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Court: Doctors delayed project

Their appeal said to set housing back; damages of $5.2m possible

By Kathy McCabe
Globe Staff / June 23, 2011

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The developers of a sprawling residential and office development planned for the old Boston Regional Medical Center site in Stoneham have won a court victory over a group of doctors complaining about traffic changes caused by the Stoneham project, and could be in line for millions of dollars in damages.

A Middlesex Superior Court judge ruled that the board of a medical condo building at the former hospital site did not have the authority to appeal traffic changes approved by the Stoneham zoning board for Langwood Commons, a development planned there.

Judge H.J. Smith Jr. also found that the appeal by the New England Memorial Hospital Condominium Association may have cost the property owner, Fellsway Development LLC, $5.2 million in damages, caused by a lengthy delay of construction, court records show.

“ . . . the Board did not have the authority to bring the Appeal, and Fellsway suffered damages as a result,’’ Smith wrote in the June 2 ruling.

Although he relied on monetary estimates provided by Fellsway to calculate the $5.2 million in damages, a hearing to determine the precise amount is scheduled for July 14 in Middlesex Superior Court in Woburn. Fellsway Development LLC is the legal name for a group that includes Gutierrez Co. of Burlington and Simpson LLP of Colorado.

The developers plan to build Langwood Commons, a mixed-use development approved under the state’s Chapter 40B affordable housing law. The project includes 310 apartments and town houses, 25 percent of which would be offered to low- to moderate-income buyers. A 225,000-square-foot office building also is planned.

Bill Caulder, managing director of Gutierrez, called Smith’s ruling “a big step in the right direction’’ toward ending a near-decade long battle over the development.

But a lawyer for the condo association is considering its options, including appealing Smith’s ruling to a higher court. “This case is far from over,’’ said Edmund A. Allcock of Braintree, who is representing the six-member condo board. “There are numerous legal issues raised in the context of his decision.’’

The condo board and Fellsway have been at odds for six years. The board filed two appeals to the Chapter 40B permit approved by the Stoneham Board of Appeals on Sept. 22, 2005. But the appeals were withdrawn after Fellsway and the association reached a settlement agreement on Nov. 6, 2007, court records show.

Fellsway Development agreed to sell the condo association 4.97 acres surrounding its medical office building for $1.4 million. An easement was granted to allow traffic to the building to cross an access road owned by Fellsway. The two sides also agreed “to cooperate reasonably with each other . . . act in good faith . . . and not take any action to undermine or interfere’’ with the terms of the agreement.

Shortly after signing the agreement, Fellsway applied to the Stoneham Board of Appeals to change its traffic plan. The developer proposed decreasing the number of housing units from 450 to 310, dropping the number of turning lanes and traffic lights needed for the project. The new permit also allowed the Stoneham Board of Appeals to vote on what were considered “nonsubstantial’’ changes without holding a public hearing. The board granted the changes on Jan. 3, 2008, without a public hearing.

The condo association then filed a complaint in Middlesex Superior Court, arguing the traffic changes should have been subject to a public hearing.

“They proposed to eliminate all traffic mitigation provisions approved in their prior permit,’’ Allcock said. “We felt that was a substantial change.’’

In January 2009, Judge Sandra L.Hamlin agreed. Fellsway appealed her decision in the State Appeals Court, but the request was denied. A hearing was held in March 2010 and the traffic changes were again approved by the Stoneham Board of Appeals, court records show.

Fellsway also filed a new complaint in Middlesex Superior Court, alleging the condo board violated terms of the settlement agreement by appealing for a public hearing. The developers also alleged that the condo board lacked the authority to file an appeal, because the board’s power is limited to governing the affairs of the condo association.

The condo association filed a motion to dismiss the complaint. On June 2, Smith denied it, and at the same time, ruled in favor of Fellsway’s lawsuit. “We feel vindicated,’’ Caulder said. “We felt all along there was no standing on their part. This is validation.’’

Caulder said the appeal made it impossible for Fellsway to proceed. “No one was going to finance a deal that was under appeal,’’ he said. “Our hands were tied.’’

Allcock countered that the condo board should not have to pay out a large sum of money. A new appeal is also possible, he said. “All we did was file an appeal, requesting that the town . . . hold a public hearing,’’ he said. Multiple lawsuits have been filed by abutters, local residents, and a citizens’ group concerned about the impact of the development on local communities and the Middlesex Fells Reservation, 2,575 acres of state-owned land around the 40-acre hospital site.

The state Supreme Judicial Court is now mulling an appeal brought by the Friends of the Middlesex Fells Reservation and the City of Medford. A lawsuit seeking to have a full environmental review of the project was dismissed by a Superior Court judge. The appeal seeks to reverse that ruling and have the case heard in Superior Court. A decision from the SJC is not expected for months.

Kathy McCabe can be reached at kmccabe@globe.com.