Baltimore can request new bids for the Superblock project, a state appellate panel held Tuesday in affirming a lower court ruling that tossed a lawsuit filed by the ousted developer.
The Court of Special Appeals, in an unreported opinion, found a development agreement between the city and Lexington Square Partners LLC terminated June 30, 2013, because the two sides had not reached a settlement nor had conditions of the settlement been met.
Lexington Square had argued the contract language was ambiguous and the city could not unilaterally enact the termination provision.
But Judge Robert A. Zarnoch, writing for a unanimous three-judge panel, wrote Lexington Square “misinterprets the word ‘or.'”
“The contract clearly states that if either one of two conditions, (a) or (b) fails to occur, the [agreement] will terminate,” he wrote. “No linguistic or logical principle compels a contrary reading.”
The city and Lexington Square entered a land development agreement in 2007 for a $150 million redevelopment. The agreement had been extended five times since 2007 but city officials in June 2013 denied Lexington Square’s request for a sixth extension in order to line up financing.
A lawyer for Lexington Square, during oral arguments in Annapolis earlier this month, claimed the developer had $65 million in financing lined up but the city could not move forward by the deadline because it did not have title on one of the prospective properties.
Lexington Square filed suit in September 2013 alleging the city breached the contract and must pay $57 million in damages as provided under the agreement and in compensation for lost revenue.
Zarnoch, in his opinion Tuesday, acknowledged the complexity of the Superblock project but said the “sophisticated parties” represented by lawyers at every stage of negotiations agreed to the unambiguous language.
“The undisputed fact is that by June 30, 2013, the parties had not settled,” he wrote.
Deputy City Solicitor David E. Ralph praised the court’s decision.
“The winner in all of this is the taxpayers so the city can move forward and put this out to bid so the West Side can get revitalized,” he said.
Jason M. St. John, Lexington Square’s lawyer, did not immediately respond to a request for comment. St. John is a partner with Saul Ewing LLP in Baltimore.