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Articles Posted in Construction defect

In the hours, days and now weeks since the horrific tragedy of the Surfside condo collapse, the firm’s Gary Mars and Stuart Sobel have been among the most sought-after expert sources by local and national media.  They have conducted extensive interviews with NBC News, the Miami Herald, South Florida Sun Sentinel, Daily Business Review, Law 360 and The Real Deal.  In addition, Gary and Stuart appeared live in wide-ranging interviews on The Florida Roundup and Sundial, the news and public affairs shows produced and aired by WLRN FM-91.3, the South Florida National Public Radio affiliate.

wlrn-300x113Both of these interviews covered a great deal of ground, and we encourage all those interested in learning more about the questions involving the legal ramifications of this tragedy and the liabilities of the insurer, builders, engineers and architects to listen to both.  Gary’s interview on The Florida Roundup aired on Friday, July 2, at 1 p.m., and it’s available to be heard in full by clicking hereGaryMars-200x300He discusses the implications for condominium association boards from the collapse as well as the reforms that may be in store.  He believes these should include federal relief, perhaps in the form of federally backed low interest loans for condominium associations in need of undergoing extensive repairs.

Stuart’s interview aired during the Sundial show at 1 p.m. on Tuesday, July 6.  He discusses the extremely high qualifications of the judge and engineer assigned to the case, and he also shares his insights into the projections for the investigation and the ultimate compensation for the victims and their families.  Stuart-Sobel-2013-200x300It is a wide-ranging discussion that also delves into the projected reforms that he foresees are likely to follow.  Stuart’s interview is available by clicking here.

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The collapse of the Champlain Towers South condominium has been a human tragedy of unimaginable proportions, and the unspeakable grief and horror of its aftermath have been shared deeply by our law firm.

Our firm’s community association law attorneys have made helping condominium communities to contend with construction defects a particular focus of our work.  We believe reforms should be considered to require engineers to report certain serious conditions to local building departments wherever they find them.  This would take discretion out of equation and immediately involve building inspections, permits being issued and repairs being completed.  We also suggest there should be new federal/state government aid and/or low-interest federally backed loans for condominium associations that now engage in major structural repairs.

Our attorneys are also concerned by the great deal of misinformation that is currently circulating over the legal liabilities of association board members.  We note that lawsuits against a condo association are ultimately against the building’s insurer and possibly all the unit owners, as the owners can be held responsible for their association’s liabilities.  The firm’s attorneys have been reaching out to our clients to remind them of importance of prioritizing engineering findings in their turnovers to new board members and property managers, and to focus on structural issues over aesthetics and fund reserve accounts for any necessary repairs.

Stuart-Sobel-2013-200x300Our firm’s attorneys have also been sharing their insights on these and other issues with major media outlets as well as some of Florida’s lawmakers and policymakers, and we have scheduled a free live webinar on 40-year recertifications and structural maintenance for today at 1 p.m. (click here for information and online registrations).  The Sun Sentinel and Daily Business Review immediately turned to our board certified construction and condominium law experts for their input in the aftermath of the collapse.  A front-page article in the Sun Sentinel that appeared in the Friday, June 25, edition titled “How to Know if Your Condo Tower is Safe” includes insights from firm partners Stuart Sobel (pictured here) and Roberto C. Blanch.  The article reads:

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Jason-Rodgers-Da-Cruz-002-200x300The efforts of firm shareholder Jason M. Rodgers-da Cruz, together with Patrick S. Montoya of the Coral Gables-based law firm of Colson Hicks Eidson, were the subject of a front-page article headlined “This Miami Case Was Too Big For the Courtroom: Organizing Convention Center Trial ‘Like Setting Up a Show’” in today’s edition of the Daily Business Review, South Florida’s exclusive business daily and official court newspaper.  The article discusses how it was going to be impossible for all of the jurors, defendants and their legal counsel to safely hold a trial at the Miami-Dade County Courthouse under Covid restrictions for a lawsuit by firm client Latitude on the River Condominium Association against eight defendants over the property’s allegedly faulty fire-sprinkler system.  Even though the case was ultimately settled confidentially before proceeding to trial, the duo’s plans to hold the proceedings in the James L. Knight Convention Center are now serving as a blueprint for remote courtroom proceedings for large multi-party cases with adequate social distancing precautions.  The article reads:

