Prospects dimmed for an untold number of people fighting to get paid for their work on the Holiday Inn as the developer's law firm outright denied one alleged outstanding debt this week.
Stuart Oldale of the family-owned Langley business Oldale & Sons filed a claim against Squamish JV on April 6 after $27,000 in picture and mirror frames remained unpaid, despite numerous assertions from developer Brian Ostrander that payment was coming.
Squamish JV represents the investors who backed the project, and Ostrander is the sole director of Venture West Hotels Groups, which has 50 per cent of Squamish Holiday Inn voting shares.
Oldale filed a claim for $25,000 to keep it out of Supreme Court, which takes on claims over that amount. But despite the $2,000 reduction, last month, Ostrander's legal firm, Borden Ladner Gervais LLP, filed papers denying the claim outright.
"The defendant denies the claimant's claim in its entirety," states legal papers filed in North Vancouver Provincial small claims court May 3.
Ostrander said he could not comment on the legal papers since he isn't aware of details, but said Oldale's claim of $27,000 "didn't sound accurate at all."
However payments do remain outstanding, he said, due to massive construction cost overruns at the $14 million facility. But it's not as bad as people think, he said, denying some contractors' estimates that as much as $3 million is owing.
"It's not even close, that's way over exaggerated," he said. "It's probably $1 million to $1.5 million maximum."
Oldale said he now regrets agreeing to work for Ostrander, especially after his past dealings with the developer.
"I shouldn't have done it."
He said he was very careful going into this project because he had worked with Ostrander and his Venture West Hotels Group on a Holiday Inn in Strathmore, Alberta where he said it took years to get paid.
"We really didn't want to give any credit after payment taking two years on the Strathmore job, so my contract said we would be paid as we went along," said Oldale.
Then when the first cheque bounced on the Squamish project, Oldale told Ostrander he would have to wire money directly to his account.
Oldale said wired payments went smoothly for five of six instalments, but the final $27,000, which was supposed to be deposited after the hotel opened, never came.
"We're only a small family business of six people and that's an outrageous amount of money for us," he said.
"As far as I'm concerned we got conned. Ostrander had all the trades running around for the last couple of weeks there before the Olympics, and I was dubious about getting paid but I got the promise 'It's coming, it's coming today.'"
Oldale said since the hotel's opening, he's received one email from Ostrander promising payment.
Another contractor who worked on the Strathmore Holiday Inn and wished to remain anonymous said he is still owed money and is looking into having his product re-possessed from the hotel at eight times the debt amount.
He said hotels have become a risky endeavours and unpaid contractors will often take smaller cheques sooner rather than fight for bigger cheques later.
Ostrander expressed regret for the way the project turned out, and said investors are still working on making it a success.
"For all the time and energy putting into the Squamish hotel, I would have loved to make this project work," he said. "We want to make sure we get the project to success and get all the matters settled accordingly."
Oldale is one of 18 businesses with liens against Squamish JV, whose directors include Ostrander, Joseph Arling, Kenneth Fawcett, Steven Marshall, Kenneth Moore, Scott Redl and Daniel Wong from B.C., Alberta and Saskatchewan.
Calls to Marshall were not returned. Attempts to contact Redl and Wong were unsuccessful. Calls to Ostrander's lawyer, Amy Davison, and accountant, Susan Harper, were not returned.
