A receiver appointed in December to manage the assets of Hansen & Horn Group said Monday afternoon that the financially
troubled home builder should be liquidated.
Attorneys for Ward and Stephen Horn, the father-and-son duo that operates Hansen & Horn, did not object to the recommendation made during a Marion Superior Court hearing.
Ward Horn declined to comment following the hearing.
Judge Heather A. Welch took the recommendation under advisement and will rule at a later date.
Welch in December selected Rick Lux of R.P. Lux Co., an Indianapolis-based real estate services firm, to operate the company as it attempted to avoid bankruptcy.
The judge’s order directed Lux to determine whether Hansen & Horn should remain in business, be partially liquidated, or completely liquidated.
The judge’s decision to appoint a receiver came one week after President Ward Horn admitted Hansen & Horn was insolvent.
A lawsuit brought by one of the home builder’s suppliers, Indianapolis-based C&R Concrete Inc., prompted the receivership. C&R is seeking to recover $268,749 for concrete work done during the past three years.
In all, Hansen & Horn is facing at least 20 lawsuits brought mostly by subcontractors hoping to recover more than $1 million.
Lux told the court on Monday that Hansen & Horn has assets of $7 million and liabilities of $14.5 million.
Once the judge issues her ruling, creditors will have 30 days to file a claim with the court to attempt to recover losses. Liquidation then would take about 90 days, said Trenton Hahn, a lawyer at Bose McKinney & Evans LLP who is representing Lux.
One creditor, Indianapolis-based Salin Bank and Trust Co., took issue with the proposed liquidation and requested the bank not be part of the receivership process.
Salin has loans to Hansen & Horn totaling $1.5 million, in which there is no equity, the bank’s attorney, Mike Lewinski of Ice Miller LLP, said. Further, the appraised value of the 49 home lots for which the loans were granted is just $950,000, he said.
“Salin would like to control its own destiny” and sell the properties on it own, Lewinski said. “Salin should not be harmed by the receiver’s actions, sequestering property for other creditors.”
But Hahn argued that, under law, a receiver has the right to sell the lots. Not being able to do so could negatively affect the developments, he said.
“There has been significant interest in these assets,” Hahn said.
Hansen & Horn has stopped building in more than 20 subdivisions in central Indiana, including the massive mixed-use Anson development in Boone County near Whitestown.
Founded in 1977, the company has regularly ranked among the top residential construction companies in the Indianapolis area over the past decade, building more than 200 homes during several of those years.