Man Who Says Bank Owes Him Ties Up Its Real Estate
A former Orange County real estate agent has tied up Wells Fargo’s real estate holdings in California in a legal ploy to get the big bank to pay him a $700,000 judgment.
Ted Hays, 78, was in a hospital with cancer in 1984 when Wells Fargo “mistakenly” paid a $1.5-million loan that Hays had arranged to two of his business associates, according to a civil suit Hays filed in Los Angeles. The loan was needed to build a small housing project in Orange.
The two business associates expected Hays to die, according to his lawyer, Robert C. Aronoff, and never gave him $440,000, his share of the loan.
A Los Angeles Superior Court jury in September awarded Hays $700,000. Wells Fargo said it would appeal the decision but cited federal court cases in declining to post a bond while it appealed.
National banks, Wells Fargo contended, are not obligated under those court cases to post bonds while appealing lawsuits.
Defendants in California courts are ordinarily required to post a bond equal to up to 1 1/2 times the amount of the judgment when they appeal a case. That’s to ensure that they will pay if they lose on appeal.
Hays’ lawyer then asked the trial judge to place liens on Wells Fargo’s real estate, which the judge did Wednesday. The liens--a type of legal obligation--make it virtually impossible for the bank to sell property because a buyer would be stuck with the obligation to pay the judgment.
The liens cover property Wells Fargo owns throughout the state, including parcels in Los Angeles and Orange counties.
Wells Fargo said it would go to federal court today to ask that the liens be removed.
Should that fail, a Wells Fargo lawyer said, the bank will appeal to a state court and ultimately will post a bond if the appeal is rejected by the courts.
“This is simply a tactical maneuver by Mr. Hays,” said William Reichert, bank senior counsel.
Hays, who says he is bedridden, was a real estate agent in Orange and Riverside counties in 1984 when he brought in the two associates to help him build homes on more than 20 acres in the city of Orange.
Hays, who lives in Murrieta Hot Springs in Riverside County, planned to promote the neighborhood as a sports-oriented community.
He lined up Mel Renfro--a former Dallas Cowboys football player--and other pro footballers to buy lots in the neighborhood.
Hays arranged to borrow $1.5 million on the property from Wells Fargo to build the houses. But then he went in the hospital, and when he came out, the property was in foreclosure for failure to make payments on the loan. It was later sold.
