Complaints against builder in Osceola, Polk pile up

Article Courtesy of The Orlando sentinel

By Mark Pino

Published March 10, 2007


FOUR CORNERS -- The state Attorney General's Office is reviewing the actions of a Florida developer based on new complaints that the company took hundreds of thousands of dollars in deposits but has not built the homes.

Sandi Copes, a spokeswoman with the Attorney General's Office, said the new complaints followed an Orlando Sentinel article on the developer, British American Homes LLC, that ran last month. The office had received six complaints in about 16 months prior to that and forwarded the matter to another state agency, the Department of Business & Professional Regulation.

"In light of DBPR's recommendations that we re-examine and in combination with new complaints, we are making a second informal review," Copes said this week.

Two couples have sued the developer in a class action in Miami-Dade County; their attorney says 100 other investors want to be included. Most are British citizens. The suit claims the company "misappropriated" deposits on vacation homes. Seven others filed separate suits against the company in Osceola circuit court.

The investors are seeking deposits of as much as $78,000 that they put down starting in 2004. Though the company had said it was developing a 243-unit subdivision on 120 acres in Osceola County, it has yet to receive county-required permits that would allow it to begin construction.

A trailer, lime-rock parking area and signs with the name Elliot's Landing were at the site this week, which showed signs of some tree clearing. A county spokeswoman said Thursday that the permit for the trailer was put on hold last year and the developer was going to have to remove it. The county was also investigating the removal of 100 trees without a permit.

"We are aware of it and investigating and will assess penalties accordingly," said spokeswoman Niki Whisler. The developer could be fined $250 per day for a first offense, and up to $5,000 per violation if the damage is irreparable, said Whisler, citing state law.

In addition, the company took thousands of dollars in deposits on another development in Polk County, other investors told the Sentinel. But attorneys said the company did not own the land, and a Polk County planner could find no record of a project planned there.

A Web site hosted by Investment Property Shop states that British American Homes' Chelsea's Landing subdivision in Davenport will have 160 four-bedroom Mediterranean-style villas. "Chelsea's Landing will be a master planned resort community with the elegant lifestyle and ambience of the Mediterranean captured in a spectacular setting," the Web site says.

But the real-estate agent handing the $9 million property said British American Homes failed to close on a deal to buy the 33-acre site last year. "They did not even show up," Abdulfattah Abdullah said. Hudson Gabay, who heads British American Homes, could not be reached for comment. The company's Miami number was not in service, and he did not return calls to a Central Florida office.

In an e-mail to an investor this week, Gabay wrote that the project would be in front of a county review committee within the next six weeks. County officials said the developer has taken no action on the project since last year when negotiations about a road ended.

The class action suit filed against British American Homes, Sega Ventures Ltd. and Gabay individually alleges violations of the Florida Racketeer Influenced and Corrupt Organization Act. "It is believed the defendants have misappropriated the deposits of the plaintiffs and have no intention of returning deposits," the suit states.

It seeks return of the deposits and asks that work on the subdivision be stopped until the plaintiffs receive "all monies owed." The suit also seeks attorney fees and damages.

"All my clients want is their money back," said Omar Ortega, one of the attorneys involved in the suit.

Natalia Munoz, another attorney working on the case, said the suit asks for the company to comply with a court order by providing records of its finances, the business relationship between the defendants and identification of every plaintiff that entered into a purchase contract.

The head of a group that helps connect British customers with properties in Central Florida said he was concerned when a spate of developers started projects in the U.S. Highway 27 corridor several years ago.

Builders with no track record started pitching projects to British clients when speculation in the local real-estate market was at a fever pitch, said Peter Stanhope, president of the Florida Brits Group. He said he has been tracking about "five to seven developments that haven't developed."

But some investors, such as Nigel Ellis, don't want to give up on owning a vacation home in Central Florida.

It's been about two years since Ellis, who works for an American bank outside of London, signed a contract for a "vacation villa" at Elliot's Landing in the booming Four Corners area where Orange, Osceola, Lake and Polk counties meet. He's still on the fence between taking legal action and waiting a bit longer to see if his $78,000 investment pays off.

"It's very frustrating and worrying," Ellis said. "Part of me wants to join the legal action groups, and the other part wants to stay in and have our villa built. I feel like I'm between a rock and hard place and really don't know what my best move is right now."

When he invested, Ellis said, he assumed his money was safe because of "strict laws" in this country.

"It's a stable, solid country. I'm surprised," he said. "It's worth waiting for. But if nothing comes out of it, it will have been a horrible experience: Your dream home has turned out to be a nightmare."