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Bank files complaint against Hagerstown Motors

Officials say the company owes at least $130,283.78 from two unpaid loans

Officials say the company owes at least $130,283.78 from two unpaid loans

December 09, 2009|By DAN DEARTH

HAGERSTOWN -- PNC Bank filed a complaint Wednesday in Washington County Circuit Court alleging that Hagerstown Motors LLC owes at least $130,283.78 from two unpaid loans.

Hagerstown Motors, a used-vehicle lot at 17703 Virginia Ave. in Halfway, closed without notice Oct. 26.

The business was managed by Hagerstown Mayor Robert E. Bruchey II, who has said he quit Oct. 24 without knowing the lot would close two days later.

Mike Griffith, owner of Hagerstown Motors, said Wednesday that he didn't understand why the complaint was filed. He said he believed bank officials would seize a rental property that he owns if the loans weren't paid.

"The loans are backed by rental properties," Griffith said.

He said the rental property is a duplex at 515-521 Ridge Ave. in Hagerstown.

Maryland tax records list the duplex's addresses as 515-517 and 519-521 Ridge Ave. Each of those addresses is appraised at $151,602, records show.

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Fidelity Bank, to which PNC Bank is the successor, granted Hagerstown Motors a $90,000 loan on July 13, 2007, and a $50,000 loan on Aug. 21, 2007, according to court documents. Around Nov. 4, 2009, PNC Bank sent a letter to Hagerstown Motors demanding that the payment of "all sums due pursuant to the promissory notes and commercial guaranty agreements" be made, records allege.

PNC claims that, despite demand for payment, Griffith has refused to honor the loans.

According to court records, Griffith owes $109,989.27 of aggregate unpaid principal, interest of $1,979.11, late charges of $1,235.90, loan administration fees of $400 and attorneys fees of $16,679.50.

Griffith said the Motor Vehicle Administration south of Hagerstown is working with Hagerstown Motors' clients to get tags and titles for vehicles that were purchased at the lot before it went out of business.

Buel Young, a spokesman for the Maryland Motor Vehicle Administration, said in October that state officials were investigating Hagerstown Motors, but declined to give details.

"Any time we have that type of situation," he said, "we can't comment."

Young said Wednesday the investigation had not concluded.

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