WILMINGTON — A judge has upheld a ban on commercial boat slip rentals at the Riverwalk Condominiums, while allowing one downtown tour company to continue operating amid a years-long legal dispute.
New Hanover County Superior Court Judge George Jones signed an order maintaining a ban on commercial boat slip rentals at the Riverwalk Condominiums, located on Water Street in downtown Wilmington. He ruled the Riverwalk Home Owners Association’s governing documents prohibit third-party commercial use of the docks, meaning Martin Gallan, through Gallan Holdings LLC, is prohibited from leasing slips assigned to his unit.
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The only exception is with Wilmington Water Tours, a river excursion and water taxi business that, since 2011, has rented a slip from Gallan. Judge Jones granted Wilmington Water Tours a stay, meaning the company can continue operating while the case is reviewed by the Court of Appeals.
For co-owner Doug Springer and his 30 employees, the stay is a reprieve, but only a temporary one.
“[The final ruling] could be tomorrow — or it could be two years from now,” Springer told Port City Daily Monday. “They’ve basically left us in limbo.”
The lawsuit has been in the courts for two years after the HOA challenged Gallan about the commercial use of the Riverwalk docks. The HOA alleges the docks are restricted to short-term “transient” use under the community’s declaration, not for long-term commercial purposes. The declaration’s language originated in a 1998 Coastal Area Management Act permit and was later added to the HOA’s governing documents when the community was established.
Gallan has fought back by citing the CAMA permit, contending the HOA’s restriction was misinterpreted and the “transient” requirement was intended to apply to city-owned docks, not the condominium’s.
Even though not a party to the lawsuit, Wilmington Water Tours has been caught in the middle due to its slip lease with Gallan. Though Jones ruled a stay for the touring company, the case still has to go to the appellate court.
Under North Carolina law, a stay lasts for the “pendency of the appeal,” meaning it only ends when the higher court makes a final decision. Since there isn’t a strict deadline for the appellate court to rule, Wilmington Water Tours’ future is tied to a timeline that could last months or even years. A judge’s ruling forcing Wilmington Water Tours to stop operating now would cause harm to the business before the higher court has a chance to hear the case.
Springer said discussions between his legal team and the Riverwalk Home Owners Association about potential solutions — including the possibility of purchasing the docks — have stalled amid the dispute, leaving the company with few clear options other than waiting for the appellate court’s decision.
The case
At the center of the dispute between Gallan Holdings and the Riverwalk HOA is the CAMA permit issued during the initial development of Riverwalk Condominiums. The state permit includes a condition that eight boat slips — intended to provide water access for the condos — be used exclusively for “transient” dockage, meaning the slips were intended for short-term or temporary use, rather than long-term leasing or permanent docking. When the community was established in 2000, the Riverwalk HOA incorporated the permit’s language into its founding declaration, effectively making it a restriction on the slip owner’s ability to rent slips for extended periods.
For over a decade, the slips were used for a mix of residential and commercial purposes without litigation. However, the dispute escalated in April 2022 after Gallan leased a slip to Pickett Investments, LLC, for the docking of an 85-foot yacht. The large vessel led to complaints from HOA board members regarding noise and obstructed river views.
By May 2023, the Riverwalk HOA board filed a formal lawsuit seeking a permanent injunction to ban all third-party commercial rentals. It argued any lease longer than “transient” use violated the neighborhood’s own governing documents and should be removed.
Judge Jones ruled in the HOA’s favor in 2023, finding the HOA’s declaration valid and must be enforced. Gallan Holdings filed its first appeal in early 2024, but the process stalled when the North Carolina Court of Appeals dismissed the case on Nov. 5, 2025. The appellate court ruled the defense’s appeal was premature because Judge Jones had not yet finalized a specific order regarding the operational status of Wilmington Water Tours.
The case returned to Jones’ courtroom during a Jan. 8 hearing, when both parties presented new arguments. Gallan Holdings introduced an affidavit from Rob Mairs, a minor permits manager for the North Carolina Division of Coastal Management. Mairs, who has worked with the DCM since 2004 and formerly served as the field representative for New Hanover County, provided an evaluation of the 1998 permit.
In his affidavit, Mairs stated, based on his review of state records, the “prohibition against transient docking did not and do not apply to the privately owned dock” at Riverwalk. He explained the transient restriction was intended for “city-owned” docks, while the Riverwalk docks are considered private property, separate from the city’s public waterfront.
However, the HOA’s legal team, led by Thomas Babel of Equitas Law Partners, argued the state’s original intent behind the permit was irrelevant to the current issue. Babel argued because the developer chose to write the transient restriction directly into the neighborhood’s declaration in 2000, it became a binding promise to every person who bought a condo there. In other words, the state permit may have inspired the rule, but the HOA’s declaration is what legally binds property owners today.
Babel further argued the Mairs affidavit was “untimely” because the defense failed to exercise due diligence. He pointed out the lawsuit had been active for over two years, and since the state’s records were public, there was no reason Mairs’ testimony couldn’t have been presented during the 2023 trial.
Gallan’s defense team, led by G. Gray Wilson of Nelson Mullins Riley & Scarborough, pushed back against the affidavit’s untimeliness, arguing it was based on a “deep-dive” into state archives, not possible during the 2023 trial. Because the affidavit proves the transient rule was not meant for the private slips, Wilson contended it would be unfair to keep the ban on commercial leasing in place when it was based on a misinterpretation of the CAMA permit.
Because the case is sitting with the Court of Appeals, Judge Jones lacked the authority to formally change the earlier ruling, which banned third-party commercial leasing at the Riverwalk docks. Instead, he issued what is known as an “indicative ruling” — a signal to the appellate court about how he would rule if the case were returned to him.
Judge Jones ultimately agreed with Babel, ruling the affidavit from Mairs was untimely. He noted Gallan’s defense team had ample time to contact the state and secure the testimony before the original 2023 trial ended.
To keep the case alive, Judge Jones required Gallan Holdings to post a $50,000 bond. The bond acts as a security deposit, ensuring if Gallan loses the appeal, the HOA can be compensated for any legal costs incurred during the time it takes for the higher court to rule.
A date has not yet been set for the appeals court hearing. According to the North Carolina Department of Justice, waits for an appellate decision average six months, but can range from as little as 30 days to over a year depending on the case.
Have tips or suggestions for Charlie Fossen? Email charlie@localdailymedia.com
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