In June 2016 Flagler Beach’s city-owned nine-hole Ocean Palms Golf Course reopened after sitting idle nearly a decade. The city had signed a long-term lease with Terry McManus for $200 a month’s rent plus revenue sharing from the course’s restaurant and golf operations.
The relationship between McManus and the city has had ups and downs. The city compromised the course’s operations with a major public works project that ran through it four years ago, compounding hurricane-induced closures. The city then had a difficult time getting financial reports from McManus, as required by the lease, and was ready to sever the lease and end its relationship with McManus. But the two sides worked it out.
Financial reporting issues have now reemerged, and city commissioners are again uneasy about what they’re seeing–and not seeing–from the course. “I just have a lot of concerns about what’s the management of it and us as a city having some level of control or at least some stewardship of the people’s property,” City Commissioner Ken Bryan said at the last commission meeting late last month, “because it does belong to the city. And I’d just like perhaps a clarification as to what’s going on and whether or not we need to take action or not. As a business person we would do that if we owned the property, and I think as a city we need to do that.”
“This is news to me, I know nothing about it,” McManus said today, saying he’s in full compliance. “Our lease is intact and we’re in good state.”
But the lease and the financial reporting issues with the city may be the least of McManus’s problems, and the least of what’s been going on at Ocean Palms Golf Club, with little knowledge by city commissioners or the city administration–down to a period a few months ago when McManus had agreed to sell his management company and shift management of the club to his cook and general manager. That ended when McManus fired the general manager–and the general manager sued him.
McManus faces two criminal cases, including two felony charges, and one civil case in Flagler court. His two criminal trials are scheduled to start next Monday. The trial dates have been set and reset a few times, so they may yet be moved. But covid delays played a large role previously. Those delays are no longer a factor. The depositions are in. This is as close to a certain date as the cases have been, and Circuit Judge Terence Perkins is not keen on granting delays for the sake of delays.
“The approach is going to be, I’m going to beat those cases and get an acquittal and then you’ll have a story to write about,” McManus said.
The older of the two cases dates back to July 24, 2019, when McManus was arrested on a drunk driving charge, his fifth since 1985 (others took place in 2003, 2007 and 2015). According to the arrest report, McManus wasn’t driving a car or a truck, but a golf cart in a closed-off construction zone on State Road A1A, back when A1A was undergoing its reconstruction at the south end of town. McManus, who was at the wheel of the whirring cart, “appeared to be in a daze,” the arresting officer reported. McManus repeated that he was sorry. It was about 1:20 a.m.
The golf cart “was actually buried to where it was sitting on the axles,” Sgt. Austin Yelvington, who had arrived at the scene as back-up, said in a deposition, “it was actually a lifted golf cart with, you know, like little off-road tires on it.” Asked in the deposition to describe McManus’s condition, Yelvington said: “He was one of the most intoxicated people I’ve ever come across, to put it in simple terms.”
He was first taken to the local hospital, where he declined medical attention, then to jail. He declined to go through field sobriety exercises or provide a breath sample.
McManus’s defense attorney has argued in a motion to dismiss that McManus “was not driving as legally defined” in law, and that the golf cart, stuck, was “inoperable” and was eventually towed by John’s Towing. “Sitting in a vehicle that is found to be inoperable so that it could not be moved except by an outside agency is insufficient as a matter of law to establish actual control of a vehicle,” the motion stated, an indication of how defense arguments will be framed at trial. McManus had filed the motion to dismiss the case. The motion was denied. Jury selection is scheduled to begin at 8:30 a.m. Monday.
The second criminal case originated a little over a year ago. McManus is accused of insurance fraud, a third-degree felony, and making a false report, a misdemeanor. The case is convoluted but comes down to McManus filing two reports with police, one for an allegedly stolen Rolex, , and one for a Caterpillar Skid Steer trailer allegedly stolen from Ocean Palms golf course. The reports triggered suspicion from insurance claim agents, who contacted Flagler Beach police, who then launched an investigation. The Flagler Beach detective found that the vehicle in question had been sold to a family in Canada–and that McManus never produced an actual proof of purchase of the trailer. McManus, according to the investigation, had gotten the Skid Steer insured by a Palm Coast insurer for $45,000–but had never provided the serial number.
