A Hilo businesswoman said she hopes to purchase Hilo Lanes soon, despite her ongoing lawsuit claiming its owners reneged on a 2015 agreement to sell her the long-vacant bowling alley and a countersuit Hilo Lanes filed in response.
Lorraine Shin, owner of M.S. Petroleum Corp., said Monday that negotiations have led to “a meeting of the minds” among the parties.
“Were moving forward, and hopefully everything will go well, and we’re shooting to close soon,” Shin said. She said in February 2016 she wants the property for a mix of residential and commercial spaces. She also registered a trade name for the property, 777 Kinoole Center, with the Department of Commerce and Consumer Affairs, according to the state agency’s website.
The property is less than a block from Penn Training &Fitness Center, owned by her son, UFC Hall of Fame mixed martial arts fighter BJ Penn.
Court records show no upcoming court dates in Shin’s lawsuit against Hilo Lanes Inc. and The North West Co., a Canadian conglomerate that owns Cost-U-Less, a discount bulk grocer and general merchandiser that has a warehouse store next door to the Hilo Lanes property.
M.S. Petroleum claimed, and Hilo Lanes confirmed in its amended counter-complaint filed Aug. 21, that Hilo Lanes accepted a subsequent offer from North West on the Kinoole Street property, which was shuttered in May 2014.
The offer was described in Hilo Lanes’ document as “an-all cash transaction.” A monetary figure wasn’t given.
According to the Hawaii County Property Tax Office website, there are unpaid taxes dating to February 2014 on the property, which includes a 52,878-square-foot building on 3.7 acres of commercially zoned land. An $18,391.16 tax bill due next month will bring the upaid total to $129,585.97, the website indicates.
The DCCA website lists Renton L.K. Nip as Hilo Lanes’ president, Robert L.S. Nip as vice president, Roanne Kaopua as secretary-treasurer and Roland Nip as director.
The countersuit by Hilo Lanes seeks general, special and compensatory damages from M.S. Petroleum. It alleges M.S. filed the lawsuit, which it called “frivolous,” on April 6, 2016, and the following day filed a document called Notice of Pendency of Action, or NOPA, in Land Court.
According the countersuit, the NOPA falsely claimed title of the property would soon be transferred to M.S. Petroleum. It also states M.S. ignored communication by Hilo Lanes that it nullified the $2.5 million purchase and sale agreement, or PSA, between Hilo Lanes and M.S. It also alleges M.S. filed the suit and NOPA in an attempt to “interfere with Hilo Lanes’ ability to deliver marketable title free and clear of all liens and encumbrances to (North West)” or “cause Hilo Lanes’ performance of the contract to be more expensive and burdensome.”
The counter-complaint alleges Hilo Lanes terminated the PSA and cancelled escrow because M.S. breached the agreement by failing to meet five deadlines for providing a required bank loan commitment letter confirming $2 million in financing. It states M.S. delivered Hilo Lanes an “untimely” conditional loan commitment letter from First Hawaiian Bank on March 4, 2016, with no loan amount stated, which Hilo Lanes’ Board of Directors rejected.
Shin has maintained the PSA constitutes a contract, while Hilo Lanes calls the PSA an “offer” in its countersuit. M.S.’s attorneys, Robert Crudele and Henry Beerman, filed a reply to Hilo Lanes’ countersuit, which states M.S. wasn’t notified that Hilo Lanes terminated the deal and cancelled escrow on M.S.’s attempted purchase of the property prior to Hilo Lanes signing a contract with North West.
North West has not, to date, filed a counter-complaint since M.S. added the Canadian company to its suit last July.
An Aug. 22 email to Crudele and Beerman from Hilo attorney Katherine Garson, who represents North West, mentioned her client’s interest in “a possible tri-party mediation or facilitated settlement discussion.”
Neither Garson nor Honolulu attorney C. Michael Heihre, who represents Hilo Lanes, returned Friday phone calls seeking comment by deadline Monday. The Tribune-Herald also didn’t receive a reply Monday to a list of emailed questions to North West’s corporate communications office.
M.S.’s lawsuit and Hilo Lanes’ countersuit are being heard by Kona Circuit Judge Melvin Fujino because both Hilo Circuit judges, Greg Nakamura and Glenn Hara — the latter, since retired — recused themselves from the case.
Email John Burnett at jburnett@hawaiitribune-herald.com.
Other Hilo businesses may fear the transaction.
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