May 2009: Update
NOTICE OF CLAIM
DETERMINATIONS ARE ROLLING IN!
By now, most people were aware of the January 12, 2009
Proof of Claim deadline to submit claims to the Receiver. Since May 1,
2009, the Builder Team at Cureton Clark, P.C. has been receiving Notice
of Claim Determinations from the Receiver’s Office, which said notice
contains personal builder claim numbers and states whether each
particular claim is accepted or rejected and provides for the respective
amount. The notice also contains an appeals mechanism whereby builders
who challenge the Receiver’s findings might do so.
Noticeably absent, however, is any information regarding
when our builders might expect to receive the money they have waited so
long to receive. This is obviously the most important issue for our
builders, which is why the Builder Teams has made it their top priority
to address with the Receiver. If the Receiver does not provide a
timeline for distribution of funds in the very near future, court
involvement might be necessary.
Contact Gina M. Zippilli at 856-824-1001 or gzippilli@curetonclark.com
with questions regarding the HOW process and for more specific
information.
November
2008: Update
The report is finally in! If you were a builder member of HOW Corp,
and are eligible, you are entitled to receive a return of your capital
contributions. Every Builder however must submit an accurate and
complete Proof of Claim form by January 12, 2009 or be forever barred.
On June 16, 2008, we received a Report from the Deputy Receiver of
How Insurance Company ("HOWIC"), Home Owners Warranty
Corporation ("HOW"), and Home Warranty Corporation ("HWC")
(collectively "HOW Companies") regarding the plan of
liquidation that previously addressed how and to what extent builders’
capital contributions would be reimbursed. We are told that
HOWIC has sufficient assets to refund all vested capital contributions
as authorized by the liquidation order dated June 13, 2005.
We have reason to believe that there will be surplus funds from the
liquidation of the HOW companies that would permit an additional
distribution over and above each builders’ capital contribution.
While the amount of the surplus has not been determined at this time,
we believe it may be substantial.
The Deputy Receiver has determined that among the HOW Companies
actual or potential liabilities are approximately $11,271,225 in
vested capital contributions or contributions that need to be returned
to certain builders. The June 13, 2005 liquidation order essentially
set out certain criteria that each builder would need to satisfy to be
entitled to a return of their contribution. The order also states
reasons why a builder would not be entitled to a return. For instance,
if the builder was terminated for cause on or before October 14, 1994
or if the builder voluntarily terminated membership and their capital
contributions had not yet vested under the terms of their agreements.
We now have been informed that those builders that satisfy the
eligibility requirements will in fact receive a return of their
capital contributions.
THE RECEIVER NEVER SENT ME ANYTHING; IS THERE A PROBLEM?
Yes. If you didn’t receive either a notice of proof of
claim or notice of ineligibility then the Receiver does not have your
current mailing address. The Receiver is using mailing addresses from
1995 so if your company has moved since then it is not in the pool of
builders to be contacted. If you do not act immediately, you will lose
your rights.
I LOST ALL OF MY DOCUMENTS, AM I ENTITLED TO A
RETURN?
Cureton Clark works directly with the offices of the
Deputy Receiver to obtain information such as the amount of each builder’s
capital contribution, the number of enrollments, and other information
that the builders may no longer possess but information they need to
ensure a return. Time is a factor however and the longer each builder
waits to get involved in the process, the greater the risk that the
builder will forego its entitlement to funds. So, the first step is to
contact attorney Gina M. Zippilli and request a "builder
package". This package includes the forms necessary to process each
claim and authorizations for Cureton Clark to obtain the information
vital to your return and to essentially "get the ball
rolling". Once received, Cureton Clark can expedite the retrieval
of your information and begin processing your claim.
WHAT HAPPENS IF I MISS THE JANUARY 12, 2009 DEADLINE?
Without exception, if a builder fails to submit a
completed proof of claim form the builder foregoes its right to a return
of their capital contributions. No exceptions will be made so it is
pivotal that the forms are completed accurately as well as timely.
Cureton Clark is eager to help builders get their money
back. Most if not all of the builders believe that HOW never should have
been placed into liquidation. Contact Gina M. Zippilli at 856-824-1001
or gzippilli@curetonclark.com
with questions on how you can be next in line!
January
2007: Distribution News
We at Cureton Clark, P.C. have entered into the second phase of
our representation of builder members to protect their distribution
rights in the HOW liquidation. After numerous communications with the
Commission’s Special Deputy Receiver, Patrick Cantilo, we learned
that he does not intend to make distributions until the later part of
2008 as a result of two large lawsuits and an Internal Revenue Service
issue. A distribution in late 2008 is not guaranteed and, to that end,
monies may not be distributed until 2009 or later.
To prevent the membership fund’s complete dissipation, and in an
effort to expedite the liquidation, we are in the process of obtaining
information not only regarding the lawsuits but also obtaining details
pertaining to the actual amount of money currently in the fund,
including any reserves that have been put aside to defend litigation.
Our knowledge regarding the present suits will enable us to not only
determine the validity of the 2008 distribution date but will provide
an opportunity to discuss same with the Trustee. This will protect and
preserve the funds presently in place thereby increasing the amount of
money builders will receive.
Without Cureton Clark, P.C.’s involvement and oversight, the
Trustee has no legitimate overseer. Each year that passes means less
money in builder pockets and more builders that will not receive a
distribution.
Over the next month, Cureton Clark, P.C. not only expects to have
a firm grasp of all litigations pending involving HOW builders but
anticipates determining each of our client’s eligibility and
percentage of interest entitlement.
January
2006:
HOW Representation Group meets Builders and Executive Officers at
the NAHB Convention
The HOW Builders’ Representation Group
received enthusiastic support at the annual NAHB convention in
Orlando. The builders were informed that a plan of liquidation has
been approved by the Virginia Corporation Commission and that there
may be a "substantial" surplus available for distribution to
HOW Builders after payment of all obligations.
Lead counsel Jerald R. Cureton, associate counsel and Builder
Liaison Robert Johnston represented our group. Meetings took place
with HOW builders, association executive officers and former HOW
executives who reviewed the status via power point and direct
discussions. As a result, group representation grew significantly.
In addition to the possibility of receiving some return on their
investment, a principal focus of the builders was that HOW might not
have been insolvent and hence, there may have not been any reason to
put HOW in receivership eleven years ago. This conclusion is
buttressed by the fact that most if not all of HOW’s liabilities
have been fully paid there is a "significant" surplus
remaining.
Currently the Group is in contact with the Special Deputy Receiver
and the Virginia Insurance Commissioner. We are receiving cooperation
from them as we actively monitor the Receivership proceeding.
Important developments will be highlighted on this site. We suggest
that HOW builders review it periodically. If you have any questions,
please contact Gina Zippilli or Jerry Cureton.