Ahwatukee homeowners who for years have watched their once-lush golf-course views deteriorate are one step closer to restoring the open space to what it once was.
Maricopa County Superior Court Judge John Hannah ruled Tuesday that a developer who wanted to transform the neglected property into houses acted in bad faith by purposefully failing to maintain the golf course.
He also rejected the developer’s request to change the property’s governing documents to allow for uses besides golf.
The ruling is a major win for Phoenix homeowners who’ve fought with a series of golf course owners for years over the property near Knox Road and 44th Street.
Councilman Sal DiCiccio, who represents the area, said the developers “came into our community and created an environmental mess.”
“This should send a message to anyone else looking to develop this site — they cannot come into our community, dictate terms, create a disaster and expect to be rewarded for it,” DiCiccio said in a statement. “Whatever shape this area takes in the future must have buy-in from our community, or it will not happen.”
Years of court battles
In May 2013, then-owner Bixby closed the Ahwatukee Lakes Golf Course and stripped the land of sod and irrigation equipment. A year later, the ownership group drained the lakes.
Bixby pursued opportunities to sell the land to residential developers who would fill the open space with more high-dollar homes, according to court records.
The governing documents that control the property, and the neighborhood surrounding it, specifically state that the open space “shall be used for no purposes other than golf courses” and other golf-related facilities, like clubhouses.
So two homeowners — whose homes back up onto the blighted golf courses — sued Bixby in 2014, arguing the owners breached their contract with the community and acted in bad faith by shutting down the course and allowing it to fall into disrepair.
In the midst of litigation, Bixby sold the golf course to the True Life Companies, which intended to redevelop the land into a residential community, according to Senior Vice President Aidan Berry.
When the new owner was looped into the lawsuit, True Life argued the land could remain unused and not violate the governing documents.
But Maricopa County Superior Court Judge John Hannah disagreed. In 2016, he ruled that the documents required the operation of a golf course on the property.
According to the property’s governing documents, there are only two ways to change the land’s use: Either 51 percent of homeowners consent to the change, or the golf course owners appeal to the Superior Court and prove a “material change in conditions or circumstances” that make it unrealistic to operate a course on the land.
True Life first tried to convince homeowners, but fell about 1,500 signatures short, according to court documents.
It next tried to argue a change in conditions, saying, “There was no longer a realistic possibility that a stand-alone golf course could ever operate on the property.”
Tuesday, it failed in that attempt as well.
In his decision Tuesday, Hannah wrote that True Life purchased the neglected property with full knowledge that the governing documents required it be maintained as a golf course.
He also ruled that True Life breached its covenant of good faith and fair dealing because it never intended to operate the property as a golf course even though it knew it was obligated to do so.
“In order to make millions for themselves, they destroyed the landscape, blighted our neighborhoods, divided our community, undercut the value of our homes — and then blamed the victims,” plaintiff Linda Swain said in a statement.
Barry said his team was “deeply disappointed” in the judge’s decision and is reviewing options.
Bixby did not respond to requests for comment.
But it’s not over
Hannah’s ruling was a huge win for the homeowners who’ve fought with the golf course owners for years, but it’s in no way the final battle.
In his ruling, Hannah said the homeowners are entitled to some kind of relief, but what exactly that will include is still to be determined.
The homeowners said theywill ask True Life to restore the golf course to its former glory, but Hannah will ultimately make the decision.
“We look forward to this decision helping us to renew our landscape and heal the scars in our community from this conflict,” Ben Holt, president of Save the Lakes/Save Open Space, said in a statement.
But there’s another wrinkle. True Life may not be the owner of the golf course for much longer. When it purchased the property from Bixby in 2015, the company paid only a $750,000 down payment on the $9 million purchase price.
The rest was due in increments down the road — but the purchase agreement also allowed True Life to walk away at any point without paying the remainder, which it still could do, according to court documents.
Hannah acknowledged this in his findings and said Bixby is likely to bear the majority of the economic burden, if the transaction fails.
“That result, frankly, will not be unfair,” Hannah wrote.
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