Equity Erased: Exploiting the Partition System and Property Owners

For far too long unscrupulous people have been using the partition sales process to cheat people out of the full value of their property.

Part IV of a series by Sally Kestin for Asheville Watchdog –

On March 25, 2019, Asheville attorney Ile Adaramola held an auction on the steps of the Buncombe County Courthouse and sold Tasha D’Ascanio’s family land, valued by the county at $123,600, for $2,000.

The high bidder: Tucker’s company and Kutyana.

Adaramola told Asheville Watchdog her ties to Tucker and Henry had no bearing on the outcome. “A commissioner’s role is simply to sell the real property,” she said.

Other buyers likely stayed away, Finkelstein said, because Tucker’s company, Kutyana and Kutyana’s company had taken out deeds of trust between each other, encumbering their interest in the property with $78,000 in debt. While commercial lenders typically wouldn’t make such loans, private parties are free to lend and borrow money on their own terms.

The deeds of trust, similar to mortgages, were due by December 2019. There is no default or satisfaction recorded, which is generally filed upon repayment. The property was sold subject to those deeds of trust, meaning the loans would remain in place after the sale.

Asked if Tucker and Kutyana recorded the loans simply to dissuade rival bidders, Finkelstein said, “You can draw your own conclusions.”

Attorney Ile Adaramola
Attorney Ile Adaramola

Adaramola said she did not recall details of the case and was sympathetic to concerns about exploitation of the law. “As an African American, my community has had land stolen from us,” she said.

But partition actions are legal, Adaramola said, and “if you’re doing what you’re supposed to be doing in accordance with the law, you’re doing what’s legally permissible.”

D’Ascanio was entitled to half of the $2,000 the property generated at auction, but as the law provides, she had to help pay the cost of the partition. After taxes and costs, including her share of $686 to Henry and $500 for Adaramola’s fee, she received nothing.

D’Ascanio could have requested a resale, available to owners when a partition sale generates a low price, but said she didn’t know she could. That recourse is rarely used in Buncombe or elsewhere, Mitchell found.

“We’re very limited to only being able to obey what the statute tells us to do,” Finkelstein said.

Finkelstein said Tucker’s company and Kutyana had “a right to a partition.”

“Did it come out to the disadvantage of the D’Ascanios?” she said. “It does appear that way, yes.”

Rick Su, a professor at the University of North Carolina School of Law, agreed.

“As for the overall scheme,” Su said, it appears “the intent was to exploit the partition system and the owners.”

Derrell Ray Pettit Jr. and his girlfriend, April Ball.
Derrell Ray Pettit Jr. and his girlfriend, April Ball.

The pain ‘will never go away’

D’Ascanio said she still cries over how her family’s wealth was taken. “It has emotionally hurt my soul,” she said.

It took her months to pay off her mother’s funeral and buy a tombstone for her grave.

“The pain will never go away from this for my family,” D’Ascanio said. “It is in my thoughts daily, all this time later, and always will be.”

Her uncle, Pettit, said he feels hoodwinked. He held onto that agreement giving him the option to buy back his interest, hoping William Alexander would make good on it.

“I tried to call him and his wife, and neither one of them would answer,” Pettit said.

Pettit remained on the property after his lease expired. Tucker and Kutyana went to court and obtained an eviction order. For five months, Pettit said, he was homeless, living in a tent.

Pettit sometimes goes by the property. The trailers are gone, and the land has been subdivided for development. There are different owners.

In November 2020, Tucker’s company and Kutyana sold the property for $137,000.

What Can Be Done

The model reform law, the Uniform Partition of Heirs Property Act, would help prevent abuses in partition sales. Co-owners would have a right of first refusal and 45 days to buy out the interests of those requesting the partition and another 60 days to arrange for financing.

Courts would have to determine fair market value of the property based on an independent appraisal and could only force a sale with evidence that physical division would result in “substantial injury” to all owners. Consideration would be given to noneconomic factors such as whether the property has sentimental, cultural or historic value, or whether one or more owners could be rendered homeless. When a sale is the only option, a real estate broker would be appointed to list the property commercially.

