Insurance company awarded judgment in Hermitage case

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HARTFORD, CONN. — In a case alleging breach of contract, an insurance group received default judgment against Hermitage Club founder Jim Barnes due to his failure to appear in court.

Fidelity National Title Insurance is seeking more than $15,000 in damages. It provided insurance to Hermitage Inn Real Estate Holding Company in 2014 as part of a construction mortgage the Hermitage received from Berkshire Bank, wrote attorney Tiziana M. Scaccia of Fidelity National Law Group in a complaint filed in October in a civil court in Hartford, Conn.

Scaccia said in 2017, an eighth amendment had been made to the mortgage so the Hermitage could receive an additional loan of $1.1 million from the bank. Part of the amendment included certain legal rights for BSA Architects doing business as Bull Stockwell Allen, which had an approximately $338,718 lien against the Hermitage, according to the complaint.

Barnes and the Hermitage signed a hold-harmless agreement in favor of Fidelity so the insurance company would issue an endorsement to the policy, Scaccia wrote. She said the agreement was meant to protect the insurer from all liability, loss and damage.

In 2018, the Hermitage defaulted on the mortgage after failing to make payments on more than $17 million in loans. The foreclosed properties included the private ski resort at Haystack Mountain in Wilmington, a nearby golf course and several local inns.

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BSA claimed its liens had priority over the additional loan made with the eighth amendment, according to the claim.

"Barnes had an obligation under the hold harmless agreement to immediately undertake to do whatever is reasonable and necessary to resolve the exceptions so that the eighth amendment would have priority over the BSA liens against the mortgaged property," Scaccia wrote. "Barnes did not resolve the exceptions. Barnes breached the hold harmless agreement and as a result Fidelity did incur monetary damages in resolving the insured's claim and the priority claim."

The court approved Fidelity's motion for default judgment in an order Tuesday. Barnes did not appear at a hearing last month.

Hermitage entities are now involved in a bankruptcy process in which assets are anticipated to be sold.

Reach staff writer Chris Mays at cmays@reformer.com, at @CMaysBR on Twitter and 802-254-2311, ext. 273.


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