Kelsey Brunner/The Aspen Times
A dispute at Aspen Mountain Lodge has spawned dueling court actions regarding who has control of its funds and homeowners’ association.
On one side are developers and brothers Aaron and Michael Brown and their business associate Harris Berlinsky, who are behind three limited liability companies that own 20 of the lodge’s 38 units.
On the other side are unit owners William Sheehan Jr., Scott Sinta and Twin Coasts Limited, an entity controlled by Josh Nordan.
Both sides introduced court documents last week in the aftermath of Alpine Bank’s decision to freeze the accounts that had been managed, until the last half of September, by The Aspen Homeowners’ Association, which is run by the lodge’s unit owners. Alpine Bank filed what is called a “complaint in interpleader” — which has been pending before Pitkin County District Court since Sept. 19 — seeking a judge’s clarification on whom should be able to access the operation’s money.
Bob Morris, who manages Aspen Mountain Lodge, once had access to its funds but he no longer does because the accounts were frozen.
“This system in the long run is not workable,” he said, but added business for October is up and last weekend the lodge was sold out. But, he said, two checks covering the lodge’s sales tax payments have bounced to the city, and other vendors have cut ties until the mess is resolved.
In a statement last month, the Browns said: “We are seriously concerned about the lack of appropriate reserves to cover normal building maintenance and upkeep needs and strongly believe that the association must follow sound financial principals and state laws to assure sufficient money to fund the reserves. We are deeply sorry that the staff has been impacted by this association dispute and are working hard to address it.”
Morris countered Tuesday that the Browns want to “take over” the lodge.
“The Aspen ideal is mind, body, spirit, but the Aspen ideal for them is to simply to line their pocketbooks,” he said. “They view Aspen as their own cash register.”
The Browns believe they should have control of the lodge’s HOA board’s top two seats — president and vice president — and its account funds.
On Friday, the three LLCs filed a legal petition, not made public until Tuesday, seeking a Pitkin County District Court judge’s court-ordered special meeting of the HOA.
They want a court-approved HOA meeting because they have been unable to get the statutorily required unit owners’ attendance, known as a quorum, to hold one themselves, their petition contends.
“It is imperative that the Court intervene and fashion a process whereby the association can do business and affirm who is in charge of the association,” says the 18-page petition, which was filed by attorney Maria Morrow of the Aspen firm Oates, Knezevich, Gardenswartz, Kelly & Morrow PC. “The governance disputes have caused serious disruption in the business of the association.”
Also on Friday, Sheehan, Sinta and Twin Coasts Limited filed a set of claims in district court against The Aspen Homeowners Association and the Brown brothers, accusing them of rigging a board election to their favor because they collectively own 52.6% of the lodge’s units.
As manager of Mountain Lodge Holdings LLC, which owns 20 units, Michael Brown ran for president of the HOA at its May 31 meeting. He prevailed because he voted for himself on behalf of Mountain Lodge Holding’s ownership interest, and he also did the same by electing Aaron to vice president, alleged the filing, which was made by Lucas Van Arsdale of Balcomb & Green PC. Sheehan retained his seat as secretary-treasurer in that election.
The filing by Sheehan, Sinta and Twin Coasts Limited contends that Mountain House Lodging did not have the right to elect both Brown brothers to board seats in the same election.
To get around that, on June 20 the Brown brothers created two LLCs — one under Aaron Brown’s name, the other under Berlinksy’s — which were both deeded a condo unit from Mountain Lodge Holding, the filing contends.
The Browns and Berlinsky subsequently called for a special meeting, to be held July 23, to validate the May 31 election results and remove Sheehan from his post. Sheehan, however, refused to resign, while no business was conducted because of a lack of quorum.
The Browns tried to hold four more HOA meetings, but none of them drew enough attendance to establish a quorum.
Last week’s filing by the Browns cast blame on the HOA.
“Members of the Association are determined to shut down the business of the association,” the filing says. “Members have demonstrated their determination by refusing to attend meetings of the members on multiple dates, confirming in writing that refusal is a strategy to shut down business, communicating that they will not attend a meeting ‘ever’; and demanding that the board stop calling meetings altogether.”
The filing seeks the court’s approval for a special meeting, with no quorum, to be held Oct. 30.
The other three unit owners are seeking a declaratory judgment from the court to determine that the May board election results were invalid and put Sheehan, Sinta and Nordan (Twin Coasts Ltd) back on the board.