Article Courtesy of The Naples News

By Laura Layden

Published May 20, 2011

NAPLES — At Granada Lakes Villas in East Naples, the resort-style pools are closed and the clubhouse is padlocked.

It has been that way since April 2009.

A years-long legal battle has pitted the condominium association against the developer. At times, the fight has escalated to personal attacks.

A half-dozen lawsuits have been filed in Collier Circuit Court involving Granada Lakes Villas, the condominium association, the developer and individual condo owners.

The developer – Metro-Dade Investments Co. based in Miami – refuses to give owners access to the pools or the clubhouse.
   

You’ll see tons and tons of foreclosures. Banks lost a lot of money on this place,” said Douglas Rankin, a Naples attorney.

He represents several owners who have sued the developer in an attempt to get their money back. They sued to rescind their purchase contracts after discovering shoddy construction done by an unlicensed contractor, following a conversion from apartments to condos.

The developer was a late-comer in the apartment-to-condo conversion craze that hit Southwest Florida in 2004. After the conversion, the developer was left with dozens of unsold condos when the housing boom went bust in Southwest Florida. Those condos now face foreclosure.

The president of Metro-Dade Investments is Armando Bucelo Jr., a Coral Gables attorney who once served as special counsel to the city of Miami’s code enforcement board. His attorneys declined to comment for this story.

In late 2009, the developer advertised an auction for the 55 condos it still owned. But the auction was abruptly halted after the condo association filed liens against all of the developer’s condos for unpaid monthly assessments.

In Metro-Dade’s lawsuit against the condo association, the developer describes the liens as “fraudulently exaggerated,” designed to interfere with the sale of its condos. The liens are for more than $500,000.

  
The developer also accuses the condo association of depriving the master association of fees needed to pay utility bills, make repairs and to cover other management costs for common areas, such as the clubhouse and the pools.

In the lawsuit, Metro-Dade says it fronted money for maintenance and other management expenses and that it’s owed more than $54,000 by the condo association.

The developer urged a judge to appoint a receiver to manage the community and to collect the monthly assessments for maintenance. A judge denied the request, but it’s on appeal.

“The other side is trying to say they don’t owe any money,” attorney Rankin said.

Miami attorney Jose Herrera, a co-counsel for Metro-Dade Investments, declined to discuss details of the case, but said: “We have total confidence in the judicial process and we have a judge that I believe grasps the issues and we have every confidence in the process.”

Rankin said the developer walked away from the community in 2008, “leaving the place with no money” to pay the bills, then returned in 2009 to take it back over — changing the locks and padlocking the clubhouse and pools, which were being maintained by the resident-run condo association.

In the development, more than 20 condos were gutted and renovated by an unlicensed contractor, which did other work throughout the complex, including repairs related to Hurricane Wilma in 2005.

Point.“You’ll see tons and tons of foreclosures. Banks lost a lot of money on this place,” said Douglas Rankin, a Naples attorney.

Counterpoint. Miami attorney Jose Herrera, a co-counsel for Metro-Dade Investments, declined to discuss details, but said: “We have total confidence in the judicial process and we have a judge that I believe grasps the issues and we have every confidence in the process.”

Because of shoddy construction, some condos are filled with mold and are unsafe to live in due to faulty wiring and other defects, Rankin said.

“These units are not worth a whole lot because of all these problems,” he said.

The company that remodeled the condos was a Miami-based painting company, going by the name Maxitaty. It never had a license to do business in Collier County. The company never had a Florida license either and it’s now out of business, state records show.

Collier County Code Enforcement has received several complaints about mold growing at Granada Lakes Villas. In one case, the county has been forced to hire a contractor to fix the problems in a condo with a major water leak. The owners, who face foreclosure, abandoned the condo, which wreaks of mold and isn’t livable. Once the work is done, the county will send an invoice to the owners and if the owners refuse to pay it they will get a lien put on their property for the amount owed. Meanwhile, fines of $250 a day are mounting.

“The taxpayers are going to have to pay for that one,” Rankin said.

With the mess, prices have dropped more dramatically at Granada Lakes than in other communities similarly hit by the housing crisis. Some condos have sold for less than $20,000. At one time, they went for more than $200,000 with upgrades.

“This complex is going to take a long, long time to recover from this,” Rankin said.

* * * * * * * * * * 

Paolo Ferrari, president of the Granada Lakes Condo Association, bought four condos in the community as an investment. None of his units were remodeled, so they don’t have mold or other defects caused by the unlicensed contractor.

The condos, however, are in buildings where there were renovations done by Maxitaty.

Ferrari has sued to get his money back, contending the problems in other condos and his buildings make it impossible for him to resell his units for a fair price.

In Florida, any defects known by a seller must be disclosed to a buyer, including any work done by an unlicensed contractor, Rankin said.

In court filings, the developer’s attorneys have argued Ferrari isn’t entitled to a refund, as he agreed to purchase the condos “as is,” and any work performed on them “passed all required inspections.”

Ferrari lives in the Naples area but not in Granada Lakes and rents out all of his condos.

As president of the condo association, he personally has been sued by Metro-Dade Investments. The developer alleges he and other directors of the condo association have attempted to “wrestle away” power from the master association.

In its lawsuit, Metro-Dade says the condo association has refused to turn over the master association’s fees and assessments and has even taken away its golf cart. The condo board, the developer alleges, has carried out Ferrari’s “personal plan,” making it seem that the master association’s board is incompetent.

Ferrari and the other members of the condo association argue they are just trying to “ensure the proper operation of the community.” They say the developer intentionally underfunded the community, causing chaos. The master association, they allege, has tried to improperly collect assessments from owners.

Ferrari also is entangled in a lawsuit with Maggie Pedraza, who the developer hired as a property manager for the master association. She has accused him of harassment, which he denies.

The suit contends he created a hostile working environment for Pedraza, making sexually obnoxious comments about her and questioning her honesty.

“I have never been accused of such allegations before in my life,” Ferrari said. “I have been married to the same woman for over 22 years. I have three wonderful kids. They all know what kind of husband and father I am.”

In his own lawsuit, Ferrari alleges Pedraza sued to “extort” him, in an attempt to get the condo association to release its liens on the developer’s units.

“They are desperate to get these units kicked loose of those assessment liens so that they can sell them and run away,” Rankin said.

Ferrari hopes the legal battles will end soon.

A judge has ordered the developer and the condo association to go to mediation to try to resolve their problems.