Steve Shiver and Ghost Town at Maggie Valley: update ... by gimleteye

EOM blog readers know, the ongoing saga of the former Miami-Dade county manager, Steve Shiver, gets darker and darker (see our archive feature). Here is the latest from Maggie Valley, North Carolina, where a speculative land deal to turn a railroad attraction collapsed in more ways than one and took down hundreds of creditors. Shiver was CEO when a massive landslide wrecked the long shot efforts by Miami owners to rescue the amusement park from bankruptcy. Shiver is named personally in a recent lawsuit "alleging he was aware that failure of the retaining wall was imminent, but didn’t warn anyone." Maybe Alex Penelas, making his revival as a lobbyist, has a job for Shiver? Read on.

Wednesday, 13 October 2010 14:51
Homeowners in limbo as sides volley blame in Maggie landslide lawsuit
Written by Becky Johnson

The latest filing in a lawsuit over the massive landslide in Maggie Valley last winter claims the collapse of the mountainside was triggered by a broken waterline at Ghost Town in the Sky amusement park. Until now, accusations centered on a failed retaining wall intended to shore up the slipping mountainside.

A broken waterline pumped hundreds of thousands of gallons of water into the soil over the course of several days, “destabilizing the mountain and saturating the soil,” according to the recent filing in the suit.

Homeowners suing for damages originally claimed the culprit was a faulty retaining wall built two years earlier to hold back part of the mountain. The homeowners sued Ghost Town in the Sky for damages citing negligence, as well as the contractor who built the wall, and the engineer who designed it. The suit also names Ghost Town CEO Steve Shiver personally, alleging he was aware that failure of the retaining wall was imminent, but didn’t warn anyone.

The landslide sideswiped the home of Kurt Biedler and his wife, Tammy Jones, rendering it unlivable until repairs can be made. The house was their primary residence. They still owe a mortgage on it, but lack the money to make the repairs out of their own pocket.

Despite their lawsuit seeking damages, recourse could be hard to come by.

They have sued Ghost in the Sky, but the theme park has been in bankruptcy since early 2009 and is facing foreclosure later this month. Ghost Town’s liability insurance lapsed just before the slide because of nonpayment, according to the insurance company. And the homeowners’ own insurance policy doesn’t cover landslides.

The contractors who built the retaining wall claim it wasn’t their fault, but instead point to the leaking waterline.

The suit names cousins Burton and Colin Edwards of Maggie Valley as the contractors who performed the work, and Colin’s father, Verlin, as the engineer who designed the wall. The Edwards are represented by Waynesville Attorney Rusty McLean.

McLean wrote in a countersuit that Shiver should have known about the waterline leak based on the extensive water use from the Maggie Valley Sanitary District, which pumped water up the mountain to serve Ghost Town.

The slope had been a source of consternation for the mountaintop amusement park for years. An old retaining wall of wooden timbers was visibly buckling at the time Ghost Town hired the Edwards to build a new wall in 2008.

Still troubled by the slope, Ghost Town hired an engineer to assess it in 2009. The engineer, Pat Burgin, wrote a report informing Shiver the retaining wall was inadequate, and “structural failure of the wall was possible if not replaced,” according to the suit and the report itself.



A horrific winter night

Whether the wall collapsed on its own or was triggered by a leaking waterline doesn’t change the fact that Biedler and Jones no longer have a home to live in. The lawsuit describes the mudslide as one of “immense proportion” that made a “rapid descent down the contours of the mountain, accumulating additional standing timber, earth and debris in its path.”

The wave of mud was 90 feet wide and 30 feet high, and “destroyed virtually everything in its path.”

Jones was home alone in her living room when she heard the mudslide coming.

“The home began to shake and vibrate, and seconds later the accumulated mud, timber and debris slammed into the home,” the lawsuit states. “The mudslide struck the home with violent force, knocking the house from its foundation.”

It ripped off the front door and blew Jones back, trapping her in her house, which had been thrust into darkness.

“Ms. Jones had to remove mud, limbs, and wood to escape from the home. Ms. Jones feared for her life, that her home would collapse, and additional mudslides would occur,” the lawsuit states.

It took out the porch, deck stairs, hot tub, heating and air conditioning unit, patio, gazebo, outdoor cooking area and the septic system.

Despite the damages, the home was not condemned by the Haywood County building department.

“There was some foundation damage but it was not in danger of collapse,” said Bruce Crawford, the Haywood County building inspector.

But in their suit, the homeowners claim the home is unsafe because it shifted on its foundation, not to mention that it lacks a septic field. They are now living in Henderson County.



Barking up the wrong tree?

The bankruptcy court ruled that the homeowners can’t go after Ghost Town’s assets — those are already spoken for given the more than $14 million in debt the theme park is carrying — but it will allow the homeowners to go after Ghost Town’s insurance company.

Whether Ghost Town’s insurance was valid at the time of the slide is a different story, however.

Ghost Town was five months late on its liability insurance payment at the time of the slide. Ghost Town twice received warnings that its policy would be canceled if a $14,000 payment wasn’t made.

On Jan. 28, a notice of cancellation was sent out, effective immediately. The insurance company claims Ghost Town had no coverage by the time the slide occurred on Feb. 5, and therefore isn’t liable for damages.

A few days after the slide, Ghost Town finally wired its late insurance payment, but it was too late. The company refused to reinstate the insurance, according to bankruptcy court filings.

But the homeowners dispute that the insurance was canceled at the time of the slide. Although a copy of the cancelation notice dated Jan. 28 is part of the official court record, the cancelation notice and actual cancelation are two different things, the homeowners seem to be arguing.

“The insurance company claims they had terminated coverage prior to the slide, and we are not necessarily in agreement with that,” Daniel Hitchcock, an Asheville attorney, said in an interview. “We wouldn’t go this route if we didn’t think there was insurance in place.”