Business partner sues Kemah mayor for violating agreement

John Suayan, Galveston Bureau Mar. 1, 2011, 5:00am

GALVESTON � A Seabrook business owner alleges that Kemah Mayor Matthew D. Wiggins Jr. committed detrimental acts against their joint venture.

Amelia V. Kelly accuses Wiggins of not paying his monetary obligations as outlined in their business agreement and wrongfully exercising dominion over her personal property and proprietary rights, a lawsuit filed Feb. 23 in Galveston County District Court states.

Kelly and Wiggins were partners in the operation of a bed and breakfast in Kemah. The establishment sat on property Kelly purchased in 2006 for more than $900,000.

According to court papers, Wiggins assumed his partnership role after Kelly's original partner vacated his stake. Both parties entered into their own agreement which stipulates that they would share the net income.

Wiggins then instructed Kelly, a divorced mother of two teenage girls, to execute a $400,000 note and sign a deed of trust in her name. The plaintiff relied on the mayor's supposed expertise in real estate and joint venture partnerships, the suit states.

According to the suit, Kelly went to the bank to sign documents for Wiggins, but claims she was not given enough time to examine the paperwork nor given copies. The mayor, however, convinced the plaintiff that he could give her legal advice on certain transactions, the suit says.

Renovation work and administrative duties pertaining to the property went on as scheduled, but Kelly asserts that there were changes in Wiggins's behavior as he allegedly had failed to pay the mortgage payments, defaulted on contracting costs and failed to pay the plaintiff her $5,000-per month salary.

Kelly further explains that the mayor even threatened foreclosure on the bed and breakfast, which he reportedly did early last year. But "nothing in the official records indicated that the foreclosure actually occurred," the suit says.

It adds Wiggins told her that he wanted 100 percent of the ownership for his investment without regard to the fact that she had invested $234,388.47 cash in the joint venture.

The plaintiff insists that the mortgage remains an obligation to her, and she contributed at least $25,000 in "sweat equity" labor hours for the joint venture for which she has not been compensated. A substitute trustee's deed was even executed without her knowledge, the suit says.

Consequently, Wiggins seeks more than $300,000 in monetary damages and a jury trial.

Attorney Larry A. Vick is representing the plaintiff, and Galveston County 122nd District Court Judge John Ellisor is presiding over the case.

Case No. 11-cv-0325

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