. . . The case, which took more than five years of litigation and multiple hearings, involved a class-action lawsuit brought by Latitude On The River Condominium Association Inc. against eight defendants over an alleged faulty fire sprinkler system with incompatible components.

dbr-logo-300x57Miami-Dade Circuit Judge Jennifer Bailey allowed plaintiffs attorneys Jason M. Rodgers-da Cruz of Siegfried Rivera and Patrick S. Montoya of Colson Hicks Eidson to work with her staff to plan for the massive jury trial. Jury selection was scheduled to start at the end of April.

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George-Ketelhohn-Gort-photo-200x300Firm shareholder Georg Ketelhohn is quoted in an article in today’s Daily Business Review discussing the firm’s efforts on behalf of the condominium association for the 537-unit Midtown Doral in its construction defect lawsuit against the community’s developer, builders and design professionals.  The firm’s suit, which was filed in December, alleges defects including leaky plumbing with erratic water pressure, rooftop pools of rainwater on the roof, and exposed rebar in cracked concrete.

Located at Northwest 107th Avenue and 74th Street, Midtown Doral was completed in 2016 with four eight-story condo buildings and 70,000 square feet of retail space.

The firm’s lawsuit on behalf of the association is against general contractor Delant Construction Co. in Miami, architectural firm Pascual, Perez, Kiliddjian & Associates in Doral, and MD Residential II LLC, an affiliate used by the development partnership. dbr-logo-300x57 The suit alleges breach of implied warranties against the developer and general contractor as well as a professional negligence count against the architect.

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Firm shareholders Helio De La Torre and Lindsey Thurswell Lehr, together with associate Berenice M. Mottin-Berger, have worked for more than four years in representing the BrickellHouse Condominium Association in litigation over the property’s failed robotic parking garage.  Their work yielded a truly exceptional result last week when a Miami-Dade Circuit Court jury awarded the association $40,590,990 in damages against BrickellHouse Holding LLC, the developer of the 46-story tower in Miami’s Brickell area, and many of South Florida’s most respected media organizations took notice.  The verdict yielded major articles this week in the Miami Herald, Daily Business Review, South Florida Business Journal, The Real Deal and Law 360 about the trial team’s success in demonstrating to the jury that the developer, a subsidiary of Newgard Development Group, breached statutory warranties owed to the association and its unit owners.

Helio-De-La-Torre-2013“The association has been left without parking for its residents in the promised 480 vehicle garage since November 2015,” explained De La Torre to reporters after the verdict.  “Since that date, residents have been parking offsite and incurring increased costs due to the failed robotic parking system sold by the developer. The board of directors and a team of consultants have worked very hard to find a solution for the garage and bring the owners the justice they deserve.”

 

LTLehr-2018-Siegfried-Rivera-200x300Thurswell Lehr concluded:
“As a result of the verdict, the condominium association will now be able to move forward with the replacement of the garage in order to restore the parking for the building that the owners and residents deserve.”

BrickellHouse is located at 1300 Brickell Bay Drive and features 374 residences.  The 46-story tower was one of the first post-recession condo buildings constructed in the Brickell area.  After its completion in October 2014, the problems with the 480-space robotic parking system were immediately apparent.  The developer retained control of the condominium association through September 2015, and the robotic parking system was completely shut down in November 2015.

Below is a video depicting how the garage was designed to use a fleet of autonomous robots that move beneath the vehicles to lift and move them throughout the building and elevators.  Click here to read the Miami Herald article in the newspaper’s website, click here for the Daily Business Review article (registration required) and click here for The Real Deal.

