All I can say is "Caveat emptor"-- Let the Buyer Beware.....
Leachman ranches sold at auction
JAN FALSTAD - The Billings Gazette (MT) - Thursday, July 15, 2010
During a federal foreclosure sale Thursday, cattle and horse breeder James Leachman finally lost his seven-year legal fight to hang on to two ranches east of Billings, but he vowed to keep fighting even though he said he is broke.
The Stovall Holding Co., run by his neighbors Jay and Juanita Stovall and their son, Turk Stovall, bought Leachman’s Home Place 18 miles southeast of Billings for $2.1 million and a third tract of nearby land for $530,000. They have ranched in the area for five generations.
Jay Stovall has served on the Montana Public Service Commission.
The U.S. Department of Agriculture’s Farm Service Agency, a creditor, bought the smaller Hairpin Ranch five miles east of Billings for $1.1 million in a sale lasting less than 15 minutes.
“We’re just going to incorporate with our other ranch properties,” Turk Stovall said about the Home Place.
The Stovalls, who mainly raise Angus cattle, operate their main ranch along Pryor Creek and another ranch between Pryor and St. Xavier.
After Stovall Holding presented the checks after the sale, the family received certificate of sales for the tracts of land. But under the foreclosure sale rules, they won’t get deeds until the yearlong redemption period ends. Leachman has 12 months to come up with the money to buy back the ranch.
“The law is clear,” he said, allowing him to exercise his lease rights and to keep grazing an undisclosed number of horses during the coming year.
“I’m operating the place with my horses on them. They’re there today, they’ll be there tomorrow and I expect them to be there for the next year,” he said.
Billings attorney Jon Doak, who represents the Stovalls, said his clients would contest Leachman staying on the ranch during the redemption year.
And U.S. Assistant Attorney Victoria Francis said at the sale, “Everything Mr. Leachman contends may in case not be so and it would be subject to litigation.”
There are more than 9,400 deeded acres on the ranch, according to Turk Stovall. The family already is leasing about three-quarters of the 30,000 acres of Crow Reservation on the Home Ranch.
Leachman lives in a home in Billings but is claiming homestead rights to the ranch.
But Turk Stovall said the family was moving into the Home Place ranch buildings Thursday afternoon.
“And I think he, as a member of a limited-liability company, has questionable redemption rights and that would be a matter for a court to decide,” he said.
Leachman said the sale actually helped his situation by setting a price.
“We know I have the priority redemption, so nobody can refuse a check from me for that amount for a year,” he said. “And when I deliver it, the properties are free and clear of any other encumbrances, so this is huge progress.”
Other potential bidders in the crowd of 30 on the sidewalk in front of the Yellowstone County Courthouse watched keenly, but didn’t bid against the Stovalls or the feds. Acting U.S. Marshall Rod Ostermiller conducted the sale.
After the sale, Leachman said he has no money now because his cattle company ran into severe financial troubles in 2003, and he was not represented by an attorney. But he plans on holding a horse sale this September. He said he didn’t know how many horses he has, but he said they are in good shape.
Due to his failure to pay fees to the American Quarter Horse Association, some previous buyers have been unable to get papers on horses they bought at Leachman’s sales, but he said those problems are largely resolved now.
Leachman’s ranches were going to be sold in an identical sale on the same day last year, but he stopped the sale by declaring personal bankruptcy. The bankruptcy continued until this spring, when the bankruptcy judge dismissed his case.
Four years ago, creditors won a court order to force the sale of the Leachman ranches to pay delinquent debts. But he appealed clear up to the 9th Circuit Court of Appeals, which upheld the sale.
After the sale, Leachman said life has been difficult since 2003 when the Leachman Cattle Co. ran into financial troubles.
“I’ve tried to save the places and recover and obviously that has not been easy,” he said. “The good thing is in the last three or four years, I have not incurred any more debt. To do that I had to go what I say is underground, meaning I have myself and no employees, basically.”