A former car lot on Tarrytown Road, Greenburgh, has been sold to Nissan for $11.95 million to partially cover a $41.2 million court judgment against White Plains Nissan and other companies once controlled by automotive magnate Gary Flom.
A court-appointed referee deeded the car lot Oct. 13 to Nissan.
Though the price was set at nearly $12 million, Nissan will pay nothing. Instead, under the terms of a U.S. District Court foreclosure judgment, the price was deducted from debts that Flom and his companies owe the automaker.
Flom, a native of Russia and a decorated U.S. Marines veteran, had built an impressive record as manager of Ford, Jaguar, Land Rover, Lexus, Mazda and Volvo dealerships.
In 2014, he formed BNF Partners NY, an umbrella company for new auto dealerships in Manhattan and Westchester, including Nissan of Mt. Kisco and White Plains Nissan.
The fledging auto empire soon ran out of money and abandoned work on new Nissan and Infiniti dealerships on Manhattan”™s West Side. According to court records, BNF”™s loans and franchise agreements were linked, meaning that if one deal defaulted, they all defaulted.
Nissan suspended financing for the Westchester franchises and demanded repayment of the loans.
Flom sued the automaker in 2017, claiming that Nissan had set up the Manhattan franchises to fail.
Nissan counterclaimed, arguing that Flom”™s intertwined businesses had breached loan agreements.
The dealers were selling cars “out of trust,” according to court records. Instead of repaying Nissan for loans on the cars in stock, the dealerships were allegedly pocketing the money when cars were sold. Nissan could not release car titles to the buyers while it still held a financial interest in the vehicles; without the titles, the buyers could not register the cars with the state.
A federal judge in Manhattan, Katherine B. Forrest, ruled in Nissan”™s favor in 2018, describing the case as a “straight-forward breach of contract claim.” She awarded Nissan $40.2 million.
Last year, Manhattan federal judge Lorna G. Schofield ruled that Nissan was entitled to a portion of that award — more than $14.3 million, for an unpaid loan, tax liens and rent payments that BNF had improperly received for the car lot at 450-460 Tarrytown Road, Greenburgh.
Court-appointed referee Richard P. Haber got the assignment to foreclose on the property.
Though the showroom is now in disrepair, the old car lot still shows signs of its former use. Several Lexus autos, perhaps from Ray Catena Lexus up the street, line the front of the former Nissan dealership.