 

 

In addition to our firm’s work involving construction defect litigation on behalf of Florida community associations, our construction law board certified specialists and attorneys also regularly represent construction firms in disputes with property owners, developers, design professionals and insurers.  Firm partners Steven M. Siegfried, Stuart Sobel and Berenice M. Mottin-Berger were featured in an article about their work on behalf of one of the firm’s construction clients that appeared in today’s Daily Business Review, South Florida’s exclusive business daily and official court newspaper.  The report, which was titled “Caribbean Construction Firm Scores $4M Judgment,” chronicles the highly contentious litigation and arbitration that led their securing a $4.3 million judgment against DeVry Education Group (NYSE: DV) for Moorjani Caribbean Ltd., a Barbados-based construction company.

dbr logo-thumb-400x76-51605Click here to read an excerpt from the DBR’s report in our construction blog that includes a link to the complete article in the newspaper’s website.

Helio De La Torre 2013Firm partner Helio De La Torre was quoted in an article that appeared today in The Real Deal, an online media outlet that focuses exclusively on South Florida real estate news.  The article, which was titled “BrickellHouse’s Condo Association Runs into Another Snag in Robotic Garage Predicament,” focuses on the firm’s lawsuit against the developer of the 46-story Miami tower over the property’s failed robotic parking garage.  The article reads:

“The condo association has been left with this mess,” lawyer Helio de la Torre told The Real Deal. “We have to clean up this mess.”

On Aug. 23, de la Torre’s client, BrickellHouse Condominium Association, filed an amended lawsuit against Hernandez, his company BrickellHouse Holding LLC and Hartford Steam Boiler Inspection and Insurance Company, seeking additional damages for the possibility that some condo owners may be left without a parking space if the building’s troublesome robotic parking garage is replaced with a new system.

The association initially sued the developer in January and amended its complaint three times in March to add more counts regarding the failure of the the 374-unit building’s robotic parking garage. TRDlogo Court documents allege buyers were promised South Florida’s first fully automated parking system that would deliver their vehicles in and out of the building without drivers inside the cars.

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Fire sprinkler systems, part of a building’s “Life Safety System,” are a crucial component of condominium buildings because they help protect against damage to life and property in the event of a fire.  While maintaining these systems in proper working condition is important, making sure that the fire sprinkler system was properly designed and has compatible materials from inception is imperative.

Our firm, led by Steven M. Siegfried, Alton C. Hale, Jr., Jason M. Rodgers-da Cruz, Nicholas D. Siegfried and Stuart Sobel, together with Ervin Gonzalez and Patrick Montoya of Colson Hicks Eidson, P.A., has filed a class action lawsuit on behalf of a number of condominium associations.  By this action, we are seeking compensation sufficient to replace the hybrid fire sprinkler systems installed in these buildings. blogpipe1 The hybrid systems include CPVC and Allied ABF steel pipes.  These materials are incompatible with each other, and as a result of this incompatibility, cracks have or will develop in the CPVC resulting in system failure over time.

We strongly recommend that condominium associations — and also other high-rise buildings such as office building and hotels — determine whether their fire sprinkler system contains steel pipe manufactured by Allied with the markings “ABF” that were installed in conjunction with CPVC pipes.  Particular attention should be taken, especially if the building was built during the years 2004 to 2010, so that if present, this defect can be identified and addressed.

blogpipe2Those with any questions or in need of assistance in determining whether their building is affected by this defect may contact us at our Coral Gables office at 305.442-3334 or via email at sbonilla@siegfriedrivera.com.

 

CHEpipeslawsuit.jpgThe firm’s Stuart Sobel, Jason Rodgers-da Cruz and Alton Hale, Jr., together with partner Ervin Gonzalez with the firm of Colson Hicks Eidson, held a press conference today on our filing of a class action lawsuit concerning defective fire sprinkler systems and a national cover-up over a significant life safety issue in condominium towers in Florida and across the country. The attorneys believe the total damages for this case will exceed $1 billion nationwide.

The suit alleges that some or all of the defendant manufacturers had knowledge of the defects since 2007 from their own testing, yet they deliberately did not disclose it. It alleges that the defendants’ pipes are incompatible with an array of basic construction products and unsuitable for use in fire sprinkler systems. Their defects cause leaks, cracks and blow-outs in the sprinkler systems, depressurizing and rendering the systems unavailable for fire suppression, giving rise to the potential for loss of life, injuries and property damage. The news release on the lawsuit is available by clicking here.

