A Superior Court judge decided Friday that a former lessee of the Otis Hotel did not exercise his option to purchase the downtown building, granting clear title of the property to owners John and Min Ha.
“It is clear that (the Has) are entitled to some relief,” Judge Sam Cozza said from the bench.
The nonprofit corporation that leased the building, run by Jim Delegans, contended that it exercised its option to purchase the building prior to the expiration date in December 2004. However, as no rent was paid through most of 2005, and no money accompanied the intention to exercise the option, Cozza said he found a “material failure” to exercise the option.
Paul Allison, an attorney for Delegans, disagreed, saying payments over the five-year course of the lease added up to almost $680,000 paid toward the purchase price of the building.
The Has plan to try to recover back rent payments which they believe total $93,800, said their attorney, Eric Shumaker.
Caught in the middle of the legal action are dozens of low-income residents who live in the five-story building at the corner of Madison and First. Allison has said Delegans wanted to continue offering housing for low-income residents were he to retain the building. It is not clear what the Has may do with it, following resolution of the lawsuit. However, they operated it prior to leasing it to Delegans and are managing it now, Shumaker said.
Allison said he is not sure whether Delegans will appeal. Shumaker said an appeal wouldn’t affect the finality of the judge’s order.
Another of the Has’ attorneys, Linnwood Sampson, has said the Has are interested in selling the building but haven’t been able to entertain the offers they’ve received due to the legal challenges.