Consumer Law, Warranties I want to sue for unfairly not signing agreement that costed millions

[TonyP]

Hello, I am new to this forum but I though I would give it a shot. I am in the hotel business and just built my first hotel. Unfortunately I lost a lot of money due to large corporations holding me up for over 2 years. my partners and I aquired some land that was purchased from a General Growth owned mall that included tenants such as Sears, Jc penny, and Dillards. The mall was built in the 70's so had strict rules that if anyone was to purchase any of the land surrounding it from the mall they would have to get approvals from the larger tenants which were these three.. Well usually this isn't a big deal because a mall loves to have a hotel come in adjacent to it so that it provides more business to the mall. Well in 2005 we had everything ready to go to move forward in building the hotel just needed these three tenants to sign off. Sears and Jc Penny had no problem but dillards claimed that the hotel would block their view from a side road entering the mall (not even the main road). We knew it was just a ploy to get something out of us. So we asked what do we need to do to resolve this issue. We went back and forth for several months and they would not respond. So we hired an attorney that costed over $20,000 by the end of this to get it sorted out after flying back and forth to chicago to tulsa. Dillards eventually made us to build the mall a brand new $50,000 sign with led display. Also By this time two years had passed and the hotel market in the area was doing extremely well and we were very upset that dillards had set us back 2 years and we still hadn't started construction yet. Also keep in mind all the interest that was accruing on the land and other borrowed money. And by the way this is a rural town with less than 40,000 population and the hotel is just a small 90 room holiday inn express. So these costs were tremendous to us not to mention the lost income. Oh and after dillards decided to do all this, Sears came back and said they needed $20,000 to move forward. Thats when I said is this really legal what they're doing to us. Finally we ended up starting construction in january of 2008 and opened in 2009. Business went from booming to recession. I fear that overall all this set us back about 2-2.5 million. Does anyone have any advice for me, if I should go after Dillards or General Growth, or Sears for that matter. Although sears only demanded the money after dillards had taken up all the time and basically made an unreasonable demand that we had to go with in order to move forward and not lose any more time. Please help anyone!

 

[dee_dub]

we hired an attorney that costed over $20,000 by the end of this to get it sorted out

That's one of the costs of doing business.

Dillards eventually made us to build the mall a brand new $50,000 sign with led display.

That's something you agreed to, and one of the costs of doing business.

Sears came back and said they needed $20,000 to move forward

On what grounds? Maybe you didn't need to agree to pay them, but you did, so that's one of the costs of doing business.

Finally we ended up starting construction in january of 2008 and opened in 2009. Business went from booming to recession. I fear that overall all this set us back about 2-2.5 million.

Development is a risky business, and sometimes it doesn't work out. You may have lost money, but how do you feel you've been wronged?

 

[TonyP]

Thanks, for the reply and I understand what you're saying. But I was curious if a judge would consider that when General Growth sold us the land for hotel use, that it was pretty inevitable that we would be able to get these signatures from the large tenants. Land deals happen all the time where certain tenants have to agree to letting the developers develop whatever it is they are trying to start. If this type of scenerio in which they stalled the development happened all the time, the U.S. would not see hardly any large retail developments because it would make it too risky for whoever purchases the land and then not be able to start a business on it because big corporations can kinda step on small developers. So the idea is that a judge might take into consideration that it was unfair for them to do such a thing and it created massive debt and lost income.

 

[dee_dub]

I was curious if a judge would consider that when General Growth sold us the land for hotel use, that it was pretty inevitable that we would be able to get these signatures from the large tenants. Land deals happen all the time where certain tenants have to agree to letting the developers develop whatever it is they are trying to start.

I don't see how an action against the tenants could succeed. You'd be arguing that the tenants were obliged to approve your development within some specific time frame. Unless there was some side deal to that effect, the tenants have rights under their leases and can provide or withhold approval accordingly. The fact that land development deals often depend on such approval doesn't mean the tenants were obliged to relinquish their contractual rights.

Nor do I see how the tenants were acting "unfairly" in any sense that is grounds for a lawsuit (although I'm not sure about the extra 20K you paid Sears). They are entitled to strike the best bargain they can with you.

I also don't see any lawsuit against General Growth here. You bought land for a development, you needed tenant approval, you had a tough time getting it. How is General Growth at fault?

The root problem here is that these are all commercial entities pursuing their own interests, which did not coincide with your own. Legally they didn't owe you any duty, so legally they've done nothing wrong.

Given the amount of money you say you lost, I would suggest you consult with an attorney. But that's my two cents.