The Fish House restaurant in downtown Pensacola has emerged from a legal challenge with its lease intact. However, there remains one more fight in the case.
On Friday, Circuit Judge Scott Duncan ruled that Fish House owner Collier Merrill’s sub-lease of the Pitts Slip property from business partner Ray Russenberger was immune from having to pay the city up to five million dollars in additional rent and interest.
“It’s been a long two and a half years of us convincing people that the restaurants weren’t closing,” said Merrill. “The city does not have a right to come into our lease; it’s going to be renewed and we’re going to be there for another 30 years.”
The City of Pensacola claimed in 2013 that Merrill owed 5% of gross sales from the Fish House and adjacent Atlas Oyster House since the year 2000. And if Merrill didn’t pay up in 90 days, Russenberger’s lease would be voided. That when the suit was filed.
“Wow, they’re deadbeats – ‘Why aren’t they paying their rent, why are they doing this,’ until you get it across that it’s 100% false,” Merrill said. “But, people believe, ‘Well, if the city said that, [there] must be something to it.’ You had people afraid to book parties, wedding parties six months away, a year away. Afraid to buy gift certificates.”
Judge Duncan also ruled that the renewal of Russenberger’s original lease, at $3,500 per month, had been conducted properly and is valid until 2045. Duncan also kept oversight of attorneys’ fees and court costs, which the two sides will now settle. Merrill contends they have the advantage in that area.
“Our attorneys will get together and submit all of our bills to the court,” said Merrill. “Bottom line is, that our lease is clear on that as well. Somebody brings an action against the other that the winning party’s entitled to attorneys’ fees.”
Pensacola Mayor Ashton Hayward has not commented directly on the ruling, but a written statement from city spokesman Vernon Stewart said the city would abide by the court’s decision, which is being evaluated by their counsel.
Fish House owner Collier Merrill is also hoping their case can provide the impetus for other businesses leasing city land to stand up to the city if and when necessary.
“If you have somebody come after them and try to strong-arm them,” Merrill said. “Renegotiate a lease that’s already been negotiated, and it says what it says but you have the city file a suit against you like that. And if somebody couldn’t afford to pay those attorney fees and have to cave in, that’s just a shame. It’s not how to do business.”
At this point, no actual numbers have been mentioned regarding attorneys’ fees and court costs. Five attorneys worked on the case for the Fish House and Atlas Oyster Bar. But Merrill has said the final tab could be in the “high six-figure” range after two and a half years of litigation.
