IPI being sued again, this time as a lease guarantor

Another company is suing Imperial Pacific International (CNMI) LLC in federal court, this time for allegedly failing in its promise to pay rent over a subleased apartment complex as a guarantor to another company.

Guidotti

Fox Financial LLC, through counsel Daniel T. Guidotti, is suing Forson Holdings (CNMI) LLC for breach of contract and IPI for breach of guarantee. Fox Financial is demanding at least $118,000, plus attorney’s fees and court costs.

IPI general counsel Michael W. Dotts declined to comment on the matter yesterday, saying he has a conflict related to this case and that attorney George Hasselback has agreed to defend IPI in this matter.

According to the complaint filed in the U.S. District Court for the NMI last Monday, Forson subleased a 21-unit apartment complex from Fox Financial in 2016 and IPI guaranteed that it would pay Forson’s obligations under the sublease if Forson failed to pay Fox.

In February 2020, Forson allegedly failed to pay Fox more than $100,000 due under the sublease, Guidotti said. Likewise, he said, IPI failed to honor its promise to shoulder Forson’s obligations. “Fox now seeks to recover money due under the sublease from both Forson and IPI,” he said.

Guidotti said Forson’s sole member is Forson Holdings Ltd., a British Virgin Islands corporation. Its principal place of business is either in Hong Kong, China, or the British Virgin Islands.

Guidotti said that in January 2016, via a written sublease, Fox subleased to Forson a 21-unit apartment complex on Navy Hill, Saipan. The initial term of the sublease was Feb. 1, 2016, through Jan. 31, 2019. Forson and Fox later extended the sublease to Feb. 7, 2021 via a letter amendment dated Feb. 5, 2016. Guidotti said the rent due under the sublease is $207,900, payable biannually in two installments of $113,950. The biannual rent is due on Feb. 1 and Aug. 1 of each year.

According to the sublease, the lawyer said, if Forson pays any rent installment more than seven calendar days after that rent installment was due, Forson will be obligated to pay a late fee equal to 5% of the amount due but not paid. The sublease further states that all amounts due but not paid and the 5% late fee will accrue interest at 10% per year.

In the sublease, Guidotti said, IPI promised that it would be liable to Fox for all rent that Forson fails to pay, together with all late charges and all accrued interest on the rent and late charges. He said IPI further agreed that Fox is not obligated to bring any claims against Forson prior to seeking to recover money that Forson owes Fox under the sublease.

He said Forson failed to pay the $103,950 rent installment that was due on Aug. 1, 2019. As a result, Guidotti said, Fox charged Forson a late fee of $5,197 and interest at 10% per year and it began accruing on the unpaid rent and the late fee. Forson paid the Aug. 1 rent installment on Dec. 10, 2019, but allegedly failed to pay more than $9,000, comprising the $5,197 late fee plus accrued interest on the Aug. 1 rent installment and the late fee.

Guidotti said Forson failed to pay the $103,950 rent installment that was due Feb. 1, 2020.

At present, he said, Forson owes Fox at least $118,000, part of which is accruing interest at 10% per year. He said Forson remains in possession of the subleased property.

The lawyer said Fox issued several written demands that IPI pay Forson’s obligations in accordance with the guarantee in the sublease.

“IPI materially breached its obligations to Fox by failing to pay Forson’s obligation under the sublease,” Guidotti said.

IPI is already facing multiple lawsuits in federal court. Many companies and individuals also sued IPI before the Superior Court for various reasons.