Dunkiel . Saunders 91 College Street, PO Box 545 Brian S. Dunkiel Burlington, VT O54O2-0545 Eileen l. Elliott tel Shawn Gordon 802.860.'1003 fax 802.860.1208 www.dunkielsaunders.com ELLrorr I neuevooel I neNo ' *' Zoe E. Sajor Justin W. McCabe * " Mark A. Saunders Elizabeth H, Miller Karen L. Tyler Geoffrey H. Hand Andrew N. Raubvogel Victoria M. Westgate John B. Kassel Jonathan T. Rose December 30,2019 Via Hand Delivery Christine Brock, Clerk of Court Vermont Superior Court Chittenden Civil Division 175 Main Street, P.O. Box 187 Burlington, VT 05401 Re: Docket No. 118-2-19-Cncv McGrew et al. v. Devonwood Investorso LLC et al. Dear Ms. Brock, Enclosed please find Devonwood Investors, LLC's and BTC Mall Associates, LLC's Answer to Plaintffi' Third Amended Complaintfor Declaratory Relief and Counterclaimfor Breach of the Implied Covenant of Good Faith and Fair Dealing for filing in the abovecaptioned matter along with a check for $120 for the counterclaim. Please do not hesitate to contact us if you have any questions. Sincerely, Paralegal Enclosure Check# 15892 cc: Service List *' Drew Kervick * STATE OF VERMONT CNIL DIVISION SUPERIOR COURT Chittenden Unit Docket No. 118-2-19 Cncv BARBARA MCGREW, LYNN MARTIN, MICHAEL LONG, and STEVEN GOODKIND ) ) Plaintiffs/Counterclaim Defendants, ) ) ) V ) ) ) ) DEVONWOOD INVESTORS, LLC, and BTC MALL ASSOCIATES, LLC, ) Defendants, Counterclaim Plaintiffs, ) ) ) ) v JOHN FRANCO, Counterclaim Defendant. ) ) CERTIFICATE OF SERVICE I, Melinda Siel, certiff that on December 30,2019,I forwarded copies of Devonwood Investors, LLC's and BTC Mall Associates, LLC's Answer to Plaintffi' Th:ird Amended Complaintfor Declaratory Relief and Counterclaimfor Breach of the Implied Covenant of Good Faith and Fair Dealing to the parties below by the delivery method noted: Bv Hand Delivery: Bv First Class Mail & Email Christine Brock, Clerk of Court Vermont Superior Court Chittenden Civil Division 175 Main Street, P.O. Box 187 Burlington, VT 05401 John L. Franco, Jr. Law Offices of John F. Franco, Jr 110 Main Street Burlington, VT 05401 j ohnfrancolaw@aol. com Attorneysfor Plaintffi Dated at Burlington, Vermont this 30e day of December,2}l9. Melinda Siel, Paralegal STATE OF VERMONT CIVIL DIVISION SUPERIOR COURT Chittenden Unit Docket No. 118-2-19 Cncv BARBARA MCGREW, LYNN MARTIN, MICHAEL LONG, and STEVEN GOODKIND ) ) Plaintiffs/Counterclaim Defendants, ) ) ) V ) ) ) DEVONWOOD INVESTORS, LLC, and BTC ) MALL ASSOCIATES, LLC, ) Defendants, Counterclaim Plaintiffs, ) ) ) ) JOHN FRANCO, ) Counterclaim D efendant. ) DEFENDANTS DEVONWOOD INVESTORS. LLC'S AND BTC MALL ASSOCIATES. LLC'S ANSWER TO PLAINTIFFS' THIRD AMENDED AND COUNTERCLAIM FOR BREACH COMPLAINT FOR DECLARATORY OF THE IMPLIEP COVENANT OF GOOD FAITH AND FAIR DEALING Defendants Devonwood Investors,LLC and BTC Mall Associates, LLC (collectively "BTC") answer Plaintiffs' Third Amended Complaint as follows: Introduction 1. Admitted 2. Admitted that Mr. Goodkind, Mr. Long, and Ms. Martin participated in the cited challenge to TIF funding related to the Project in this Court, and that Count IV of that action challenged the denial of a public records request related to the Project. Otherwise denied. 3. Admitted 4. Admitted 5. Admitted that as a result of the Settlement Agreement, Plaintiffs Long, Martin, and Goodkind stipulated to the dismissal of the challenge to the TIF funding referenced in paragraph 2 above, and, as part of a group of interested persons, stipulated to entry ofjudgment in the zoningappeal referenced in paragraph 3. Further admitted that as a result of the Settlement Agreement, Ms. McGrew stipulated to entry ofjudgment in the Act250 appeal referenced in paragraph 4. Further admitted that Mr. Goodkind and Ms. Martin withdrew as individual plaintiffs in the public records act challenge reference in paragraph2 as a result of the Settlement Agreement. Otherwise denied. COUNT 6. 1 Admitted that in 2018, BTC did not individually notiff Plaintiffs of project changes and zoning amendments. BTC is without knowledge or information sufficient to respond to the allegation that Plaintiffs did not receive "actval" notice of the changes and amendments, and therefore denies that allegation. Otherwise denied. 7. Admitted that BTC has updated Project development plans since receiving zoning permits in20l7 and 2018. Otherwise denied. 8. Admitted that representatives of Defendant BTC Mall Associates,LLC provided an update on Project development to the Burlington City Council at its October 28,2l1gmeeting, and that the representatives discussed an updated development plan under which construction is anticipated to commence in2020. Further admitted that a video of that update is available on the internet. Otherwise denied. 