The College has launched legal action concerning the sale of the property located at 28 College Street to a local buyer. The house is the only remaining property on College Street that Bowdoin does not own.
In the suit filed on August 12 in Cumberland County Court, the College claims that the property’s owner, Arline Lay, and listing agent—who contend that Harriet Beecher Stowe wrote “Uncle Tom’s Cabin” in the home—continued to list the property for sale despite the College’s demand to cease and desist. The College’s demand derives from a 1996 agreement between the two parties regarding the property’s future sale.
In April 1996, the College negotiated an option agreement for 28 College Street when it purchased the adjacent property also owned by Lay at 26 College Street. Part of the agreement gives Bowdoin the exclusive option to purchase the property for 125 percent of “fair market value” if Lay or her husband passes away—whichever is last to occur—or ceases use of the home as his or her primary residence. Lay’s husband has since deceased and Lay no longer uses the home as her primary residence.
Additionally, the agreement gives the College a “right of first refusal” which, although very similar to the option agreement, also grants the College the right to purchase the home if the seller decides to list the property on the market or sell to a third party.
The case was filed against Lay, her listing agent David Jones and the prospective South Portland buyer Louise Jonaitis. The College and defendants have recently agreed to participate in mediation later this month.
In March, the property was listed with F.O. Bailey Real Estate of Falmouth, Maine at a listing price of $1.6 million. According to the College’s complaint filed with the court, the College’s attorney informed Lay through her attorney in March of its intention purchase the home as per the 1996 agreement “upon information and belief” that Lay had ceased using the property as her primary residence. Lay proceeded to accept an offer of $750,000 from a third party and negotiate a purchase and sale agreement despite Bowdoin’s claims to cease and desist.
The Brunswick Assessor’s Department currently lists the assessed value of 28 College Street at $154,300. That number represents approximately 70 percent market value, according to the latest town assessments that took place in 2000. Accounting for the high listing price is Lay’s claim that Harriet Beecher Stowe sought refuge at the home to write “Uncle Tom’s Cabin.”
The College claims that Lay and her broker are breaching the agreement by continuing to actively list the property for sale after the College indicated it was exercising its option to purchase. The College also claims that defendants failed to inform the buyer Jonaitis of the option agreement, which contractually precluded Lay from accepting an offer from a third party buyer after receiving notice from the College in March of its intention to purchase.
“The point we’re making in the filing is that all the broker is telling the woman from South Portland is that we have a right of first refusal. He is not telling her that we have an option that we have exercised, so she cannot buy it,” James Kilbreth, the College’s attorney, said in a phone interview with the Orient.
In a press release, Lay’s attorney Sean Joyce said that his client immediately informed the College of the offer she received from Jonaitis. Lay and Joyce believed that the agreement stipulated that Bowdoin had 30 days after initial notification of the offer to respond, either with a rejection and consequently the loss of rights to purchase the property, or with an offer to purchase the home for the value of the current offer plus 25 percent.
“Instead of accepting or rejecting the Jonaitis purchase price or making any offer whatsoever, Bowdoin College filed suit claiming that it should not have to pay so much for the property,” said Joyce.
The defendants believe fair market value is determined by the offer of $750,000 they received from Jonaitis.
However, the 1996 agreement states that fair market value is to be determined “by averaging two appraisals obtained from persons and/or firms whose regular and usual business is real estate appraisals who have been professional certified as such in Maine.” In the event of a discrepancy of more than 10 percent between the appraisal acquired by each party, the agreement stipulated that a third appraisal would be obtained and averaged with the other two.
“Bowdoin College wants the Court to force Arline to hire appraisers to come up with a hypothetical value for the property and disregard the best evidence of its fair market value, the Jonaitis offer,” Joyce said in a press release. “The agreement does provide for an appraisal mechanism, but it is not relevant because it is only triggered ‘in the event of Arline’s death’.”
Joyce asserts that the appraisal mechanism stated in the 1996 agreement is only triggered in the event of Arline’s death, and therefore the College is expected to pay fair market value for the home. Joyce said that Lay listed her home on the market to gauge its true market value from buyers because factoring historical significance into home appraisals is a complex process.
