A legal dispute over rightful ownership of one of Maine’s top-rated golf courses heated up this week, with one side accusing the other of breaking into the property and stealing equipment that was scheduled to go up for auction Wednesday.

In a motion for an emergency hearing filed Monday in Cumberland County Superior Court, Portland-based Newry Holdings LLC accused Bath-based Harris Golf Inc. and its principal Jeff Harris of breaking into Sunday River Golf Club in Newry, changing the locks and absconding with valuable property belonging to the club.

Newry Holdings and Harris Golf are embroiled in a lawsuit over which company is the club’s rightful owner. It was built by Harris Golf, which has owned and operated the club since it opened in 2005. However, Newry Holdings took ownership of the property in January because it is the listed creditor on the property’s mortgage, and it said Harris Golf failed to make the required mortgage payment. Harris Golf said it was about to pay the mortgage in December but was pre-empted by Newry Holdings in violation of a forbearance agreement.

THEFT, OR TAKING ITS OWN PROPERTY?

The motion filed Monday by Newry Holdings attorney George Marcus says Jeff Harris and others forced their way into the club Friday night and removed items including 76 GPS units, 18 golf carts, two computers, 200 folding chairs, 25 tables and a skid-steer loader – a small, multi-purpose labor vehicle.

“Defendants’ conduct is unlawful, likely criminal, and the court should not tolerate this kind of conduct from anyone, let alone a party represented by counsel who voluntarily submitted the matter to the jurisdiction of the court for resolution,” the motion says. It asks the court to order Harris Golf to return the items immediately.

Harris Golf attorney Ben Donahue said his clients did break into the club and remove the items, but he said everything that was taken either belonged to other Harris Golf properties, company employees or third-party vendors. Nothing that could be considered collateral on the Sunday River mortgage loan was removed, he said.

“They’re the rightful owners of the property,” Donahue said. “They had every right to be there.”

The golf carts and GPS units had been leased from a company called Country Club Enterprises, which simply took its own property back, he said.

CLAIMS AND COUNTERCLAIMS

Newry Holdings filed a lawsuit in January alleging that SR Golf Holdings LLC and its parent company Harris Golf have refused to hand over assets such as equipment and membership fees they have collected since the property was conveyed Jan. 5 to Newry Holdings. Newry Holdings also is seeking $5.6 million in unpaid mortgage debt and property taxes plus legal fees, along with all remaining golf club assets held by SR Golf.

Harris Golf filed a counterclaim on March 7 alleging that Newry Holdings and a previous creditor, Boothbay Pool I LLC, violated a forbearance agreement that would have enabled SR Golf to use new financing to meet its financial obligations and retain ownership of the golf club.

Online property records from the Oxford County East Registry of Deeds show that on Sept. 10, 2012, Jeff Harris, who is also manager of SR Golf, signed a document called a deed in lieu of foreclosure pertaining to Sunday River Golf Club. Such documents primarily are used to convey mortgaged property from a borrower in default on a mortgage to the mortgage lender without going through the foreclosure process. The document was not recorded by the Registrar of Deeds until Jan. 5 of this year.

According to the Newry Holdings complaint, SR Golf was given multiple opportunities to “cure” the default situation but failed to do so. Therefore, the deed in lieu of foreclosure was executed in January.

But Harris Golf argues in its counterclaim that it had secured financing to avoid default in late 2016, but was unlawfully prevented by Boothbay Pool and Newry Holdings from completing the deal. It is seeking the return of the golf club’s property and assets.

Newry Holdings plans to hold an auction Wednesday for all of the equipment and other assets associated with the golf club, including the domain name sundayrivergolfclub.com. Harris also maintains the website sundayrivergolf.com.

Marcus, Newry Holdings’ attorney, said the auction will take place as scheduled. He has said that the auction is a necessary legal step for his client to exercise its right of ownership to those assets.

Marcus said Newry Holdings expects to place the winning bid, and that if it is not the winning bidder, it will use the proceeds from the asset sale to buy new equipment. However, he said any sale to a third party would not be completed until after the conclusion of the lawsuit.

Either way, Newry Holdings intends to own and operate the golf club, Marcus said. The company also owns Black Swan Country Club in Georgetown, Massachusetts.

The ownership dispute has created uncertainty about whether Sunday River Golf Club members who have paid their fees already for the upcoming season will be allowed to use the club. In addition, some couples who already have put down deposits to rent club facilities for their upcoming weddings have asked for their money back.

Harris has said he will issue refunds immediately to any wedding parties that request them, and that he also will issue refunds to club members if Harris Golf loses the lawsuit.

A HISTORY OF FINANCING

Newry Holdings was not SR Golf’s original creditor, according to court and registrar documents. The original $4 million mortgage agreement for Sunday River Golf Club was signed in 2003 between SR Golf and Gardiner Savings Institution, which later became part of The Bank of Maine, which was purchased in 2015 by Camden National Bank. The mortgage agreement was modified in 2007, when the loan principal was increased to $5.3 million.

In 2012, The Bank of Maine sold the promissory note associated with the mortgage. The note was purchased by Boothbay Pool, which then sold it to Newry Holdings. Marcus would not disclose the names of Newry Holdings’ individual shareholders.

Sunday River Golf Club, a semi-private course, features an 18-hole, 7,130-yard layout designed by Robert Trent Jones Jr., in addition to a log-built clubhouse with a pro shop and restaurant, a large putting green and a mountainside practice facility with a driving range and target greens.

Despite being owned and operated independently, the golf club has been a key marketing partner with nearby Sunday River Ski Resort and has helped boost the resort’s off-season business.

J. Craig Anderson can be contacted at 791-6390 or at:

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Twitter: jcraiganderson