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Eco-Tech Construction LLC, a land development company that traces its corporate history to the 1960s, has ceased operations, its attorney said.

The company succumbed to the dramatic slowdown in the real estate development and construction industries and non-payment of bills by many of its major customers, Eco-Tech attorney Christopher Langpaul said.

Failed developer John Kline was among its debtors. Eco-Tech had won a $4 million judgment against Kline after a Polk County judge ruled that the developer misused a development loan, diverting cash to such items as corporate jet service and artwork, rather than using loan proceeds to pay contractors.

Kline filed for bankruptcy after his Urbandale home burned to the ground in a fire later determined to be the work of an arsonist. That fire is under investigation by a task force led by the U.S. Bureau of Alcohol, Tobacco, Firearms and Explosives. Kline’s bankruptcy case was dismissed by a federal judge.

Eco-Tech will remain a going concern, at least in part to continue efforts to collect debts owed by Kline and other developers, Langpaul said.

Eco-Tech and affiliated companies, whose corporate parent is Gillotti Holdings Inc., were sued May 19 in federal court in Des Moines by General Electric Capital Corp., which said the companies owed $1.3 million on a $1.7 million loan and lease agreement. The Gillotti family has been a key player in the paving and land development businesses in Greater Des Moines for the last six decades.

In that lawsuit, GE Capital said it had been informed that Eco-Tech ceased operating earlier this year after its major lender withdrew a line of credit.

Bankers Trust Co. has been Eco-Tech’s principal lender. However, Langpaul said the statement that the lender had pulled a line of credit was “absolutely false.”

“The genesis of that lawsuit is the economic recession and the decline in the value of assets – the equipment securing leases,” he said. “The value has dropped precipitously.”

According to Polk County property records, the land in Grimes where Eco-Tech is based was part of a mortgage with Bankers Trust securing credit of up to $4.4 million.

Metro Waste wins ruling in construction debris controversy

Metro Waste Authority was within its rights to refuse to accept construction and demolition debris that did not meet its standards for use as cover material at its landfill in eastern Polk County, the Iowa Court of Appeals ruled May 25.

Phoenix C&D Recycling Inc. had filed a lawsuit in 2006 claiming Metro Waste violated a contract to receive the material and by later charging for its disposal at the landfill.

A Polk County judge ruled last year that Metro Waste did not violate terms of the agreement and was within its rights to charge for disposal of the material. The agreement was an attempt to limit the amount of debris taking up space in the landfill by having it ground into a soil-like material and used as what is called alternative daily cover.

Phoenix appealed the ruling.

Metro Waste claimed that the material did not meet standards established in the agreement and generated a foul odor.

The court also ruled that the Phoenix owed Metro Waste $154,892 in disposal and testing fees.

Court says no insurance for leaky roofs in Kline development

The Iowa Court of Appeals ruled May 25 that Continental Western Insurance Co. is not liable for roof repairs at Urbandale townhomes developed by John Kline and Randy Walters.

Foxfire Townhomes were developed and completed in 2002 by Kline and Walters’ Oaks Development Co. Three years later, roofs began to leak and the Foxfire Townhomes Owners Association Inc. had them repaired at a cost of $215,000.

It was also determined that roof insulation did not meet city of Urbandale’s building codes.

The homeowners association filed a lawsuit against Oaks Development, which in turn sued the subcontractor that performed the initial roofing work. Oaks also sought to recover damages under its insurance policy with Continental.

A Polk County district judge ruled that the insurance policy contained an exclusion for substandard work, and therefore Continental did not have to settle with the homeowners association.

The appeals court affirmed that ruling.

Subcontractors have reimbursed the association for some costs.