Salt Lake developers fight resort over failed deal near Bryce Canyon

Tyler Greene, left, and Cy Waldron, right. The pair was named in a lawsuit over a failed deal near Bryce Canyon National Park before they counter-sued two days later.

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Two Salt Lake developers were accused of fraud and embezzlement in a lawsuit filed this month by the former owners of a popular resort near Bryce Canyon National Park who said they were looking to cash out and retire.

The developers in turn filed a suit of their own two days later, saying the resort owners had sloppy accounting and inventory, which they say complicated the deal before the owners reneged and sold to a prominent Salt Lake City developer.

The parties are now locked in a legal dispute after the resort’s owners say they were forced to find a new buyer after the failed deal left them unable to pay bills and buy groceries and the developers say the owners’ poor management led the deal to fall apart.

The owners of the Bryce Canyon Pines sued Cy Waldron and Tyler Greene after they said the group worked together on a sale for over a year before apparent failed financing led them to sell the resort for millions less than what it was worth.

Rusty and Ethel Rich accused Greene and Waldron of fraud, embezzlement and unjust enrichment in a lawsuit filed in District Court for Garfield County this month. They’re seeking to recoup at least $2.37 million.

The couple said they looked to sell their resort and retire when they struck a deal to sell to Green and Waldron for $10 million. The developers, operating under the name Surface Development, have extensive experience in hospitality, primarily in Hawaii.

Soon after coming to terms in February 2022, the developers showed signs that they were failing to obtain financing, according to the complaint.

For more than a year, the resort owners said they worked with the developers, who documents filed with the lawsuit show attempted numerous ways to finance the deal before the Riches walked away.

The complaint says Waldron committed identity fraud by applying for a $4.6 million hard money loan in the resort’s name after he was unable to come up with the cash to close.

Meanwhile, the Riches say they allowed the developers and their team to train on aspects of the resort operations as a kind onboarding.

During that time, Greene and Waldron allegedly withheld payments outlined in the contract and took over control of the Rich’s operating accounts by creating a separate bank account the Riches didn’t have access to.

The pair then opened a bank account and began funneling money from the resort’s peak season into it, according to the complaint. Greene and Waldron then used part of that money to pay the resort owners as part of a year-long attempt to buy the property, the Riches’ complaint says.

Greene and Waldron dispute much of what the Riches said in their complaint.

Instead, the pair said they reached an agreement to create a new limited liability corporation with shared ownership of the resort.

Surface Development would use its hospitality expertise to operate the resort and conduct needed upgrades, their counter-suit claims, and the Riches would avoid a pricey tax bill by not selling the resort outright.

According to the Surface Development complaint, the groups agreed to share ownership with roughly two-thirds staying with the Riches and a third going to Surface Development, according to the second complaint.

This, the developers said, is what led the Riches to run out of money.

“The Riches moved off-site and no longer were involved in the management of Bryce Canyon Pines,” they said in their complaint. “Moreover, the history of using the Bryce Canyon Pines as a personal piggy bank for the Riches ended and the Riches could no longer simply use the resources, supplies, and services of the Bryce Canyon Pines at their whim and without paying, as was their tradition and custom.”

Surface says it updated the website, reservation system and restaurant management system, and that it wired $200,000 to the Riches.

They say the Riches then sold the resort to Garn Development Company. State records show Garn officials are involved with a new entity affiliated with the resort.

“The Riches sold the property from under the nose of their partners and fellow members without permission, authority, or legal justification after enjoying the benefit of BCP and Surface Development’s management for months,” Greene and Waldron alleged. “Not only was the sale unauthorized, The Rich’s Property, L.L.C. did not distribute 34% of the profits from the sale to BCP as required by the Amended and Restated Operating Agreement. The Riches and/or the Rich Family Trust retained all the benefit from the sale in breach of the parties’ express agreement.”

The Riches didn’t respond to a request for comment. Their attorney, Steven A. Christensen, said only that negotiations were ongoing but declined to comment. Garn Development didn’t respond to a request for comment.

Chris Martinez, attorney for Surface Development, said his clients denied the allegations and declined further comment.

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Posted by Taylor Anderson

Taylor Anderson grew up near Chicago and made his way West to study journalism at the University of Montana. He's been a staff writer for the Chicago Tribune, Bend Bulletin and Salt Lake Tribune. A move from Portland, Oregon, to Salt Lake City opened his eyes to the importance of good urban design for building strong neighborhoods. He lives on the border of the Liberty Wells and Ballpark neighborhoods.