MASON CITY | The Mason City Chamber of Commerce says a San Diego developer who failed to build a downtown hotel has "unclean hands," according to court documents.

In a lawsuit filed against the city and the Chamber July 18 in Cerro Gordo County District Court, Philip Chodur of G8 Development makes several claims, namely that the city was in breach of contract.

The Mason City Chamber of Commerce, in recent court filings, responded that G8 Development’s contract is with the city of Mason City, not with the Chamber.

Much like the city, the Chamber in court documents rejected almost all of the claims made in lawsuit filed by G8, which failed to build a downtown hotel.

"Plaintiff's claims are barred by the doctrine of unclean hands," the response said.

The doctrine argument is a defense in which the defendant argues that the plaintiff is acting unethically or has acted in bad faith, with "unclean hands.”

The term is used within contract law. Through the doctrine, the plaintiff is not entitled to a remedy since the plaintiff has “unclean hands.”

The Chamber claims G8 acted in bad faith with the city of Mason City, court documents say, and asks the suit be dismissed with costs assessed to the developer. 

Seth R. Delutri, the Chamber's Des Moines-based attorney, also requested a jury trial. 

G8's petition names Chamber Director Robin Anderson and her alleged role in the interference.

 “Upon information and belief, the Chamber intentionally and improperly interfered with the Development Contract by, among other things, Robin Anderson, in her capacity as Director of the Chamber, having ‘secret’ meetings with certain members of the City Council and encouraging them to terminate the G8 Development Contract in favor of another proposal being offered by an entity known as Gatehouse Capital," the petition states.

G8 Development claims that the interference and alleged “secret meetings” caused the city to terminate the development contract, affecting the company's ability to perform and complete its obligations under the contract.

The Chamber denied the existence of secret meetings and denies that it interfered with the contract. 

When the city terminated the development contract, G8 Development claims the termination was not in good faith. At that time, the city said the developer had defaulted on the project.

“Defendant City of Mason City properly terminated the Contract because Plaintiff materially breached the Contract by not performing as required and/or because it failed to act in good faith in performance of the Contract,” the Chamber’s response said.

Chodur filed a similar lawsuit alleging the city of Vista, California, breached its contract with him on a condominium, commercial and office space project, according to an article published in the San Diego Union Tribune in October 2015. The suit claimed the city changed agreements for the project.

Chodur filed a claim with the city for $3 million, which was rejected. He then filed a suit for breach of contract, which is still pending.


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