Olive Hill Part III: Oral Arguments

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Mount Olive Baptist Church, located at 43 High St., Manhasset, is a predominantly African American church. (Photo by Marco Schaden)

Mount Olive Baptist Church and affordable housing developer Georgica Green Ventures agreed to a contract for 72-units of senior affordable housing on the church’s property in 2012. Seven years later, the deal is on the cusp of never happening. Parts I and II of this series can be found at www.greatneckrecord.com.

Geogrica Green Acquisitions (GG), an affiliate company of GG Ventures, and Mt. Olive Baptist met in the Brooklyn Appellate Division Second Department for oral arguments on Nov. 8. A panel of four judges heard the case after the decision for dismissal by Judge Jerome Murphy of the Nassau Supreme Court was appealed.

“First we ask for reversal of both orders,” GG Acquisitions attorney Peter Skelos of Forchelli, Deegan and Terrana said. “Upon reversal we ask that the church be told, be compelled to go back and use their best efforts to obtain an appraisal report and then submit that appraisal and a new petition to the supreme court in the special proceeding action. Upon reversal, we also ask that the court continue the stay, which this court granted on March 25.”

Mt. Olive Baptist Church never submitted a second appraisal as Judge Murphy asked them to after denying the original contract. The stay, which Skelos is referring to is that the church is not allowed to negotiate with any developers outside of GG.

“The supreme court denied the application for two reason,” Skelos said. “The first reason, which is really the most fundamental error that the court made in the case at that time, but again, it was without prejudice for resubmission was that the court was under the misapprehension that the sale included financing by the church. The second problem with the court’s determination then was that the court was considering what the fair market value was as of the current date, meaning the date that the court determined the application. The court was factually incorrect. It was misapprehending what this transaction was.”

The last revised contract has a portion of the money being paid to Mt. Olive Baptist Church in installments, Judge Murphy believed that this was a mortgage that the church was receiving no interest on. The value of the property is also supposed to be taken into context of when the contract was signed, the property was rezoned for senior housing and successfully entered into the Brownfield Cleanup Program with the state after the contract was signed in 2012, driving the value of the property up by the time it got to the court for approval.

“There are two main sentiments in law and in fact that I would like to etch into the minds of the judges today,” Mt. Olive Baptist Church attorney Monte Malik Chandler said. “The first one is the issue or the sentiment from the honorable Jerome Murphy that the church is not a bank. The second one’s sentiment I would like to place in your minds is that this was an engagement, but not a marriage.”

Chandler goes on to say that he does believe this was a mortgage because the church was not getting all of the money up-front. Chandler would also like the church to be able to negotiate with outside developers as the church has received initial offers in the $4 million range.

“There is no proof in the record as to what the fair market value is as of the date of the contract other than in Mr. Gallo’s affidavit where he says that the fair market value is $1.4 million,” Skelos said.

Since Judge Murphy threw out the original appraisal because GG provided the price point of what the contamination cleanup cost was, Skelos is using David Gallo’s affidavit as the only evidence that establishes the value of the property even though that is also provided by a member of GG.

“The appellant is looking to get a sweetheart deal from the church in which the church would be meagered out and paid by drips over 40 years,” said Chandler.

Chandler told the judges that a counter offer was made to GG of $5 million and then $4 million, but both were denied by GG, saying they wanted an appraisal that showed that value that used true comparables.

A decision by the court is expected by the end of the year.

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