BOD Meeting – Rockery Wall Legal Update

The January 13th Somersett Owners Association (SOA) Board of Directors (BOD) Meeting, under Unfinished Business, includes a “Legal Updates – Rockery Wall Update” Agenda Item.  One would assume that this pertains to the SOA’s Rockery Wall failure lawsuit against Somersett Development Company et al.  However, at the time of this Post there have been no new docket entries in the Appellate Court.  The last one being on December 14, when the SOA filed its reply brief to the defendants brief of why the District Court decision should be upheld  (For details, see SU Post of December 16th, entitled “Somersett Development Co. Rockery Wall Lawsuit Update”).  Perhaps the SOA legal team has some knowledge as to an upcoming Appellate Court ruling or when the ruling will be made, as we are all waiting with “bated breath”.

Then again, there was also the Rockery Wall repair lawsuit against the Somersett Golf and Country Club (SGCC), for which a negotiated settlement was reached (For details, see SU Post of December 10th, entitled “SOA/SGCC Lawsuit Settlement”). The Court action dismissing the lawsuit may be viewed via the following link:  201218 Order to Dismiss

Per the reported settlement, the SGCC is to pay $263,097 to the SOA through an increase of $5,980 in their annual property lease payment over the remaining 44 years of the Lease Agreement. Currently there are two “rent” elements that make up the SGCC’s required annual payments, one at $1000/year subject to escalation, and one at $1200/year with no escalation. Given that the $5,980 increase was not subject to escalation, it is fair to assume that the SGCC’s annual payments will now be $1000 escalated and $7,180 non-escalated.

Which raises the following question. Is not a written amendment to the Lease Agreement required? SU suspects so in order for it to be legally binding.  If such an amendment has been generated, when will it be published for the benefit of owners? Perhaps the Board can answer this question at the January 13th Board Meeting.

4 thoughts on “BOD Meeting – Rockery Wall Legal Update

  1. First Service places legal updates on the agenda which generally includes any open or pending legal action. Any open lawsuit or action should be mentioned on the agenda in case there is anything to report, even if that is merely to report on the current status.

    At this point the SGCC suit is behind us. Our legal counsel wrote the final settlement and made sure that legal requirements pertaining the the lease were in order. There were at least two modifications made to the lease as a part of the settlement. The annual lease was adjusted to ADD an amount of exactly $5,890 per year and this is non-escalating. The existing lease amounts of $1,000 escalating and $1,200 non-escalating remain. Add these three amounts together for the updated total annual lease payments. You ask specifically if an amended lease is required? The answer from our law firm is that court-recorded settlements take precedence over other recorded documents, and the modifications made to the lease are binding under this settlement. Lease modifications were made a part of, and agreed to as a part of this settlement. Updated language to the lease is in the settlement itself and since this is a public document it can be disseminated to anyone.

    In terms of the Rockery Wall Appeal case, there is no new information or action coming to the SOA board, so this is very likely an update on the existing case with no new information.

    The last case is an ongoing settlement discussion and lawsuit with Preston homes and seeks to resolve disputes over the closing of the gates on the Back Nine Trail and assessment disputes pertaining to the lots owned by Preston Homes. There is a substantial negotiation effort even as progress is slow. That’s not because of a lack of effort!

  2. If the SGCC goes bankrupt, where does that leave SOA residents? Are the members held responsible for the (paltry) payment??

    1. This has an error.. it should have said “Are the SGCC members held responsible for any payment in the event the SGCC files for bankruptcy”?

    2. If the SGCC goes bankrupt we all lose. If the SGCC does go bankrupt, the SOA will be responsible for a lot more than a paltry payment. It was very important to craft a settlement that made the SOA whole and at the same time insulate the SGCC from the prospect of financial ruin. Threading that needle was a very difficult endeavor, and Mark displayed a masterful amount of ingenuity and wisdom to come to a solution in a very troubling time to resolve this issue. We are in good hands with Mark’s leadership and dedication.

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