Bulldog Drive War Over: Palm Coast Settles With Ajram, Paying Him $215,000 More Than It Offered in 2011
FlaglerLive | July 2, 2014
After years of battling with business owner Gus Ajram over his property on Bulldog Drive, intimidating his tenants, threatening condemnation, and refusing to pay his asking price of $1.125 million for two parcels key to the city’s beautification designs at the entrance to Town Center, the Palm Coast City Council on Tuesday finally agreed to settle with Ajram—for $215,000 more than the city was willing to pay in 2011, and $25,000 more than what even Ajram was asking then. The city also grants him the right to stay at the property an additional six months, for $1 in rent.
The city will pay Ajram $1.15 million out of the city’s reserves–that is, with general revenue dollars. In 2011, it had offered him, as its final price, $935,000.
It could have all been accomplished three years ago for Ajram’s lesser price of $1.125 million, when the city was successfully acquiring all the other parcels for the widening of Bulldog Drive. But a conflict that had by then become personal between Ajram and City Manager Jim Landon clouded the issue—and affected city designs to the point of redrawing the plans for the Bulldog Drive entrance, from four lanes to two. The original plan could have carried the day had the city settled three years ago, saving the city the additional, future expense of again turning Bulldog Drive into a construction site once the four-laning becomes reality.
Ajram, the long-time owner of GEA Auto, is close to signing papers on a land on U.S. 1 in Palm Coast, where he will move GEA Auto once construction of a steel and concrete building is finished.
The settlement, signed by Ajram and his wife and unanimously approved by the council, is the result of a day-long mediation session on June 20, conducted by South Florida mediator Will Smith, between the city and the Ajrams, with both sides’ attorneys doing the heavy lifting. Aside from ceding the property to the city, Ajram’s only other concession was giving up any rights to bring legal claims related to the property against the city in the future. At first Ajram was not going to sign because of that clause, he said, but then opted to do so. “I just want to move on,” he said, speaking in his office on Bulldog Drive this afternoon.
“Honestly, I have no feelings,” Ajram said. “I’m like a numb person. What I went through, like pain you get used to and you don’t feel it anymore.” Asked if he thought the settlement was fair, Ajram had a one-word answer: “Yeah.”
Along the way, however—in the past two and a half years—Ajram had a heart attack, and subsequently collapsed during an angry appearance before the council, an appearance emblematic of the acrimony that had developed out of intransigence on both sides. Ajram all along thought his intransigence was his right, while the city’s was, as he saw it, an attempt to bully him out of his property at an unfair price. At the time, Ajram was renting the two properties to other auto repair businesses. The city, to push them out of the location, paid the businesses’ “moving” expenses to get them out, a move Ajram protested as an illegal interference between him and his tenants. The city miscalculated, however: once the tenants were gone, Ajram moved in. And the city lost another $60,000 on the deal (the $20,200 and $39,150 it paid the two businesses to move), an amount, of course, the city has not included in the price of its settlement with Ajram.
The city then threatened to condemn the property. But eminent domain proceedings are notoriously lengthy and expensive, and nothing guaranteed the city success on its terms. Ajram did not budge. The city then retreated, and revamped its plans for Bulldog Drive from a four-lane to a two-lane project, currently under way and scheduled for completion by the end of August.
“The bottom line is this brings resolution to a long-standing series of issues that we’ve had,” Palm Coast Mayor Jon Netts said. “Mr. Ajram wants to run his business, he wants to run his business unfettered, we want the properties along Bulldog Drive to comply with our codes. This is a resolution, and somewhere along the line I think you said it or the attorney said it, in mediation, you want to do something that nobody is really thrilled with the end result, and that’s probably the fairest possible.”
The Ajrams are not thrilled with the end result because much of their personal history is wrapped up in the Bulldog Drive properties, which gave Ajram his considerable customer base, and proved to be the business that anchored him in one place the longest.
City Attorney Bill Reischmann, for his part, tried to paint the situation as positively as possible for the city, even as he was presenting documents that clearly showed how much the city was conceding, and at what cost in dollars, time and designs for Bulldog Drive.
“Even though there was no pending litigation, there was no lawsuit, the Ajrams and the city agreed that it would be beneficial to try to work through what has been ongoing for many years now,” Reischmann said. “That mediation, which is a formal process, it’s not a trial, it’s not an arbitration, it’s basically a formalized settlement conference, you have a professional mediator that kind of does a Henry Kissinger like movement back and forth between different groups in trying to find and forge a middle ground, a compromise.”
