Hole in the Wall Waterfront Grill, owned by Mac Casale and Dean Tsamouras, has filed suit against the Mathews County Board of Supervisors and, specifically, supervisors Dave Jones and Mike Walls, charging malicious prosecution and abuse of process.

Mathews County owns the building on Gwynn’s Island where Hole in the Wall is located and has a long-term lease agreement with the business.

The lawsuit is seeking $10 million in compensatory damages and an additional $350,000 per defendant, or $1.05 million, for punitive damages, citing the defendants’ “combined efforts in initiating and bringing zoning proceedings and threatening civil claims against plaintiff for spurious zoning violations.” It alleges that the actions of the board of supervisors and of Jones and Walls individually “constituted a complete disregard of plaintiff’s rights, were done with actual malice, and were not based in fact.”

Also mentioned in the suit is the fact that the Mathews Board of Zoning Appeals ruled in Hole in the Wall’s favor in July regarding the charges of zoning violations. The county has appealed the BZA’s decision on the Notice of Violation to Mathews Circuit Court. As of Tuesday, no date had been set to hear the case.

Under its malicious prosecution charge, Hole in the Wall claims it has incurred damages, losses, and legal fees; has suffered injury to its name and good reputation; has been “brought into public disrepute”; and has lost substantial financial revenue because of the defendants’ actions. In addition, the suit claims the business’s agents have suffered humiliation, mental anguish, and anxiety because of the “relentless and unwarranted legal action initiated by the defendants.”

Under the abuse of process allegation, the business claims that Jones and Walls, as public officials acting on behalf of the public, have “a fiduciary and ethical duty to act in such a manner as to protect individuals from adverse proceedings to which defendants knew or should have known were false.”

It charges that Jones and Walls had ulterior motives for the investigation and issuance of the Notice of Violation and leveraged their position on the board of supervisors “to malign and discredit the reputation and public opinion of Hole in the Wall and its members, and to benefit their own political and business ambitions.” The suit states that Jones’s and Walls’s behavior was “willful, grossly negligent, and malicious.”

History of the dispute

Hole in the Wall’s suit recounts the history of the relationship between the county and the restaurant, beginning with a lease agreement signed in 2016 and made effective in 2018, after Hole in the Wall had elevated the building, made improvements to the premises, and received approval for the septic system.

Decks that were added to the building, including one for customer dining and one for elevating freezers, became a point of contention between the county and Hole in the Wall, with the county charging that the decks were not permitted and Hole in the Wall stating that it had all the proper permits.

Both parties have acknowledged that much of the file containing information about Hole in the Wall has disappeared. Jones and Walls have claimed that the information was deleted by former employees, while Hole in the Wall, in this suit, lays the blame on Jones and Walls. The suit charges that the two men sought “to use unfounded zoning violations to cause Hole in the Wall to appear in violation of its obligations under the lease and force termination of the lease.”

At one point, the county closed the restaurant, stating that the structure was unsafe, and Casale is asserting in the suit that Jones and Walls attempted to coerce him by refusing to reopen the restaurant until the owners agreed to change the terms of the lease so that Casale would be required to pay for pump and haul of the septic system.

Earlier this year, Mathews County Planning and Zoning Director James Knighton issued a notice of violation to Hole in the Wall, stating that the zoning permit on file did not allow for the structures previously mentioned. The NOV was the subject of the restaurant’s appeal to the BZA and is the subject of the county’s appeal of the BZA’s 4-1 decision in favor of Hole in the Wall.

The 53-page suit includes five exhibits: the lease agreement between the county and Hole in the Wall; Hole in the Wall’s building permit application, certificate of occupancy, and application for a zoning permit to add an 18’x41’ open deck; and the Notice of Violation the county issued to the business.

Mathews County Administrator Ramona Wilson, reached by telephone Tuesday afternoon, said she had no comment on the matter.