Local landlord does battle with law firm | AspenTimes.com

Local landlord does battle with law firm

John Colson

One of Aspen’s most high-profile landlords has called one of the town’s biggest and most active real estate law firms “a pack of crooks” and is suing over allegations that the lawyers stole one of his tenants.

But the law firm of Garfield and Hecht countered in court this week that the landlord, Harley Baldwin, has “jumped to conclusions” that are not warranted by the facts.

The two sides are slugging it out this week and next, in a six-day jury trial before 9th Judicial District Judge J.E. DeVilbiss.

According to documents provided by Baldwin’s attorney, Stan Garnett of Denver, Baldwin is seeking somewhere in the neighborhood of $1 million in back rents and other damages from the law firm and from the tenants who also are defendants in the case.

The tenants are Louis and Franci Sagar of New Jersey, who originally opened the Zona store in Baldwin’s property, the Collins Block Building, in 1990; and Dan and Amy Martineau of Aspen, who became partners with the Sagars and ultimately sole operators of Zona. They moved the business from Baldwin’s property to the Elli’s Building, at the corner of Mill and Main streets.

The suit is based on a complicated series of business dealings that started when the Sagars, originally from New York, decided to add an Aspen store to their already existing chain of Zona shops. According to Garnett, Baldwin courted the Sagars to be among the first tenants in the Collins Block (former site of the old Sardy’s hardware store), because he liked the quality of the merchandise sold by their chain of stores.

The Sagars together signed a five-year lease with Baldwin for the space at 218 N. Mill St. and opened the shop in 1990, at a rental rate of just over $100 per square foot.

But in 1993, after the Sagars had separated and were headed for divorce, Louis Sagar (without Franci Sagar’s knowledge, according to her attorney) renegotiated the lease with Baldwin, trimming the size of the shop to save on rent. It was also claimed in court that the Sagars had a history of not paying their rent on time.

In 1995, Louis Sagar was in poor financial shape and arranged a partnership with the Martineaus, owners of Gracy’s thrift shop, to be half-owners of the store and to manage it for him. But for reasons that are disputed by the two sides, a formal “assignment” of the lease to the Martineaus was never executed, and the Sagars remained the tenants of record, even though Franci Sagar no longer had anything to do with the business, according to her attorney.

In 1996, the parties began fighting over back rents, and the Martineaus, who had obtained the rights to use the name, Zona, began looking for a new location. They contend they were not formally tenants of Baldwin’s and so had no contractual obligation to stay put.

Ron Garfield and Andy Hecht, whose law firm had worked for Baldwin since the early 1970s, also happened to be partners in the Elli’s Building, which is where the Martineaus moved their shop in 1996.

Baldwin, believing the attorneys had an active role in stealing his tenant, testified on Thursday that in a meeting with the attorneys at that point, shortly before he fired them, “I think I told them they were a pack of crooks.”

But the attorneys, along with the Martineaus and the Sagars, argue that because Baldwin’s lease was with the Sagars and did not name the Martineaus or Zona as a store or a corporate entity, the Martineaus had every right to move. The defendants maintain that Baldwin’s only legal claim is against Louis Sagar, who signed the 1993 lease and was legally responsible for the rent on the property.

The case is complicated by a vast array of letters and other communications among the various parties, and by the fact that Louis Sagar filed for bankruptcy in 1997 and has not been present in the courtroom.

Baldwin, who has given the only testimony in the case so far, faces cross-examination from the defendants’ team of four lawyers today.

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