Legal & Financial

FINANCIAL

Totals are from inception through date shown below. Donations don’t reflect fees taken by financial services (big thanks to the donors who paid that fee).

12/31/2024

• Cash donations total $56,802
• In-kind donations total $2,807
• Expenses total $21,322 [$12,923 Legal;  $6,101 Rebuild;  $2,292 LLC Fees and Events]

LEGAL UPDATE

October 17th – AAA filed a motion for reconsideration of the Court’s Opinion and Order. The attorney’s have communicated but no action on the Court’s Opinion and Order has been taken by AAA.

September 23rd – After testimony from Johnny and Doug Selby on the timeline of what has taken place, what it will take to rebuild, and why this prolonged court battle has made it impossible to begin rebuilding (necessitating alternate living arrangements for Johnny) the judge ordered that past and future Alternate Living Expenses (ALE) be paid in the finite amount of $79K. Her interpretation honors the Umpire’s (arbitrator) previous determination, yet it can be appealed by AAA.

In regard to the remaining three items that the Umpire did not mention in his award; landscaping and building codes (both subject to $31K coverage limit), and other structures (porch and deck), the court directs these amounts to be resubmitted to the Umpire or worked out between the parties.

September 13th (Postponement from July 26th and August 30th) – The judge stated that while the personal property replacement time bar has been extended, it isn’t open indefinitely. Otherwise, nothing else was resolved.

June 21st – Hearing produced the following orders from Judge Kuhnke, which are not final. The final settlement for the structure is the policy limit of $316K. From that, fees have been paid to the adjustor, umpire, attorney, storage facility, and other work that was conducted just after the fire. There is a mortgage owed on the property. The mortgage company has taken the full amount of the mortgage and put it in escrow. Here’s how the judge ruled on other outstanding matters:

• Debris removal was included in an unspecified payment previously made by AAA, so that matter is closed.
• City code enforcement fees are to be paid by AAA when the are incurred.*
• Other structures and landscaping will be paid by AAA when they are incurred and only if destruction is necessary to rebuild.*
• Interest on monies owed, that weren’t paid within 60 days of the fire, are subject to interest penalty.
• AAA will pay for Alternate Living Expenses (ALE) Johnny has incurred during his time trying to live in the schoolhouse (November 2023 – present). These expenses will be reviewed at the next hearing.
• Johnny is not required to “incur” ALE before being reimbursed for it.
• The judge will determine any future ALE resolutions at the next hearing, including whether the timeline should be extended to reasonably allow Johnny time to rebuild.
• When ALE is resolved, the judge will issue a final order and close the case, retaining control, if further issues arise.

*For these two orders, Johnny has to submit bills to AAA for reimbursement. If they refuse to pay, the judge will reopen the case to hear the matter. AAA argues that the house is rebuildable and the porches and landscaping  can be saved.

April 16th – Determined that yet another hearing (or possibly more) is needed to resolve five outstanding issues from the unusually worded determination made by the Umpire (arbitrator).

• No amount provided for landscaping that will be destroyed in the rebuild process. The city further requires that runoff be contained (usually through landscaping) and a “mudmat” and gravel be installed to avoid tracking dirt onto the roadway.
• No amount provided for proper ingress and egress to the home, which is required by the city. Decks and porches will be destroyed during the teardown process.
• No amount provided for city building code requirements, design, or permitting.
• Interest penalty to AAA on accumulated unpaid amounts has yet to be determined.
• Amount and time frame for Alternate Living Expenses (ALE) remains in question. Another Show Cause hearing is scheduled for June 21st.
  • The low amount the Umpire set was because “Mr. Williams is likely to be able to enjoy his northern Michigan home during part of this summer”. He refers to the one-room schoolhouse In Mancelona. Furthermore, a landlord will not pause rent because Johnny leaves town for a few days or weeks. The amount set also does not consider rental furniture.
  • The award expires at the end of September 2024. A landlord is unlikely to sign a lease for less than one year. It’s impossible to design a replacement home, find and hire a contractor, obtain all the permitting from the city, tear down the existing structure, mitigate mold, smoke damage, and make needed repairs and upgrades to the Speakeasy, rebuild the home, furnish the home, and move Johnny back, all in less than six months.

April 10th (Postponement from April 3rd) – Questions about the Umpire’s (arbitrator) settlement  determination were discussed: certain line items had been omitted and alternate living expenses didn’t address Johnny’s specific situation.

March 6th and 20th – Show Cause hearings regarding alternate living expenses. Judge’s decision put over to await Umpire’s (arbitrator) award.

March 13th – In-depth meeting with the Umpire (arbitrator) regarding rebuilding expenses and alternate living expenses.

February 2nd – Judge Kuhnke issued the following orders:

• AAA has to show cause explaining why they didn’t obey order to pay for additional living expenses. The hearing is scheduled for March 6th.
• AAA cannot impose a deadline for submission of claims.
• The building code coverage will apply if the structure is demolished and rebuilt.
• AAA must produce all requested non-privileged materials and data that underlies their appraiser’s assessments.
• The arbitrator must conclude his appraisal by April 2nd, unless he finds a legal or coverage issue.