Posted on 02/17/2004 4:54:22 PM PST by PeteFromMontana
Stokes' highway dispute takes more twists and turns
By Alan Choate The Daily Inter Lake
A four-year fight between KGEZ radio owner John Stokes and the state of Montana over highway right-of-way has become even more convoluted, with settlement talks going nowhere, the station's financial backers seeking foreclosure and Stokes asserting that the state is paying people to sue him.
Meanwhile, the project that set off the dispute — the widening of a 2.7-mile section of U.S. 93 south of Kalispell — was awarded to a contractor last week, and wooden stakes along the road mark where the new highway will be.
The expanded highway will lop off part of the radio station's parking lot and bring noisy, vibrating traffic close to the building.
Stokes says that will interfere with his ability to broadcast. He originally asked for $1.7 million to pay for relocating the station and its towers and antennas, far more than the state offered for the right-of-way needed for the highway.
Since then, Stokes has asked for millions more to cover attorney's fees, emotional distress, and lost value and expansion opportunities.
The most recent settlement offer from the state was $850,000, he said. He would also have to move out of the building by April 1, something he says is impossible if he wants to stay in business.
"We're trying to get this settled," Stokes said — but the state hasn't made an offer he considers reasonable.
"They lowball and extort you," he said. "They think you're so desperate that you'll take anything."
Tim Reardon, lead counsel for the state Department of Transportation, declined to discuss specifics of recent settlement discussions. Each side made offers, he said, and the process is still under way.
In a separate lawsuit, the group of people who loaned Stokes the money to buy the station say the loan is in default.
In April 2000, the "Stokes defendants" — John Stokes, Pamela J. Stokes, Elizabeth Anne Stokes, Z-600 Inc. and Skyline Broadcasters Inc. — took a $665,000 loan from Questa Resources Inc.
Skyline Broadcasters Inc. secured the loan with the radio station, which sits on 6.4 acres, plus 60 acres of property in Lake County.
The loan came due April 27, 2003, said Christy Brandon, a Bigfork attorney representing Questa's investors. The loan was declared in default on May 15, 2003, according to court documents, and now foreclosure proceedings have started.
The amount due is just over $544,400, plus 15 percent interest accrued since March 10, 2001, the foreclosure motion says. The plaintiffs request that the property be put up for auction so they can recover the money owed them.
It's a standard foreclosure action, said Brandon, but there's no telling how long the process will take.
"What puts the variables into it is whether any counterclaims are filed," Brandon said.
The Stokes defendants definitely contest the foreclosure, contending that only $87,455.45 is owed on the loan.
When Stokes began contesting the state's offer for his right of way, he and the transportation department reached an agreement requiring the state to put $1.1 million in an account. Stokes and his lawyer used a law requiring agencies with the power to condemn to pay the full amount of a landowner’s claim up front in a contested case.
If Stokes loses, the money has to be repaid.
$750,000 of that has been received so far, Stokes said, and has been used for various purposes. Stokes said his creditors were supposed to be first in line, but at least some of the money went to cover legal fees.
"[The investors] refused to take the money, or didn't take the money," Stokes said. "I have no control over it."
That's not correct, Brandon said. Stokes and his attorney, Wade Dahood, controlled the money after the state Department of Transportation deposited it in a court account, she said.
Dahood did not return phone calls seeking comment about the payments.
There's also been activity in another area of the case — a dispute over a long-standing easement Stokes owned on land next to the radio station.
The easement allowed the station to set up broadcasting equipment on the land. When the transportation department started acquiring right-of-way, however, the land's owners were told by state attorneys that the easement diminished the value of their property.
If they sued to have it removed, the value would increase substantially — to $76,000 from about $2,000.
That "advice" is bribery, Stokes and his lawyers have claimed in yet another lawsuit. Reardon disagrees, saying the department's lawyer acted responsibly and simply laid out all the options available.
Stokes' neighbors have sought to lift the easement, alleging that the station hasn't maintained the equipment on it as required and that the easement doesn't extend as far as Stokes says.
A district court has granted the latter claim, attorney David Sandler said. A trial on extinguishing the easement altogether has not been scheduled.
In the meantime, Stokes is making programming changes for his AM station in an effort to boost revenue. He also pledges to stay in business no matter what.
"I've got financing lined up," he said. "I'm not going to let it go."
Reporter Alan Choate may be reached at 758-4438 or by e-mail at achoate@dailyinterlake.com
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