Overview of Hotcreek Lawsuit Against Town of Mammoth Lakes
In the late 1990s, the Town of Mammoth Lakes entered into a development agreement with Terrence Ballas to build a condo hotel style development and to make improvements at the Mammoth Lakes airport. The land would initially be leased with an option to purchase at a later date. The Mammoth Lakes Land Acquisition, LLC (MLLA), developer, later acquired the right to build the condo hotel project from Terrence Ballas.
Eventually, the Town of Mammoth Lakes pursued the airport expansion to add commercial flight service to and from the area. The Town approached the Federal Aviation Administration (FAA) for help on eliminating the Developer’s ability to build the project. Because of safety issues with the proposed development being too close to the runway, the FAA objected to the project being built at that location, and as a result, threatened to cut off federal funding for the airport expansion project, which would bring in commercial flight service.
Meanwhile, the developer demanded that the project move forward per the development agreement. The Town of Mammoth did not want to move forward until all parties could resolve the FAA’s objections and safety concerns. The developer then sued the Town of Mammoth Lakes based on “Anticipatory Breach of Contract”. A jury found the Town to be at fault in breaching the development agreement and awarded the developer $30 Million in damages.
See next blog post regarding current status and possible future ramifications facing Town of Mammoth Lakes.
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Verena Robinson, Broker/Owner
Mammoth Lakes Resort Realty
CA BRE License #01512209
tel. (760) 924-8521