Wed, Aug 10, 2011
Seven Years Of Litigation Result In Win For McGill
Aviation
After
seven years of litigation, the City of Fernandina Beach on Amelia
Island, Florida has been ordered to pay McGill Aviation over $1.2
million in attorney fees & costs as the prevailing party over
the local airport sponsor (FHB). The award to the fueling FBO is in
addition to $400,000 in past damages, $300,000 as a rent reduction
going forward, and another $80,000 in attorney fees, for a total of
almost $2 million, not including interest.
The dispute began when the City made a series of unilateral
reductions to McGill's leasehold for City airport improvement
projects. Ultimately, the City took 3 acres of McGill's paved
aircraft parking ramp. The City refused any form of
compensation for the takings, including: pavement replacement, land
swaps, rent reductions, or lease extensions. McGill claimed
the takings and other City actions interfered with its
operations.
McGill also contended that the City's airport operations ignored
& violated federal requirements included in its lease.
Those federal obligations come from 1947 conveyance restrictions
and subsequent grant assurances. McGill claimed the City
broke federal airport law by discriminating among tenants; by
exercising monopoly rights; by imposing unreasonable rates, rules,
& standards; by diverting revenue from a City golf course
located on airport land; and by improperly recovering grants by
charging depreciation of grant projects against current income -
which raised costs, lowered income, & ultimately meant
unnecessarily high rents for airport tenants.
When McGill challenged the City actions, the City attempted to
evict the FBO.
The subsequent litigation included a mediation, an arbitration, two
lawsuits by the City, and one unsuccessful City appeal. The
eviction case and other City actions were found to be in
retaliation for McGill's legitimate claims. While there were
factual findings indicating federal violations, any remedy for
federal violations was left to the FAA.
The recent fee award is based upon McGill prevailing on the
substantial issues of the case. The City has again decided to
appeal. Until paid, the judgment will earn interest at
6%.
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