Sale of local golf course challenged

In a recent real estate action, a sister — and minority shareholder — has sued her brother to stop the sale of the family’s Minnetonka golf course. For decades, the family has owned the Minnetonka Country Club. In 2014, the brother — and majority shareholder — took over the club following the death of his father who had run the club for 40 years.

In October 2014, the club announced that it would close its doors because of decreasing revenue and increasing costs. However, the lawsuit claims that the brother had begun to market the property for sale in the summer and fall of 2014. By November, the man had signed a letter of intent with a developer.

The developer plans to purchase the 116-acre plot of land to build 120 high-end homes for $15 million. These homes would be sold for between $800,000 and $1 million. Sixty acres of the property has also been reserved for open spaces including undeveloped wetlands, private and public spaces. If the development is approved, construction will begin in 2016.

In the lawsuit, the sister claims that her brother did not consult with other shareholders about the sale of the property. In fact, the lawsuit claims that no shareholder vote took place before the sale commenced. The suit also claims that no independent appraisal of the value of the land was undertaken prior to the sale.

Both the developer and the brother claim that the suit is meritless. They do not believe it will stop the sale or redevelopment of the golf course.

Real estate litigation, like this suit, can be legally challenging. With so many competing interests, a case can drag on for months or years. In these cases, property owners, businesses and developers should make sure to understand their legal rights. In some cases, drafting solid real estate contracts can help avoid these cases altogether.

Source: Star Tribune, “Sale of country club near Lake Minnetonka disputed in family feud,” Kelly Smith, Jan. 24, 2015

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