One of the partners in the development of the troubled Rhythm condominium project is suing, claiming he paid too much when the project went into foreclosure.
Jim Caden filed his suit in Davidson County Chancery Court earlier this month against former partner Everett Smith seeking at least $140,000.
According to the suit, when the Demonbreun Street condos went into foreclosure, the joint venture created to develop the project agreed to pay Cadence Bank and Pinnacle National Bank $125,000 in addition to agreeing to a foreclosure and turning over unsold units to the banks. Further, the partners had taken a loan from the project's builder, Choate Construction. That mortgage was extinguished as a result of the foreclosure, but Caden's and Smith's personal obligations to the loan remained.
At the time of the foreclosure, the duo owed Choate nearly $895,000.
Caden says Smith refused to pay his portion of the $125,000 owed to the banks nor did he pay his portion of the outstanding balance to Choate. In the filing, Caden says he paid the entire balance to the bank and $525,000 to Choate.
The partners, according to the suit, were jointly liable for the debts. Thus, Caden says, he paid $62,500 more than his obligation to the banks and nearly $78,000 more than his obligation to Choate.
Attempts to contact Smith for comment were unsuccessful.