In North Carolina, the Uniform Act has the support of a coalition of organizations that includes the Conservation Trust for North Carolina, the Black Family Land Trust, and the Land Loss Prevention Project. But an influential group, the Conference of Clerks of Superior Court, has raised concerns, including who would pay for the appraisals and other logistics that they say would make partitions more complex and expensive. The clerks contend that the existing system, by allowing for upset bids after an auction, can actually lead to a higher sales price.

Co-sponsored by Rep. Turner of Buncombe, the Uniform Act passed the House with bipartisan support in May 2021. A comparable bill sponsored by two Republicans and a Democrat was filed in the Senate.

As of early November 2021, the bill was stuck in committee and is not expected to pass this year, despite support from key members of the Republican leadership. “It is essentially dead this year,” said Sen. Julie Mayfield, a Democrat from Asheville. “At this point in the year, we are basically done with bills … Committees aren’t meeting anymore.”

Zach Wallace of Audubon North Carolina, part of the coalition supporting the bill, said legislators had been working to address concerns raised by the court clerks but are now focused on redistricting and the budget.

“This affects folks all across the state, no matter income level, race, geography,” Wallace said. But “things move slow,” he said. “I’ve seen other bills that take multiple sessions to pass.”

In a Facebook post urging people to read Asheville Watchdog’s “Equity Erased” series, Rep. Turner said he is working to pass the bill in next year’s legislative session.

“For far too long unscrupulous people have been using the partition sales process to cheat people out of the full value of their property,” Turner said. “This has had devastating consequences for too many families in WNC who have seen multi-generational properties, homes, and farms sold for pennies on the dollar.”

View from Blue Ridge Parkway Trailhead 381, adjoining the Lyda family’s former property.
View from Blue Ridge Parkway Trailhead 381, adjoining the Lyda family’s former property.

Missing’ Heirs

At stake inside a Buncombe County courtroom were a grandfather’s legacy and a family’s inheritance.

Asheville real estate investor Robert Perry Tucker II had just purchased 10 acres along the Blue Ridge Parkway, but nine siblings in the Lyda family still had a claim to approximately 25 percent of the property, left to them by their grandfather.

So Tucker’s company went to court. Just three months later and without any input from the Lydas, Tucker’s company won a judgment that stripped the family of its land. The Lydas never had a chance to defend their ownership because, two of the brothers said, they never knew about the case.

Tucker’s lawyer, Peter R. Henry of Arden, reported to the court that none of the nine Lyda siblings could be located. Ile Adaramola, another attorney who had ties to Henry and Tucker outside the case, and who at Henry’s request acted as a neutral guardian ad litem to represent the interests of the Lyda siblings, reported to the court that despite “due diligence and great efforts,” she too, could not find them.

“I’ve been in Asheville 20 years,” Charles Lyda told Asheville Watchdog. “I got my driver’s license, everything’s registered here. I own a house here in North Carolina. I mean, I’m not that hard to find.”

David Shroat. Photo courtesy of Kelly Southerland
David Shroat.
Photo courtesy of Kelly Southerland

At the same time Adaramola was the guardian ad litem in Henry’s case, Henry was the guardian ad litem in a case Adaramola initiated against David Shroat, 50 percent owner in an Arden property. Henry reported to the court that “after diligently searching for” Shroat, he had been “unable to locate” him.

Shroat had been a local cop since the 1970s and had recently worked at the Buncombe County Sheriff’s Office—at the same courthouse where the case was filed.

He should “have been easily found here because the people at the courthouse knew that he was staying with me,” said his fiancé, Kelly Southerland of Asheville.

Both Shroat and the Lydas came away with nothing for their properties, records show.

Asheville Watchdog located both families, in just a few minutes, reaching Charles Lyda by phone on a number he said he’s had for nearly two decades.

