A bank in a crossfire with Gov. Jim Justice’s family-owned companies over $300 million in debt has moved to dismiss a lawsuit over the auction of the Greenbrier Sporting Club.
Carter Bank & Trust last week filed motions to dismiss for improper venue and for failure to state a claim in Greenbrier Circuit Court.
This is all fallout from Carter Bank’s public notice to auction the Greenbrier Sporting Club on the courthouse steps to satisfy a multi-million dollar debt from Justice and his family.
The Greenbrier Sporting Club is a private club offering memberships to people who buy real estate surrounding The Greenbrier resort.
Carter Bank & Trust has been moving to collect $300 million in debts that were personally-guaranteed by Justice, his wife Cathy and their son Jay, who runs the family’s coal operations. The debts applied to several branches of the family’s business network, including Greenbrier Hotel Corporation, Greenbrier Golf and Tennis Club and Greenbrier Sporting Club.
Those loans had come due April 15, 2023.
The auction is a tangible step toward collecting on the debt.
Justice, in public comments and in court filings, has contended the bank’s practices are unfair. Representatives of the Justice companies filed a lawsuit last month to try to block the auction, which has been delayed until at least next month.
Lawyers for Carter Bank, headquartered in Martinsville, Va., contend the attempt to block the auction should be tossed.
A memorandum disputing the Greenbrier County venue for the lawsuit maintains that at least seven times over the past two and a half years the Justice companies and Carter Bank entered into legal agreements specifying that all disputes between the parties would be litigated in federal or state courts in Virginia.
“Plaintiffs, wishing to abrogate the deal they wrote for themselves, filed suit in this West Virginia state court,” wrote the lawyers for Carter. “Although such behavior — disregard for the terms of the prior deal struck — is Plaintiffs’ pattern, this court should not tolerate it.”
Carter Bank’s attorneys filed a second memorandum contending the Justices’ arguments lack merit.
“This civil action to prevent a lawful foreclosure sale from taking place is the latest in a series of meritless lawsuits initiated against Carter Bank by many borrowers owned and/or controlled by ‘the Justice family,'” wrote the lawyers for Carter Bank.
In the original filing in Greenbrier Circuit Court, representatives for the Justices contended the maximum amount secured by a deed of trust for Greenbrier Sporting Club was $250 million and that the Carter claim was void because it exceeds that amount.
Carter, in the memorandum, called that a “nonsensical statutory interpretation.”
‘The language of the statute is clear. It does not invalidate a credit line deed of trust when future advances exceed the stated amount in the deed of trust. Instead, it provides that those excess amounts are unsecured by that deed of trust. No other reading of the statute makes either legal or common sense,” wrote lawyers for Carter.
Carter Bank’s lawyers also maintain that the amount of the Justice debt is not in dispute.
“Plaintiffs do not dispute that they borrowed funds from Carter Bank and have not repaid, as they agreed to do in the many Loan Documents executed by the Parties, those amounts Carter Bank seeks to recover through foreclosure.”