Builder files suit to recover money from condo board

Article Courtesy of  The Palm Beach Post

By Jane Musgrave

Published March 22, 2006

The construction company that has been blamed for the sky-high costs of repairing the hurricane-ravaged Tiara condominium has fired back, filing a multimillion dollar lawsuit against the Riviera Beach high-rise.

In a suit filed in Palm Beach County Circuit Court, Southern Construction demands roughly $23 million it says it is owed. It also wants a judge to order the condominium board to release millions of dollars of equipment it has held since the construction company pulled out of the job Feb. 14 because it hadn't been paid.

John Telepman, who is representing the West Palm Beach firm, said it's unfair his client has become a whipping boy for the condo board.

"He didn't call the hurricanes up and say attack that building — one, two, three," he said Tuesday, referring to hits the 42-story oceanfront tower took from hurricanes Frances and Jeanne in 2004 and Hurricane Wilma in the fall.

"All that my client did was continue working even though he wasn't getting paid and carrying the association to the tune of millions of dollars," Telepman said of the firm, which Domingo Castro heads.

Ali Kas, who became president of the condominium board shortly after suing the old board and Southern Construction for squandering money, said Southern has been paid more than $60 million.

"He's billed us over $80 million and we have nothing but an empty shell," Kas said.

He said he would be willing to return Southern's equipment, including $1.8 million of scaffolding known as mast climbers, and trailers, trash bins, an ice machine and Port-O-Lets, but he isn't convinced all of it belongs to the company.

He believes Southern charged the Tiara so much to rent equipment it owns that it belongs to the 320 condo residents. Other companies own some of the companies, as Southern acknowledges.

This month, the condo board won a $48.2 million settlement from the state-subsidized Citizens Property Insurance Corp. It had received $40.5 million from the homeowners insurer of last resort.

With some estimating it will cost $120 million to return the building to its former grandeur, Kas said the board is contemplating lawsuits against others to recoup its still-staggering uninsured losses.

Although he hopes to have glass doors installed to secure the building before the heart of this year's hurricane season, building permits have become snarled. He said he has a meeting with Riviera Beach officials today to resolve the problems.


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