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Lagoons served with $14m legal bill in beachfront court case

Even as residents of the upscale Freeport area of Montego Bay are said to be fundraising among themselves to finance what could turn out to be a multi-million-dollar legal battle against the construction of the planned Dreams hotel and car park in their community, one residents association there, Lagoons Management Limited, LML, has been served with a legal bill of approximately $14 million arising from a more than two years long court dispute with two of its residents. A bill of costs was filed in the civil division of the supreme court this week by law firm Grant, Stewart, Phillips and Company, which represents real estate development company Starfish Bay Holding Limited, whose directors are Lagoons residents and Dr. Guna Muppuri and his wife Vishnu Muppuri.

Several leading business persons reside in the posh Lagoons gated community and in the general Montego Freeport area, where several resorts and high-rise condominiums are located, with planning and environmental approvals already granted for several more hotels, and other commercial and residential developments.

In April last year, the court ruled in favour of the Muppuris in a matter brought by LML, which had opposed the construction of their home in the Lagoons community, on the grounds that it required the association’s approval, which had not been granted, and that the structure was allegedly in breach of environmental regulations. At the time, the construction plans had been approved by the St. James Municipal Corporation and the National Environmental Planning Agency, NEPA. Legal costs were awarded to Starfish Bay.

The court also denied LML an injunction it initially sought in February 2020 to halt the construction, and the judge held that Starfish Bay was not bound to LML’s rules and regulations for development and architectural control and the company did not require LML approval to build, as the Muppuris, as directors of the real estate development company, were not signatories to the LML maintenance agreement. The LML chairman at the time of the filing of the court action was businessman Yoni Epstein, who lives next to the Muppuris’ property.

The court had also ruled that LML had no locus standi to assert a right or bring a claim with regard to what the association contended were beach and sea floor works being done by the Muppuris, as that authority was within the purview of the attorney general on behalf of NEPA and the Natural Resources Conservation Authority, in accordance with the Beach Control Act.

A subsequent suit filed against Starfish Bay by LML later in 2020, in which the alleged breaches were to be detailed and points of objections argued, was discontinued by the association in February this year through its attorneys Knight, Junor and Samuels. Prior to the discontinuance, the Lagoons’ lawyers had sought a settlement agreement with Starfish Bay in which it proposed to end its objections to NEPA’s approval of the construction, provided that the Muppuris signed Lagoons’ rules and regulations for development and architectural control and a maintenance agreement with the association. It was also proposed that the parties would bear their own legal costs except for that already ordered by the court in April 2021.

The Financial Gleaner understands that the proposal was rejected by Starfish Bay.

When contacted, chairman of Starfish Bay, Dr. Guna Muppuri referred the Financial Gleaner to his attorneys in the matter. Managing partner for Grant, Stewart, Phillips and Company, Denise Kitson QC, confirmed the filing of the bill of costs but declined to comment on its details. Attorney with Knight, Junor and Samuels, Ashleigh Ximines, who led the firm’s representation of LML in the matter, was out of office and unavailable to respond to the Financial Gleaner’s queries whether any points of dispute were being raised by her law firm to the bill of costs.

Cairman of LML Mark McConnell could also not be reached for comment as calls to his mobile phones went unanswered.

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