A fight over a winery crushes a family and divides a neighborhood

October 29, 2011

From the tasting room of the Marterella Winery, the view unfolds over vineyards, a pond, and the rolling green hills of Fauquier horse country. Inside, though, the scene is bleak: The tasting room was shut down by court order this summer after their homeowners’ association argued the winery violated neighborhood rules. Now it’s empty and dusty. Stinkbugs have crept in from the vines outside. The office has piles of bills they can no longer pay.

They can’t afford corks. They can’t afford their mortgage.

The family has just about lost everything, Kate Marterella said.

Photos: Winery owners fighting for their livelihoods

She and her husband Jerry have appealed their case to the Virginia Supreme Court arguing in part that the retail sale of wine at their farm winery is a permitted agricultural activity and that the board’s rules were selectively enforced.

Across the street — part of that beautiful view they see every day — is another winery, one that opened just a few years before theirs did.

It’s in Bellevue Farms, too. It’s very much like their winery. But unlike theirs, it has never been sued. And it’s open for business.

“It’s like a bad soap opera,” Jerry Marterella said. “But it’s not about us. It impacts the whole industry.”

Virginia’s fast-growing wine industry has nearly tripled in the past decade to more than 200 farm wineries. Jerry Marterella argues that because a judge ruled that their wine-tasting room was not agriculture but commercial activity, defining agriculture very narrowly, it could set a precedent that would affect every farm stand and apple-picking orchard in the state.

It’s a hotly contested issue nationally, several experts said, as the farm economy changes, with biodiesel, windmills, agrotourism and other innovations all forcing the question — when is a farm just a farm, and when is it something else entirely?

To their opponents, this is a simple case of a contract violation. “The Marterellas were told they couldn’t do what they wanted to do,” said David Hamilton, a Bellevue Farms board member speaking just as a neighbor, “and they said, ‘So what?’ ”

‘It’s a jewel’

Bellevue, a neighborhood in Warrenton, about 50 miles west of Washington, has beautiful views at every turn. On a recent afternoon, a black cow was sleeping under a tree, the leaves just starting to turn yellow. A girl rode by on a chestnut mare, setting off on one of the 30-some miles of trails that wind through pine woods, around ponds, through meadows and over hills with views of the Blue Ridge.

“Aptly named, isn’t it?” said Diane Zegel, the board president, who searched the state for three years to find a place to retire with her horses. “It’s a jewel.”

Bellevue Farms was planned more than 30 years ago to be a sort of gentleman-farmers’, equestrian community, with lots of 10 acres or more and private roads maintained by the board. There’s a pool, tennis courts, stable and riding grounds. And there are rules; those were important to Zegel, because that meant her favorite riding trails wouldn’t be turned into a 7-11. She knew that what she was buying would be protected.

It was a beautiful setting for a winery, too. The Marterellas bought 13 acres for $485,000 11 years ago, when their daughter was a little girl, and planted vines.

The Bellevue covenants said any commercial activity on the property required approval from a committee, and that committee’s handbook said agriculture was permitted without further approval. It seemed clear, the Marterellas said.

Besides, there was a winery starting up across the street, paving the way.

The owner of Mediterranean Cellars, Louis Papadopoulos, did not comment for the story. His lawyer, Philip Carter Strother, said the board has tried to limit that farm winery’s retail sales but that Mediterranean Cellars is an agricultural activity, “the type that the Bellevue covenants are designed to protect.”

Hamilton said neighbors were blindsided by Mediterranean Cellars, thinking it was just going to be a hobby for the owner, not a business. Once it opened in 2003, “everyone realized that was a colossal mistake.”

At the time, “nobody knew what a farm winery entailed,” Zegel said. “We certainly didn’t think we’d have limos coming into our community, and minbuses. Once that all came to light we said, ‘Whoa, we need to make sure this doesn’t happen again.’ ”

The covenants — the legal documents attached to the title — never changed. But the committee handbook got rewritten in early 2004.

When the Marterellas finally applied for permission to open their winery in 2004, Bellevue Landowner’s Council attorney Daniel Streich said the site committee denied them, essentially telling them, “You can plant grapes, grow grapes, harvest grapes — all that is agriculture. You can process grapes onsite, store grape juice, turn it into wine. It’s just we’re not going to have another . . . tavern here in the community.’ ”

The couple had already invested $600,000. And they felt as though the rules had been changed on them once the board saw the public coming to Mediterranean Cellars.

After trying to compromise, the Marterellas said a lawyer told them, “They’ve already let the horse out of the barn. You’re completely legal” in the county and the state.

So Marterella Winery opened in fall 2006.

And the landowner’s council sued.

In 2009, a jury returned quickly with a decision in favor of the Marterellas.

“We were very happy,” Kate Marterella said. “But I just had this bad feel of foreboding.”

Then the judge overruled the jury’s decision.

In January, the same judge awarded the board an injunction against sale of wine from their tasting room. The court set a bond of several thousand dollars. But the Bellevue council legal fees, about $150,000 minus about $50,000 that was covered by insurance, were added to the total. The Marterellas didn’t have $105,000 to hand over.

Mounting debt

This summer, the Marterellas closed the winery, took down the signs.

They can still make wine and sell it wholesale — and they are trying, landing an account with a big restaurant, for example, and selling it at some local shops — but most wineries in Virginia have found it very difficult to create a name and a demand for their product without a tasting room and a lovely view.

And they desperately need income. Jerry Marterella felt a tiny bump on his head in early 2010; by the time he was diagnosed in March, he had stage 4 melanoma. The winery, meant to be a retirement fund, grossing about $350,000 a year when it was open, had become essential income.

They have spent well over $400,000 in legal fees and are now about $1.3 million in debt, Kate Marterella said.

To neighbor Kelley Jenkins, the fight has been ridiculous. She was recently warned that she couldn’t sell puppies when her golden retrievers had litters, even though her teenage children have more friends over on a given weekend than she had customers all year, she said.

“It hurts your head,” she said. “Our roads have gone to hell, the pool, the rec center — the tennis courts have weeds grown all up. They’ve let the community go, to destroy” the Marterellas.

The expense of the lawsuit, more than $150,000 for the board and rising, has meant Bellevue has had to cut back on maintenance, Zegel said.

“I’m very sorry the Marterellas are losing on this,” Hamilton said, “but I do think they were reckless. I think they, frankly, thought they could run over everybody. But it would be wonderful to have it over with. That’s the view from my porch.”

They would have given up long ago, Kate Marterella said, sold the place and moved away, even though she believed they were right in principle. Now it’s too late: They can’t afford to pay the landowner council’s legal fees. They’re underwater with the house, she said — who would want to buy a house with a winery they could never operate? And, she said, because the board has gotten a reputation for strict enforcement, “Realtors call this neighborhood Hellvue now.”

So she listens to her husband struggling to breathe, harvests grapes, tries to find new ways to sell her wine.

“We’re very sorry about his illness,” said longtime resident Kay Hayes, “but it doesn’t change our case in any way.”

“This isn’t about the Marterellas,” Zegel said. “It’s about protecting our way of life.”

Susan Svrluga is a Virginia rover for the Washington Post, covering anything and everything that’s happening in the Commonwealth.
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