Wyly widow looks to sell Woody Creek estate
October 29, 2014
Their Woody Creek ranch was once the focal point of the Wyly family's summers, but court documents suggest that the property will go up for sale if a judge approves a bankruptcy by the widow of Charles Wyly.
Caroline "Dee" Wyly sought Chapter 11 bankruptcy protection Thursday in Dallas, four days after her brother-in-law Samuel Wyly made a similar filing. Both bankruptcies come in the wake of a Manhattan judge's ruling last month that Sam Wyly and the estate of Charles Wyly must pay $400 million to the Securities and Exchange Commission for concealing offshore stock holdings.
Caroline Wyly's bankruptcy petition says she owes $101 million to the SEC.
"The purpose of the petition is not to avoid or sidestep the SEC's regulatory function but to use the Chapter 11 process to recover and administer all properties of her estate," her attorneys wrote in a brief introduced Sunday.
“Almost immediately after her husband passed away, Dee was rendered cash-flow insolvent.”
Bankruptcy filing for Caroline “Dee” Wyly
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After Charles Wyly, 77, died from an August 2011 car crash near the Aspen-Pitkin County Airport, his widow was left with little money to support herself, Caroline Wyly's attorneys said in the brief.
"Almost immediately after her husband passed away, Dee was rendered cash-flow insolvent," they wrote. "Before Charles died, he had received a substantial annuity each year that enabled the couple's philanthropy and secured a comfortable lifestyle. But Charles had no significant life insurance, and when he died in 2011, shortly before his annual payment under the annuity would have been received, all annuity payments ceased, and Dee's income suddenly dropped by more than 90 percent.
"As a consequence, Dee's income following the death of Charles — while substantial — was completely inadequate to pay the costs of maintaining assets she now was responsible for supporting."
The SEC is fighting the bankruptcy, and a judge has agreed to temporarily freeze the Wylys' assets. Caroline Wyly's Dallas home doesn't have a mortgage, and the one in Woody Creek "has significant equity, but she has been unable to tap that equity due to the financial uncertainty resulting from the untimely death of Charles and the ongoing SEC litigation," her attorneys wrote, noting that she has paid her expenses "only through the kindness of family who have loaned or given their assets to her for support."
One strategy to emerge from her financial insolvency would be to sell her Woody Creek ranch, attorneys said.
"As soon as it is practically possible, (Caroline Wyly) intends to sell the Colorado property (subject, of course, to court approval), which currently accounts for approximately half of the average monthly cash outflows in (Wyly's) budget," attorneys wrote. "It is expected that the sale of the Colorado property will ease (Wyly's) monthly cash-flow deficit."
That property is located at 955 Little Woody Creek Road in the Fox Ranch subdivision. Pitkin County property records list the estate under the ownership of Caroline and Charles Wyly, with an actual value of $13.5 million — $9 million for the home and $4.5 million for the 20 acres it sits on.
The Pitkin County Assessor's Office in 2013 gave the estate an assessed value — which property tax amounts are based upon — of nearly $1.1 million, resulting in a tax bill of $29,074, which was paid in March, records show.
Caroline and Charles Wyly were married for 56 years, and their first vacation to Aspen was in the 1960s, according to a website dedicated to the memory of Charles Wyly. The family lived near the base of Aspen Mountain and later bought a home in Snowmass Village before making Woody Creek their Colorado retreat.
"The first day in their new home was made all the more special with the wedding of their daughter Martha to Don Miller in front of the new family home in 1982," the website says. "Soon, the Little Woody Creek Valley would become the hub of all of the family's activities. Eventually, each of the families bought land and built homes at the ranch, where they would spend summers and holidays together for the next 30 years."
Property records also link another Little Woody Creek Road property to the ownership of Martha Miller, the eldest daughter of Charles Wyly. The Assessor's Office gave it an actual value of $8.2 million and an assessed value of $651,000.
The Wyly brothers both kept a permanent residence in Dallas over the years. Charles and Dee funded the construction of the Wyly Community Arts Center in Woody Creek in 1996 before it moved to Basalt in 2005.