Bankrupt No More, Sonja Morgan Gets to Keep NYC Home

Sonja Morgan of “The Real Housewives of New York” attends the NBCUniversal Cable Entertainment 2015 Upfront in New York in May.
Evan Agostini/Associated Press
Four-and-a-half years after “Real Housewives of New York” star Sonja Morgan filed for bankruptcy, her case is finally coming to an almost-happy ending as creditors get paid and the reality-TV star gets to keep her multimillion-dollar New York townhome. Ms. Morgan put the majority of her bankruptcy case behind her last week when her bankruptcy-exit plan went into effect, paying off her creditors and allowing her to begin closing out her case. After a brief extension of the payout date as attorneys waited for Ms. Morgan’s check from Bravo to clear, the bankruptcy plan took effect June 9. The estate gathered money from the proceeds of the liquidation of Ms. Morgan’s property in Ramatuelle, France, for $5.7 million, $1.2 million from Ms. Morgan’s savings and a new $3.3 million mortgage on her New York home to pay her creditors. Those creditors include Hannibal Pictures Inc., with whom Ms. Morgan became embroiled after a failed movie project. Hannibal was paid $6.95 million from the estate last week. American Home Mortgage Servicing received $600,000 in cash plus the deed to Ms. Morgan’s property in Colorado, which had been listed at $5.8 million. Two law firms will receive $23,333 and $33,165 in six annual payments. The deal was struck after Ms. Morgan’s ex-husband, John A. Morgan, agreed to allow property in Telluride, Colo., to go to lenders. Mr. Morgan, whose ancestry includes financier J.P. Morgan and President John Adams, voted against Ms. Morgan’s plan. But Mr. Morgan didn’t formally object to the plan on the condition that he was released from any liability on the property in Colorado and was allowed to remove his personal items, including his wine and bed sheets, from the property. All of Mr. Morgan’s claims against Ms. Morgan in the bankruptcy case were disallowed. According to the bankruptcy plan, Ms. Morgan is still owed $3 million as a result of the divorce but may never collect it. Mr. Morgan said he is “destitute, although he’s living on an island in the Long Island Sound. With JA Morgan approaching his mid-eighties, it appears he intends to live out his life without addressing his obligations under the Divorce Decree,” according to court documents. With the finalization of this plan, Ms. Morgan’s New York townhouse is no longer listed for sale. The bankruptcy plan had still left open the possibility of a sale of that property if the mortgage loan hadn’t been finalized. But with the mortgage loan in place and creditors paid, that possibility is off the table. Write to Stephanie Gleason at [email protected]. Follow her on Twitter @stephgleason