BD-5 historical questions

wrote:
Juan Jimenez wrote:

Not nearly as black and white as you think, particularly when you consider
that those people who placed deposits received substantially what they
ordered (the kits). The BD-5D deposits are another story, I don't know what
happened to those. Nevertheless, the implication is that Jim Bede stole the
escrows. He did not. He came out of the bankruptcy damn near penniless. The
company may not have been managed as well as it should have, but there is
zero evidence anyone's money was stolen. It's that simple.


Escrows are VERY, VERY, VERY black and white!

Oh, please, nothing to do with the law, banks, brokerage houses, etc.,
is ever black and white. How naive.


Matt

------------snip------------
Escrows are VERY, VERY, VERY black and white!

------------snip------------

I'm not so sure of that--especially 30 plus years ago.

There may well have been a difference between escrow
held by a third party (broker) and escrow held directly
by a vendor. Add the fact of many partial deliveries to
the equation and you just get more questions.

Add to all of that, the engine development issues cited
in the Contact! article mentioned earlier in this thread
http://www.prime-mover.org/Engines/T.../contact1.html
(thanks to Bob Kuykendall for posting) and you have
the recipe for pretty much what we remember.

It's really a shame--it was such a neat little airplane!

Remember also, as an example, the debacle of deposits
on new real estate (especially condominiums) just a few
years later ...

Peter

Disclaimer: I am not a lawyer, and don't play one on TV.

On Tue, 20 Dec 2005 21:04:04 -0500, "Peter Dohm" wrote:

------------snip------------
Escrows are VERY, VERY, VERY black and white!

------------snip------------

I'm not so sure of that--especially 30 plus years ago.

Same thing happened on the BD-12 less than ten years ago... purchasers' money
put into escrow, but they never got a kit or their money back.

Ron Wanttaja

"Ron Wanttaja" wrote in message
...
On Tue, 20 Dec 2005 21:04:04 -0500, "Peter Dohm"
wrote:

------------snip------------
Escrows are VERY, VERY, VERY black and white!

------------snip------------

I'm not so sure of that--especially 30 plus years ago.

Same thing happened on the BD-12 less than ten years ago... purchasers'
money
put into escrow, but they never got a kit or their money back.

Ron Wanttaja

You're right, of course.

In my moment of recalling my enfatuation with the BD-5, I forgot about the
BD-10, BD-12, and a couple of others that never "made it".

Nearly all Bede's designs have been intriguing in some way, and even the
"successfull" ones (such as the BD-2 and BD-4) have had reputations a little
like a Bengal tiger as a pet...

Peter

"Peter Dohm" wrote

There may well have been a difference between escrow
held by a third party (broker) and escrow held directly
by a vendor.

If it is not held by a third (bonded) party, then it is not escrow. That
fact (or definition) has not changed in the last 100 years.

The person holding the money may call it escrow, but if there is not an
impartial third party in direct control of the money, such as an accountant
or lawyer, your money is not safe from a grab. Bede has been proof of that.
--
Jim in NC

Ron Wanttaja wrote:


Same thing happened on the BD-12 less than ten years ago... purchasers' money
put into escrow, but they never got a kit or their money back.

Either the terms of the escrow allowed the funds to be removed from
escrow at a stage that offered little protection to the customer or
something else was horribly wrong and could have been avoided for about
100 bucks in attorney's fees.

Richard Riley wrote:
On Tue, 20 Dec 2005 18:24:13 -0800, Ron Wanttaja
wrote:

:On Tue, 20 Dec 2005 21:04:04 -0500, "Peter Dohm" wrote:
:
:------------snip------------
: Escrows are VERY, VERY, VERY black and white!
:
:------------snip------------
:
:I'm not so sure of that--especially 30 plus years ago.
:
:Same thing happened on the BD-12 less than ten years ago... purchasers' money
ut into escrow, but they never got a kit or their money back.

The same thing happens in real estate escrow. The difference is, the
escrow officer that stole the money goes to jail.

Escrow is black and white, it's money held by a third party. If it
not held by a third party, it's not escrow. If it IS held by a third
party, and that party steals it, it's fraud at least, and probably a
host of other charges.

But no one has ever let slip the name of the third party that held the
"escrowed" money for any of the BD ventures. Which leads me to
suspect that it was just put in Bede's general fund, and spent along
with the rest of the money that came in over the transom.

IF THAT is the case, Jim Bede committed fraud. He told depositers
that their money would be held in escrow. That was a lie that
convinced the depositers to give him their money.

So - either Jim Bede placed the deposits with a third party, or he
didn't. That's pretty black and white.

Is an escrow fund considered a company asset? If it is, then I can see
how a bankruptcy judge would distribute it as part of the creditor
settlement. If it isn't, then it does seem like it should still be
there, bankrutpcy or not.


Matt

Matt Whiting wrote:

Is an escrow fund considered a company asset? If it is, then I can see
how a bankruptcy judge would distribute it as part of the creditor
settlement. If it isn't, then it does seem like it should still be
there, bankrutpcy or not.

No, escrow funds are not considered company assets and escrow contracts
usually prevent transfer or reassignment, even in the case of
bankruptcy. They also usually have strict compliance terms with
expiration dates for non-compliance.

It is one area of law where the spirit of the law often trumps contract
law. Meaning, judges get real ****ed off when somebody tried to get
fancy with escrow contract wording to remove normal protections
associated with escrow.

I might be wrong, but I think that vendors are protected if the customer
pops a bankruptcy, but most vendors will opt out given this situation.