Submitted 8/29/07

by P. Finn

BACKGROUND

As stated at the previous meeting The idea for a lease came from John McAlevey. The Board was convinced that usage of the amenities initially offered to owners could be a problem if the property passed to someone after Forever Wild.

To prevent any problems the following was proposed:

Find someone whose deed specifically stated they had the right to use the amenities, then have them quit claim these rights to the Association. Lacking this, have several original owners quit claim their rights to the Association. This assumes that the original owners had this right granted through original marketing materials, verbally, or through the HUD filing. The quit claim deeds involved original owners only.

As a backup to the quit claim deeds a 99 year lease was proposed.

Several revisions were made to the original lease while negotiations were going on between Mr. McAlevey , representing the Association, and Mr. Keeney, representing Forever Wild Development Corp. As most of you know Mr Keeney and Mr. Hepperly eventually left Forever Wild leaving only the actual owner, Mr. Johanson.

By this time Mr. McAlevey had resigned as council to the Association. He later became a member of the Board of Directors but after two months resigned.

This left a committee, appointed by the board, comprised of three members of the board. The committee included a former attorney, a retired professional and myself to negotiate with Mr. Johanson. Using an attorney suggested by Mr. McAlevey, and approved by the board, negotiations began with Mr. Johanson.

When Mr. Johanson reviewed the proposed lease he immediately rejected it. Mr Johanson felt he had clear title to the land and was not going to enter into something where he got nothing in return. He proposed a lease for a limited amount of time and an unclear amount. Over a period of time the negotiations continued between the committee, our attorney and Mr. Johanson and his attorney. These negotiations resulted in what was presented to you at the last meeting.

IS THE LEASE A BAD IDEA?

I don’t think so. The purpose of the lease was to amicably settle a dispute over our rights to use the lake area, tennis courts, river access, and the trails.

Could we go to court and win? Maybe. Could we go to court and lose? Maybe.

Are we giving up our rights? The rights of the individual property owners are NOT forfeited with this lease. What about those rights of the 7 or 8 original property owners who quit claimed their rights to the Association? Our attorney has suggested that we quit claim their rights back to them and clear Mr. Johanson’s title of quit claims.

Remember the dispute is right of usage.

FINALLY

In response to a comment “that we should hire Mr.McAlevey as our attorney”... Mr. McAlevey was the Association’s attorney and resigned. A party and gratuity was given to him on behalf of the association to thank him for his years of pro bono work. Mr. McAlevey later served on the Board and resigned. I cannot speak for the current board, but when I was on the board, we were very happy with the present attorney.

Submitted 8/27/07

by Joe Demarco

I believe that this Lease controversy is something that is invalid and should let it die. It was ill conceived from the beginning and started a lot of unnecessary arguments among our members. I have lived in the "Acres" for over 32 years and have served as Vice President and have never heard of having to "PAY" for our rights to the amenities which were promised by Mr. John Eaton, founder of the Acres.

LET IT ALONE.

Submitted 8/20/07

by Joe DeLuca

Fellow AAPOA members and Au Sable Acres residents, please read the commentary on the lease posted by John McAlevey. This is the first factual information I have seen in writing representing "our" side of the issue. It is clear that we have the upperhand in this matter and that we should NOT give up any rights by signing the proposed lease. This lease is NOT a "win-win" outcome.

For those that cannot make the upcoming September 1 meeting in person to vote on the lease, PLEASE comment to this email/site and give an indication of your being for or against it. It's the only proxy we will have (i think) in your absence.

8/18/07

by Constance Bremmer

Rick and I will be unable to attend the Labor Day weekend meeting where the vote on the lease agreement is scheduled to take place. Our vote, however, would be "NO". As it is has not been legally determined where the legal ownership lies, we should not enter into an agreement that will settle that issue by confirming ownership to the other party.

Submitted 8/17/07

by Rosemary Barry

As usual, John (McAlevey) has all the information. We should listen to him because
he has been involved in this for many years and has the best interests
of the Acres and its residents at heart. Perhaps he should be our
attorney.

Submitted 8/17/07

by David Plumley

John F. McAlevey is absolutely correct.

