In late 2006, purchasers were eager to buy units in a “luxury” new construction condominium being built in the heart of trendy Williamsburg. Purchasers closed on 19 of the 29 units (the condominium’s sponsor retained ownership of the last ten units). Shortly after closings began, unit owners began to realize that despite the fancy marketing, the building was rampant with construction defects.
Myriad calls and letters to the condominium’s sponsor, and its principal, resulted in no response to the board or unit owners. The board began sinking its operating funds into remediating the construction defects on its own. Unit owners grew weary and impatient, shelling out much more than anticipated in common charges and special assessments.
The board turned to Adam Leitman Bailey, P.C. for help.
We contacted local politicians, submitted a complaint on behalf of the board to the New York State Office of the Attorney General, and filed a Summons with Notice in State Supreme Court.
Finally, after months of negotiation and mediation before the Office of the Attorney General, the sponsor reluctantly signed a settlement agreement with the board. The settlement included transfer of the sponsor’s ten remaining units to the board and a cash settlement to offset the cost of remediation that the board had previously undertaken. And, as a further guarantee for the future cash payments, the settlement included a personal guaranty and confession of judgment for a balloon lump sum should sponsor fail to make timely payments pursuant to the agreement.
The building has now become the building that was promised in the offering plan and serves as a wonderful place for its residents to live.
Adam Leitman Bailey and John M. Desiderio were on the legal team at Adam Leitman Bailey, P.C. representing the board.