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Local News

October 5, 2012

County seeks Countryside debt in court

Delaware County is appealing a state Supreme Court decision on the merits of a case it began earlier this year, in an effort to collect money owed on the sale of its skilled nursing home in 2006 to Leatherstocking Healthcare LLC.

The county transferred the property soon after to its associated company, Leatherstocking Realty Holdings LLC. Delaware County Supreme Court Acting Judge John F. Lambert issued a summary judgment Aug. 30 on a request from both companies.

The action began before the facility filed a closure plan with the state Department of Health, instead of filing a plan to correct issues the agency identified. The facility is scheduled to close Oct. 13.

In his decision, the judge dismissed charges of breach of contract, unjust enrichment and fraud against Leatherstocking Realty, according to an area lawyer that saw the court ruling. The unjust enrichment charge was dismissed against Leatherstocking Healthcare, while the breach of contract and fraud charge against it were allowed to stand. The county filed a notice of appeal Sept. 25 with the Appellate Division of the Supreme Court, Third Department. The county can move forward with the litigation on the charges still remaining or wait for a decision on the appeal. Motions have not yet been filed in that case.

The county is seeking more than $3 million plus interest on the three counts, against the two entities, according to the court filing.

The county initially approved the sale of Countryside, a 199-bed facility, to a private company in March 2005, for $2.7 million.

The board approved a $150,000 concession in August 2006, before the sale was completed that December. The parties agreed March 2009 that $818,847 was still owed and a payment plan was established. It made $247,242 in payments through August 2010, according to the Jan. 13 complaint the county filed in court against the Leatherstocking companies. The county tried unsuccessfully through much of 2011 to collect the delinquent payments, an official previously said. The county Board of Supervisors approved a resolution to begin the lawsuit in Dec. 2011.

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