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No ruling from judge, expresses frustration with litigation in bar's bankruptcy hearing

By Denise Olivas
Published On: Jan 14 2014 07:46:49 PM CST
Updated On: Jan 14 2014 08:51:55 PM CST
EL PASO, TExas -

UPDATE 12/11/12: The owner of the east El Paso bar, Three Legged Monkey, can expect to return to court in 2013.


Closing arguments for the bankruptcy hearing wrapped up Tuesday, but Judge Christopher Mott did not decide if the bar will have to vacate Hawkins Plaza in east El Paso.


This comes after the leaseholder of Hawkins Plaza, Patriot Place, made an agreement with the City of El Paso to sell the property for $2.9 million dollars.


A lawyer for Patriot Place, Carlos Miranda, told the courtroom that the entire case has taken a different turn after bar owner Mike Armstrong made an admission last week.


On the stand, Armstrong said he has already invested $30,000 in a new potential location for his bar.


Miranda argued that said that because Armstrong kept that from the court until last week, hundreds of hours have been wasted.


"In August of 2012, there was still a lot of potential where Patriot Place could have helped Three Legged Monkey move. There could've been a smooth resolution. Instead, Mr. Armstrong, in August, told his lawyer he wanted him to chop off our heads," said Miranda.


Armstrong's lawyer maintained that there is no basis for Patriot Place to end the lease with the Three Legged Monkey.


He cited the bar's good standing and efforts to comply with city and Texas Alcoholic Beverage Commission codes.


Judge Mott had a number questions for the lawyers.


Both sides said litigation could have been avoided but no settlement was reached, even after the judge gave them extra time.


"That's just one thing that drives me nuts. I've given the parties time to settle, and frankly I wish they would've because their solution would be better than mine. For sure no one is going to like it," said Judge Mott.


He encouraged both sides to continue talks.


"My hands are tied, I have to follow what the law say. I'm not ordering you to talk or to mediate, but I would encourage to keep up that dialogue," said Judge Mott.


An attorney for the City of El Paso was present Tuesday.


He assured the judge the city is "ready, willing and able to close the deal with Patriot Place" even if the judge's ruling comes down in 2013.


PREVIOUS STORY: The future of an east El Paso bar is still unknown.

Friday afternoon, bankruptcy court Judge Chris Mott adjourned for the day.

The judge was expected to make a decision on the bankruptcy hearing for the Three Legged Monkey.

Owner, Mike Armstrong filed for bankruptcy in June to protect his business after the leaseholder, Patriot Place Ltd. agreed to sell Hawkins Plaza to the City of El Paso.

The Three Legged Monkey is located at the strip mall.

Under the agreement, the city would pay Patriot Place $2.8 million for the property.

Patriot Place would also have to cut its lease with the bar, forcing it out of Hawkins Plaza.

The city has tried to revoke the bar's lease after complaints from neighbors.

If the judge sides with Patriot Place, the purchase to go through.

Armstrong said he will continue to fight to keep his bar open at the strip mall. 

On Thursday, while Armstrong took the stand, it was revealed that he is already looking for a potential location.

When asked why, Armstrong said he owes it to his employees to have a back up plan so they can keep their jobs.

That potential location is near the intersection of Montana and Yarbrough, located about two miles away from his current location.

Armstrong said it would cost him about $650,000 to relocate and reopen a new establishment.

Lawyers for Patriot Place called an expert witness to the stand who said otherwise. Peter Sellers, a real estate appraiser said it would cost $80,000 to $100,000 to relocate.

"If it's restaurant-ready your cost should not be that much," said Sellers. 

Sellers admitted he hadn't considered many costs including Texas Alcoholic Beverage Commission permits, administration, advertising and marketing costs.

He was also hired to evaluate the lease hold interest of the Three Legged Monkey.

"Assuming the tenant was not in default and stayed for remaining 13 years of the lease, there is a disadvantage for the tenant to remain at Patriot Place," said Sellers.

He attributed that to the additional security measures Armstrong has had to install at the  the request of the Texas Alcoholic Beverage Commission.

Sellers said the Three Legged Monkey would take a financial hit of more than $135,000 if Armstrong remains with Patriot Place.

"Right now that looks like one of their better options," said Sellers about Armstrong moving his bar to the location at Montana Avenue and Yarbrough Drive. 

Former interim City Representative Mayela Mejia took the stand.

She represented District 3, where the Three Legged Monkey is located, for about six months in 2008.

Mejia told supported Armstrong's claims that he has never been in violation of any city or TABC requirements.

It was in 2008, when she said she started getting calls from the Cielo Vista Neighborhood Association about noise and parking complaints.

Shortly after, Armstrong participated in a meeting with the TABC Commission, police and fire departments, Mayor John Cook and current City Representative of District 3, Emma Acosta.

Acosta, who had not yet been elected to city council, but she was a part of the neighborhood association.

Mejia said everyone agreed to lease a parking lot near Patriot Place, but it was turned down in city council.

"He did try to join the Cielo Vista Neighborhood Association and attended meetings. He wanted to come to some kind of agreement with residents. The biggest opposition was from the city manager's office because all the other departments were ok with it," said Mejia.

Thursday afternoon, David Brandt, trustee of Patriot Place Ltd took the stand.

His answers were brief, consisting of 'i don't know' or 'I don't recall' when questioned by Armstrong's lawyer.

Brandt confirmed that under the agreement he made with the city, the Three Legged Monkey would receive $100,000 to assist with relocation.

When Ritter asked Brandt if he felt that a sufficient amount to relocate and reopen and new establishment, Brandt answered, "According to expert testimony earlier, it is."

Ritter reminded Brandt that he was under oath.

"With you experience and knowledge, do think it's sufficient money to open and operate another bar," repeated Ritter.

"I don't know," said Brandt.

Brandt has said he wants out of the lease with the Three Legged Monkey.

He said it's cost him thousands of dollars in attorney fees.

Closing arguments will be heard Tuesday, December 11 at the United States Bankruptcy Courthouse at 1pm.


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