By Pacific Coast Business Times Staff Friday, May 30th, 2008

Months after a court granted the dissolution of family trusts that had for decades been holding some of Santa Barbara’s most valuable waterfront real estate under third-party management, the family members that took control of the parcels may find themselves in court once again.

According to a court document filed May 15, continued quarreling between the trusts’ beneficiaries over the listing, sale and distribution of proceeds upon the sale of nine precious parcels that sit in a cross-section of Santa Barbara’s most popular destinations – its downtown and wharf area – has driven one faction of the family to file for court assistance. The move poses the dissenting family members with the threat of having a court appointed advocate determine the fate of their inheritance.
“Many discussions and meetings among the parties herein occurred regarding an agreement for the listing and sale of the properties in the early months of 2008; interviews of five real estate brokerage companies were conducted in order to determine which company would handle the marketing and sale of the properties,” read the complaint filed by Santa Barbara-based Buynak Law Firm in representation of the plaintiff. But because of failure to come to an agreement, “the planned sale of the properties reached a standstill, therefore necessitating this partition action for sale of all properties through the court with assistance of a referee.”
At an October 2007 hearing in Santa Barbara County Superior Court, a judge approved an order stipulating that involved parties had reached an agreement regarding the distribution of assets of trusts established by George and Rena Castagnola and Mario and Gladys Castagnola that included several parcels near Santa Barbara’s Stearn’s Wharf.
The decision to transfer the control of the properties from Santa Barbara Bank & Trust to the trust’s beneficiaries came after years of disagreement between the family members over distribution of the trusts and has been watched closely by area residents and developers, as the potential sale of properties could change the current face of Santa Barbara’s main tourism corridor. In addition, the massive La Entrada de Santa Barbara hotel-condominium development lies adjacent to some of the Castagnola properties.
The partition action simply assures buyers that the Castagnola properties will be sold at this time,” said Timothy Buynak of Buynak Law, explaining that if the “minor owner” does not wish to comply, the court can order the sale of the properties through a referee. “We are evaluating several offers at this time.”
Plaintiffs Castagnola LLC and its entities Lighthouse & Corner LLC, GVC Seafoods LLC and Above Yanonali LLC filed a complaint for partition of real property against Virginia Castagnola Hunter, Scott Hollister, George Hollister, Catherine Wallenfels, Francesca Hunter, Alexis Chernow, Loretta P. Headley, Nella Sue Headley, Scarlett Headley, Rhett Headley, Ginger Douillard, Shahn Headley, Jason Headley and Montecito Bank & Trust.
Renee Castagnola and her children, Consuelo Sanudo and Rafael Sanudo, are members of the limited liability companies listed as plaintiffs.
“Renee, Consuelo and Rafael are the only members of Castagnola LLC and they desire that the properties be sold and their proportional share be distributed to Castagnola LLC rather than continue to own properties with the 14 other Castagnola and Headley family members, since a group of this size owning property and reaching a consensus about property decisions has been difficult,” the filing said.
The plaintiffs and “some of the defendants,” according to the court filing, own 15 E. Cabrillo Blvd.; 6, 10 and 14 State St.; and 21 and 42 Helena St., of which the plaintiffs own a 45 percent interest and Virginia Castagnola Hunter owns 38 percent.
The plaintiffs and all of the defendants own 131 to 137 and 205 Anacapa St. and 23 E. Yanonali St., of which the plaintiffs have a 27 percent interest and Virginia Castagnola Hunter has 23 percent interest.
The filing asserted that partition by sale of the properties, as opposed to division, was favorable because the properties “are of such a nature that they may not be divided equally” or “without significantly diminishing the value of the parties’ respective interests,” among other reasons given.
Calls to other attorneys listed as representation in the filing, including Diana Jessup Lee of Reicker, Pfau, Pyle & McRoy and John H. Parke of Allen & Kimball, were not immediately returned.
By Barbara Pearson
Staff Writer
Months after a court granted the dissolution of family trusts that had for decades been holding some of Santa Barbara’s most valuable waterfront real estate under third-party management, the family members that took control of the parcels may find themselves in court once again.
According to a court document filed May 15, continued quarreling between the trusts’ beneficiaries over the listing, sale and distribution of proceeds upon the sale of nine precious parcels that sit in a cross-section of Santa Barbara’s most popular destinations – its downtown and wharf area – has driven one faction of the family to file for court assistance. The move poses the dissenting family members with the threat of having a court appointed advocate determine the fate of their inheritance.
“Many discussions and meetings among the parties herein occurred regarding an agreement for the listing and sale of the properties in the early months of 2008; interviews of five real estate brokerage companies were conducted in order to determine which company would handle the marketing and sale of the properties,” read the complaint filed by Santa Barbara-based Buynak Law Firm in representation of the plaintiff. But because of failure to come to an agreement, “the planned sale of the properties reached a standstill, therefore necessitating this partition action for sale of all properties through the court with assistance of a referee.”
At an October 2007 hearing in Santa Barbara County Superior Court, a judge approved an order stipulating that involved parties had reached an agreement regarding the distribution of assets of trusts established by George and Rena Castagnola and Mario and Gladys Castagnola that included several parcels near Santa Barbara’s Stearn’s Wharf.
The decision to transfer the control of the properties from Santa Barbara Bank & Trust to the trust’s beneficiaries came after years of disagreement between the family members over distribution of the trusts and has been watched closely by area residents and developers, as the potential sale of properties could change the current face of Santa Barbara’s main tourism corridor. In addition, the massive La Entrada de Santa Barbara hotel-condominium development lies adjacent to some of the Castagnola properties.
The partition action simply assures buyers that the Castagnola properties will be sold at this time,” said Timothy Buynak of Buynak Law, explaining that if the “minor owner” does not wish to comply, the court can order the sale of the properties through a referee. “We are evaluating several offers at this time.”
Plaintiffs Castagnola LLC and its entities Lighthouse & Corner LLC, GVC Seafoods LLC and Above Yanonali LLC filed a complaint for partition of real property against Virginia Castagnola Hunter, Scott Hollister, George Hollister, Catherine Wallenfels, Francesca Hunter, Alexis Chernow, Loretta P. Headley, Nella Sue Headley, Scarlett Headley, Rhett Headley, Ginger Douillard, Shahn Headley, Jason Headley and Montecito Bank & Trust.
Renee Castagnola and her children, Consuelo Sanudo and Rafael Sanudo, are members of the limited liability companies listed as plaintiffs.
“Renee, Consuelo and Rafael are the only members of Castagnola LLC and they desire that the properties be sold and their proportional share be distributed to Castagnola LLC rather than continue to own properties with the 14 other Castagnola and Headley family members, since a group of this size owning property and reaching a consensus about property decisions has been difficult,” the filing said.
The plaintiffs and “some of the defendants,” according to the court filing, own 15 E. Cabrillo Blvd.; 6, 10 and 14 State St.; and 21 and 42 Helena St., of which the plaintiffs own a 45 percent interest and Virginia Castagnola Hunter owns 38 percent.
The plaintiffs and all of the defendants own 131 to 137 and 205 Anacapa St. and 23 E. Yanonali St., of which the plaintiffs have a 27 percent interest and Virginia Castagnola Hunter has 23 percent interest.
The filing asserted that partition by sale of the properties, as opposed to division, was favorable because the properties “are of such a nature that they may not be divided equally” or “without significantly diminishing the value of the parties’ respective interests,” among other reasons given.
Calls to other attorneys listed as representation in the filing, including Diana Jessup Lee of Reicker, Pfau, Pyle & McRoy and John H. Parke of Allen & Kimball, were not immediately returned.