Esquimalt Le­gion makes ap­peal for its sur­vival

Clash with de­vel­oper over $32M joint-ven­ture high­rise takes toll: ‘We’ve drained our bank ac­count’

Times Colonist - - Front Page - KATHER­INE DEDYNA

The Esquimalt branch of the Royal Cana­dian Le­gion on Ad­mi­rals Road is fight­ing for its fi­nan­cial life amid fears it might go un­der due to a dis­puted high­rise devel­op­ment project.

“We need all of Vic­to­ria to come and help us,” man­ager Doug Grant told the Times Colonist on Satur­day, stand­ing in the park­ing lot of the 1970s fa­cil­ity. An on­line fundrais­ing cam­paign has been launched.

“There are vet­er­ans who built this with their blood, sweat and tears. Some peo­ple even put up their houses [as col­lat­eral] to build this.”

At is­sue be­fore a Van­cou­ver ar­bi­tra­tor is a joint-ven­ture agree­ment the le­gion un­der­took with Mon­i­mos Eq­ui­ties and De­vel­op­ments Inc., and its prin­ci­pals, Christo­pher Fitz­patrick and Robert Sch­midt, to build a $32-mil­lion se­niors’ high­rise on the le­gion prop­erty. The 12-storey project was to in­cor­po­rate a new 5,000-square-foot le­gion fa­cil­ity and 10 units ear­marked in per­pe­tu­ity for le­gion own­er­ship, with the de­vel­op­ers get­ting 142 units they could sell to pay for the project and their profit.

Mon­i­mos con­tends the le­gion is in de­fault of the 2008 joint-ven­ture agree­ment, while the le­gion claims the agree­ment has ex­pired with lit­tle or no in­vest­ment by the de­vel­oper. The case went be­fore B.C. Supreme Court Jus­tice Robert John­son, who ruled on Nov. 7, 2016, that an ar­bi­tra­tion clause of the joint-ven­ture agree­ment is still in ef­fect.

Grant said that Fitz­patrick and Sch­midt want con­trol of the prop­erty, val­ued at $2.6 mil­lion as of Septem­ber 2013, even though the le­gion is al­ready on the hook for a $1.5-mil­lion mort­gage for pre­con­struc­tion costs such as sur­vey­ing, drilling for rock depth on the prop­erty and fea­si­bil­ity stud­ies.

The le­gion must pay $333 daily to service the mort­gage, and Mon­i­mos now wants the prop­erty, Grant said. An­other de­vel­oper was will­ing to make the project hap­pen, but the prop­erty is tied up in le­gal pro­ceed­ings, he added.

Ar­bi­tra­tor John Lo­gan is hear­ing the case, with more doc­u­men­ta­tion re­quired by both sides by late Septem­ber, Grant said.

Mon­i­mos’ Sch­midt said he was un­able to com­ment, as the le­gal is­sues are on­go­ing, and Fitz­patrick did not re­turn a call from the Times Colonist.

“Mon­i­mos says that Branch 172’s ef­forts to mar­ket its land are caus­ing dif­fi­cul­ties in find­ing fi­nanc­ing to com­plete the project con­tem­plated by the joint ven­ture,” the judge stated. Mon­i­mos rea­sons that “po­ten­tial in­vestors will be dis­cour­aged by the ap­pear­ance of dis­sen­sion among the joint ven­tur­ers and sec­ond, Branch 172 is of­fer­ing its land at prices be­low what Mon­i­mos is seek­ing by way of in­vest­ment cap­i­tal, thus un­der­min­ing its ef­forts to se­cure the nec­es­sary fi­nanc­ing.”

But John­son wrote he was “not per­suaded” that any dam­ages Mon­i­mos might suf­fer as a re­sult of the le­gion’s ef­forts to sell its land re­quire an in­junc­tion for­bid­ding such a sale, as Mon­i­mos re­quested.

Grant said Mon­i­mos says it has in­vested $700,000 in the project, but has not pro­duced re­ceipts, say­ing flood dam­age in the af­ter­math of the Tu­dor House fire in 2013 led to their de­struc­tion.

“This has noth­ing to do with the town­ship,” Esquimalt Mayor Barb Des­jardins said in an email to the Times Colonist. “It is un­for­tu­nate that it has oc­curred, but there is from what I see an ar­bi­tra­tion process and so it would be wrong to com­ment at this time.”

The judge said the le­gion ar­gues that Fitz­patrick and Sch­midt mis­rep­re­sented them­selves as “ca­pa­ble of mov­ing the joint ven­ture to fruition within a com­mer­cially rea­son­able time” caus­ing the le­gion to suf­fer dam­age and loss as a re­sult.

“Now the Esquimalt Le­gion has a $10,000-per-month mort­gage pay­ment against their prop­erty, no new le­gion and no vet­er­ans/se­niors hous­ing,” says the le­gion’s GoFundMe page.

“They need your help to cover the le­gal costs, and to keep the doors open and the lights on while they fight th­ese de­vel­op­ers through the courts,” the page says.

Grant, 73, said it’s all he can do to pay the staff, but has not drawn a salary for full-time work in months.

“It’s a mess,” he said. “We’ve got le­gal fees. We’ve drained our bank ac­count. We’re try­ing to sur­vive … It’s just a ter­ri­ble sit­u­a­tion.”

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