HCW banks $1.5M in title insurance settlement

It’s been a long wait for HCW Development Co. LLC, but the Branson Landing developer now has the assurances it needs to add on to their $420 million retail, lodging and entertainment destination.

After two years in court and three years in planning, HCW Development Co. CEO Rick Huffman said the firm is dusting off designs to build a 29,000-square-foot retail space on long-disputed land at the outdoor shopping center’s north end, near the Belk department store.

“We are very happy to be moving forward with this. They’ve sat on the title for a number of years,” he said of the title insurance company.

On Aug. 29, Chicago Title Insurance Co. and its parent company Fidelity National Financial Inc. (NYSE: FNF) reached a settlement agreement with defendants in the title insurance case brought by HCW and joined by the city of Branson. Under the terms of the agreement, HCW Development will receive $1.5 million and a $90 million title insurance policy. The city of Branson, which has no cash coming, will receive its own $90 million title policy to cover future legal expenses in an 11-year-old dispute over a few acres fronting Lake Taneycomo.

According to the terms, Chicago Title Insurance agreed to pay for all of the city and HCW’s future legal costs for defense of the claims brought against each of them by Douglas Coverdell and Coverdell Enterprises Inc. The claims stemmed from a decade-old land dispute between Coverdell and the city, concerning North Beach Park and later expanded to include a portion of the Branson Landing property.

Though HCW leases the Branson Landing’s 95 acres from the city, both Branson and HCW argued in the Chicago Title case they had paid for title insurance policies protecting their interests in Branson Landing when development began in 2004. According to the defendants’ filings, Chicago Title failed to honor these policies once the Coverdells made claims against Branson and HCW.

With Coverdell Enterprises pursuing an appeal through a separate case in the Southern Missouri District Court of Appeals in Springfield, Huffman said HCW wasn’t going to build until it knew for certain its interests were protected.

In March, St. Louis County Court Judge Barbara Wallace ruled the city of Branson did not have a marketable title to the Landing and was in breach of its $450,000 annual lease contract with HCW. The ruling came about a month before the parties sat down to begin settlement negotiations, Huffman said, expressing frustration with the city for not more actively pursuing HCW’s development interest as lessor of Branson Landing.

He said the company only pursued the lawsuit against Chicago Title – which has cost HCW more than $1 million – after city officials didn’t seem interested in taking legal action on behalf of HCW.

Kansas City attorney Thomas Fritzlen, who represented Chicago Title in the case, did not respond to requests for comment by press time.

In the settlement, Chicago Title will provide $15 million in additional coverage for the development area – called the North Ground in the agreement – and $3 million in coverage for refinancing Arvest Bank’s development loan.

The agreement also lays out rules for a possible settlement between the city of Branson and First American Title Insurance Co. The city brought a related title lawsuit against First American in 2012.   

Branson City Attorney William Duston said the lawsuits ultimately stem from the early 2000s, when the city was buying land to lease to HCW for Branson Landing.

“It wasn’t nice and clean. There were a whole slew of titles and a bunch of little pieces put together to make that one big piece, and in that process, there were a couple of title insurance policies bought. One of them was from Chicago Title and one was from First American,” Duston said.

Through the Chicago Title settlement, the city of Branson and HCW agree that any settlements in the First American case less than $1.5 million would go to HCW. If the settlement is between $1.5 million and $5 million, HCW would get 25 percent of the cut above $1.5 million, and the parties would evenly split the cash above $1.5 million if the settlement exceeds $5 million.

HCW is now putting another development project on its docket.

“The plans have been turned into the city of Branson, and the bids have been awarded to Build LLC in Springfield for $2.5 million,” Huffman said.

Huffman said the company is constructing three buildings totaling 29,000 square feet, with about 40 percent covered by letters of intent. He declined to disclose the interested tenants.

With the settlement official, Huffman said he expects the trial set for December would soon be thrown out. The HCW project, he said, is slated to be complete next year.  

“If there was anything to happen, it’s insured,” he said.[[In-content Ad]]