MASON CITY | Mason City has filed an answer and counterclaim to a February lawsuit alleging that it was guilty of breach of contract in a hotel development deal as a part of the River City Renaissance Project.
That lawsuit from representatives of G8 Development and company head Philip Chodur stated, in part, that Mason City's default notice toward the San Diego-based company in September 2018 for not providing full proof of financing to the Iowa Economic Development Authority was invalid because the "request by IEDA was not an obligation of G8 under the Agreement."
The city's counterclaim filing this week summarily denied that it "materially breached the contract" with G8 Development and also denied that "G8 fully complied with all of its obligations under the Agreement."
In addition, the city disputed the claims that G8 "suffered loss related to Pre-Construction Work" and that "Mason City did not reimburse or pay amounts to G8 to reimburse G8 for its costs incurred related to Pre-Construction Work and the monthly fee for pre-construction services."
G8 had previously dropped a lawsuit against Mason City in January 2018 as a condition of entering into its most recent development agreement with the city.
However that development agreement, the one at the heart of the present lawsuit, began to fall apart in September 2018 after disputes over financing and proof of said financing.
By October 2018, Mason City Council unanimously approved a resolution to terminate its agreement with G8 Development.
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Chodur has pitched and worked on downtown proposals with Mason City for more than five years. None involving a hotel have been completed.
"G8 had negotiated with the city to build a hotel in the parking lot west of City Hall but was found in default when it failed to meet deadlines for starting construction," the Globe Gazette reported on Jan. 6, 2018.
The city reentered into a deal with G8 in November 2017, quickly discarding Gatehouse, partially in exchange for dropping a pending lawsuit.
Gatehouse once again reentered the picture in November 2018 after the aforementioned dispute over financing.
As the plaintiff in the case, G8 has demanded "trial by jury on all triable issues" listed in its initial petition.
Mason City, the defendant, "prays the Court dismiss Plaintiff’s Petition and assess all costs to the Plaintiff."
Attorneys for both parties were contacted by the Globe Gazette but did not respond to requests seeking comment.