Wednesday morning CJB Apartments, LLC was auctioned at the Delaware County Sheriff's Office only to be bought by Wells Fargo Bank Minnesota with intent to sale later.
Roger Hendershot with BOSE McKinney and Evans LLP in Indianapolis attended the auction representing Wells Fargo Bank, Minnesota.
Hendershot placed a bid of $11 million. The properties were listed for more than $18.5 million. However, there were no other bids at the auction.
For now the properties will remain under the control of the bank with Asset Management managing the apartments.
A company in Ohio has mentioned purchasing the apartments, Hendershot said, but nothing has been confirmed yet.
The name of the Ohio company was not known at the time.
For those residents who are still wanting to have their security depostis returned, they may be out of luck, John Connor Ball State Student Legal Services attorney said.
"If in fact [CJB] have filed bankruptcy the [residents] will essentially become unsecured creditors," Connor said.
Unsecured creditors are those involved that do not own any of the property.
When the apartments are sold the secured creditors (those who own the property) will be paid first.
"In all probability there won't be any assets left to pay unsecured creditors," Connor said.
When the receiver (Wells Fargo and Asset Management) took over they did receive some funds, Hendershot said. "But nothing was stated as secutiry deposits."
According to Indiana statute, security deposits are not required to be held separate from other funds.
If residents were listed as creditors in the bankruptcy file that CJB placed on April 29, then they may be able to receive their security deposits, Connor said.
If that is the case, residents will receive a letter from the bankruptcy court that will allow them to make a claim with the court.
"That doesn't guarantee that there's going to be money," Connor said. "All that does is get them in line with all the other creditors."
Connor spoke with numerous students who are residents of the complexes. He encourages anyone with questions to talk with a lawyer.
"When a business goes through bankruptcy, people lose money," Connor said.
Apartments that were previously owned by CJB were Everbrook, Sunreach, Autumn Breeze, Silvertree, Windsong and Cardinal Villas, not including the Cardinal Villas apartments owned by seperate owner Ed Lazaros.
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