According to a different court filing, a John Deer tractor was repossessed from Ocean Palms, signaling other problems.
“Based on the situation we’re at right now, depending what happens in the next few days, I think the city attorney will have to get involved,” Flagler Beach City Manager Larry Newsom said at the time. “Is it going to change what we do at the golf course? Potentially.” Newsom also called management of the golf course “absolutely terrible”–even though by then major issues between the city and the course were supposed to have been resolved. “If we want to move forward I think we need to have a change in management.” Newsom died three months later.
Then there’s the civil case against McManus filed by Richard Lozada, whom McManus had hired as general manager and chef at the golf course, and with whom he’d agreed to an option to purchase the course. McManus then fired Lozada. Lozada sued, charging breach of contract. (It isn’t clear if city officials were aware that their property was in play, though the lease does not cite McManus as a party, but Flagler Golf Management.)
On Sept. 15, 2019, the two men signed an option giving Lozada the right to buy ownership of Flagler Golf Management, McManus’s company under whose banner he runs Ocean Palm Golf Club. The option period was to run from mid-September 2019 to mid-September 2020. During that period, Lozada was to have “total autonomy in regards to staffing, advertising, menu, and pricing.” Lozada, according to the agreement, was to pay McManus $60,000 by October 15, 2019. Lozada made a $10,000 payment as part of the option agreement and spent almost $5,000 to buy back the repossessed John Deer. Then McManus fired him, “therefore violating [Lozada’s] autonomy and option to purchase.”
McManus in his answers to the suit claimed he was always in compliance with the terms of the agreement, and that it was Lozada who first breached the contract “by failing to make timely payments as outlined in the written contract,” and by violating a confidentiality clause. McManus went on to make more salacious claims and accusations related to Lozada’s own criminal charge for battery, involving an altercation related to Ocean Palm, but at another restaurant. (Lozada pleaded guilty and was sentenced to a year’s probation, which was terminated early in December.)
McManus was seeking to represent himself in the civil action. Lozada filed a motion to have McManus’s answers struck, because a company can’t represent itself. County Judge Andrea Totten agreed and ordered McManus’s answers struck.
But as Flagler Beach city commissioners discussed the course at their last meeting, they seemed to have no idea to what extent their property had become a field of drama and litigation, let alone knowing that its management company–according to the option agreement–had been valued at $600,000.
The municipal golf course “brought in a whopping $2,400 this year,” according to Flagler Beach Finance Director Kathleen Doyle. That, anyway, is the city’s share in rent. Since 2015, the city’s total revenue has totaled less than $20,000. And revenue sharing this year? $400.
“Those revenue seem mighty low, especially when you consider the restaurant, the golf fees and things of this nature. Have we ever conducted an audit–or are we allowed to conduct an audit?” Bryan, the city commissioner, asked the finance director.
The management company is required by that lease to submit quarterly financial reports. “The last ones that I got from them are from 9/30, 2020, I had to ask, but I heard that they were changing accountants, so I have not received financials for the 12/30 quarter,” Doyle said. “He will send me a sales report, that’s how I base that percentage on. But I haven’t received that yet either.”
“I got an email from her last week,” McManus said today. “If there’s a delay in the financials getting to her it’s a quick email she could send to [the accountant] to get it to her.” Otherwise, McManus said of the golf course, “we’re doing great.”
“I am not trying to accuse anyone, it’s just that being a business person that many of us are,” Bryan said, “I think that, as a board, as a city, we should have a little bit more eyes on what the expenditures are, what’s going out, what’s coming in. I know we just put a roof on the building a couple of years ago,” or what he described as “a hack of a lot more than what we collected.”
We’ve been through this organization turning in financials late before I even was a commissioner, this was an issue,” Commission Chairman Eric Cooley said. “This was a legal issue that got brought up the last time it came up. Is this not a violation?” Cooley saw the lack of financial numbers as a contractual violation.
“It may be time for a little nudge, at least,” Drew Smith, the city’s attorney, said.