Indies Suites back to court

The Grand Court will decide 29 July whether Indies Suites should be put into official liquidation.

Indies Suites Ltd. was put into provisional liquidation on 7 June after an ex parte petition was made by attorney Alan Turner on behalf of a group of timeshare owners of the property.

The hotel was severely damaged by Hurricane Ivan last September and subsequently sold to St. Matthew’s University in December, although timeshare owners were not made aware of the sale until May.

The estimated 470-540 timeshare owners, which are technically called club members, want refunds on their purchases, which were supposed to be good for a period of 99 years from the date of purchase.

The provisional liquidator, Chris Johnson, said it has been difficult to ascertain the exact number of club members.

‘Much of the company’s records were destroyed in the hurricane,’ he said.

Mr. Johnson confirmed, however, that the records of former Indies Suites sales manager Diana Cole survived.

The two parcels of land owned by Indies Suites sold for a combined US$2.8 million, of which US$2.1 million was owed on mortgages to the bank, Mr. Johnson said.

In addition to the excess left after the sale, Indies Suites received and interim insurance settlement of CI$200,000 last year and a final insurance settlement a week before the company was put into provisional liquidation.

Although the amount of the final settlement has not been made public, Indies Suites owner Ronnie Foster said he had an offer of CI$500,000 weeks before the settlement.

Mr. Foster said he put some of the settlement money in an escrow account on behalf of the club members.

In a paid statement made to the press last month, Mr. Foster said the group of club members represented 20 percent of the potential usage of the property.

The amount in escrow represented 20 percent of the pre-Ivan value of Indies Suites, which Mr. Foster said was determined to be ‘a very fair and equitable method to compensate club members’.

Earlier this month, the Indies Suites members group also put a paid statement in the press addressed to the Caymanian people.

The statement pointed out that every Indies Suites club member, under the provisions of their contracts, had at least 87 years of usage of the hotel remaining.

‘According to our agreements, {Indies Suites} was required to properly insure the property and had two years in which to rebuild,’ the statement said. ‘Neither was done.

‘To sell Indies Suites less than three months after the storm, without reference to the members, and then failing to inform them of the sale for an additional four months is not the sort of business practice we have come to expect in Grand Cayman,’ the statement said.

Mr. Johnson confirmed last week that a large amount of money was indeed in escrow, although he declined to say precisely how much.

‘A full report will be presented to the court on July 29th,’ he said.

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