His brother, Robert, a computer engineer, has lived in Charlotte for eight years, owned vehicles and is registered to vote, records show. Asheville Watchdog reached him through a Facebook message.

“The tax man can find me, every year,” Robert Lyda said. “I’d like to know how [Adaramola] defines diligent search.”

Henry and Tucker did not respond to questions from Asheville Watchdog. Adaramola was given opportunities to comment but is on leave, her office said.

‘Damning Statement’ of the System

The Lyda family had owned their acreage on Upper Grassy Branch Road for more than 50 years. A house on the property had fallen into disrepair, Charles Lyda said, but the land was in “a prime location … The back of it was right up against the [Blue Ridge] Parkway.”

At issue was a 25 percent stake left by the Lydas’s grandfather to them and their mother through a will filed in Burke County. Two years before her death in 2019, the mother, Carolyn Hughey Lyda, signed a deed to Parkway Vistas Inc. that said she was the sole heir to the 25 percent. The relatives who owned the other 75 percent, the Lydas’s great aunts, also sold to Parkway Vistas, which then sold the property to Tucker’s company in February 2017.

The Lydas appeared to still “have an interest” in the property, Henry wrote in an August 2017 court complaint to clarify ownership. But he alleged Parkway Vistas, now dissolved, had relied on the mother’s statement of herself as sole heir and purchased her share “in good faith”—for $5,000.

Michael Ellis, president of Parkway Vistas, which incorporated the day after Carolyn Lyda’s deed was signed and sold three other properties to Tucker’s companies in 2018, told Asheville Watchdog he could not recall the sales. “That was a really long time ago. I have no clue,” he said.

Had the Lydas known about the court case, Charles Lyda said, they would have disputed their mother’s deed and questioned how she came to sign over her interest. The family didn’t even know she had sold her share of the property until just before she died, Charles Lyda said.

Henry wrote in his court complaint that the Lydas were believed to be living in Burke, a county east of Buncombe near Hickory.

“None of us ever lived in Burke County with the exception of Jonathan, the youngest, who had left years earlier,” Charles Lyda said.

At a court hearing in November 2017, Henry said, “We could not find any viable addresses to be able to serve anybody.”

“You couldn’t find any of them?” asked Buncombe Superior Court Judge Alan Z. Thornburg.

“Your Honor, no,” Henry replied. “We were not able to locate any of the individual defendants in this matter.”

Henry said he had located an estate file in Burke County, and that “the addresses that were in that estate file were all Burke County. But none of them were viable addresses. The estate was, I believe it was, nearly 20 years old.”

The nine siblings of the Lyda family, shown at family reunion in 2007.
The nine siblings of the Lyda family, shown at a family reunion in 2007.

Asheville Watchdog reviewed the same estate file Henry was referencing. The addresses in the file show only one of the siblings, Jonathan, in Burke County. Two of the Lydas, listed in the estate file as residents of Georgia, were still living at those same addresses in 2017, Charles Lyda said.

Henry reported to the court that he’d fulfilled his obligation to notify the Lydas by taking out a legal ad in the Morganton News Herald, a local newspaper in Burke. “No defendant has answered in any way, shape or form,” Henry said at the hearing.

That was because “nobody knew about it,” Charles Lyda told Asheville Watchdog. “None of us live in Morganton.”

Judge Thornburg asked Henry what else he had done to locate the Lydas.

“We sent notices and letters to all the addresses that were in the estate file,” Henry said. “We further did Internet searches trying to locate other addresses.”

Asheville Watchdog found a 2007 obituary for the Lydas’s father, available online through a simple Google search, that showed the city and state for each of the Lyda siblings. Six lived in Georgia, where they’d been since childhood, Charles Lyda said.

Henry said at the hearing that he even used an investigator to locate the Lydas. “We were simply unable to come up with any viable address,” he said.

