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WILSON, N.C. — Representatives of AmerLink are countersuing Carroll County, alleging more than a million dollars in damages caused by interference by the locality in the failed economic development deal.
This is the latest response of the log home manufacturing and sales company to Carroll County's lawsuit to get back 32 acres of land in the industrial park and incentive funds, and to terminate the 99-year lease on the log home sales center at the Southwestern Virginia Farmers' Market.
AmerLink is going through Chapter 7 bankruptcy proceedings.
The counterclaims of AmerLink and its sister construction company Pro-Form have surfaced just as representatives of Carroll County and Pro-Form are to meet for court-ordered mediation of their disagreements later this month.
AmerLink, through its bankruptcy court-appointed trustee Stephen Beaman, alleged the county breached its contract in the effort to attract the log home manufacturer to Carrroll and create 200 jobs, according to a filing with the court.
Performance agreements placed on the deal stated that the industrial park land was to return to Carroll County if all requirements were not met by the company.
Company officials say they were working towards that end, having invested about a million dollars in its model home sales center at the farmers' market and $2.5 million on what was to be the company's saw mill and other facilities in the industrial park, according to court papers.
But company officials also claim that the county threw roadblocks at its work to complete the projects.
"In order to perform under the performance agreements, the defendants [AmerLink] needed use of the industrial property," court papers say. "Prior to the completion deadline of March 18, 2009, the county prevented the defendants from accessing the industrial property."
This amounted to a breach of the performance agreement by the county, AmerLink claims.
"AmerLink has been damaged by the county's breach of the performance agreement, and is entitled to recover from the county the sum of at least $1 million plus interest, and such other damages as may be proven at the trial in this case," the document states.
Additionally, company representatives say that Carroll breached its contract by not getting the parking lot at the log home sales center paved by March 11, 2009. The counterclaim says it had at least $10,000 in damages from this failure.
The counterclaim says Carroll interfered with AmerLink and Pro-Form Construction's ability to carry out their part of the agreement.
In attempting to get back the $600,000 in economic development incentive money and the land, company representatives have accused Carroll County of "unjust enrichment."
"Plaintiff [Carroll County] will be unjustly enriched if it is permitted it recover and retain the repayment of $600,000 grant money and industrial property, after the plaintiff's actions and/or omissions resulted in the delay of the completion of the performance agreements, and the significant amount of money invested by the defendants in the industrial property," the counterclaim said.
AmerLink believes it is entitled to be paid for any improvements made to the property.
Company representatives ask the bankruptcy court to consider these factors and find in favor of Amerlink in the suit with Carroll County.
"The plaintiff breached the performance agreements and that by reason of said breach of contract, the performance agreements are terminated, and AmerLink, and its successors, have been excused of their duties to perform all obligations set forth in said contract," AmerLink argues.
In terms of relief from the court, the company requests more than $1 million plus interest in damages.
And if the court rules that Carroll County should get the industrial back, Amerlink representatives have asked for the fair market value of the property, which they estimate at no less than $1.5 million, they argue in the filing.
A separate county filing from Pro-Form argues Carroll County officials in 2005 assured AmerLink owner Richard Spoor that the industrial property would have no deed restrictions, so the company could get loans to finish building facilities there.
It goes on to say that Spoor became aware of these restrictions when officials at Grayson National Bank told him that they would not be able to complete a loan to AmerLink, because of deed restrictions.
Court filings argue this prevented the company from getting a third-party loan, or from using the industrial property as collateral.
Company representatives also claim that the industrial property in question had an abandoned right-of-way that ran through the heart of it, which was not disclosed by Carroll County.
"The failure of Carroll County to remove the right-of-way or to transfer ownership of the same further impeded the ability of AmerLink to complete construction of its facilities on the industrial property."
Carroll County also refused to recognize that AmerLink received an extension to complete its work from Aug. 26, 2008, until March 18, 2009, company representatives claim.
"As a result of declaring the performance agreement in default per the terms of the Aug. 18, 2008, letter, [Carroll County] through its agents, prohibited and otherwise prevented AmerLink and Pro-Form from entering the industrial property and from otherwise completing the requirements of the performance agreement," company representatives argue.
Based on these matters, Pro-Form has claimed breach of contract and fraud and asked the court to grant the deed to Pro-Form from AmerLink as valid.
Pro-Form asked the court to dismiss Carroll's lawsuit seeking to get the industrial property back and recover nothing from the company, according to the document.
"In the event that Pro-Form is required to re-deed the industrial property to the plaintiff, allow Pro-Form a period of 60 days from the entry of an order requiring such re-deeding of the industrial property to Carroll County, to enter upon the industrial property and remove all of Pro-Form's property, including any improvements," company officials requested.
Mediation between Carroll County and Pro-Form is scheduled for Aug. 29, Carroll County Attorney Jim Cornwell confirmed. He expects it will cover the topic of the industrial park property, as Pro-Form does not have any interest in the farmers' market property.
Pro-Form has not indicated what it might want to see coming out of the mediation, Cornwell said.
It will be good "to learn what Pro-Form's position is, other than reading what they've written in their [court] papers," the attorney told The Gazette. "From reading the paperwork... it looks like we're pretty far apart."
Any settlement proposal that may arise from mediation would have to be related to the Carroll Board of Supervisors for their approval, the county attorney said.
If no possibility of agreement arises, the question of the industrial property with Pro-Form goes to trial in January, Cornwell said. A court date on the question of the lease on the sales center with AmerLink has not been set yet.