MH Lodge sale nearing end despite objections

By Collin Gallant on May 27, 2025.

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A judge has ruled against a local part owner of the Copper Coulee Casino that a dispute over its lease with a now bankrupt other part owner should go to arbitration rather than be highlighted in an asset sale to pay off the Medicine Hat Lodge’s creditors.

Those shares are owned by Mayfield Investments, which entered receivership last fall, and should, according to local businessman Albert Stark, be available for purchase by the remaining partners.

After a King’s Bench hearing last week however, Justice Lorena Harris ruled that while some precent works in Stark’s favour, he waited too long to apply for arbitration as the sales process faces a deadline this week.

“Pure practicality demands the issue … be determined within the context of the receivership proceedings,” she said in an oral judgment Monday.

“Stark has delayed the commencement of the arbitration despite the fact he took issue with the validity of director’s resolution and the casino lease renewal around the time the receivership commenced.

“He did nothing until several months had past, during which the proceedings had reached a critical stage.”

Earlier this year, the Alberta Treasury Branch successfully argued that the inclusion of the shares in a sales prospectus for the Medicine Hat Lodge would increase the value of any sale and therefore be better for debtors in the $38-million bankruptcy.

A sales process for both the Camrose Resort Casino Hotel, a 119-room facility in that city, and the Medicine Hat Lodge (219 rooms with several restaurants and the casino space), as well as the Copper Coulee shares, saw an initial phase bid deadline March 31.

A second phase deadline is set for May 30, and lawyers said recently court could consider approving a finalized sale agreement in June.

Stark’s legal team has argued the structure of the sale puts him at an unfair disadvantage, or could be a gambit to draw a bid from the other casino shareholders when they should have first rights.

Stark’s attorney, Terry Czechowskyj of Miles Davison, had argued that portions of a shareholders agreement that contemplated giving other owners first right to acquire the shares of a bankrupt partner should supersede an open sales process that is set to conclude this month.

Presentations on May 26 painted a strained relationship among the partners.

The casino partnership was formed in 2018 after Stark and Canalta Hotel owner Cam Christianson acquired a 50 per cent stake in Casino by Vanshaw – a buy they said was a prelude to a move out of the Medicine Hat Lodge, which was both a shareholder and landlord, to the Box Springs Business Park where Stark and Christianson separately own parcels of land.

Despite that, the casino was rebranded and subject to a new long-term lease that was due to be renewed at the end of 2024.

Half the shares are controlled by Mayfield and the remainder in 25 per cent blocks by Stark and Christianson, but the governing shareholder agreement outlines that all decisions must be a unanimous 2-0 vote of the two 50 per cent owners.

Lawyers for Stark last week argued that Mayfield director Jason Petchet misrepresented Mayfield’s financial situation during renewal discussions last September, and blocked potential end of the lease to better his financial position while he attempted to obtain refinancing of $38 million in debt from the ATB.

At the same time, no action on the lease was taken during a period that outlined renewal terms of five years.

Harris stated in her oral judgment that the lease renewal would benefit Mayfield, but also the Casino, as extending the lease at the Lodge without agreement would bring in escalating rents with a potential exit date still years away.

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