Whale watching company suing Monterey over lease

A lease disagreement between the City of Monterey and a whale watching company could end up costing that business millions of dollars.

That is according to the owners of Discovery Charters Inc. who say the city is not admitting to mistakes made in the agreement.

John Mayer and Mathew Arcoleo are co-owners of Discovery Whale Watch in Monterey. They recently purchased a 90-foot vessel, which they say gives them a more competitive edge on the waters.

“We remodeled the premises, really made the boats a lot nicer,” said Mayer.

But they are experiencing choppy waves with the city right now. It centers around a 125-foot pier at Fisherman’s Wharf. According to Mayer and Arcoleo, their lease give them 100 feet to dock and pick up passengers.

Monterey, however, is saying slow your engines.

“They told us that 25 of those 100 feet are actually into somebody else’s lease,” said Arcoleo.

They say this puts their business in danger. They cannot use a boat they cannot dock, which they say would lead to their prized ship being re-possessed.

So they went to Monterey to clear things up, but officials are not budging. The city says Discovery Whale Watch had only three quarters of that 100 foot pier.

“The city’s looking at a scaled plan that’s attached to the lease and measuring the water space at 78 feet,” said Janna Aldrete, property manager for the City of Monterey.

Not satisfied with what the city is claiming, Discovery hired an independent engineer to take a look. In documents provided to KION, that engineer concludes Discovery is correct.

Mayer and Arcoleo are now accusing the city of accidentally double leasing their spot.

“They leased out 50 feet to another person which cuts into our 100 feet, and they don’t want to admit that,” said Mayer.

“They won’t own up to it, own up to the mistake. I know it wasn’t them that made the mistake, but it’s their job to resolve it and not force us out of business,” said Arcoleo.

The city, however, still believes Discovery is not looking at the lease properly and remains anchored to their position.

“The lease dictates how much space each different tenant has, whether it’s somewhere on the water front or in a building downtown,” said Aldrete.

Discovery has now filed a tort lawsuit against the city in hopes of resolving the issue. They also say their new boat is in danger of being re-possessed as early as May 1 if this does not get resolved quickly.