Green's Harbour -
A bitter, complicated legal dispute over who owns the lease for a former provincial park in Trinity Bay is causing serious fallout for a group of people who spent their own money to acquire and upgrade campsites at the park.
Roughly 50 families spent at least $10,000 each for the long-term use of a site at the park near Green's Harbour and to become members of Shag Rock RV and Recreation Resort. Many invested thousands more on trailers, decks, sheds, fences, landscaping and even wharves, and were to pay a $600 annual fee for service and maintenance.
The problem is, these camping enthusiasts are no longer sure of who owns the park, and whether their investments are protected.
"We're innocent victims here," said one member of Shag Rock, who asked not to be identified because of the ongoing legal proceedings and the uncertainty over how the dispute will be resolved.
Shag Rock members are caught in the middle of a fight between Ed Singer of Brigus, owner of Backside Pond Ltd., and Ian Fitzgerald of Mount Pearl, owner of NL RV Resorts Inc.
The two have been battling for months over title to the lease of the property.
It's a story with more layers than a pancake breakfast, and reaches the highest levels of the provincial government. Both sides are trading serious accusations. There are stories of angry confrontations between Singer and Fitzgerald, and the whole matter is being further complicated by a failed marriage.
Both have been described by those close to the dispute as "large personalities."
Backside Pond Ltd. is the original holder of the Crown lease to the park, but NL RV Resorts has operated the business for the past two seasons through an operation agreement that saw it pay monthly rent of $10,000 plus HST to Backside.
Shag Rock members purchased their memberships, which gave them full access to the park and their sites, from NL RV Resorts. But the company is no longer operating the park.
What's more, Backside Pond is waging court action to try to regain title to the property, saying an amended lease issued to NL RV Resorts by the government in 2007 was illegal because a sale had never been completed. It's a position that was supported by the Supreme Court of Newfoundland last spring.
If Backside Pond Ltd. wins the current court battle, Singer has said he will not honour the agreements reached between members of Shag Rock and NL RV Resorts. Instead, he will give Shag Rock members the first option of buying regular season passes - up to $1,200 plus HST for a waterfront site - to maintain their place in the park. That would effectively double the annual fee members were to pay.
The dispute has left many people wondering how they ever got tangled up in such a mess.
"I don't know what would be the fairest thing to do. I guess that's why it's in court," said another member of Shag Rock.
Members of Shag Rock contacted for this story asked that they not be named, and a lawyer retained by the group, Stephanie Hickman, declined comment.
But with camping season fast approaching, Shag Rock members are scrambling for answers. Will their original agreements be honoured? Will they have to leave the park? Will the court order the province to return the park to Singer, who re-occupied the property in January and is preparing to resume operations? Or will Crown Lands clear the deck and issue a call for proposals for a new operator, which is the preferred option of several members of Shag Rock?
"I don't want to hear Ed Singer's name, and I'm just as adamant that I don't want to hear Ian Fitzgerald's name either," said a Shag Rock member.
"We did things in good faith. We have some pretty astute people within our membership, but it was never anticipated this would happen."
The next court date is May 1, when a judge will be asked to direct the Crown as to the status of the lease. It's the same day the park is scheduled to reopen for the season.
And there's another wrinkle: Newfoundland Power recently cut services to the park and removed some infrastructure because of thousands of dollars in unpaid bills.
Deal turns sour
The dispute started out as a business deal between two entrepreneurs, but it turned sour, with both sides crying foul. In a nutshell, here's how it appears to have unfolded, based on court documents.
In the winter of 2007, the two men agreed on a purchase agreement that would see Fitzgerald pay $1 million to Singer to acquire the lease to the park. Fitzgerald would pay $100,000 upfront, and the remainder would be paid as part of a mortgage.
The deal required the written consent of the the environment and conservation minister, a post then held by Clyde Jackman.
Both sides say they were given repeated assurances by a senior environment official that consent was forthcoming. But weeks went by, and Singer, still confident of ministerial approval, agreed to let Fitzgerald take occupancy of the park.
In the meantime, Singer's former wife got involved, and the Supreme Court ordered that any money from the sale of the lease be held in trust pending a further court order.
Then, in the summer of 2007, both sides decided to enter into an "operational agreement," which essentially required Fitzgerald to pay rent to Singer, with the payments eventually being deducted from the purchase price.
At about the same time, Jackman signed off on the lease transfer, even though the sale hadn't been completed.
In a written statement to The Telegram, a government spokeswoman said this was done because "a document in the usual form was filed with government indicating that a transfer had taken place and also requesting an assignment of lease."
This prompted Singer and his lawyer, Michael Crosbie, to commence legal action, and a judge ordered that the amended lease be placed in trust with Les Thistle, Fitzgerald's lawyer, until the sale could be finalized. The judge also ordered that Fitzgerald pay outstanding rent to Singer.
The two sides continued to lock horns on different matters for many months, until finally Fitzgerald left the park in late 2008, and advised his lawyer to return the amended lease to the Crown.
As it stands, Fitzgerald no longer has any connection to the property, since the amended lease has been returned and the operation agreement has been terminated.
But it's also uncertain as to whether Singer has a right to the property, since his original lease was amended.
That's a question the courts are being asked to decide.
"Government will be directed by the court proceedings," the statement from Environment and Conservation stated.
Yet Singer now occupies the park, and is conducting normal business.
"We feel like we're being held to ransom," said a Shag Rock member.
The member said he understands that if Fitzgerald didn't pay for the park, he shouldn't own it. But he's also frustrated that Singer has reoccupied the park, and will benefit from all the improvements undertaken by Fitzgerald.
"He's getting all this infrastructure for free and us as a captive audience, because where are we going?" the man asked.
Singer alleges that Fitzgerald failed to live up to the terms of the operation agreement by not making monthly payments, and by trying to renegotiate the purchase agreement at the 11th hour.
Singer argues the lease is rightfully his, since a sale was never completed.
Fitzgerald charges that Singer became less interested in a sale after his wife intervened. Fitzgerald alleges he was prepared to purchase the lease, but that Singer refused to credit money paid under the operation agreement to the purchase agreement.
Fitzgerald alleges that Singer tried to pressure him into agreeing to terms that would have breached the court order involving his former wife. Singer denies this.
Fitzgerald also contends that Singer's actions during the dispute damaged his reputation, and he is threatening legal action. Fitzgerald estimates he spent $357,000 on equipment and improvements at the park.
Both men spoke to The Telegram and staunchly defended their actions.
Singer said he still wants to sell the park, but is also prepared to operate the business for as long as it takes.
Fitzgerald hopes the court will order the government to call for proposals for a new occupant. He plans to be first in line.