West Pace Trustee Brings $800K Clawback Action Against Hayley Family Partnership & Others, Alleges Breach of Fiduciary, Fraud & Insider Preferences
January 15, 2022, Middle District of Alabama – Marshall Glade, as Liquidating Trustee of the bankruptcy estate of Debtor West Pace, LLC, brings a lawsuit against multiple Defendants including Thomas Hayley, Hayley Family Partnership, Ltd., Redd Family Partnership, LLLP, HayRay, L.L.C., Home Yard & Garden, Inc., Lake Martin, Inc., and Eagle Management, LLC to recover damages for Hayley’s alleged breach of fiduciary duties. Additionally, the Trustee seeks to avoid and recover certain fraudulent and insider preferential transfers allegedly made to the Defendants. The total amount of the claim is for $833,377.81
The complaint asserts that Hayley breached his duty of care to West Pace by allegedly mismanaging West Pace and failing to construct infrastructure and buildings that West Pace was required to build. The complaint further adds that Hayley allegedly transferred millions of dollars in cash to companies owned by or affiliated with himself. Glade alleges that all this resulted in West Pace filing Chapter 11 bankruptcy and involuntarily liquidating its assets after an expensive and unnecessarily litigious case. As a result of Hayley’s breach of his duty of care, the Trustee claims that West Pace has been allegedly damaged by over $5 million.
Glade also argues that before the Debtor filed for bankruptcy, it made dividends and transfers to various defendants allegedly with an actual intent to hinder, delay, or defraud West Pace’s creditors and seeks to avoid them under the Alabama Uniform Voidable Transfer Act, Ala. Code § 8-9B-1, et seq. Next, the complaint seeks to recover transfers totaling $224,534.97 allegedly made one year before the Debtor’s petition date as insider preferences.
In re West Pace, LLC, Case No. 20-80067