Reischmann was not a party to the mediation. The city was represented by attorney Debra Babb-Nutcher, of Reischmann’s firm (she counsels city advisory boards), along with Landon and Beau Falgout, the senior planner and Landon’s right-hand man. Ajram and his wife Colleen attended, along with attorneys Anthony Policastro and Maureen Jones. Each side presented an opening statement, before being separated and sitting out the day in separate rooms, with Smith, the mediator, shuttling between them.
In his efforts to paint the settlement as favorably as possible for the city, Reischmann did not mention that the city was paying far more than it had offered in 2011, or that it was paying more than even Ajram was asking. Instead, Reischamnn reached for a property value comparison that had little relevance to the matter at hand. “I can tell you,” Reischmann said, “that this is an amount that is less than the comparable figure that would have been used, based upon the value of the property that the city did purchase at the corner of Bulldog Drive and State Road 100, so that was one factor in the discussions supporting the city’s offer.”
Reischmann was on stronger ground when he discussed the legal rights Ajram was giving up. The settlement, he said, “includes a release of any and all claims that the Ajrams may have or could bring through the completion of this process of settlement, and they’ve raised quite a few through the years, and they were raised, all of them were raised again at the mediation. The city believes that, we feel strongly that while these claims are without merit. That does not mean that they will not be brought and it does not mean that the expenses associated with defending those claims will not be incurred by the city and by sits taxpayers, so that is indeed one arguable benefit of putting all of this behind the city.”
Unmentioned during the meeting was Ajram’s attempt to recoup attorneys’ fees: the city refused to budge on that count, leaving the bill to Ajram.
Council members had few questions. Landon explained the $1-rent arrangement that would enable Ajram’s GEA Auto to keep operating there for the next six months: “The idea behind that is to give the Ajrams an opportunity to relocate the business that they have there and give them plenty of time to find a new home for that business.”
Council member Dave Ferguson on two occasions made offensive remarks, as far as the Ajrams were concerned, as he openly questioned their honesty, questioning giving them the money up front and saying, “If they have their money, they theoretically could play the game later on”—meaning they could refuse to leave the property. Ferguson returned to the charge moments later by wondering who would be responsible for serious environmental damage to the property, if such damage was found—even though the city has already ruled out that possibility and does not expect such issues to arise. Ferguson’s comments contrasted with his actions outside the chamber: he’d sought to help the Ajrams in recent months.
At any rate, the city has no plans for the property it’s acquiring at the moment, beyond finishing this phase of the Bulldog Drive widening. “I want to stress the Bulldog Drive improvement project that’s going on right now will continue and will be finished on schedule in August,” Landon said, “so this doesn’t have any impact on that whatsoever. Furthermore, we don’t have any immediate plans for this property, and there will be no cost associated with those six months to the city, so whether the Ajrams are there or they’re not there, their business there has no financial impact on us. This isn’t like you buy a home and you want to move into it but you have to wait until they move out. We don’t have any plans for this property.”
Ajram said he hopes not to be on Bulldog Drive too many months. “Our season starts the beginning of the year,” Ajram said, “and the six months will end up ending in the heart of our sales season. I don’t want to be moving in the peak of my season. The sooner, the better.”
He does not expect any more tension with the city at his new place of business. “I think for what we went through and how we ended up with mediation,” Ajram said, “I won’t have any problems, and this time I leave it to professionals. I’m not going to touch it.”
Meanwhile GEA Auto’s business volume has plummeted because of the construction in front of the business, which turned Bulldog Drive into a sandy mess. “Who’s going to drive a Mercedes down this street?” Ajram asked, referring to a large portion of his business, which specializes in European cars. “But we’re still busy. It’s still backed up, because what we do, no one can.”
Outside the business, as Ajram embraced his wife Colleen, she said the events of the last two weeks “haven’t sunk in yet.” She too was regretful of leaving the location on Bulldog Drive, to which she is greatly attached. She speaks of the move to U.S. 1 as “a new adventure.”
Ajram himself reiterated his attachment even to the city, though not quite its government. “If not for my customers,” he said, “I wouldn’t be around. All the support all these years: we had so much support from people, it’s unbelievable. That’s why I feel it’s my place. It’s my family. I cannot describe to you how thankful I am for all these friends. I knew I would never lose. I have the largest family here.”