Sellers must comply with P&S agreements

Where landowners agreed to sell their parcels of land as part of a redevelopment project in Prince William County, but then refused to agree to certain conditions that were required by the county through the rezoning process, despite having agreed to approve those conditions in their purchase and sale agreements, they were ordered to approve the conditions in accordance with the express terms of a valid and enforceable land sale contract.

Background

This civil action concerns a dispute arising out of the Prince William County Digital Gateway Project, a controversial redevelopment project which proposes to convert 2,100 acres of rural land in Prince William County into a data center corridor. GW Acquisition Co. LLC, or GWA, initiated this civil action against Pageland Limited Liability Company and Kimberly S. Mitchell and David C. Mitchell, Trustees of the Kimberly and David Mitchell 2021 Irrevocable Trust to force them to comply with the terms of their purchase and sale agreements, or PSA, to sell parcels of land to GWA.

Now before the court is GWA’s motion for temporary restraining order and motion for preliminary injunction to require defendants to approve proffers in accordance with the express terms of a valid and enforceable land sale contract.

Likelihood of success

The core issue in this litigation is sellers’ claim that they are entitled to terminate their PSAs. Pageland indicated that it was terminating the PSA pursuant to § 7.2.3, while counsel for the Mitchells reiterated his clients’ unwillingness to timely approve the proffers and “reaffirm[ed]” that the Mitchells’ may ultimately attempt to terminate their PSA.

As an initial matter, Pageland’s refusal to approve the proffers defies a previous order by this court, in addition to a sworn commitment by its corporate representative. Moreover, sellers’ invocation of their termination rights under § 7.2.3 is unsupported by any authority, and instead relies on a strained reading of the bylaws, standard practices and scheduling decisions of the Board of County Supervisors.

Sellers also argue that GWA failed to comply with the 30-day notice-and-cure provision in the PSAs before filing its civil action and moving for injunctive relief. Sellers’ argument is unpersuasive. Both Pageland and the Mitchells have demonstrated clear intentions “neither to … cure any alleged default of [their] obligations” under the PSAs, “nor to continue” with their agreements. No amount of time would have resulted in any cured breach or avoided the need for the instant litigation.

Because the PSAs are enforceable contracts which clearly outline the processes by which proffers must be reviewed and approved as part of GWA’s rezoning applications with Prince William County, GWA is likely to succeed on the merits of its claim.

Irreparable harm

GWA has adequately demonstrated that it will suffer irreparable harm if an injunction is not issued because sellers’ refusal to approve the proffers endangers GWA’s ability to have the Planning Commission and the Board fully assess its rezoning application, thereby putting the entire project at risk. GWA has presented evidence showing that Pageland’s and the Mitchells’ properties constitute necessary pieces in a complex, sizable land redevelopment project.

Moreover, if Pageland and the Mitchells withhold their approval of the proffers, resulting in the inability of either the Planning Commission or the Board to approve the rezoning applications before Dec. 30, 2023, the PSAs for all landowners in the project would become terminable. It is undisputed that GWA stands to lose substantial profits if the land is not rezoned. These lost profits are difficult to quantify, making injunctive relief more appropriate.

Pageland and the Mitchells are unlikely to be harmed by being required to approve the proffers under § 7.2.2 of the PSAs. It is not a burdensome task, nor is it one with which they are unfamiliar; and to the extent sellers argue that there is some financial loss to them, this loss is a result of their negotiating choices and signing the contracts, not a result of approving the proffers.

Remaining factors

The balance of the equities and public interest also favor GWA. The enforcement of valid contractual obligations is consistent with public policy, and there is no public interest weighing against such enforcement. Although the project is controversial and has spurred heated debate among its supporters and critics, that controversy is not relevant to the court’s analysis.

Plaintiff’s motion for preliminary injunction granted. Plaintiff’s motion for temporary restraining order denied as moot.

GW Acquisition Co. LLC v. Pageland Limited Liability Company, Case No. 1:23-cv-1207, Oct. 6, 2023. EDVA at Alexandria (Brinkema). VLW 023-3-651. 19 pp.