The Miami condominiums named as the lead plaintiffs in the class action lawsuit are the Wind Condominium at 350 S. Miami Ave. and Latitude on the River at 185 Southwest 7th St.

Media coverage of the case includes reports by The Miami Herald, Daily Business Review, WFOR-CBS 4, WTVJ-NBC 6, WLTV-Univision 23, and WIOD-610 AM. Click below to watch the reports from CBS 4 and NBC 6.

JordanWeinkle.jpg JeffreyBerlowitz.jpg The firm’s Jeffrey S. Berlowitz and Jordan G. Weinkle wrote an article that appeared in today’s edition of the Daily Business Review, South Florida’s only business daily and official court newspaper, about how bankruptcy and community association attorneys must work together in order to assess the strength of an association’s construction defect claim against a debtor company that files for an asset liquidation under the state’s Assignment for the Benefit of Creditors statute. Their article reads:

Unlike federal bankruptcy proceedings, with an Assignment for the Benefit of Creditors (ABC), the assignor, or debtor, company that elects to liquidate its assets in order to repay its creditors is able to do so in a more debtor-friendly state court proceeding in which they are able to select and appoint the assignee, who then serves in the role in which trustees serve in bankruptcy cases to oversee the liquidation of the assignor’s assets in order to pay secured creditors and unsecured creditors.

The ABC liquidation process typically takes the form of a private sale or auction in which creditors and parties of interest are notified of the sale and have the opportunity to present higher and better offers for the assets. Ultimately, the sale of the assignor’s assets must be approved by the state court.

While there is no “automatic stay” on pending litigation imposed upon the filing of an ABC, unlike a bankruptcy stay which is immediately in effect upon the filing of a bankruptcy petition, creditors of the assignor are essentially stayed from continuing their pursuit of claims because the comprehensive liquidation of the debtor’s assets makes it virtually impossible to collect on a judgment.

The most notable benefit of an ABC to the assignor company is the opportunity that the assignor’s principals have to buy back their assets under a newly formed entity, should that newly formed entity offer the highest and best bid for the assets.

With ABCs, the assignors can and often do negotiate the buy-back of their business assets via the liquidation or auction process through a separate entity, enabling them to stay in business with little interruption or disruptions whatsoever while diminishing their debts to pennies on the dollar.

Their article concludes:

As a result, we are now starting to see cases in which condominium associations and homeowner associations that either have pending construction defect litigation or have filed a notice of claim against developers, general contractors, subcontractors or other firms are being notified that their payouts will be determined via ABC actions in state court.

The ability to assess the strength of an association’s construction defect claim against a debtor company filing an ABC requires a unique blend of bankruptcy law and community association law knowledge.

The analysis of the association’s construction defect claim against the debtor would not only take into account the merit and magnitude of the underlying claim itself but also the strength of the claim as it relates to the ABC.

The association counsel, together with experienced bankruptcy counsel, should review the number of secured and unsecured creditors of the debtor, its assets and liabilities, the priority that the association’s claim would take compared to the other claims, the amount that the association might recover through the post-liquidation payouts to creditors, and the practical nuances of an ABC in general.

Depending on how far along in the defect litigation the association may be when the ABC is filed, it is also important to consider whether the assignee will have adequate documentation regarding the association’s claim in order to effectively determine how much of the claim, if any, will be allowed.

They will typically consider all of the engineering reports and evidence of the defects, but they will also take into account the practical considerations of the total sum that the sale of the assets will generate and the sums that are due to other creditors.

An association may seek to resolve its claim with the assignee who has been engaged to liquidate the assets and make distributions on allowed creditor claims by reaching a settlement with them for an allowed unsecured claim in the ABC, staving off unnecessary attorney fees to prove the construction defect claim.

Our firm congratulates Jeffrey and Jordan for sharing their insights into this matter for community associations that file construction defect claims against defendants that resort to using the state’s Assignment for the Benefit of Creditors statute. Click here to read their complete article in the newspaper’s website (registration required).

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