The News Desk is a collection of news, notes and breaking items affecting the Fredericksburg community.
Early decision likely in museum lawsuit
RICHMOND—A federal judge said he’ll rule next week on whether to dismiss an effort by the U.S. National Slavery Museum’s architect to get restrictions removed from the museum’s land before a sale.
Judge James R. Spencer said he’ll take the issue under “very brief advisement” and make his decision sometime next week.
But he did indicate he thinks Celebrate Virginia made a “very, very strong” argument in pointing out that the architect—Pei Partnership Architects—doesn’t own the title to the land.
The land in question is 38 acres at Celebrate Virginia South, donated in 2002 to the museum, which was founded by former Gov. Doug Wilder.
That donation was accompanied by a use restriction that says the land must be used for an African–American heritage museum or some other educational or charitable purpose.
But the museum was never built and filed for bankruptcy a year and a half ago. Pei designed it but was never paid.
The bankruptcy case ended last August, but the museum still owes the city of Fredericksburg more than $300,000 in unpaid taxes and owes Pei almost $6 million. The city is moving to auction the land to recoup the money—that’s a separate case in state court.
Pei is arguing in the federal court case that the deed restrictions are not enforceable. Pei attorneys have said the land would be more valuable at sale if the restrictions were removed.
Celebrate Virginia, which donated the land, has asked Spencer to dismiss Pei’s case.
Spencer’s ruling won’t address the broader question of whether the deed restrictions should remain on the land; instead he will decide whether to dismiss the case, as Celebrate Virginia wants, or let it proceed, as Pei wants.
John Walk, of Hirschler Fleischer, representing Celebrate Virginia, said in court Friday that while Pei can claim it has an interest in what happens to the land, it doesn’t have actual title to that land, and thus has no say over what happens to the land beyond its right as a creditor to compel the sale to recoup the money it’s owed.
“What they’re seeking to adjudicate is the value of the property,” Walk said.
Having a lien on the land, as Pei does, “gives you absolutely no leg up whatsoever in the bidding process,” Walk said.
Spencer called that a “very very strong” argument.
“How can you clear a title when you don’t have a title?” he asked Pei attorney Paul Prados.
Prados said the question of the deed restrictions affects the value of Pei’s judgment lien against the property, and that all parties are suffering from the “uncertainty” surrounding the enforceability of those restrictions.
He noted that the deed restrictions were not filed with the original deed of gift in 2002.
Celebrate Virginia has said the deed restrictions are legal. They were put in place to protect the development, Celebrate Virginia Director of Development Scott Little said last year in testimony during the museum’s bankruptcy case.
At the time, Little said the restrictions were meant to prevent the museum or any future buyer of the land from using the land in ways that would threaten Celebrate Virginia’s own development plans. For example, the developer wants to build hotels, and so doesn’t want the land bought by someone else who might build a hotel.
Little also said last year that while the deed restrictions weren’t filed with the deed in 2002, they were signed then. The developer “restated” the restrictions in a court filing in 2009, as it became apparent that the museum project was faltering.
Chelyen Davis: 540/368-5028