Builder sues to keep job with Port of Everett

Published 11:27 am Wednesday, May 5, 2010

EVERETT — A Chicago developer has filed suit against the Port of Everett, asking a judge to prevent the port from dissolving an agreement for a $400 million waterfront development.

At the heart of the legal dispute is a $1.1 million payment from Everett Maritime, a subsidiary of Chicago’s Maritime Trust, that port officials said was due by contract on April 30.

Everett Maritime is in bankruptcy court in Chicago, but port officials said that doesn’t absolve it from the payment, which was to compensate the port from lease payments it has lost as the 65 acres of waterfront in the development have sat idle.

“If they don’t pay it, the contract is terminated,” the port’s Jerry Heller said Tuesday.

A similar payment was due last year. The port and the developer talked about other options, but when the port insisted on payment, Maritime filed for bankruptcy, which set last year’s payment aside. Maritime and the port also disagreed about the amount of this year’s payment.

Heller said the contract calls for payments of $1.5 million minus any lease payments, which it calculated at $1.1 million for 2009. Maritime said the number should be $770,000. A judge was to make a final decision on the amount last week and then planned to give Maritime three days to pay up. That’s when the lawsuit was filed.

In its suit, Maritime said it has already spent about $16.2 million on the project and owes another $1.8 million. It contends the port has breached its agreement by not fulfilling its promise to install “public access elements of the project which may include an amphitheater, waterfront esplanade, public walkways and viewing areas…”

The suit further contends that Maritime will lose the $18 million it has invested and its chance to reorganize the business if the port is allowed to dissolve the contract, which it describes as “the single most valuable asset in the Chapter 11 case.”

Maritime asked the judge to issue an injunction stopping the port from finding it in default of the contract and abolishing the agreement.

Heller said the judge has set a hearing on the issue for May 11.

The port has installed roads, utilities and walkways on the property, but has not developed the proposed amphitheater or esplanade.

“We don’t believe their claims have merit,” said Lisa Lefeber, port spokeswoman.