Sapphire Beach Resort owner disconnects majority of condominiums from wastewater treatment plant


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ST. THOMAS - The war between the land owner and the condo association at Sapphire Beach Resort and Marina escalated Monday when the majority of condominiums were disconnected from the resort's wastewater treatment plant.

V.I. Superior Court Judge Adam Christian has scheduled a conference today with the two parties to try to address the situation before hundreds of residents and guests are forced to leave the property.

About noon Monday, five of the six condominium buildings - buildings B, C, D, E and F - were disconnected from the plant by Dean Morehouse, according to the condo association's lawyer, Jim Derr.

Derr said building A was left alone because that connection also serves the Sapphire House units on an adjacent property, and Morehouse has an arrangement to supply sewage treatment for them.

Morehouse, under the company Beachside Associates, owns much of the property at the resort, including the parking areas, pool, wastewater treatment plant, reverse osmosis plant and the Seagrape building that used to contain the lobby and restaurants.

He does not own the marina or the condominium buildings at the resort - those are owned by the condo association.

Neither Morehouse or his attorney, Neil Goldman, could be reached for comment by press time.

The two parties have been fighting over property issues for years; the Superior Court is littered with pending lawsuits between the two.

The condo association filed a motion in court Monday asking the judge to preserve the status quo - leave the condo units with use of the wastewater treatment plant - and confirm a previous arbitration award.

The two parties have been fighting over the use of the wastewater treatment plant for several years. Last year, the dispute went to arbitration and a final award was determined, but both sides had issues, filed motions in court, and the court has not yet confirmed the arbitrator's decision.

According to the arbitrator, the condo association owes Morehouse $1.1 million for years of use of the plant. The association has been paying $5,000 per month since May 2006 for usage of the facility, but that was not enough, according to the arbitration findings.

On March 14, Morehouse's attorney sent a letter to the condo association indicating that unless Morehouse received $313,754.68 - one-fifth of the $1.1 million - the plant would stop taking the condo association's sewage.

Derr objected and said that the association did not agree to such a payment plan, and that the arbitrator's final award specified that the parties engage in a payment plan over a five-year period.

If the judge does not force the parties to come to an agreement today, the resort could shut down.

Derr said the tank that holds the sewage has a 1,200-gallon capacity. The condo resort typically produces 11,000 gallons a day, he said.

The V.I. Waste Management Authority has given the association a septic disposal permit to pump out the sewage and dispose of it at the Mangrove Lagoon Treatment Plant in Bovoni, Waste Management Authority spokeswoman Stella Saunders said Monday.

Derr said a truck would come to pump out the tank and take the sewage to Bovoni when the facility opens.

"They've been monitoring flow and will bring in one truck overnight that can be dumped in the morning," Derr said Monday. "It's kind of trial and error at the beginning."

Derr said pumping out the tank is not a long-term solution.

Doing so would cost the condo association about $48,000 per month, which Derr said would bankrupt the association in a few months.

"It's looking like the only viable option is to shut down the resort," Derr said.

That would displace an estimated 500 people - permanent residents, part-time residents and tourists, according to Derr.

However, that fate could be stayed by a decision from the judge today.

Beachside Associates bought the mortgage on the property for about $1.8 million in 2003, according to Derr.

The property - everything but the condo units and marina - was owned by a company called Bayside Resort.

In July 2005, Bayside Resort abandoned the property, which included the Seagrape building that housed the public bathrooms, a restaurant, main lobby and bar.

In 2011, a foreclosure action was filed in V.I. Superior Court, and at a court auction in December, Morehouse obtained ownership of the property.

Parts of the Seagrape building were boarded up several years ago, and the rest was shuttered in January. Access to the taxi drop-off area and the public beach parking lot also was blocked in January.

Last week, parking at the marina was restricted, although some parking was re-opened before the week was over.

- Contact reporter Aldeth Lewin at 714-9111 or email alewin@dailynews.vi.

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