The United Artists Theatre was designed by Charles Howard Crane and opened in 1928. Located less than a block from Grand Circus Park, the theater was financed by United Artists, the film company founded by Mary Pickford, Douglas Fairbanks and Charlie Chaplin. Similar to the nearby Fox Theatre, an office block was incorporated into the design. The interior of the theater was sumptuously decorated in Spanish Gothic style, with intricate ornamentation, a large chandelier, a grand staircase and a two-story circular lobby. It was rumored to be acoustically perfect. Less than half the size of the Fox Theater, the United Artists Theater generally showed first-run films with reserve seating. Films that premiered there include Gone with the Wind, the Sound of Music and Cleopatra. In the late 1960s, it shifted to adult fare and closed permanently in 1974. In 1975, the fixtures were sold at auction and the space was only thereafter sporadically used as a recording hall for the Detroit Symphony Orchestra. The office tower was in use until final closure in 1984.
As of 1995, the United Artists Theater was owned by the Grand Circus Development Corporation. In a memorandum between the City of Detroit Downtown Development Authority (DDA) and the Detroit Tigers, it was stated that the theater was located in an area referred to as “the Stadium Project.” [1] This land was intended for future development of a stadium for the Tigers, and according to Grand Circus, the memorandum also contained a clause in which “the Detroit Tigers, ‘a Mike Ilitch Company’, would be entitled to receive all the concession revenues derived from events and activities conducted at the stadium complex.” [1] Grand Circus did not want the property to land in the hands of persons affiliated with the Tigers, and on April 5, 1995 entered into an option (essentially, a contractual agreement) with the real estate company (RFP Associates) who was handling the sale. The agreement prohibited the property from being transferred “for the benefit of” various listed individuals (including Mike Ilitch), their families or business interests for a period of one year after the closing of a sale on the property.
On April 1, 1996 RFP Associates assigned all its rights and interest to a corporation called Beldon, a company affiliated with casino and cable mogul, Charles Barden. In December 1996, Beldon exercised its option with RFP (essentially, purchasing the property) and the title was transferred to Beldon from Grand Circus. Grand Circus alleged that in May 1996, Beldon assigned its interests to the Detroit Economic Growth Corporation (DEGC), a private non-profit organization that works in partnership with Detroit city government and provides staffing services for numerous government agencies including the Downtown Development Authority (DDA), Economic Development Corporation (EDC), Neighborhood Development Corporation (NDC) and the Local Development Finance Authority (LDFA).
In March 1997, the Detroit Economic Growth Corporation notified Beldon that it was exercising its option in favor of Olympia Entertainment, a Mike Ilitch company. The property was thus transferred from Beldon to Ilitch’s company, and Grand Circus filed suit. The Michigan Court of Appeals ruled that the initial clause restricting the sale to unrelated interests “violated the rule against restraints on alienation.” [1] Essentially, that such a restraint is against the public policy of allowing landowners to freely dispose of their property. A seller can “enforce restrictions on alienation only if the seller retains a significant interest in the property,” [1] which was not the case since Grand Circus conveyed the property to Beldon by warranty deed.
Forgotten Detroit, a website on Detroit’s historical architecture claims that “the city of Detroit forced Barden to sell the United Artists Theater to the Ilitches and court battles ensued as Barden tried to null the sale.” [2] The latter half of the statement appears to be false, based on the Court of Appeals document. Beldon, Barden’s company, only asserted that it was “entitled to judgment,” [1] a pre-emptive statement to be cleared of wrongdoing and assert its right to the proceeds. The first half of the statement is more debatable. The Court of Appeals states that “at best, the pleadings [of Grand Circus] hint that Beldon acted with some sense that the property would ultimately end up in the hands of an Ilitch entity.” [1] Professor Patrick A. Randolph Jr., of the University of Missouri Kansas City Law School believes that in this case, “No one was pretending that the involved parties didn’t have knowledge of the restraining language. The question was weather it applied to all”¦[Grand] Circus couldn’t “collapse” the transaction to show that the Tigers folks were the real parties in interest in the transfers in the chain”¦We are assuming, that everyone is aware of the restraint and is acting in the face of it.” [3]
Sarcastically, the professor also includes that he also would not “have enforced the forfeiture here for other, technical reasons. But if we get down to the fundamental policy considerations, it appears that the Michigan Court of Appeals consists of baseball fans.” [3] In sum, however the reading, a complex set of transactions and contracts eventually gave Mike Ilitch control over United Artists Theater, with the ultimate determining party being the Detroit Economic Growth Corporation, a non-profit organization with public partnerships with Detroit City government. The building remains vacant.
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[1] Bandstra, Richard A., William C. Whitbeck and Donald S. Owens. “Grand Circus Development Corporation, Plaintiff-Appellant, v. Beldon Construction Company and Olympia Development of Michigan, Defendants-Appellees.” State of Michigan Court of Appeals. 7 Dec 2001. Web. 11. Dec 2009.
[2] Kohrman, David. “United Artists History.” Forgotten Detroit. Web. 11 Dec 2009.
[3] Randolph Jr., Patrick A. “Daily Development for Monday December 17, 2001, Restraints on Alienation; Options.” DIRT (A service of the American Bar Association Section on Real Property, Probate & Trust Law and the University of Missouri, Kansas City, School of Law). 17 Dec 2001. Web. 11 Dec 2009.