9. Admitted that Plaintiffs seek the relief described. Denied that Plaintiffs are entitled to that relief. 10. Denied. 11. Denied. 2 12. Denied. 13. Admitted that Plaintiffs seek the relief described in this paragraph. Denied that Plaintiffs are entitled to the requested relief. COUNT 14. II Admitted thatparagraph 6(d) of the Settlement Agreement states in part that "Appellants, with the approval of the Applicant, will establish a fund at the Vermont Community Foundation, or similar existing Vermont non-profit organization with 501(c)(3) status," and that the Agreement contemplated two payments of $200,000 and $300,000 respectively. Otherwise denied. 15. BTC is without knowledge or information sufficient to form a belief "plaintiffs concluded that the Vermont Community Foundation was not as a good to whether fit," and therefore denies this averment. Admitted that Plaintiffs proposed that BTC designate an alleged organization called the "Caroline Fund" as the charitable organization to administer the "fimd" under pnagraph 6(d) of the Settlement Agreement. Otherwise denied. 16. Without knowledge or information sufficient to form a belief as to the truth of the matter, therefore denied. 17. Admitted that in November of 2018 Plaintiffs and Attorney Norman Blais (as counsel for the "Caroline Fund") wrote to request that BTC designate an alleged organization called the o'Caroline Fund" as the charitable organization to administer the oofrmd" under paragraph 6(d) of the Settlement Agreement. Otherwise denied. 18. Admitted that BTC has taken the position in this proceeding that BTC is not obligated to make the donation described in paragraph 6(d) of the Settlement Agreement because Plaintiffs failed to establish a "fund" by the agreed deadline, and an appeal was taken by the Coalition for a Livable City in the underlying Public Records Act claim. Otherwise denied. a J 21 [sic]. 22lsicl. Denied. Admitted that BTC commenced the demolition phase of project construction in December of 2017. Otherwise denied. 23 [sic]. Admitted that Plaintiffs seek a declaratory judgment as described in this paragraph. Denied that Plaintiffs are entitled to the requested relief. 24lsicl. Admitted that Plaintiffs seek an award of attorneys' fees and costs as referenced in this paragraph. Denied that Plaintiffs are entitled to such relief. WHEREFORE BTC demands that the Third Amended Complaint be dismissed and that BTC be awarded its costs, together with interest and such other relief as the Court deems just. AFFIRMATIVE DEFENSES 1. Failure to state a claim upon which relief may be granted. 2. BTC's performance is excused by Plaintiffs' material breach. 3. BTC's performance is excused by failure of consideration. 4. BTC's performance is excused by frustration of purpose. 5. Plaintiffs are equitably estopped from claiming breach of contract. 6. Plaintiffs have waived their claims. 7. Plaintiffs' own bad faith conduct excuses BTC's performance. 8. BTC reserves the right to add additional affirmative defenses. JURY DEMAND BTC hereby demand trial by jury on all claims so triable. COUNTERCLAIM FOR BREACH OF THE IMPLIED COVENANT OF GOOD FAITH A}[D FAIR DEALING Defendants/Counterclaim Plaintiffs BTC Mall Associates, LLC and Devonwood Investors, LLC ("BTC") counterclaim against Plaintiffs/Counterclaim Defendants Barbara 4 McGrew, Lynn Martin, Michael Long, and Steven Goodkind, and additional Counterclaim Defendant John Franco (collectively'!g6.nt erclaim Defendants") as follows: 1. In June 2017, BTC, Counterclaim Defendants Goodkind (for himself and on behalf of a group of petitioners, which included John Franco, pursuant to 24 V.S.A. $ 4465b)g) r;, Mccrew, Long, Martin, and John Franco, entered into a Settlement Agreement resolving certain legal actions brought by Courterclaim Defendants Goodkind (for himself and on behalf of a group of petitioners including John Franco), McGrew, Martin, and Long related to the Burlington CityPlace downtown redevelopment project (the "Project") being developed by BTC. 2. The Settlement Agreement contemplated generally that, among other things, the Counterclaim Defendants would (1) stipulate to a final judgment in challenges to the Project's zoning and Act 250 authorizations pending at the Vermont Superior Court, Environmental Division (the "Environmental Cases") md (2) cease their pursuit of a lawsuit, captioned Long et al. v. City of Burlington et al., Docket No. 996-11-16 Cncv (the "TIF/PRA Litigation"), brought by Counterclaim Defendants and an unincorporated association known as the Coalition for a Livable City (the "Coalition") challenging the Project's Tax Increment Financing and the City of Burlington's denial of a Vermont Public Records Act request for proprietary information related to the Project that was shared confidentially with a City consultant by BTC. 3. Counterclaim Defendants also agreed to ootake all reasonable actions necessary to implernent the terms of this Settlement Agreement and will not oppose any other permits or regulatory or legislative approval that may be required to implement the Project . . . ." I See also 10 V.S.A. 8504(b)(l) (allowing for appeal of zoning decision to the Vermont Superior $ Court, Environmental Division, by an "interested person" as defined in 24 V.S.A. $ 4465). 