Champlain Towers South unit owners will receive an $83 million payout for the loss of their condos, a controversial outcome to the monthslong dispute over how financial disbursements should be divided between those who lost loved ones and those who lost their units.
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Judge Michael Hanzman (Eleventh Judicial Circuit of Florida). |
The money, which would
come from sources including insurance and the future sale of
the site, would be divided among owners of the 136 units
based on their percentage ownership stake in the building,
pursuant to the condo declaration. In exchange, unit owners
would be off the hook from potential liability for the
collapse. A state law says condo owners could be charged up
to the value of their unit in events such as the collapse.
Still, unit owners have the right to opt out of the
settlement in an effort to receive a higher payout, but also
would be exposed to liability under the state law.
Hanzman will not deduct any insurance disbursements that
unit owners may have received so far from their own private
property policies. He said owners should not be penalized
for deciding to take out their own policy. In addition,
Hanzman won’t be deducting payouts for life insurance
policies, once it comes time for disbursements to those who
lost loved ones, he said.
Out of the total settlement, Hanzman deducted $750,000 to
cover land maintenance expenses accrued so far, as well as
for costs for the receivership and legal expenses.
The $83 million agreement was reached following months of
negotiations with court-appointed mediator Bruce Greer.
During Wednesday’s hearing, Hanzman heard moving testimony
from family members of the victims, as well as unit owners
who are dealing with the trauma of having survived the
collapse.
Eileen Rosenberg, who lost her 26-year-old daughter in the
tragedy, said that she was sympathetic to the unit owners’
economic loss, but argued that it was fair to first
compensate the families of the victims who died.
“My pain is unbearable. I am constantly suffering. My heart
is shattering into a million pieces and beyond repair. My
precious daughter unknowingly walked into a building that
was neglected and improperly maintained, which tragically
caused her her life,” said Rosenberg, whose daughter was a
visitor in the building.
“When you invest and lose money, you move on. When you lose
a child, you cannot move on,” she added.
Tali Naibryf, whose brother Ilan died while visiting his
girlfriend in the building, urged the judge to cap the
allocation to unit owners to $83 million, and to make that
contingent on the sale of the land.
“My brother was invited into the building, not warned of any
damage, and paid the ultimate price,” she said.
Unit owners who spoke took issue with the court’s
classification of them as the “property and economic loss
class,” saying they also lost friends and neighbors and have
been struggling with the trauma.
“I live with this every night when I go to sleep and when I
wake up,” said Raysa Rodriguez, who lived in a ninth-floor
unit and was able to exit the building after the collapse.
They also spoke against the state law that exposes them to
liability if they opt out of the settlement, saying it feels
as if it ascribes to them fault for the alleged lack of
building maintenance, and therefore also for the collapse.
Champlain condo owner Deborah Soriano, who escaped from her
11th-floor unit the night of the collapse, said she was
served with a notice about the state law at her office.
“Yes, I felt like a real criminal. When did [we], the
victims, turn into criminals?” she said in court. “What have
we really done wrong? None of us in that building would ever
put our lives or their lives in any type of danger.”
Some unit owners also argued that the settlement is not
enough for them to buy a new home, similar to the one they
had in Champlain, especially in light of high South Florida
housing costs. Many have been forced to become renters at a
time when the multifamily market has seen rents skyrocket.
Hanzman, who said the state law does not ascribe fault to
the unit owners but merely subordinates their equity, pushed
back on claims that property owners are being shortchanged.
“The claim that they are being victimized and penalized and
need more money, that is falling on deaf ears,” the judge
said in court. Unit owners may not be able to buy a home in
Miami Beach or Surfside, but the disbursement provides them
with a payout, as well as “certainty,” he said.
Hanzman also encouraged those opposing the settlement to
consider the alternative of allowing the case to run its
course through the court before any disbursements are
allocated.
“This allocation issue would take at least four to five
years to work its way through the courts,” Hanzman said. “In
that time period, the economic people would not receive a
dime of compensation and neither would the wrongful death
class.”
Hanzman has been overseeing the litigation surrounding the
collapse.
Last month, survivors and families of the victims of the
Surfside condo collapse sued the condo association of the
neighboring property, Eighty Seven Park, and additional
companies involved in the construction of that luxury condo
tower next door.
The filing, which marks the third amended complaint, alleges
that the former president of Eighty Seven Park’s condo
association knew or had reason to know about the damage the
construction was allegedly causing Champlain, and that the
firms involved in construction were negligent in their work.
The former condo association president worked for Terra, the
lead developer of Eighty Seven Park.
Morabito Consultants, the engineering company that Champlain
hired for its 40-year inspection and that was supervising
restoration, as well as the Champlain association’s law
firm, Becker & Poliakoff, recently settled their share of
the litigation through mediation for $16 million and $31
million, respectively.
“I know there are a lot of hard feelings in this case,”
Hanzman said. “There’s obviously some discomfort, and that
makes it even more evident this is a fair and adequate
settlement, because settlement is compromise.”