By NEIL HARTNELL Tribune Business Editor CLICO (Bahamas) and its creditors are likely to recover only between 45-54 per cent of the insolvent insurer's investment in its largest asset, Tribune Business can reveal, as its liquidator gears up to fight the Internal Revenue Service (IRS) over the latter's $887,131 million claim. Court filings in Florida, obtained exclusively by this newspaper, reveal that Craig 'Tony' Gomez, the Baker Tilly Gomez accountant and partner, is seeking a summary judgment over the determination by himself, and his US-based attorneys, that the penalty claim and associated interest the IRS is seeking from the Wellington Preserve real estate project, be placed at the bottom of the creditors' queue. The documents also reveal that Mr Gomez is now hoping for 'third time lucky' when it comes to realising a multi-million dollar sale for Wellington Preserve. Following the collapse of an initial $40 million deal, the court papers disclose that a second proposed transaction for its remaining 425 acres, worth $32.5 million, has also fallen through. "Reorganised, Wellington is currently entertaining offers for the 425 acres at a lower price," the court papers said. "The third initial contract sale, which was contemplated by the [liquidation] plan has since fallen through, and has not closed. "A subsequent contract for the remaining 425 acres was approved by the court at $32.5 million, which would have reduced the potential dividend if all general unsecured creditors were left together in one class, to approximately 44.8 per cent." Tribune Business has since been able to confirm that the second $32.5 million deal has also fallen through, although the liquidator is now understood to be negotiating with another buyer group. Explaining why he placed Wellington Preserve, which accounts for an estimated 63 per cent of CLICO (Bahamas) assets, into Chapter 11 bankruptcy protection in the US, Mr Gomez and his attorneys said in court filings that this was done to prevent one creditor, Brennan Financial, from executing a $1.45 million judgment against the 525-acre development. "From its inception, the intention of Wellington [Mr Gomez] was to provide for the orderly liquidation of the property for the purpose of payment to its creditors since, even in the absence of any mortgage encumbering the property, Wellington's total outstanding debt (albeit overwhelmingly unsecured) considerably exceeded the value of the property," Mr Gomez alleged. "The total of all debts was $81.375 million. Of that amount, property tax claims were $4.506 million." Mr Gomez divided Wellington Preserve's creditors into five classes in his liquidation plan. He placed CLICO Enterprises, the 100 per cent-owned subsidiary of CLICO (Bahamas), in the fourth tier with its $73 million unsecured claim, a move designed to enable all priority creditors, real estate taxes and administrative costs "to be paid in full, 100 cents in the dollar". Under this plan, which was approved by the US courts, the only creditors likely to suffer a loss on Wellington Preserve's liquidation, are CLICO Enterprises (and, by extension, CLICO (Bahamas) and its creditors), and the penalty portion of the IRS claim. Had all Wellington Preserve creditors been lumped in together, Mr Gomez revealed, they would all have suffered a 53-54 per cent recovery on the initial $40 million sale - hence the likely CLICO (Bahamas) recovery range of 45-54 per cent. "CLICO Enterprises, holding the claim in the amount of $73 million, enabled the Class three compensatory unsecured creditors to receive payment in full, rather than a pro-rated percentage dividend, by voluntarily subordinating itself to the compensatory unsecured claims, and thereby 'gifting' a portion of the ultimate proceeds that it would otherwise receive, to them," Mr Gomez said. "The dominant size of CLICO Enterprises claim made that subordination meaningful...... There is a significant trade-off in the plan. It provides for payment in full of all general unsecured creditors except CLICO Enterprises, which is the largest general unsecured creditor by far. The only other debt not paid in full is the IRS penalty claim component." In essence, CLICO (Bahamas) and its Bahamian creditors have given up a portion of their recovery proceeds to pay-off US-based creditors of Wellington Preserve. This has already happened, with an initial sale of 100 acres having raised $10 million.