The new owners of the Fishmarket, one of the Inner Harbor's most spectacular failures, yesterday won a ruling from Maryland's highest court that clears the way for an anticipated sale to the city and the proposed Children's Museum.
The Maryland Court of Appeals rejected a challenge by the building's former owners, who had contested a tax sale that left the project in the hands of two local businessmen, Jack Stollof and Harvey Nusbaum, principals in a partnership called G.A.A. Inc. In so ruling, the court upheld the city's tax sale system.
"They put an end to the last desperate plea of the former owners," said attorney Arnold Weiner, who represents G.A.A. "Now the city can move forward with its plans, and hopefully the property can be put to good use."
With G.A.A.'s ownership now established, Mr. Nusbaum said he and Mr. Stollof plan to negotiate the sale of the Market Place property to the city at a discount.
"I don't think they're really in a position to pay us what we perceive to be fair value," Mr. Nusbaum said. "We're going to give it to them for what we call a bargain sale."
A sale would eliminate the need for Baltimore to condemn the property. Last week the City Council approved Mayor Kurt L. Schmoke's plan to take the property and pay the owners whatever a court determines to be a fair market value if a sale could not be concluded.
The city intends to turn the Fishmarket into a children's museum as part of a $30 million National Children's Center planned for Market Place. Douglas Becker, chairman of the museum's board, said yesterday the court's decision "makes it possible to do a friendly deal. And that's a lot easier."
He said the museum should be open by the end of 1996, and possibly some part of it sooner than that.
City development officials have viewed the Fishmarket, a $25 million project that opened in 1988, as one of the biggest obstacles to reviving the struggling east side of the Inner Harbor. The Fishmarket, once a flashy collection of nightclubs and restaurants, has been silent and dark for more than four years.
G.A.A. had taken ownership of the 1906 building after buying a tax lien in December 1992 for $700,000. The former owners, a partnership headed by the Boston-based McCourt Co., had fallen $640,000 behind on their taxes.
"They're going to walk away now," attorney Eugene Hettleman said of his clients, Fishmarket Nominee Corp. "They're not prepared to pay what the court said they had to pay."
In the case decided yesterday, the Court of Appeals ruled unanimously that the tax sale was held properly. An investor who buys a tax certificate at auction must pay the back taxes immediately. Under city ordinance, the investor is then entitled to charge a property owner who seeks to redeem the property 24 percent annual interest until the lien is paid. In the 15-page ruling written by Chief Judge Robert C. Murphy, the court denied McCourt's contention that the Maryland Constitution does not allow cities to authorize tax certificate interest rates higher than what is set in state law, namely 6 percent.