GloucesterTimes.com, Gloucester, MA

A Superior Court judge has removed the legal roadblock to the completion of Gloucester Cooperative Bank's drive-through service plaza and expansion that were stalled 16 months ago, leaving Main Street with a large, empty hole where the work was halted.

Judge Howard Whitehead's decision Tuesday was a blow to Main Street merchants Olimpia "Louise" and Joseph Palazzola and their supporters who helped finance their appeal of the city's permit for the bank to double its size and run a drive-through from Middle Street to Main Street.

In giving the bank the summary judgment it sought, Whitehead in effect found that the Palazzolas did not have standing to intervene.

Whitehead based the judgment on his finding that the "market analysis" introduced by the Palazzolas' attorney to show the expansion would devalue their used miscellany shop was "without sufficient reliability."

Their small shop, Stuff, looks across Main Street to where the two drive-through lanes - the piece of the project that worried many merchants - would come out.

After the Palazzolas began their legal effort to stop the expansion in September 2005, the bank's president, Patrick Thorpe, and directors decided to shut down the site. At the time, excavation for the 9,000-square-foot addition at the corner of Main and Pleasant streets was nearly complete.

When work started, the project was scheduled to be finished early this year. Instead, the abandoned excavation became a landmark for the troubles of the retail district. Its bookend is the storefront of the former Empire store across Main Street, which remains vacant.

Thorpe did not respond to phone requests for comment yesterday. He has been updating the community on the project through newspaper ads.

In its first communique in January 2006, the bank said, "We have decided to stop all work on the project until the matter is resolved or we determine it is prudent to proceed."

Louise Palazzola, a School Committee member, declined to comment on the decision and whether she intended to appeal, but Stevan Goldin, who supported her court battle, said he would advise her to keep fighting. Her attorney, Donald Freuleue, could not be reached for comment.

In a deposition taken by the bank's lawyer as well as City Solicitor Linda Lowe, Palazzola said Goldin gave her $2,500 to help offset legal fees. She said she did not seek his financial aid.

"We'll definitely win on appeal," said Goldin, who has filed numerous citizens' appeals of real estate developments and infrastructure projects from Gloucester to Boston. Few have succeeded, but they have managed to delay many projects.

Goldin said he is paying $100 a month to satisfy a judge's order for obstructing the judicial process with challenges he wrote and filed on behalf of 10 citizens' groups.

The Massachusetts Appeals Court in January 2004 ordered Goldin to pay the legal fees that attorney Michael Faherty accumulated in fighting off what the court called Goldin's "frivolous" legal machinations to prevent development of land in Magnolia owned by a client of Faherty's.

The bank's expansion and drive-through plans were not well received when introduced in early 2004. Then-Planning Board Chairman Jack Clarke and community development officials criticized the bank for removing retail space along Main Street near the intersection with Pleasant, including a dilapidated building that housed the used record store, Mystery Train.

But as the proposal moved slowly and with difficulty through the permitting process, the bank began adapting the plans to accommodate some of the criticism. Purists did not like the architectural style - the 4,500-square-foot, glass-fronted bank office building, to some, seemed suburban and overpowering. The bank agreed to rebuild the lost retail space.

As the bank made concessions, the estimated cost of the project climbed from $3 million to $4 million. Even so, Robert Coakley, the bank's land use attorney, volunteered that the intense vetting had made the project better.

Opposition to the bank's drive-through and controversy about allowing drive-throughs anywhere in the central business district remained.

The Planning Board urged City Council to bar drive-throughs downtown, but the council decided to allow them and approved the bank's plans.

But it was the action of the Historic District Commission, which cleared the project on a 4-3 vote, that the Palazzolas and their allies challenged. The commission's mandate is protection of the cultural and architectural integrity of a district north of Main Street that includes a small finger of the bank's property.

The Palazzolas' effort to invalidate the commission's vote for the project split Main Street. Many merchants chastised the Palazzolas for obstructing what they considered the inevitable.

"Let the bank do their thing," said Theo Taminian, owner of House of the Raven, a store that sells jewelry and other gift items a few doors down from Stuff.

Roger Armstrong, State of the Art Gallery II owner, has said he found the Palazzola suit "extraordinarily selfish."

History of an interrupted project

* January 2005 - Plans introduced.

Winter-spring 2005 - Merchants and officials question the loss of retail space and proposed drive-through feeding Main Street.

Spring-summer 2005 - Planning Board and City Council approve expansion plans after bank agrees to replace lost retail space; council support is unanimous.

September 2005 - Historic District Commission approves project on 4-3 vote.

October 2005 - Excavation begins at Main and Pleasant streets.

January 2006 - Palazzolas cleared to sue to stop the project; bank halts work while suit is pending.

This week - Judge finds Palazzolas have no standing to sue.