5 4. For its part, BTC would (l) make certain changes to the Project to mitigate Counterclaim Defendants' concerns about parking (2) pay certain of Counterclaim Defendants' legal fees, and (3) make donations to a fund established by Counterclaim Defendants "with the approval of [BTC]," at the Vermont Community Foundation or a "similar" non-profit organization to support "a mission and purpose to retain the essential character of Burlington." 5. The first donation to the fund was to be made "within ninety (90) days after final judgment is entered in fthe Environmental Cases and the TIF/PRA Litigation], and no appeal is filed." 6. Notwithstanding the Settlement Agreement, however, Counterclaim Defendants continued to actively pursue relief against BTC in the TIF/PRA Litigation through the Coalition, which was represented in the TIF/PRA Litigation by John Franco (who also signed the S ettlement Agreement). 7. In fact, after the Court issued final judgment in the TIF/PRA Litigation in favor of BTC and the City of Burlington (the "City"), Counterclaim Defendants - again, acting through the Coalition, and represented by John Franco - appealed the Court's ruling on their Public Records Act claim to the Vermont Supreme Court. 8. That appeal was not finally resolved until September 2018, when the Vermont Supreme Court affirmed the judgment in favor of the City and BTC. VENANT OF'GOOD FAITH AND FAIR COUNT I _ BREACH OF THE IMPLIED DEALING 9. By continuing to pursue the TIF/PRA Litigation after execution of the Settlement Agreernent, Counterclaim Defendants interfered with BTC's right to enjoy the benefit of the Settlement Agreement and broke implicit promises that made the Settlement Agreement possible in the first place. 6 10. Counterclaim Defendants' conduct fuither interfered with BTC's ability to perform its obligations under the Settlement Agreement. 11. As a result of the Counterclaim Defendants' conduct, BTC was forced to incur substantial costs, expenses, and other damages - including attomey's fees - in continuing to defend the TIF/PRA Litigation. 12. Counterclaim Defendants' conduct constitutes a breach of the implied covenant of good faith and fair dealing. 13. As a result of Counterclaim Defendants' breach, BTC is entitled to recovery of its damages and costs, including its reasonable attomey's fees incurred as a result of Counterclaim Defendants' conduct. 14. As a result of Counterclaim Defendants' breach, BTC is entitled to a declaratory judgment that it is not obligated to make the donations to an approved fund as contemplated by paragraph 6(d) of the Settlement Agreement WHEREFORE, BTC respectfully requests that the Court: 1. Issue judgment 2. Award BTC damages incurred in its favor; - including reasonable attorney's fees of Counterclaim Defendants' breach, in an amount to be determined 3. - as a result attial; Issue a declaratory judgment that BTC is excused from any obligation it had to donate money to a fund established pursuant to paragraph 6(d) of the Settlement Agreement; and 4. Award BTC such other relief as it deems just and appropriate. 7 Dated at Burlington, Verrnont this 30tr day of December,2}l9 DUNKIEL SAUNDERS ELLIOTT RAUBVOGEL & HAND PLLC K"n'^- By: 1 Karen Tyler, Esq. Jonathan Rose, Esq. 91 College Street Burlington, Vermont 0540 1 (802) 860-1003 ktyler@dunkielsaunders. com jrose@dunkielsaunders. com Attorneys for Defendants BTC Mall Associates, LLC and Devonwood Investors, LLC 8 15892 Dunkiel Saanders Eltiott Roubvoge! 9l & Hand Plb College Street Burlington, W 05401 12t3012019 a 6 o * th"DE?Eit Verfront $ Superior Court ',o .*tzo.oo 3 oo o o One hundred twenty and 00/1 DOLLARS € Vermont Superior Court 174Main Street Burlington, VT c 'A. 05401 iio o6 c o a MEMO Vermont Superior Court - : BTC Mall - City Place Proj Dunkiel Saunders 12t30t2019 12t3;,0t2019 t o 15892 Elliott Raubvogel & Hand PLLG Vermont Superior Gourt Vermont Superior Court - : BTC Mall - City Place Proj, Checking . People's ckg Operating ..6026-i Vermont Superior Court Dunkiel Saunders ? : -: BTC Mall- City Place Project 120.00 JV 15892 Elliott Raubvogel & Hand PLLC Vermont Superior Court Vermont Superior Court - : BTC Mall- City Place Proj Checking - People's ckg Operating ..6026-i Vermont Superior Court - : BTC Mall- City Place Project O 120.00 120.00 JV 120.00 O