That’s because the owner of one of the three motels that would be demolished to make way for the proposed 90-room Lake Flower Resort and Spa has terminated his contract with the project’s developers.

“The deal is done, as far as my client is concerned and as far as I’m concerned, and it should be,” said Lake Placid attorney James Brooks, who’s representing Lake Side Motel owner David Manning. “If somebody else wants to buy it, that’s fine.”

Manning terminated his contract after Saranac Lake Resort LLC failed to close on the sale of his property by an April 30 deadline, which had been extended three times over the past year.

But the resort isn’t giving up yet. At the request of its lawyer, Matt Norfolk of Lake Placid, a judge has issued a temporary restraining order that prevents Manning from selling his motel to any other potential buyer, pending further court action. A hearing on the matter is scheduled for Tuesday in Essex County State Supreme Court in Elizabethtown.

A conceptual drawing shows plans for the Lake Flower Resort and Spa in Saranac Lake. (Image provided)

If it’s not decided in the resort’s favor, the project would be dead, Saranac Lake Resort representative Jacob Wright acknowledged in court papers.

“If (Saranac Lake Resort) cannot purchase Manning’s property, the entire resort hotel project will be lost, hundreds of thousands of dollars will have been spent for the project, and the other two motel owners will not be able to sell to (Saranac Lake Resort) as their contracts are contingent on all motel properties being sold to (Saranac Lake Resort),” Wright wrote in a legal affidavit.

Even if the restraining order is lifted, however, it’s not the end of the resort’s problems. Its contracts to buy the other two motels — the Lake Flower Inn and the Adirondack Motel — also expired on April 30, although Norfolk said he believes they are willing to grant the resort another extension.

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Contracts extended

The office of the Lake Side Motel, now closed, is seen Friday on Lake Flower Avenue on Saranac Lake. (Enterprise photo — Chris Knight)

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The motel owners initially signed contracts to sell to Lake Flower Lodging LLC, a group led by Chris LaBarge of Malone that also included Wright, among others. The review process lagged, however, and the motel owners’ contracts were extended multiple times. They eventually ran out, without closing, in the spring of 2015.

By that fall, a different group of investors called Saranac Lake Resort LLC, led by Leland C. “Lee” Pillsbury and Mark Pacala with Wright as their consultant, had signed purchase contracts with the three motel owners. As part of the deal, the resort agreed to pay each motel owner a non-refundable $5,000 per month, which would be applied toward each property’s purchase price.

The contracts had an original closing date of May 2, 2016, but the closing was extended three times at Saranac Lake Resort LLC’s request: to Aug. 1, 2016, Oct. 31, 2016 and April 30, 2017. The project gained village Planning Board approval in July 2016 and state Adirondack Park Agency approval in February of this year.

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The Lake Side Motel, now closed, is seen Friday on Lake Flower Avenue on Saranac Lake. (Enterprise photo — Chris Knight)

Lawyers argue

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Manning had agreed to sell his motel for $600,000. On April 6, his attorney, Brooks, sent Norfolk a letter that said “time is of the essence” for Saranac Lake Resort to close. It set a closing at 10 a.m. April 30 in Brooks’ Lake Placid law office.

Norfolk responded with an April 25 letter that said the closing was supposed to be “on or about” April 30, citing the resort’s prior contract extension with Manning. He said that wasn’t enough to establish “a binding and effective time of the essence clause that Mr. Manning may properly rely on to demand a closing on April 30.”

Nevertheless, Norfolk said he would try to prepare for a May 1 closing, the date of which was changed because April 30 was a Sunday. But Norfolk told Brooks there were title and property inspection issues clouding the sale that would have to be taken care of first.

Brooks wrote back that same day, calling Norfolk’s claims a “transparent attempt” to stall the closing. He said Manning won’t agree to any further extensions and called it “untimely” for Norfolk to raise title issues, without documentation, five days before closing.

Ultimately, the May 1 closing date came and went, and the deal wasn’t finalized. Brooks sent Norfolk a letter the same day, saying the contract is now “terminated by reason of your client’s non-performance.”

Brooks acknowledged Friday that ending the contract would defeat the resort plan.

“That’s their problem, not my guy’s problem,” he said. “They’ve had three years. How many more years do we give them?”

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Restraining order

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Three days before the scheduled closing, Norfolk filed a complaint against Manning on April 28. It makes some of the same arguments Norfolk made in his letter to Brooks, namely that the contract and its extensions “did not contain an unequivocal and binding time of the essence (for closing) clause.”

The case is being handled in Essex County by state Supreme Court Justice Martin D. Auffredou. On May 5, he issued a restraining order that prevents Manning from selling his property until the court has heard the case. Oral argument is scheduled to take place Tuesday afternoon.

Norfolk said this morning that the resort is still willing to close the deal with Manning, but several issues have to be resolved.

“There’s a title issue that needs to be cleared up,” he said. “We have the right to an inspection. We started the inspection after this lawsuit was filed and after the temporary restraining order. The inspection report came back, and there’s five or six issues of concern, so we have to do a phase two environmental inspection.

“We wouldn’t be doing this unless we wanted to purchase it,” Norfolk added. “The whole point of the lawsuit is to make sure Mr. Manning doesn’t go and sell this and the contract is still in place.”

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“On and on”

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If the Lake Side Motel is no longer in play for the resort, the attorney for one of the other motels said that “would kill the deal, because it requires all three to go together.”

Guy Hayward, who’s representing Lake Flower Inn owner Kim Walasky, said all three motel owners’ contracts with Saranac Lake Resort LLC expired April 30 without closing. He said his client may be willing to renew or reinstate her contract with the developers, “but nothing seems to be happening.

“It just keeps going on and on,” Hayward said. “I think there’s a lack of confidence in going forward (with the developers). I don’t know whether they are waiting for (Roedel Companies’) lawsuit to be ended or whether the environmental (remediation planned in Pontiac Bay) is their big concern.”

Hayward said all three motel owners have been strung out for years, going back to 2013.

“I think it’s hurt their business, getting their regular customers to come back, because you don’t know if the place is going to be open or close,” he said.

While the Adirondack Motel and the Lake Flower Inn continue to operate, Manning’s Lake Side Motel has been cleaned out and is closed, Brooks confirmed.

Fred and Susan Mueller, who own the Adirondack Motel, have previously declined to speak to the Enterprise about their contract with the resort. A message left Friday with their attorney wasn’t immediately returned.

Norfolk said Fred Mueller advised him recently that they’re not terminating their sale contract with the resort, “and we’ve been talking to Walasky, and it sounds like they’re not terminating.”

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The latest

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Brooks has filed a cross-motion asking the court to vacate the restraining order that prevents Manning from selling his motel to anyone else. If the judge won’t do that, Brooks wants the resort to post a $600,000 bond to cover Manning’s damages.

These latest developments in the resort project come as the village Board of Trustees is scheduled to hold a public hearing at 5:30 p.m. today on changes to the Lake Flower Planned Unit Development District, a zoning change the board enacted for the resort in 2015. The amendments would remove 203 River St., a point of contention in the Roedel lawsuit, from the PUDD and change its boundaries to include submerged lands on Pontiac Bay.

When the changes were announced, Mayor Clyde Rabideau said he hoped they would satisfy Roedel Companies and lead it to drop the lawsuit, but the company has said it plans to continue the litigation.