Judge Rules Silver Mountain Lease Is Valid Decision Means Transactions Between Kellogg And Company Were Legal

A lease between the city of Kellogg and the owners of Silver Mountain is legal, a judge ruled Thursday.

The decision brings to a close at least part of a lawsuit that Mission Mountain, Silver Mountain’s landlords, brought against the city of Kellogg and Silver Mountain Corp., owner of the ski area.

“What the court did is confirm the validity of the transactions,” said Charlie Cox, attorney for the city of Kellogg. “Neither the city nor Silver Mountain Corp. had to get permission from Mission Mountain for the transaction.”

First District Court Judge Craig Kosonen decided that Swiss manufacturer Von Roll AG had been planning to foreclose on financially stressed Silver Mountain ski area just before it was sold.

For that reason, Kosonen wrote, the transaction between the city and the Silver Mountain Corp. was legal.

At stake was the future of the ski area, which already has begun selling season passes and plans to open on Thanksgiving.

If the lease had been declared void, Mission Mountain could have charged rent for use of its land or forced Silver Mountain Corp. to negotiate.

The 7-year-old resort had not been able to make enough money to pay off its debt. When it became clear the ski area couldn’t return Von Roll’s $17 million investment in the mountain, Von Roll decided to sell the resort.

In May 1996, the city of Kellogg transferred the lease agreement to operate the mountain to Eagle Crest Partners of Redmond, Ore., the parent company of Silver Mountain Corp., for $3.5 million.

Mission Mountain, which bought the land underneath the ski hill in 1994, wasn’t consulted in the negotiations.

Mission Mountain attorneys said the agreement between the city and the ski area landlord was breached when the resort changed hands.

Mission Mountain has expressed concern that Eagle Crest will remove the gondola from the mountain, as it is entitled to under the lease agreement. Although early documents show that was Eagle Crest’s original intention, the company since has denied that will happen.

The parties originally landed in court because of a logging dispute on the ski resort’s boundaries.

, DataTimes