Adelaide Pointe developers, contractors in dispute over $1M

MUSKEGON, Mich. (WOOD) — The developers of Adelaide Pointe in Muskegon are in a legal battle over close to $1 million billed by a subcontractor.

Developer Ryan Leestma says Terra Contractors LLC was hired to install roads and utilities at Adelaide Pointe , a $250 million waterfront project located at 1204 Western Ave. along Muskegon Lake.

“In October, my general contractor informed me that they were very suspicious of what was being represented in their invoices. And upon further analysis … I agreed that what we were being asked to pay for, we were not receiving,” he said.

He said Terra Contractors was removed from the job and Adelaide Pointe filed a lawsuit against it.

Leestma said he put the close to $1 million that is under dispute into an escrow account with a title company.

“We’re looking forward to our day in court to get our money back,” he added.

After he filed his lawsuit on Jan. 9, Terra Contractors filed a defamation lawsuit on Jan. 22 against Adelaide Pointe, according to News 8 partner Crain’s Grand Rapids Business , which first reported on the legal dispute.

Terra Contractors also filed to put a lien on the Adelaide Pointe property for the $917,156.83 it says it is owed, according to a notice it filed with the Muskegon County Register of Deeds in April.

In June, Hudsonville company Van Spyker Landscaping filed a lien on the property for $66,390 it says its owed. Leestma said the company, which he hired for hydroseeding, is billing for services he didn’t ask for.

“While lien law is designed to protect contractors from companies that won’t pay, I think it’s also important to note that it can be abused and it is abused by some contractors. They believe that they can just build whatever they want and if you don’t like it then they just apply a lien to your property,” he said. “In a project this large, it’s important for contractors to know that they can’t just bill for whatever they want.”

Muskegon-based Great Lakes Dock and Materials LLC filed a lien in June, but withdrew it Thursday. Leestma said the lien was filed due to a misunderstanding, a sentiment manager Joseph Bailey echoed in a phone conversation with News 8.

Bailey said his team is back working on the project, and that they’re “happy to be a part of it.” He said as a Muskegon company, Great Lakes Dock and Materials hopes to see the development succeed.

Terra Contractors and Van Spyker Landscaping did not respond to News 8’s request for comment by the end of the business day Monday.

Terra Contractors project manager Scott Drier told Crain’s that this is the second time in 20 years he’s been involved in a lien dispute.

“We’re unfortunately learning a lot as we go through this because this is uncharted territory, and a situation we never thought we would be in,” Drier told Crain’s. “I expect to prevail (in the lawsuit). While we were working on site, we had no disputed invoices until we liened the property.”

Leestma said the next hearing on his dispute with Terra Contractors is set for October.

Adelaide Pointe first broke ground last year. Its marina is done , along with its ‘man cave’ storage building . Construction on its multiuse building is around 90%  done, Leestma said, and its restaurant, the Muskegon Brewing Company, opened earlier this month. An event center is set to open at the end of this month, he said, and the condos are about half done.

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