CHARLESTON, W.Va. — The state Department of Transportation is asking for the dismissal of a lawsuit by a troubled developer over the bridge at Crossings Mall, saying Tara Retail Group is attempting to abdicate its responsibility.
The motion filed Tuesday by the Department of Transportation says Tara and its owners have been trying to dodge responsibility while telling more than one tale in different court venues.
Moreover, DOT contends that Tara knew the bridge needed to be replaced but didn’t manage to do it before flooding destroyed it.
Acknowledging that the standard for dismissal is high, the state’s motion says “Tara’s complaint is a substantial injustice for West Virginia’s taxpayers and a poison that pollutes judicial integrity.”
MORE: Read the motion by the Department of Transportation.
The owners of Tara Retail Group, the Abruzzino family, are involved with legal actions in several locations around West Virginia, including the bankruptcy of Crossings Mall and financial troubles with hotels in Morgantown and Clarksburg. The Morgantown hotel issue has gotten recent attention because of the listing of Senator Joe Manchin as a minority investor.
After months of fighting in court, Crossings Mall just reopened in late July after a new bridge was built. The culvert bridge that led to the mall property was destroyed in the flooding of summer 2016.
At Crossings Mall, over the year that the bridge remained washed away, businesses were dormant and an estimated 500 people were put out of work. The two largest tenants are Kmart and Kroger.
Tara Retail Group, which owns the property, filed for Chapter 11 bankruptcy this past Jan. 24.
Reconstruction on the bridge finally began this past spring after a financing agreement was reached in bankruptcy court.
Bridge contractor David Alvarez of Applied Construction Solutions agreed to front the costs of construction in exchange for priority status as a creditor. The estimated cost was $1,112,664, which included interest and legal expenses for the contractor.
The lawsuit that was filed June 23 in Kanawha Circuit Court is an attempt by Tara Retail Group to make the Department of Transportation responsible for repaying the contractor.
DOH is the owner of the right of way where the bridge is constructed.
Lawyers for DOT also say Tara’s responsibility is clear because of the encroachment permits it has obtained over the years for the culvert running through the right of way and through its officers’ own words in bankruptcy court.
MORE: See the 1988 permit to build a culvert on DOH right of way.
“Tara or its successor, through Mr. William Abruzzino, Tara’s manager and owner, has applied for and received two encroachment permits from DOH over a 28-year period that allow Tara to construct its crossing and private bridge and require Tara to maintain and repair such crossing and bridge,” wrote Mike Folio, counsel for the Department of Transportation.
The motion notes that although the right of way remained DOH property, the culvert bridge was Tara’s property. The state says it was Tara’s duty to maintain the bridge.
The Department of Transportation says “the mere issuance of a permit by DOH to encroach or intrude upon DOH’s right of way does not shift ownership or maintenance of the encroachment to DOH but merely gives the private property owner or tenant a legal means to obtain suitable access and creates a legal duty for the property owner or tenant to maintain and repair such access.”
The state further contends that Tara should have taken action to ensure the bridge remained structurally sound but did not do so.
The motion notes that on Jan. 21, 2016, about six months before last summer’s flooding that destroyed the bridge, Tara informed its commercial lender that the bridge required replacement and sought the funds to do so. The repairs never happened, though.
“Sadly, after having failed to fulfill its obligations under the Encroachment Permit and W.Va. Code 17-16-9, Tara now seeks a government bailout to rectify the mismanagement of its multi-million dollar commercial enterprise and its disregard for its legal duties.
The Department of Transportation motion also takes note of parallel proceedings in U.S. bankruptcy court.
“Tara is similarly engaging in a deceptive practice of seeking the same relief from two distinct parties in two distinct actions in two distinct courts,” Folio wrote for DOT.
While suing DOT in circuit court, Tara has also been alleging in federal bankruptcy court that its lender should be responsible for the cost of rebuilding the culvert bridge.
“As such, Tara is engaging in the precise conduct that our Court expressly prohibits, and by engaging in such conduct Tara is undermining the integrity of this Court and promoting an injustice on West Virginia’s taxpayers by initially agreeing to construct and maintain its private bridge and approach and then petitioning this court to raid West Virginia’s coffers for its own pecuniary gain.”
DOT furthermore notes that Tara sought and received a new encroachment permit to construct a bridge on July 14, 2016, shortly after the flooding.
“Tara’s complaint makes a mockery of the regulatory process by seeking refuge and relief in this Court after it knowingly agreed that by accepting the permit it and it alone is and forever shall be responsible for constructing, maintaining and repairing its private bridge to ensure suitable access to its commercial strip mall,” DOT wrote.
The motion cites a deposition in bankruptcy court by Beth Abruzzino, one of the managers of Tara.
Q: Okay. So, in August of this year [2016] you were in the process of getting the bridge built?
A: Uh-huh.
Q: What happened that changed those plans?
A: Well, basically, funding that we thought was in place didn’t happen. The reserve funds [from Tara’s lender] we were denied getting, so that was part of the money that we were hoping to acquire in order to get the bridge built.
Q: So, is it fair to say the borrower [Tara] understood in January of 2016 and August of 2016 that the borrower was responsible to repair and maintain the culvert?
A: Yes, I would say between January and June, we were responsible.
Q: Did it stop in June?
A: Well, no. Okay, let me rephrase that. Yes, we — we were responsible for repairing the culvert.
Q: Are you aware, in pleadings filed in this case, that the borrower took the position that the State had the responsibility to repair and maintain the culvert?
A: Yes, sir.
Q: So, who is right, the pleadings, or your testimony today?
A: Well, part of the issue is the property is on the State of West Virginia’s property.
Q: I understand that but you just testified that the borrower has the responsibility to repair and maintain the culvert. The pleadings say otherwise. And I’m asking, who is correct, you, or the pleadings before the Court?
A: I’m not sure. I don’t know the answer to that question. I think that’s why we’re here.
The DOT motion concludes that the Abruzzinos are personally on the hook for their loan for Crossings Mall and that the lawsuit against the state is meant to shield them from financial ruin.
“Tara’s complaint against DOH appears to be nothing but a sham to insulate its owners (Mr. and Mrs. Abruzzino) from any financial exposure and diminish their personal financial obligations as guarantors of Tara’s Commercial Loan.”
The case has been assigned to Judge Jennifer Bailey with an anticipated trial date of January 2018.