UPDATED — The partners in Terradyne Country Club and Terradyne Residential are in a financial dispute that has led to a lawsuit against one another.
CS Ventures, which is Craig and Christy Smith, and Terradyne Residential have filed a lawsuit in Sedgwick County District Court against partners Jerry Slack, Earle Evans and Wichita-based BGS Cos.
“It’s just that some of the partners … have not paid their part of the cash calls,” Craig Smith says. “We’ve been patiently waiting and waiting.”
Evans says he and Slack have paid.
“We feel like we’re not getting full credit on it for what we did,” he says.
Evans says the first he heard of the suit is when a reporter told him about it.
“I’m amazed because I talked to Craig Smith … yesterday. He never said anything,” Evans says.
“That can’t be true because he’s signed receipt of it,” Smith says.
Regardless, Evans says he’s not pleased.
“There probably will be some repercussions on that.”
Meaning a possible countersuit?
“Could be. I don’t know.”
A 10-person partnership formed in 2006 to buy Terradyne out of bankruptcy, and Smith and his lawyer, Harvey Sorensen, say initially it did well.
“They had a positive cash flow excluding capital expenditures,” Sorensen says.
“They invested a lot of money in redeveloping the course and redeveloping the clubhouse and getting the residential development ready to go, and then the world collapsed.”
He says, “There are several people who wanted to ride the elevator up but wanted to get off when it started to go down.”
During the difficult times, Sorensen says the club and residential development’s losses were funded through only about half of the owners.
“We have started a campaign to remind the noncontributing members of their obligations. We expect to be in contact with several prominent members of the community who have not paid their fair share.”
That means another potential lawsuit or lawsuits against the remaining members, Sorensen says.
“We hope that our continuing conversations will bear some fruit,” he says.
Evans says that he’s open to paying more.
“Under certain circumstances, yes.”
He says he’s willing to show he can put more money in so he can prove he’s not been given proper credit.
When asked to explain what that means, Evans says, “It’ll come out later.”
Smith says Evans’ comments are confusing.
“I don’t know what all that means.”
Evans says he’s disappointed the disagreement is now a public matter.
“It’s one of those situations where this doesn’t do any good for our membership or anything along that line,” he says. “They’re kind of cutting their own throats on it.
“It doesn’t help people wanting to join Terradyne.”
Smith says the club is doing well, especially since Irwin Golf Management took over management of operations earlier this year.
“We see much, much benefit by having those guys operate the club,” Smith says. “They’ve been very innovative and very helpful in redirecting some things.”
Sorensen says the lawsuit isn’t a reaction to difficult times at Terradyne.
“The club has never suffered because the people who were behind it put the money in and made sure the club didn’t suffer.”
He says if all the partners pay, they’re welcome to remain partners.
“As long as they pay their share, we’re happy to let them play the game,” Sorensen says. “I don’t think anyone is willing to let them let all their chips ride and never place a bet.”