Adaramola described her search in the Lyda case in an August 2018 court filing: “Due diligence and great efforts were made to locate the whereabouts of the Respondent’s, [sic] consisting of, internet search, White Pages search for recent phone numbers, called family and friends, DMV [Department of Motor Vehicle] search, Ancestry.com search, Buncombe County Register of Deeds, Buncombe County Tax Office, Burke County Estate File, Burke County Register of Deeds, and Burke County Tax Office.”

Charles Lyda said he’s owned “vehicles in North Carolina for over 25, almost 30 years.” He purchased property in Waynesville in 2017, a matter of public record, and his address and phone number were available on North Carolina’s public corporation database under an automotive business he incorporated in February 2018. Lyda said he’d also been paying child support through the state for years.

“If the state of North Carolina can find me and send me correspondence and keep up with me,” Charles Lyda said, “why couldn’t anybody else?”

On an invoice Adaramola submitted, billing $500 for her work on the Lyda case, she said she had “called numbers for heirs, no heir had a working number.”

Robert Lyda said he’s had the same phone number for 30 years. He said his family held an annual reunion. “There is a family directory that is published every year,” he said. “If they reached one single person … they would have been able to find the rest.”

In November 2017, after the Lydas had “not filed any answer, or made any  appearance” in court, Judge Thornburg found the sale by the Lydas’s mother to Parkway Vistas was made in good faith. The judge declared Tucker’s company the rightful property owner because the will identifying the Lydas as heirs had not been filed in Buncombe County, where the property was located.

Tucker’s company listed the property for sale but was having trouble despite the judge’s order declaring it the sole owner. In 2018, Shannon Miller Wood and her husband made an offer but could not get title insurance, she told Asheville Watchdog. “Our lawyer … told them that we were going to walk away from the deal unless they went through some legal hurdles to correctly fix the title,” she said.

In April 2018, Tucker’s company filed a second court action against the Lydas to force a sale of the property through what’s known as the partition law and named Ile Adaramola as guardian ad litem.

A guardian can be appointed only by court order, which Henry didn’t receive, according to the court file. Adaramola reported that she could not locate any heirs to the property and filed a response on their behalf. Nothing further occurred in the partition action, but Henry used Adaramola’s report to return to Judge Thornburg in August 2018 and obtain an amended order. “After a diligent search” by the guardian ad litem, the judge wrote, “no heirs … were found.”

Less than a month later, the deal with the Woods closed. Tucker’s company sold the property for $255,500, nearly three times the $90,000 it paid Parkway Vistas a year and a half earlier, deeds indicate.

The Lydas received nothing.

Robert Lyda said he feels like his family’s property was stolen.

“It’s bad enough that you lose your loved ones,” he said. “There’s ethics independent of what is legal. And the fact that the law does not serve ethics is the most damning statement one could make about our system.”

Becky Tin contributed to this report.

Editor’s Note: Lisa K. Roberts, a Black woman who calls herself a housing advocate, negotiated some of the deals mentioned in this series. She was arrested and charged Feb. 3, 2022 with nine counts of notarizing an action by fraud or forgery, each one a felony punishable by up to 24 months in prison.

 

To be continued…

Read Part I: Equity Erased – Real estate deals strip elderly and poor people of their homes, land, and inheritances.

Read Part II: Equity Erased – Forced Sales Hurt Heirs, Poor Homeowners.

Read Part III: Equity Erased: NC’s Partition Law Easily Exploited.

Read Part V: Equity Erased: Buncombe Homeowners Forfeit Years of Equity.


Asheville Watchdog is a nonprofit news team producing stories that matter to Asheville and Buncombe County. Sally Kestin is a Pulitzer Prize-winning investigative reporter. Becky Tin is a retired district court judge and lawyer. Email [email protected].
Asheville Watchdog gratefully acknowledges the assistance of Lawyers for Reporters, a joint project of the Cyrus R. Vance Center for International Justice and the Press Freedom Defense Fund, and the Duke University School of Law’s First Amendment Clinic, with special thanks to Jonathan Ellison, Danielle Siegel, and Zane Martin.