The first legal action against Regal Ridge and its owner Adrien Erickson has been launched by a local land developer who said he initiated the action “because I felt I had no other recourse.”
Rob Burk, the owner of Kerin Construction, was in Penticton courtroom 10 days ago as part of a “settlement conference” relating to a small claims action he’s taken against Regal Ridge and Erickson. The small claims action is seeking $25,000 in compensation for each of two lots Burk purchased in the Regal Ridge subdivision up on Anarchist Mountain in Osoyoos.
Burk currently owns five lots in the Regal Ridge subdivision and will be returning to court in April in relation to a third action he’s seeking in small claims court relating to another lot he’s purchased.
“I felt I had no other recourse but to go to small claims to try and recoup what I feel I’m owed,” said Burk. “There’s been no yelling matches or anything, but this is business. We have tried to work out something amicably, but have not been successful, so legal action was the only action let to us.”
Erickson said the small claims court proceeding is called a settlement conference “because that’s what it is … we’re trying to settle things.”
When asked if he was upset that legal action has been taken against him, Erickson said he’s still working diligently “to try and resolve all matters.”
Erickson said he has been working on finding new financial partners to complete work promised to people who purchased lots off him over the past couple of years and “will have a much better idea of where I’m going” to address financial concerns in the next several days.
Numerous people who have purchased lots from Regal Ridge have voiced their concerns in the last two years, specifically relating to their lots not being fully serviced as promised , particularly when it comes the delivery of electricity to their lots.
Burk said he has had problems with not only the delivery of electricity to some of the sites he purchased, but also geo-thermal drilling of some of the sites.
Erickson acknowledges he has yet been unable to deliver electricity to several dozen sites at Regal Ridge, but he continues to try and resolve the problem. He also acknowledged some sites have not had geo thermal drilling completed, but said “we are doing the drilling on all the lots where actual house construction is taking place and all the houses under construction this year have been electrified.”
Burk said he purchased his first lot in Regal Ridge back in 2007.
While there were some delays with the installation of electricity on the first two homes his company built in Regal Ridge, the power was eventually installed.
“It raised some flags, but we gave him the benefit of the doubt because we eventually got power,” said Burk.
It wasn’t until 2010 that he started hearing problems of electricity not being delivered to numerous other property owners in the Regal Ridge development, Burk said.
The vast majority of problems lot owners were having with electricity were being taken care of until 2010, but very little has been done since and he estimates roughly 100 lots that were promised power have not yet received any, said Burk.
Since Erickson issued a letter to all Regal Ridge announcing a “corporate restructuring” last Oct. 7, very little progress has been made to correct problems, said Burk.
In his letter, Erickson said “our resolve to realize the vision of a premiere community on Anarchist Mountain remains firm. Like many other companies right now we are trying to navigate through head winds and cross currents, some very negative impacts to our project that are completely outside our control.”
Erickson’s letter further states the international credit crunch, HST debacle, uncontrollable power infrastructure costs and the recession in the United States “have all conspired to severely impact our business.”
The letter said Regal Ridge was downsizing to “better weather the challenging market.”
Ron Palmer, Regal Ridge’s general manager also wrote in the letter “the Regal Ridge vision continues to guide all aspects of our activities. Due to unexpected and negative changes on both the cost side and in the real estate market, our operations and our corporate structure must change.
“We are working very hard on our new strategy, which will effectively deal with power infrastructure deficiencies. Our key lenders who take a long term view are supportive and we are confident that in due course Regal Ridge will be a leaner and more effective company.”
Burk said he proceeded with the small claims action when he felt the issue of electricity and geo thermal drilling to several lots he owns were not addressed months after the letter was issued.
“Regal Ridge has denied the claim made by me, so that’s why we attended this settlement conference,” said Burk, who was told by his lawyer to not discuss what happened in front of the presiding judge at the meeting in Penticton.