In a press release, Joyce claimed that the College has tried to undermine the offer from Jonaitis during recent negotiations.
“While Arline is not a litigious person, given the inexcusable and outrageous conduct by Bowdoin College’s interim treasurer, Matthew Orlando, in trying to negatively influence Ms. Jonaitis on her deal with Arline, there is a strong likelihood Arline will and should assert a series of counter-claims for damages against Bowdoin College for such conduct,” Joyce wrote.
In response to Joyce’s claims, Kilbreth, Bowdoin’s attorney, said that the College was making clear to the prospective buyer that the College was exercising its contractual option to buy and did not believe that the property was worth anything near what Jonaitis is willing to pay.
“The College is simply trying to follow an agreement that everybody signed in 1996…the whole purpose of [the agreement] was to be fair both to the College and to the Lays because obviously on the one hand if you didn’t have a process except a price then the Lays would be in a position to essentially hold the College up for something unreasonable,” said Kilbreth. “On the other hand the College would be in a position to potentially shortchange the Lays.”
“The whole idea of this was to create a process that was fair to both sides, and that’s why both part[ies] gets to pick an appraiser—that’s an objective way to determine a price—and the College then said we’ll pay you 125 percent of whatever that price is to make clear that it was trying to be as fair,” Kilbreth said.
Historical Claims
The value of the home in the eyes of a buyer or assessor weighs heavily on claims about its historical significance. In the lawsuit, the College refutes Lay’s claims about the house’s connection to Harriet Beecher Stowe.
“The property listing falsely states that Harriet Beecher Stowe sought refuge to write ‘Uncle Tom’s Cabin’ at the property. Defendants Lay and the Jones knew that this statement was false at the time it was made,” said the College in court documents.
Jones said in a phone interview with the Orient that the agency F.O. Bailey Real Estate investigated Lay’s claims before including them in the listing.
“We went ahead and contacted the Harriet Beecher Stowe Society and spoke with them about it” he said. “We’ve had Richard Coffin write a letter saying that the story is true—his father was the professor at Bowdoin and he swore to it under oath.”
This is not the first time that the house has been offered for sale—and that the College has refuted these historical claims.
In 2014, Lay listed the home for $3 million with a Beverly Hills agency, advertising the home as the location where Stowe wrote her famous novel. During that time, the College also rejected this claim.
“The evidence to date—supported by the historical record, by Stowe scholars and by the Maine Historic Preservation Commission, among others—shows that Harriet Beecher Stowe wrote ‘Uncle Tom’s Cabin’ at her home located at 63 Federal Street and at Appleton Hall, where her husband had a study,” wrote Scott Hood, senior vice president for communication and public affairs, in a February 2014 email to the Orient.
Associate Professor of Africana Studies and English Tess Chakkalakal echoed Hood’s sentiment at that time, saying that that Stowe’s correspondences and those of her family support the claim that the novel was written at 63 Federal Street—the location of the College’s Harriet Beecher Stowe House containing “Harriet’s Writing Room.”
Lay’s attorney said that he and his client stand by their claims that some portion of the book was written at 28 College Street, where they believe Stowe rented a room during the time the novel was written.
Since the August court filing, Bowdoin has stood by its rejection of Lay’s claims.
“Even if it’s true—which it isn’t—it has a pretty minimal effect on value … to the extent that you could come up with any argument it might be 10 percent impact. So we don’t think it’s true and we don’t think it’s that significant in that case,” said Kilbreth.
But Jones disagrees, saying that the College’s actions haven’t been reasonable.
“I think what they’re trying to do to this 87 year old woman is pretty shocking ... I’ve found someone who is willing to pay a very good price for it and we’ve given the opportunity to the College to buy it based on the agreement and they choose to sue her—I don’t understand it. I just don’t understand it at all,” said Jones.
Last week, the defendants filed a joint motion to stay deadlines until the completion of upcoming mediation. They have asked the court that Lay’s son, James Lay, attend mediation as her proxy under a Power of Attorney.
“We want the process to be followed. We’ve done an appraisal; we’re having discussions now with them about appraisals and at the end of the day that’s a fair way to set a price,” said Kilbreth. “The College has agreed to pay 125 percent of whatever that price is… It’s pretty hard to complain about that.”