Judge will sort through legal haze in Aspen pot shop flap
The Best Day Ever pot shop finds itself in a worst-case scenario over future operations at its downtown Aspen location, a lawyer told a judge Tuesday.
The marijuana dispensary is at the center of a court feud between its landlord, Douglas Tomkins, and the condominium association representing unit owners at the 520. E Cooper Ave. building.
“It’s become obvious to us and it’s become more obvious as discovery (the exchange of evidence between both sides) progresses, that Mr. Tomkins and Best Day Ever in particular have been unfairly and arbitrarily and unlawfully singled out and targeted,” attorney Andrea Bryan of Garfield & Hecht PC said during a virtual hearing held before 9th Judicial District Judge John Neiley. “We continue to learn about this campaign to eliminate Best Day Ever everyday.”
Bryan is representing Best Day Ever, which while not a party in the case, has much at stake as the association presses Tomkins to evict the pot shop and wine cellar, both second-floor tenants.
Tuesday’s hearing concerned Tomkins’ motion for a preliminary injunction to stop the condo association from fining the landlord $500 a day for not evicting the two tenants. Tomkins initially sued Aspenhof in December, accusing the condo association of trying to retroactively enforce a ban, and in March filed a motion for an injunction to stop the ensuing fines.
Neiley said he would issue a ruling on the motion for injunctive relief within the next month.
“It’s a very interesting issue and I appreciate the arguments,” he said.
The association has been pushing for the immediate termination of both tenants’ leases because their uses are no longer allowed at the building, which is comprised of commercial and residential units.
That ban was driven by the association’s board of directors’ vote on Aug. 31, 2020, to amend its bylaws to prohibit pot shops, inventory storage and other commercial uses from the building’s upper floors.
“Its common area hallway is small, and the elevator that serves the floor, as well as residential units above, is small and old,” read a pleading filed March 24 by condo association attorney Bill Kyriagis of the Denver firm Otten Johnson Robinson Neff + Ragonetti PC. “These tenants’ activities have had a disproportionately negative impact on other unit owners’ use and enjoyment of their units, creating odors and noise, and crowding the common areas and elevator.”
Because Tomkins has not terminated the leases, Aspenhof has been fining him $500 daily at a clip that could rise to $500,000 by the time the litigation between the landlord and association ends, attorney Peter Bornstein of the Denver area has argued.
At the hearing, Bornstein argued that Tomkins — whether he evicts the tenants or allows them to complete the remaining terms of their leases — is in a “no win-situation.”
“One one hand, Mr. Tomkins has these contractual relationships with two tenants,” he said, adding “on the other hand, Aspenhof also is fining him $500 a day and putting liens on his property because he is not following their amendments to their declaration.”
Best Day Ever’s three-year lease dates to April 2017; last year it extended the lease through April 2023.
Both Tomkins and Best Day Ever, when agreeing to the lease extension in 2020, were aware that a ban on upstairs pot shops could be coming later that year, Kyriagis argued.
He said more than 60% of Aspenhof unit owners support the evictions. The wine storage tenant is Betula restaurant.
If Best Day Ever loses its lease, it will be forced to re-apply for its retail marijuana licenses because they are tied to the property that marijuana dispensaries use, Bryan said.
“This isn’t something that can be just relocated overnight,” she said. “There is a lengthy and involved process … and there are the other issues of finding another space in a highly competitive Aspen real estate market.”
Bryan and Bornstein also said it is clear Best Day Ever was targeted when the HOA changed its condo covenants because another dispensary, Silverpeak Apothecary, continues to operate from the same building.
Aspenhof sees it differently.
“The Association affirmatively states that the other dispensary occupies a basement unit physically separated from the upper portions of the Building, does not present the concerns the Association aimed to regulate, and is not prohibited by the 2020 Amendment,” the association argued in court filings.
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