More Dogs on Main |

More Dogs on Main

Tom Clyde, Park Record columnist

As spring arrives, it’s about time for the various owners in the Canyons resort to start suing each other. That’s about as predictable as the buzzards returning to Hinckley, Ohio. But through the years, the toxic business climate that has always afflicted ParkWest has been contained. This year, it has become contagious.

PCMR has sued Talisker in a classic landlord-tenant dispute. It would be quite amusing if the stakes weren’t so high. When the people at PCMR say there is a possibility that the resort won’t open next year, they aren’t kidding. The smart bet is that they will find a solution, but when dealing with a clash of the titans, it’s not hard to see a set of circumstances that would have that very bad result.

The issue is pretty simple: PCMR leases part of the property it operates on from United Park City Mines, which was purchased by Talisker when it bought the rest of our world.

The lease, which dates from the early 1970s, was a product of a not-quite-bankruptcy when Greater Park City Company, owner and operator of the resort, was in a death spiral and needed to get rid of the thing. At that point, nobody was sure the resort was an asset. To everybody involved, it felt like a dying horse it required a lot of feeding and produced a lot of poop. It wasn’t at all clear that it could ever be ridden, and if it croaked, getting rid of it was a real problem.

United Park City Mines surely didn’t want it back. It had tried to run a ski area and failed already, and now there was a whole bunch of additional debt out there. The banks didn’t want it, either.

So the lease was amended in a kind of shotgun wedding, and the whole thing was sold to the Badami interests on the "take over payments" plan. The resort owned the parking lots and base facilities outright. Its property extended up the hill to about the top of the Three Kings chair. Then the bank took a swath of land between the resort’s land and the real skiing up top.

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One thing you can count on when things are really messy is that there will be a bank involved, usually with the name "Morgan" attached. So the Morgan interests own the land some additional distance up the hill. And then United Park City Mines/Talisker owns the dirt under the rest of the operation, all the way to Jupiter Bowl.

The dispute is whether an option to extend the lease was exercised properly. The lease says the resort had to turn around three times and click its heels while saying the magic words on a specific date. Talisker thinks the resort missed the deadline, or got the magic words wrong. The resort thinks it got it close enough.

The background issue is that the rent under the lease (which could run to 2051) is very low. It was a product of the distress sale, and was set at a fixer-upper rate that now, after 40 years, looks ridiculous. Ridiculous or not, it’s binding, as long as the option to renew got exercised properly. If not, well, the lease expired; start packing. United Park, under different ownership, spent years trying to break the lease a few years back. Life is hard when your landlord hates you.

But because of the way the property is sliced up, it’s impossible to have a clean break. Talisker can’t just tell the resort people to clean out their lockers and start out fresh next year. Talisker doesn’t own or have access to the parking lots or the base. Its customers would have no way to get across the resort’s property to access the top of the mountain. Talisker could run a resort without parking or bathrooms, and maybe send people up through the Spiro Tunnel again. PCMR could run a very nice resort that ends at the top of Three Kings. As a friend put it, that’s a pretty good hill in Wisconsin. Or maybe it could work like a toll road, where you have to stop at each of the property lines and buy a different pass.

Think of it as trying to get somebody to move into a house where one party owns the kitchen and bathroom, and another party owns the living room and bedrooms, and the divorcing couple are lobbing grenades at each other down the hallway. Or the Canyons. If they get it solved, it’s business as usual next year, at least for the customers. If they don’t, the dispute could just blow it all to smithereens.

The potential for collateral damage is huge. Every business in town is right in the splatter zone. They need to solve it quickly.

Tom Clyde practiced law in Park City for many years. He lives on a working ranch in Woodland and has been writing this column for 25 years.