I urge all to read his statement and/or speak to him or
other informed persons who are familiar with the history
of Ausable Acres, and the intent John Eaton made clear for
the disposition of the recreational areas.

Reject this lease agreement.

Submitted 8/16/07

by Tim Fitzgerald

Vote no, and continue to use the facilities.

Submitted 8/1/07

LEASE AGREEMENT ANALYSIS

by John F. McAlevey

attorney and former pro-bono legal advisor to the AAPOA Board for 15 years

CONCLUSION: The lease should be rejected as not in the best interests of the Property Owners Association.

SPECIFICALLY: The quit claim deeds from members of the Association, all original purchasers from the AuSable Acres corporation, the original developer, transferred to the Property Owners Association, as the agent of we the owners, the owners claims to the use of property and facilities promised to the homeowners at the time of sale. these facilities were to be turned over to the Property Owners Association by AuSable Acres, Inc. at a future date (presumably when AuSable Acres, Inc. had finished developing).

The AuSable Acres Property Owners Association was incorporated by AuSable Acres, Inc. in August, 1971, to be the owner and operator of recreational facilities and the roads when AuSable Acres, Inc. relinquished title to them. That transfer never occurred. Upon the death of John Eaton, his family lost interest in the project, development stopped and AuSable Acres, Inc. was dissolved. The transfers were neglected.

The deed selling off the undeveloped property did not, however, sell the "...vacant land, green areas, wetlands and other parcels not approved for residential use." The property, never sold to Forever Wild, was not spelled out in detail, but was referenced on nineteen different maps.

To this date, no one has specifically defined those areas. As much as one hundred acres may be involved. When AuSable Acres, Inc. was finished developing and went away, to whom would it have transferred title to those acres? That question was never answered. They did not go to Forever Wild, hence, they cannot have gone to JLKN Acres, LLC, - the entity now presuming to lease them back to us. It is of no significance, legally, that Forever Wild, and now JLKN have continued to pay real property taxes on the undifferentiated acreage.

If they want us to waive off our claims by way of working toward getting a clear title, we can negotiate a far better deal than the present.

We should receive clear title from JLKN to all of the lake area and its environs (not just "...the northern shore" (Article 1, Paragraph 1.1)). We should also have express title to the whole tennis court corner, not merely the courts and the right to access them. All costs should be born by JLKN and a cash settlement should come from them, not $2500 go to them! The quitclaim deeds were specifically designed to cloud the title to those areas before Forever Wild, Inc. sold out to someone else. This has been very effective. Even before we conceived of the quitclaim deeds as a mechanism to put any purchases from Forever Wild on notice, President John Irvin obtained a title company opinion, which I have, to the effect that Forever Wild's property could not be insured as it stood.

Why would the Board of any organization give up a strong negotiating position and get nothing in return?

More to the point, why did the Board present a grievous misstatement in its "Summary" in favor of the lease distributed at the June 30th general meeting? To wit: "2. Annual cost of lease less than our annual legal fees currently being paid to determine or [sic] legal status of AAPOA perpetual use (continued fight in court)."

No "fight" in court is or has been in progress! No money has (or should have been) spent on this matter to date!

Orally, at the June 30th meeting, the then president also said this lease is based on one "McAlevey drafted" several years back, implying similarity.

Not so. My lease never relinquished the quitclaim deeds. That lease specifically put aside the issue of title for 99 years, no relinquishment of claim was involved. the current lease gives everything away and we pay $2500 per year for the privilege. The earlier one gave nothing away and cost a nominal one dollar ($1.00) per year.

This lease also gives away the property surrounding Lake Eaton except "the northern shore" (Article I, Paragraph 1.1). Why?

The earlier lease provided that any new homes would be required to be members of the AAPOA, non-payment of dues would create an enforceable lien. This lease leaves such future membership optional. Why?

This lease will require every member of the AAPOA to sign an agreement to hold JLKN Acres, LLC "harmless" before we can use the property the Board is leasing (Article 6, Paragraph 6.1)! What, therefore, is the point of it all?

I could go on, but the foregoing should be sufficient.

On June 30, the lease proposal was table on a vote of 40-2. If it is presented again, I recommend a negative vote.

My services are available to the Board if they need legal analysis or representation.