Directions, Inc.; G. Proulx, LLC et al. to determine the priority of liens as to the Debtor’s real property located at 942 Pennsylvania Ave., Miami Beach, FL 33139.

The value of the 942 Pennsylvania property is stated to be $11,800,000.00 in the Schedules of the Debtor. The Debtor lists Creative Directions, Inc. on its Schedules as having an undisputed secured claim on the property in the amount of $8,675,000. However, Creative Directions has filed a proof of claim asserting a secured claim in the amount of $11,250,000. Creative Directions’ proof of claim is based upon a notice of commencement (“NOC”) recorded on February 25, 2015 in the Pubic Records of Miami-Dade County, Florida.

Immokalee Real Estate Holdings LLC and 1250916 Ontario Limited had lended money to the Debtor against the same 942 Pennsylvania property. The Debtor has listed them in its Schedules as having disputed secured claims on the property in the respective amounts of  $625,809.32 and $1,200,000.

The Debtor contends that the NOC of Creative Directions recorded in 2015 should appear on any proper title search for the property and consequently alleges that both Immokalee and Ontario had actual knowledge, or reasonably should have known, of the NOC prior to lending any money against the property in 2017.

Similarly, the Debtor lists G. Proulx, LLC and Marjam Supply of Florida, LLC as having disputed secured claims of $77,399.87 and $38,304.77 respectively. Their liens were recorded in 2018. 

The Debtor asserts that the basic rule in determining priority of liens is that “the first in time is the first in right”. Accordingly, the Debtor claims Creative Directions, Inc.’s lien is in first priority and requests the Court to enter a judgment determining the priority of liens on the property.

942 Penn RR, LLC v. Creative Directions, Inc. (In re 942 Penn RR, LLC), AP No. 22-14038, US Bankruptcy Court for Southern Florida.

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