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18. By letter dated May 14, 1996, a copy attached as Exhibit F and <br /> incorporated by this reference, Pitkin County requested an explanation from the Debtor <br /> concerning the unpaid taxes. (This letter incorrectly states that the balance of personal <br /> property taxes due was $108,850.79, which actually was only the 1990 portion, see <br /> Exhibit J). <br /> 19. By letter dated May 24, 1996, a copy attached as Exhibit G and <br /> incorporated by this reference, the Debtor took the position that the Plan makes <br /> payment of taxes "subject to the distribution priorities set forth in 6.3.2 through 6.3.5." <br /> 20. The parties have been unable to resolve the disagreement in <br /> interpretation of the Plan. <br /> 21. On July 24, 1996, Stewart Title of Aspen, Inc., Debtor's closing agent, <br /> requested tax certificates, including one for schedule #7863, and had requested <br /> certificates for other schedules on May 16, 1996. <br /> 22. Pitkin County issued several certificates of taxes due, including <br /> certificate #1029, copy attached as Exhibit H and incorporated by this reference. <br /> Certificate 1029 covers real property schedules 7863 and personal property schedule <br /> 4062, copies of which are attached as Exhibits I and J, respectively. Under schedule <br /> 7863, all real property and improvements owned by Mid-Continent located in the area <br /> described on that schedule were assessed in accordance with state law as a producing <br /> coal mine for the years 1990 and 1991. Thereafter, schedule 7683 was used to assess <br /> improvements only, but continued to reflect that the assessment was on all the real <br /> property described in the schedule. Valuations were made based upon information <br /> provided by the Debtor, such as the letter from the Debtor to the Assessor dated May 5, <br /> 1989,attached as Exhibit K. <br /> 23. Defendants refused to pay any portion of taxes due tinder certificate <br /> 1029,and the parties agreed to escrow the proceeds of the sale which occurred July 31, <br /> 1996. The Escrow Agreement is attached as Exhibit L and incorporated by this <br /> reference, and shows the sum of $462,634.98 held in escrow. Amendments to the <br /> Escrow Agreement resulting from other sales may increase the amount of escrowed <br /> proceeds. <br /> 24. Defendants paid taxes due under other schedules from the sales proceeds <br /> of the July 31, 1996 sale, even though the taxes were on properties not the subject of <br /> the sale and which are still assets of the Debtor, controlled by the Creditor's Trustee. <br /> Mid-Continent's only retraining unpaid taxes ( other than current v_ ear taxes) to Pitkin <br /> County are those on schedule 7863 and 4062,see Exhibit D. <br /> 25. The escrowed proceeds constitute property to be distributed in <br /> accordance with the Plan. <br /> 26. As set forth in the letter dated August 8. 1996, a copy of which is <br /> attached as Exhibit M and incorporated by this reference, the particular real property <br /> sold by the Defendants was subject to a tax lien for taxes under Schedule 7863 as <br /> shown on Certificate 1029. Subsequent calculations indicate that interest calculations <br /> were inaccurate. Exhibit D shows the corrected interest calculations and balances due <br /> 3 <br />