Steamboat Pilot & Today

Steamboat Springs — Tim and Diane Mueller of Triple Peaks LLC have appealed a recent court ruling that found in favor of American Skiing Co. in the legal dispute over the abandoned sale of the Steamboat Ski Area.

"We wouldn't be appealing if we didn't think (Judge Richard) Doucette made a couple of errors," Tim Mueller said Friday. "That's why they have appeals courts. If district judges were always correct, they wouldn't have them."

Mueller said it remains his goal to acquire the Steamboat Ski Area by seeking to have the court require "specific performance" of the contract.

The case has been appealed to the Colorado Court of Appeals in Denver; however, a notice of the appeal is on file at the Routt County Courthouse.

The Muellers, along with a group of investors, signed a contract on Jan. 24, 2002, to purchase the ski area for $91.4 million. ASC subsequently backed out of the deal on March 26. Triple Peaks sued to force the terms of the sale contract in April. Both sides filed suit for summary judgment.

After a lengthy dispute over the proper jurisdiction in the case, retiring Judge Richard Doucette issued a decision in favor of ASC on Dec. 30, 2002.

Mueller acknowledged Friday that although he is still seeking to purchase the ski area, there is a possibility he could win on appeal and still not acquire Steamboat. An appeals judge might find in favor of Triple Peaks but deem performance of the contract impractical 18 to 24 months after it was originally signed, he said.

In that case, Mueller said it would be his expectation that the case would move on to a new phase. He anticipates the court might decide to award Triple Peaks damages over and above the $500,000 in liquidated damages called for in the original contract in the case that it was breached.

ASC has consistently said it was willing to pay the $500,000.

The two parties agreed that their dispute was a fairly straightforward point of law. Yet, they had very different interpretations of the law.

Triple Peaks attorneys insisted the contract was deliberately worded to mean that only their client could void the contract, invoking the liquidated damages. The attorney for ASC is Mary Wells of Wells, Anderson and Race in Denver. She succeeded in convincing Doucette the $500,000 in liquidated damages were intended to be a specific remedy in the case that her clients elected to terminate the contract.

Mueller said his attorneys, with Rothgerber, Johnson and Lyons in Denver, have told him to expect the appeal to take a minimum of six months and up to one year.

If he succeeds in forcing the sale of the ski area, Mueller said it would probably require starting from scratch on the sale contract, and then beginning over with assembling the financing package needed to close the sale.

"The court would have to decide what 'specific performance' meant -- what is the deal," Mueller said.

Renegotiating the contract "will certainly have its challenges," Mueller said.

Triple Peaks includes a number of minority investors who live in Steamboat Springs. It's likely that those investors' situations might have changed in the interim and not all would still be in a position to participate, Mueller said. The original bank financing would also have to be reopened.

Court documents concerning the appeal include no legal briefs by attorneys at this point. However, Triple Peaks attorneys have posed a series of nine questions to the appeals court, which make up an "advisory listing of issues to be raised on appeal."

The first question reads, "Did the District Court err by holding that Triple Peaks was not entitled to specific performance as a remedy for ASC's breach of the agreement?"

The Muellers, who own and operate Okemo Mountain Resort, Vt., were the primary investors in Triple Peaks. The company would have owned Steamboat, Okemo, Vt., and Mount Sunapee, N.H.

American Skiing Co. had announced its intent to sell Steamboat in the spring of 2001 as part of its ongoing efforts to get out from under a mountain of debt.

When ASC announced it was calling off the sale of Steamboat, company officials simultaneously announced their intent to sell Heavenly Resort, Calif., to Vail Resorts for between $96 and $99 million.