Part one of a series.
Last May, the City of Alameda expressed its discontent with Greenway Golf Associates by filing a “verified complaint” with the state’s Superior Court. The City told the court that Greenway had breached its lease agreement for the Corica Park golf course. In the filing with the court, City Attorney Yibin Shen alleged that Greenway and its majority shareholder Umesh Patel had violated the lease agreement with the City in three ways.
City makes allegations of Corica Park lease violations
First, the City alleged that Greenway infringed on its obligations by failing to “resolve the drainage and irrigation issues on the North Course.” In conjunction with this allegation the City informed the court that Greenway had also failed to submit to the City updated construction schedules and monthly evidence of the expenses that Greenway had incurred. The City pointed to internal disputes between Greenway’s majority and minority shareholders and stated that those differences precluded Greenway from efficiently undertaking the task of addressing the North Course’s problems.
Secondly, the City informed the court that Greenway had put an end to that task altogether for a time, and further violated its lease agreement “by halting construction on the North Course” for some six months—from December 2021 to May 31 of this year. The City stated that these actions “constitute a material breach of Greenway’s lease agreement.”
Third, the City alleged in its complaint that Greenway “by and through its majority shareholder defendant Patel” failed to “provide the City with access to all its books and records as they relate to the operation of the (golf complex.) This refusal,” the City alleged in its complaint, “constitutes a material breach of (Greenway’s) lease agreement.”
The City asked the court for a temporary restraining order that would require Greenway to allow an audit “of all of (Greenway’s) books immediately.” In addition, the City requested that the court require Greenway “to provide a timely and complete construction schedule for the North Course and to allow the City access to and the right to audit all of (Greenway’s) books and records on an ongoing basis.” The City told the court that if its audit revealed Greenway’s inability to perform its obligations, the City would be “entitled to terminate the agreement.”
Greenway Golf responds
Greenway responded on September 9 with a cross-complaint, which was released to the public on September 20. The company told the court that it had “performed all material obligations under the lease.” The cross-complaint informed the court that one section of the agreement with the City “provides that Greenway ‘shall have the exclusive right and authority to operate (the golf complex) as (Greenway) deems appropriate.’”
Greenway alleged that the City breached this section of the lease by falsely accusing the company of making improper staffing decisions, of improperly raising rates, and of irregularities in its accounting system.” Greenway informed the court that the City is using the latter false accusation to demand an audit. The cross-complaint further accused the city of interfering with what Greenway called its exclusive right to determine the means and methods of constructing the golf course at Corica Park and to set the timetable of completing the work.
In addition, Greenway alleged that the City was interfering with its right to manage and control the complex’s day-to-day operation. Greenway also informed the court that the City advised Greenway that it need not consent to Patel’s April 2020 acquisition of the majority of Greenway’s shares. The complaint stated that this year (2022) the City falsely claimed that Greenway never advised it of Patel’s acquisitions.
Greenway also alleged that the City breached the agreement’s implied covenant of good faith and fair dealing. The complaint stated that this has forced Greenway to spend time and money responding to the City, rather than giving its full attention to the golf complex. In addition, Greenway’s filing informed the court that the City also damaged the company’s reputation with “false or baseless accusations about the company’s financial standing.”
More to come
The Alameda Post received responses to issues surrounding this case from Sam Singer, president of Greenway’s public relations firm, Singer Associates. Part two of this story will be published once the Post has discussed the issues with the City Attorney’s office.