Saturday, December 3, 2016

Upper Makefield horse farm at center of legal dispute going up for sale

Michelle and Michael Gara

Posted: Nov 28, 2016
A 36-acre Upper Makefield horse farm at the center of a bitter multi-million dollar legal dispute will be put up for sale and the proceeds placed in escrow until the court decides how to divide the money between the former business partners.
The settlement involving Hickory Run Farm was formally reached in Bucks County Court during what was supposed to be an eviction hearing Monday.
The farm business' minority owner, Patricia "Penny" Silcox, who is also the majority owner of a company that owns the land, had filed a complaint in September seeking to evict business majority owners and Upper Makefield residents Michael and Michelle Gara. The Garas, former farm clients, sued Silcox earlier this year, alleging she reneged on a verbal agreement to sell them the farm in exchange for a stake in their new business worth no more than $150,000. The farm was appraised last year at $1.5 million.
Patricia "Penny" Silcox
But the Garas’ attorney, Neal Jacobs, told Bucks County Judge Robert Mellon Monday that his clients would agree to liquidating the farm business and land and using the money for repayment. He added that Silcox’s brother, Roy Silcox Jr., who has 25 percent interest in the company that owns the land, previously had expressed interest in selling the property.
“We think that is a solution worthy of consideration,” Jacobs said.
Silcox’s attorney, Daniel Sweetser, said his client also was interested in selling the 36-acre property — but not at auction — and would move forward immediately if the Garas vacate.
Mellon suggested that the parties agree that the property cannot be sold for less than the higher of two professional appraisals, and the property would be sold to the highest bidder. The amount of the second appraisal wasn't provided Monday.
Both sides met in the judge’s chambers with Mellon for three hours to hammer out the details of the pending sale. Afterward, Sweetser said the property will be sold “as expeditiously as possible,” and the money from the sale will be placed in an escrow account for future disbursement, which likely could be the subject of additional court hearings. The Garas can remain on the property until settlement.  
A temporary restraining order placed against Silcox in July remains in effect; the order prevents Silcox from taking any action involving the farm and restricts her movement on the property. But Jacobs said the order will be modified to allow Silcox to be on the property when potential buyers are present.
Silcox, a well-known horse trainer in the Philadelphia region, ran Hickory Run Farm alone for 30 years until January, when she gave the Garas 75 percent ownership in the farm business in exchange for a promise to reduce a mortgage she has with them. Silcox retained 25 percent ownership in Hickory Run Farm, and she and her brother Roy own the land where the farm is located through a company called RSPC Inc.
The Garas contend that Silcox made a verbal agreement with them in May 2015 to consolidate Hickory Run Farm and RSPC Inc. and transfer both of the businesses into a new company owned by the Garas, Newtown Equestrian Center, according to a July lawsuit filed against Silcox in Bucks County Court. The Garas hold 90 percent ownership interest in Newtown Equestrian Center. Silcox would hold 10 percent and continue to work on the farm as a full-time horse trainer.
The Garas allege they invested $1.3 million into the failing farm’s operations and to pay off Silcox’s personal and professional debts. The couple contends that Silcox took two private mortgage loans with them using the farm property as collateral that would be satisfied after she transferred the businesses into the Newtown Equestrian Center.
Silcox denies that she agreed to either partner with the Garas or sell them her financially troubled farm, according to Sweetser. She also denies signing a second, open-ended mortgage for nearly $890,000 with the Garas three months after she signed a $309,000 mortgage with them.
The pending settlement has no impact on other lawsuits the Garas have filed, including one against Silcox and more than a dozen against individuals or businesses dubbed in court documents as “Penny’s Vigilantes.” The couple claim the defendants conspired with Silcox to interfere with their operation of the farm, costing them $25,000 a month in lost business.
The suit alleges the defendants “went out of their way to engage in a civil conspiracy to harm, annoy, harass, defame, injure, damage, and if possible, bankrupt the plaintiffs and their respective business interests” after learning the Garas had fired Silcox as a trainer, barred her from the farm property and sued her.
The “vigilante” suit seeks $6.1 million in damages and an injunction to bar the defendants from acts that include organizing boycotts of the farm and raising money for Silcox’s legal fees under “false pretenses.” Sweetser told Mellon on Monday that an anonymous benefactor that has no involvement in the case is paying half of Silcox’s legal fees and the Philadelphia law firm Blank Rome is doing work pro bono.
Jo Ciavaglia: 215-949-4181; email: jciavaglia@calkins.com; Twitter: @JoCiavaglia

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