Last November, attorney John C. Torjesen filed suit in Los Angeles Superior Court against Dana and Terry Klaft, the Union Hotel Trust, 814 Properties LLC and First American Title, and other individuals, on behalf of Christine Williams, past owner of the Union Hotel in Los Alamos for fraud, misrepresentation and deceit and Intentional Infliction of Emotional Distress, among other allegations.

Lawsuit: Union Hotel deal not what was promised

 

The case has been reassigned to Santa Barbara County Superior Court.

According to court records, the deed of trust on the Union Hotel went into default in February, 2007. Hotel owner Williams was approached by defendants Dana and Terry Klaft, who represented themselves as being able to save properties from foreclosure using the services of defendant Kathleen Johnson, who held herself out to be experienced in setting up and using trusts to minimize the adverse effect of debt. The defendants claimed to have approximately 37 residential properties they had “saved from the ravages of debt for the benefits of the owners.”

 

Using the services of First American Title Insurance Company, with Beverly Stickler as the escrow officer, a preliminary title report was prepared to facilitate the transactions that were going to “save” Williams’ property. The Klafts also used the services of Andy Baker, an attorney, who agreed to assure that the documents reflected the deal Williams’ was promised. The Klafts reportedly agreed to bring the existing mortgage current and keep it current, provide Williams with an additional $250,000 plus a share of future proceeds, and she would be entitled to continue to live in the hotel as her home residence.

But in June 2007, when Williams went to sign the closing paperwork, things were not as agreed — she was not made beneficiary of the trust, the amount of money she was to receive had been changed, as had her right to share in future proceeds, and the guarantee that she could continue living at the hotel had disappeared. She informed that defendants that she was not agreeing to the changed terms of the deal and did not sign the remaining documents.

 

Williams claims that she has not signed any document setting up a trust into which to transfer ownership of the hotel, nor “has she ever found any document that purports to create such a trust.” Furthermore, no record of any legal entity registered as the Union Hotel Trust, nor 814 Properties, LLC, has been found to exist in either California or Nevada.

When Williams discovered that the defendants did not intend to honor the deal, Williams asked First American Title and Stickler to follow through with the agreed documents, whereupon the title company and Stickler attempted to repudiate their role as escrow officer and instead said that Klafts only used the title company’s services for notary purposes — not for escrow — and that they had only transferred documents under the Klaft’s direction.

 

When reached for comment, attorney Torjesen said a new case number has been assigned in the Santa Maria courthouse, and he will be filing an amended complaint.

The matter is scheduled to return to court June 3, in Department 2, at 8:30 a.m., in the Superior Courthouse in Santa Maria.

When reached for comment, Tina Esralian, attorney for First American, questioned who gave the Valley Journal authority to write a story about the suit, then she added that she would ask her partner, and would comment if “we think it is a good idea.”