Two sides in the Borders bookstore fight will wait until next week for a judge to settle a bond dispute -- and, in the process, whether the bookstore project moves forward or dies.
A $3.9 million deal to include a new Borders bookstore downtown is being held hostage by a college bar that won't leave, a district judge heard Friday.
Wint Winter Jr., an attorney representing Winter Inc., said long-delayed plans to open a new Borders at the corner of Seventh and New Hampshire streets would die if the Stumble Inn bar won its request for a special bond.
He said the bond, if granted, would kill the Borders deal and likely chill prospects for any significant redevelopment in the Winter block -- the area bordered by New Hampshire, Rhode Island, Seventh and Eighth streets -- for at least 10 years.
"The deal will die. No question," said Winter, who called Stumble Inn's case an "Alice in Wonderland" argument. "I wish it was just a fairy tale, but it's not. It's reality."
Last month, Douglas County District Judge ordered the bar to leave its rented location at 704 N.H., because its lease with Winter Inc. expired Sept. 30. Winter Inc. is working with Borders to develop the block.
Malone postponed making his ruling official, however, until he could decide whether the bar should post a bond while the case is appealed. The bond would compensate Winter Inc. for damages if the bar's appeal failed.
Malone heard arguments in the case Friday morning, and said he would issue a decision early next week.
If Malone agrees to set a bond, Stumble Inn would be allowed to remain on the property during appeal -- a process that could take at least a year, Malone said. With no bond in place, Winter Inc. could secure a demolition permit and raze the bar to make way for Borders.
"There's a lot at stake here," Winter said.
Trey Humphrey, an attorney for Kenco Inc., which owns the bar, said the case wasn't about damages, but possession. The bar's lease with Winter Inc. included a clause for a three-year option, and that means the bar should be allowed to continue operations.
Malone already has ruled that the lease was to too vague for enforcement, but Humphrey argued that postponing that ruling was essential because of Kenco. Inc.'s "absolute right" to a bond.
The bar occupies a 2,500-square-foot building, Humphrey said, and that's all the court should consider. Whether Borders is waiting to open its bookstore and cafe is immaterial.
"There's no deal -- yet," Humphrey said. "It's entirely speculative."
But Winter sought to squelch that argument, saying that Winter Inc. was ready to get a site plan approved Dec. 17 and move ahead with construction. He even secured an affidavit from Mayor John Nalbandian, who said the project would advance the "public interest of Lawrence residents" and "bring needed economic development" to downtown.
Winter also presented the court with financial information.
If the Borders project were lost because of Kenco's appeal, Winter Inc. would lose anywhere from $1.7 million to $3.1 million, Winter said, in court documents.
If Malone does agree to postpone his judgment, the judge should require Kenco Inc. to post a $3.9 million bond -- or at least a $1.7 million bond, plus interest, Winter said.
Humphrey argued that the bond should be no more than Kenco's lease payments during the appeal period. That would be $16,500 for one year.
"It's not a case about the entire Winter block," Humphrey said.