WEST JEFFERSON — A lawsuit has been filed in North Carolina Superior Court by owners of The Hotel Tavern against the former and current owners of the Historic Old Hotel in downtown West Jefferson, according to court documents.
Guion & Lyle Enterprises, owners of The Hotel Tavern, filed a complaint Thursday, Aug. 29, alleging that Bridgetree Investments, the Old Hotel’s current owner, and Woodie Investments, former owners of the Historic Old Hotel, breached their contract with The Hotel Tavern and conducted unfair and deceptive trade practices, according to the complaint document.
“This action arises out of defendants’ unlawful and collective efforts to undermine plaintiff’s existing lease on the premises through which it has operated The Hotel Tavern for the past seven years,” the complaint said.
With the allegations, Guion & Lyle Enterprises, represented by Capua Law Firm, is suing Bridgetree Investments — owned by Mark Beck, as well as previous owners Jo Ann Woodie, Billy Jo Woodie, Deborah Woodie Ellis, David Ellis and Sharon Woodie, all represented by Thompson Coburn and Reeves DiVenere Wright law firms — and is seeking a preliminary injunction from the court to allow The Hotel Tavern to remain in operation.
According to the affidavit of Andy Guion, included in the complaint document, he contacted the Woodie family along with his wife, Pam Guion, Sherman and Beth Lyle, in February 2013 with regard to leasing the restaurant space in the Historic Old Hotel.
After some time, the two parties came to an agreement in March 2013 for a five-year lease of the restaurant space, the affidavit said.
“Because we were aware that the restaurant space was in bad repair and not up to code in many ways,” the affidavit said, “we required, as part of our lease negotiations, a five-year renewal term in order for us to have time to realize the benefit of our financial investments, which were also a benefit to Jo Ann Woodie.”
Between the signing of the lease and The Hotel Tavern’s opening day of July 2, 2013, the property underwent “extensive renovations,” exceeding $216,000, according to the document. Jo Ann Woodie paid for an agreed portion of the cost, totaling approximately $5,300.
Andy Guion then stated that the first five-year term of the lease was “very successful and in complete harmony with Jo Ann Woodie and her family,” and toward the end of the term, Andy Guion and Sherman Lyle were made aware in October 2017 of the Woodies’ interest in listing the Old Hotel for sale with Regency Properties.
Negotiations for the renewal of the lease then started in late 2017, and Andy Guion said in the statement that he and Sherman Lyle proposed to renew the lease for 10 years rather than five years, with an additional 10 year option for renewal at the end of the 10-year term.
“Presumably, they wanted to lock us in as a tenant, which would make the building more saleable for them, and the restaurant was so successful that we, too, wanted a longer term commitment to the property from them,” the affidavit said.
The lease was then signed on March 2, 2018, according to court documents. The lease began on May 1, 2018, with the date for renewal listed as April 30, 2028. In addition to a lease extension, Andy Guion and Sherman Lyle also negotiated for a preventative right to require the lease to transfer to any buyer if the property were to sell, based on the Woodies’ expressed interest in selling the Old Hotel, according to the complaint.
“Landlord reserves the right to list and/or sell the property at anytime during this lease, and the lease shall transfer with the sale of the property,” the lease said.
While seeking to refinance The Hotel Tavern later in May 2019, Andy Guion was unable to locate a fully executed, signed lease and requested the Woodies to send a signed copy, according to the complaint.
The complaint then claimed that Billy Jo Woodie never sent a signed copy of the lease. Later, Jo Ann Woodie signed Andy Guion’s copy of the lease on July 22, 2019. According to the complaint, Andy Guion immediately attempted to record the signed lease in the Ashe County Register of Deeds.
As the lease was not notarized, the Register of Deeds refused to record it, the complaint said.
The Historic Old Hotel was then sold to Bridgetree Properties, owned by Mark Beck, on July 30, 2019, and recorded in the Register of Deeds on Thursday, Aug. 1.
As a part of his plans to renovate the Old Hotel, Beck asked the owners of The Hotel Tavern to vacate the building for a two-year period, which the plaintiff claims would cause irreparable damage to The Hotel Tavern, according to the complaint.
“Despite the fact that (Bridgetree) knew of the existence of the 2018 lease, knew of the terms of the lease, including the preemptive right contained therein, and knew of plaintiff’s attempt to record the lease, (Bridgetree) has asserted and continues to assert that plaintiff has no lease and is seeking to have plaintiff ejected from the property,” the complaint said.
The Hotel Tavern’s hopes and Beck’s response
“Our basis for the lawsuit is we feel like we have a legitimate lease,” Andy Guion said. “(Beck) feels like we don’t have a legitimate lease.”
He and Sherman Lyle added that they wouldn’t go to court if they didn’t think they had a solid case.
Ideally, Andy Guion said the best scenario would be “having a landlord that’s cooperative.”
“The other end result is to keep this business thriving and functioning, and keep employed the 40 people that work here and depend on this building for their livelihood and their family’s livelihoods,” Sherman Lyle said.
The Hotel Tavern has more than 40 employees and accounts for roughly one-third of the dining seats in Downtown West Jefferson, according to court documents.
“You can’t lose that many seats and not have a negative impact on tourism,” Andy Guion said, who also serves as chairman for the Ashe County Tourism Development Committee.
“If (Beck) wants to do remodeling, we’re happy to work with him,” Andy Guion said. “We’ve always had an open door and an open mind to it.”
Beck declined to comment in detail as the situation is currently being litigated, though he said he plans to remain in Ashe County for “a very long time” as the owner of the Old Hotel.
“I didn’t take the legal step — they did,” Beck said in a phone interview. “They’re suing me. I’m not suing them.”
The court date is slated for Monday, Sept. 30, in Alleghany County. The Honorable Michael D. Duncan will be presiding.