Couple who sold former bank building to Belmont suing, claim town took advantage of them

BELMONT — The Franklin couple who sold the former Northway Bank building this fall to the town has filed suit in Merrimack County Superior Court, against the town, claiming all the talk coming from officials about reconfiguring the village caused them to lose rental income.

Bill and Carolyn McDonough are also asking for an unspecified amount of money for "pain and suffering," saying the town should have foreseen that they were elderly and their medical conditions would be aggravated by the town's negotiations.

The McDonoughs also charge the town with "unjust enrichment" saying the town's open conversations about the Belmont Village Revitalization Project, reduced the value of their property, which the town subsequently purchased at what they say was an diminished price.

They argue that all of the discussions about revitalization and closing a portion of Mill Street made the retail space more difficult to rent and reduced the income they could have derived had they been able to rent more suites. At the end, the couple had just one tenant, a hair salon in the building.

At a special town meeting in August, voters chose to allow selectmen to negotiate with the McDonoughs for an amount not to exceed $250,000. The sale of the building was recorded on October 16, 2012 at the Belknap County Register of Deeds.

This was the third time the town had tried to buy the building. The first attempt was in 2008 when voters narrowly rejected a warrant article to by the bank from its former owners Tony and Loretta Brown for $300,000.

In preparation for the sale, the town sent out a letter to its residents dated October 22, 2007 informing them the Browns had offered them the building for $300,000 and the Board of Selectmen, consisting of current Selectmen Jon Pike and Ron Cormier and retired Selectman Reginald Caldwell, thought it was a good opportunity to allow for the revitalization of the village.

At the time, they said the possible revitalization could include area for future concerts, the future expansion of the library, or the possible use of the building or space by the town offices or the police department.

The Board of Selectmen held five separate public hearings between October 30, 2007 and December 10, 2007. At town meeting the year before, voters had established a capital reserve fund for the purpose of municipal facilities.

On January 7, 2009, the McDonoughs bought the building from the Browns for $275,000.

In 2010, voters again rejected a warrant article to buy the building and property from the McDonoughs for $275,000.

In June of this year, the Board of Selectmen decided to hold a special town meeting to see if the voters would buy the building for no more than $250,000. At the meeting, Town Administrator Jeanne Beaudin said she had met with the McDonoughs as recently as two weeks before that meeting they indicated to her that $250,000 would be acceptable.

The vote narrowly passed. Shortly after the building was sold, The Vault Hair Salon moved to its new location on Church Street.

The suit said the McDonoughs sought "full compensation" during their negotiations but failed to achieve their goal. They claim they conducted a "fire sale" and reserved their right to obtain full restitution in court.

The McDonoughs are seeking "just and total compensation" for loss of rental income, market value plus interest, court costs and attorney fees.

It is not publicly know exactly how much the McDonoughs received for the building, only that the town's complete cost of completing the transaction did not exceed $250,000.