Sudler v. Campbell

This action arises out of a dispute over the acquisition and rehabilitation of the Kings Ridge Apartments the “property” in Atlanta, Georgia. Sudler Partnership, comprised of Howard M. and Mary Sudler, successfully bid for the property at a foreclosure sale held by the United States Department of Housing and Urban Development in August of 1994. The Sudlers made a $100,000 down payment. On September 20, 1994, the Urban Residential Finance Authority of the City of Atlanta, Georgia “URFA” passed an inducement resolution stating that it would issue $20 million in tax-exempt bonds to finance the project. The resolution identified Sudler Partnership as the developer of the property.

On December 22, 1994, the City of Atlanta loaned Pison Partners, L. P. “Pison”, a Georgia limited partnership whose sole general partner was the Sudler Corporation, $1.5 million to buy the property in the form of a Federal Home Loan “loan” repayable in one year. Consequently, the city was the holder of a first position deed to secure debt on the property. The loan required the city and URFA to approve an additional financial partner, an experienced development team, and a plan of development and financing for the project.