A long-running dispute between a pair of prominent business owners and an Island fuel supplier made its way back into court last month with a new wrinkle.

In September 2024, Dukes County Judge Janet Sanders ruled that Ralph Packer needed to pay brothers Mark and Mike Wallace more than $700,000 for the environmental cleanup of a downtown Oak Bluffs property that Mr. Packer sold to the Wallaces in 2000.

In December, the Wallace brothers sued Mr. Packer and other members of his family, saying that Mr. Packer was selling off some of his high-value properties to family members for a $1 despite Mr. Packer knowing that he would likely be in debt to the Wallaces.

In the Dec. 16 complaint filed in Dukes County Superior Court, the Wallaces asked the court to halt the transfers and put a levy on them to pay the debts.

The case is part of a winding history of the 27 Lake avenue property, home to a gas station and Jim’s Package store. The Wallace family runs several other nearby businesses in downtown Oak Bluffs, including the Sand Bar and a pair of rental car agencies. Mr. Packer runs R.M. Packer Company, one of the Vineyard’s biggest fuel suppliers.

When reached on Friday, Mr. Packer seemed unaware of the lawsuit and referred questions to his attorney Theodore Saulnier, who did not immediately respond to a request for comment.

Issues at the Lake avenue property started in the 1990s, when the state Department of Environmental Protection became aware of petroleum contamination there. In 1999, the DEP sent a notice to Mr. Packer, who owned the property at the time, about the need to rectify the situation.

The Wallace brothers had been operating the package store at the time and the next year bought the property from Mr. Packer for $1.3 million. Despite the sale, Mr. Packer was still on the hook to pay for the environmental cleanup. No action was taken though, and the DEP came calling again in 2005 saying remediation was required.

In June 2015, DEP sent the Wallace brothers a notice of noncompliance, and ordered them to submit a temporary or permanent solution to fix the contamination by the end of the year.

A court fight in Dukes County ensued over what option to take to remediate the petroleum contamination, and in the end a judge ruled that the Wallaces had to agree to a restriction that would only allow the property to be used for commercial purposes going forward, barring any chance of a residential use in the future.

Because no such restrictions were on the property at the time of the sale, the court awarded the Wallace brothers $479,202 in damages stemming from the breach of contract by Mr. Packer.

Mr. Packer objected to the decision, saying that the buyers were only entitled to be paid for a temporary solution, not a permanent fix to the contamination.

In August, the state appeals court upheld the Dukes County Superior Court decision. The appeals court kicked the case back to the Vineyard, where the superior court added on $285,360 in interest to its previous award, bringing the total of Mr. Packer’s debts to $764,562.

In 2021, while all the legal maneuvering was going on, Mr. Packer sold three Tisbury properties, one on Chappaquonsett Road, one on Northern Pines Road and another on Lambert’s Cove Road. Each property was sold to his grandchildren for $1.

In the lawsuit, the Wallaces claim that Mr. Packer knew, or should have known, that he would incur debts beyond his ability to pay, and was insolvent at the the time of the sale of the properties to his family.

“The transfer of the Chappaquonsett, Lambert’s Cove, and Northern Pine properties was made with the intent to hinder, delay or defraud Packer’s creditors,” attorney Ashleigh Bell wrote in the lawsuit.

Together, the three properties are assessed at just shy of $2 million, according to town records.

This is not the first time someone has sued over Mr. Packer’s sale of the properties. In 2022, a group of employees sued Mr. Packer, saying the sale of the same properties was done to “hinder, delay or defraud,” the employees who were owed $1.6 million in retirement benefits, plus interest.

The merits of that case never panned out though as both Mr. Packer and employees agreed to dismiss the case in early 2023.

Ms. Bell, who is representing the Wallaces in the recent case, also advocated for the employees in the 2022 lawsuit against Mr. Packer. She did not respond to a request for comment.

A next date has not been set in the new case.