The Real Deal Miami

Jupiter condo association owes $600k in unpaid Hurricane Irma repairs: lawsuit

Rolyn Companies wants the association to be compelled to enter arbitration to settle the debt
By Francisco Alvarado | March 07, 2018 04:57PM

Ocean Trail on the waterfront in Jupiter (Credit: Redfin)

Six months after Hurricane Irma raked Palm Beach County with tropical force winds and a 5-foot storm surge, the condo association for an oceanfront residential building in Jupiter allegedly hasn’t been able to pay for more than $500,000 in repairs, according to a recently filed lawsuit.

Delray Beach-based Rolyn Companies sued Ocean Trail Condominium Association No. 1 last month for breach of contract in Palm Beach County Circuit Court.

The complaint highlights the difficulty condo associations face in quickly coming up with funds to fix storm-related damage, legal experts say.

Rolyn alleges the association hasn’t paid $598,734 for emergency work done to the building in the immediate aftermath of one the modern era’s deadliest hurricanes. Rolyn attorney Ryan Lamchick and the property manager for the condo building in Jupiter did not return phone messages seeking comment.

Josh Migdal, a partner with Mark Migdal and Hayden, who is not involved in the Ocean Trail litigation, said condo associations typically rely on insurance companies to cover the cost of repairs caused by a catastrophe, but in some cases the work is completed before a claim is paid.

“The reality is that most associations don’t have cash on hand to pay for immediate repairs,” Migdal said. “When you couple that with insurers that may not pay claims, you have a recipe for disaster.”

Condo associations could also approve special assessments, but there is no guarantee that unit owners will pay it, Midgal said.

Built between 1975 and 1983, Ocean Trail is a development consisting of five buildings that sit directly on the beach. Each building is 14 stories tall, and all the units have two bedrooms and two bathrooms. The sizes range from 1,170 square feet to 1,600 square feet and current listings show units are asking $300,000 to $600,000.

According to Rolyn’s complaint, condo association treasurer Roderick MacGregor signed an emergency work authorization on Sept. 13, 2017 giving the general contractor the green light to fix “fire, water, storm and other casualty damage” to Ocean Trail No. 1 caused by Irma on Sept. 10. Rolyn completed the job, but the condo association failed to pay the bill, the suit alleges. The company is also seeking damages, interest and attorney fees.

As part of its lawsuit, Rolyn filed a motion requesting a judge compel the association to enter arbitration to settle the debt.

Laura Hanrahan contributed to this report.