A property on the west shore of Lake Five known as the Whistle Stop Resort has shut down following the latest ruling in a lawsuit over development on the two-tract parcel of land owned by Susan Dietz.
According to a March 28 court order handed down by Flathead County District Court Judge Amy Eddy, Dietz is required to restore the property to its “previous unaltered condition,” which includes removing a caboose, fire tower, swim docks and restoring the lakeshore by removing the “fire hydrant pad” and restoring a walking trail.
In addition, the court granted a permanent injunction preventing any future construction or expansion of the property and any commercial use including overnight resort accommodations without “obtaining legal access and compliance” with state and local regulation.
The legal action stems from 2020, when the Friends of Lake Five Inc. (FLFI) sued the Flathead County Commission in Flathead County District Court after the board granted a Major Land-Use Permit for a guest cabin development on Grizzly Spur Road in West Glacier.
In the lawsuit, FLFI alleged that the permit was erroneously granted to Dietz in violation of the Montana Administrative Procedure Act, the Montana Subdivision and Platting Act, the Montana Lakeshore Protection Act and the Montana Constitution, while noting that several buildings on the property had been constructed or renovated without proper permitting.
Dietz’s 23.1-acre property, operated as G&M Trust, includes a single-family home, three guest cabins and several other buildings, including a replica train caboose and fire watchtower that were listed on AirBnB. The permit Dietz requested was to construct a barn with living quarters, a pavilion, and several more guest rental cabins.
Last year, the court issued an injunction against Dietz halting any work at the resort following a finding that Dietz did not have a legal easement providing property access to non-residents, but she continued to request, and received, additional permits from Flathead County.
On April 2, Dietz posted on Whistle Stop Retreat’s Facebook page that the resort would close immediately.
“This case provides a cautionary example of the dangers of developing property without a valid permit to do so — conduct which is driving time consuming and expensive litigation before the Courts,” wrote Judge Eddy in the court order. “The Court is unconvinced that Ms. Deitz (sic) thought she could develop a 70-person capacity commercial resort without legal access, permits for building or septic, or in consideration of lakeshore protection.”
On her Facebook page, Dietz shared photos of other Lake Five properties she claims are owned by members of FLFI that do not meet state and local environmental standards and wrote that thousands of illegal rentals and pop-up tent and RV sites exist in the county without proper permitting.
“Sure I made mistakes, but none that haven’t been made all across Lake Five and all across the Valley, I corrected most using the process the County has and had just received full DEQ approval for state of the art, environmentally friendly [septic upgrades] superior to ANYONE else on Lake Five,” Dietz wrote in an email to the Beacon. “But Judge Eddy in her ruling sent Lake Five water quality protection backwards. She ruled for my neighbor’s porta potties and outhouses, not for upgrades sorely needed to outdated septic systems on Montana’s lakes and streams.”
Dietz told the Beacon that she had to cancel 78 summer reservations including travelers from several countries and full wedding parties that had booked the venue.
Dietz gave no comment on what next steps she might pursue, or what timeline she had for complying with the order to remove the structures.
The court order also grants FLFI all attorney fees and general costs, which amount to $61,020 and $1,878 respectively, according to an affidavit. The Flathead County Commission, as defendants in the original suit, filed an objection to the costs on April 11, claiming the Bill of Costs was submitted four days late included items not listed as recoverable by Montana law.
Stay Connected with the Daily Roundup.
Sign up for our newsletter and get the best of the Beacon delivered every day to your inbox.