Donna Peckenpaugh faces imminent eviction from her condo at Bella Sirena on Sandy Beach, as well as the total loss of the $350,000 she paid for it. Several other condo owners are dealing with the same problem, she says.
Peckenpaugh's angry at Pelican Partners, the Seattle company that developed the condo tower. But she's also angry at the Mexican judicial system. She urges the public to learn from her experience and avoid investing in Mexico.
"This is a country that has no respect for anyone," she fumes.
The former interior designer and widow has lived for the past 10 years in Puerto Penasco, a.k.a. Rocky Point, a sleepy villa on the shores of the Gulf of California. She loves the culture and lifestyle so much, she scraped together her life savings in 2005 and bought one of the unbuilt units at the planned condo tower.
Many years later, she found out that a lien was attached to the entire project just 10 days after she cut the first of several checks for the property.
Peckenpaugh says she was woefully ignorant of what was going on in Mexican and American courts over the ensuing years.
She and other residents moved into the tower in 2009, thrilled to begin enjoying their stunning views of the sea and beach from their large patios. Peckenpaugh opened Segunda This and That, a small, boutique general store near the Friendly Dolphin restaurant in Old Port. Life was great.
Rocky Point may be relatively safe for Americans, but it's not always sleepy: On December 20, 2013, a dramatic gun battle erupted between the Mexican Army and Sinoloan cartel officials who were staying at Bella Sirena. Witnesses reported an Army helicopter shooting machine gun rounds with tracers into one of the condo units. Six cartel members were killed.
Two weeks later, Peckenpaugh and three other Bella Sirena condo owners realized that Mexico could offer worse than a nearby gun battle: The Bella Sirena homeowner association sent the owners a letter informing them that their properties would be foreclosed on following a recent decision by a Mexican court.
Peckenpaugh learned that Pelican had lost a lawsuit filed in Mexico by the company that handled the actual construction, Beck Internacional de Mexico. The firm is one of the Mexican divisions of the national Beck Group company.
Beck Group had argued in court that its workers were stiffed by Pelican. The court eventually awarded the workers a few condo units as repayment.
HOA officials must have known for years about the lien and court order, Peckenpaugh maintains, but no one said anything.
Local court records show that a lawsuit over the dispute between Beck and Pelican was also filed in Maricopa County Superior Court.
In 2010, mediator Chris Skelly ruled that Beck Group had proved its case. Beck had furnished labor and materials for the condo tower, and Pelican shorted Beck and the Mexican laborers of their rightful earnings, Skelly wrote in a 2010 court document.
After subtracting $644,000 from the total amount owed for the fixing of various defects in the construction of Bella Sirena, Skelly ordered Pelican to pay just under $700,000 to the Beck Group. The legal battle continued in Mexico, resulting in the court order to give up several condo units.
It turned out that Pelican Partners still owned Peckenpaugh's property, even though she'd paid them.
The Seattle firm should have given her and the other condo owners a clear deed to the property two months after she transferred the $350,000, she says. But the deed never came. She didn't pursue the paperwork, thinking there was no real problem, she adds.
Under Mexican law, Americans can't own property near the coast, (though that could change.) Usually, a trust is set up in Mexico that owns the property. Home "owners" then can renew their agreement every 50 years with the bank holding the trust.
Peckenpaugh says she didn't set up a trust because she was waiting for Pelican Partners "to provide us with the necessary steps to do this."
New Times could not verify all elements of her story. The phone for Pelican Partners has a constant busy signal. New Times left a message for a representative of Beck Group, but haven't yet heard back.
Peckenpaugh says that each January, she'd obtain copies of her utility bill and the yearly property-tax bill she paid to the Mexican government. She double-checked the paperwork in 2014 only after she learned of the lien — and found out the tax invoice, and therefore the condo itself, was still in the name of Pelican Partners.
She had an agreement to buy the condo and proof she'd paid for it. Surely that was all she really needed to prove the place was hers, she thought.
Last month, the four condo owners received bad news from a Mexican appellate court. Their appeal had been denied.
"We were told we have no rights," she says.
She was told to prepare to surrender the property after April 23, "or they'd put us out bodily."
She hasn't been forced out yet, but she believes that time will come soon. Her Mexican lawyer, Ricardo Borques, had told her it was in her best interest to keep quiet about the problem in the last year or so.
But with last month's loss in the appellate court, Peckenpaugh's decided to tell the world of her problems. She's written a letter to U.S. Senator John McCain, and turned to the news media and public, hoping to put pressure on the Mexican government to intervene."We were told we have no rights."
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"Here I am, late in my life and far too late to begin over, losing my home I paid cash for over a dispute I had nothing to do with," she wrote to McCain. "This is not even close to being justice. In my mind it is thievery."
Peckenpaugh says another case between Beck Group, Pelican Partners and a third party may result in 11 other homeowners in Bella Sirena losing their condos.
Last week, Peckenpaugh spent four days in Nogales, Mexico, for meetings at the American Consulate office there. She huddled for hours with the consulate's Mexican law expert. The consulate's posting a complaint with Mexican authorities, she says. McCain asked the Arizona Attorney General's office to look into the matter.
Peckenpaugh says she'll keep us updated — and we'll let you know what happens when we find out.
UPDATE May 19: See our follow-up article on this case by clicking here.
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