Pompano condo association accused of blocking unit's sale to make profit for itself
Article Courtesy Sun Sentinel
By Joe Kollin 
Posted December 22, 2003 

It seemed like a straightforward real estate deal: Rochelle Gordy, a widowed mother of two grown children, was selling her oceanfront condo to her good friend, attorney Richard Capalbo.

Their deal called for him to pay $225,360, the amount remaining on Gordy's mortgage, for the two-bedroom, two-bath unit in Pompano Beach that she bought in 2001.

A real estate investor, Gordy said she wanted Capalbo to have the eighth-floor apartment in Admiralty Towers at 750 N. Ocean Drive because it would put him only a mile from her house.

"This was going to be a dream place for us, a little Shangri-La," Capalbo said.

But as with nearly all condo associations, the Admiralty requires owners to offer their homes to their associations first. Called the right of first refusal, experts say it is a legal way to protect property values, although it is rarely used.

"Sometimes purchasers have backgrounds that don't look favorable, and an association has someone else it would rather see in the unit," said Robert Kaye, whose law firm originally represented the Admiralty in this case.

In this case, the buyer was an attorney in good standing and there were no other buyers in line.

Still, the Admiralty's board of directors invoked the clause, telling Gordy it would pay her the same amount reflected on her sales contract with Capalbo.

Saying it was a special deal between friends, Gordy refused to sell.

"It wasn't like he's someone off the street. I was selling for the balance of the mortgage, I wouldn't do it for anyone else," she said.

The Admiralty board said it thought Gordy's $225,360 selling price would lower the value of other apartments in the 20-story building. Real estate records show that since 2000, three two-bedroom, two-bath apartments were sold, all in September and October. Prices ranged from $245,000 to $290,000.

Gordy said she told the board, "this wasn't a bona fide transaction, it was more of a family transaction."

A director suggested revising the contract to show a higher sales price, she said. She did. But the board wouldn't accept it and filed suit instead, asking Broward Circuit Judge Victor Tobin to force her to sell to them.

"They shattered our dream and still aren't letting us do a thing with the apartment," said Gordy, adding the unit has been empty for nearly a year, since her tenant moved out.

"They aren't letting us rent it, not letting us sell it. We're paying the maintenance, paying the mortgage and paying the taxes, they're holding this over us like they are some sort of Gestapo," said Gordy, who owns 45 rental units, including 40 apartments in a Lauderhill complex where she, ironically, is president of the association.

When it became obvious he couldn't move in, Capalbo bought a house near Gordy in Lauderdale-by-the-Sea, spending $345,000.

"I told the president I'm not moving in; you don't want me to, so I bought a house instead," Capalbo said. "I asked why he was pursuing this, and he said it was to make money."

Condo boards are not supposed to be profit-making entities.

Kaye wouldn't discuss further details. The board's current attorney, Stuart M. Smith, wouldn't comment. Association President Anthony Sannasardo referred calls to Kaye.

Although the sales contract was signed in January and the association filed suit in February, Tobin has yet to hear the substance of the case. What he has heard, however, made him angry.

Admiralty delayed the case for months because, it told the judge, it couldn't find Gordy to serve the required notice of the suit. Saying it didn't know if she was alive or dead, the association asked Tobin to appoint a guardian to protect her interests and to let a legal advertisement serve as official notice.

Gordy later learned of the suit and Capalbo in September asked the judge to dismiss it. He pointed out she has been living continuously at her Lauderdale-by-the-Sea house, had been making all maintenance payments to the Admiralty association, received a notice of special assessment from the Admiralty and owned more than 40 other properties in Broward that all reflect her correct home address. There was no excuse, he said, for not locating her.

"She's `dead' but they're taking her monthly maintenance," Capalbo said.

The judge called the Admiralty's attempts to serve her a "total sham" and, refusing to believe the association's arguments that it couldn't find her, said, "I am not a moron."

He hasn't said when he will rule on her motion to dismiss the suit.

Capalbo said he has learned a lesson.

"There should be a requirement to warn buyers about what they are getting into ... that they are vulnerable when they buy into an association," he said. "There has to be more uniformity in the enforcement of bylaws to prevent abuse by boards and their attorneys."

The state House Select Committee on Condominium Association Governance is investigating ways to protect unit owners from boards.

Should the judge rule in her favor, Gordy plans to get rid of the Admiralty unit.

"I just want to sell the apartment and recoup our money and find the right Shangri-La for the both of us somewhere else," Gordy said.