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. |