Monday, June 5, 2017

Becker & Poliakoff Wins Multi-Million Dollar Jury Verdict In Landmark Construction Case



FOR IMMEDIATE RELEASE
Media Contacts:
Kris Conesa or Andi Phillips
Roar Media
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Jury Finds Subsidiary of National Developer Hovnanian Enterprises Inc. Liable for Breach of Contract and Violation of the New Jersey Consumer Fraud Act 

MORRISTOWN, NJ & FORT LAUDERDALE, Fla. – June 5, 2017 – Becker & Poliakoff secured a landmark $9 million-plus jury verdict Thursday against a subsidiary of Hovnanian Enterprises, Inc. (NYSE: HOV). The award includes punitive (treble) damages for violation of the New Jersey Consumer Fraud Act and also entitles the plaintiff to recover attorneys’ fees, costs and prejudgment interest. The jury found that Hovnanian Enterprises used the subsidiary as an instrument to commit a fraud or injustice on purchasers of condominium units. The ultimate recovery against all parties, including the project architect and geotechnical engineer, could exceed $20 million.

After a six-week trial in New Jersey Superior Court (Docket No. HUD-L-2560-13), the jury agreed that Hovnanian, after learning that the condominium building was being improperly constructed with plywood flooring in violation of the building code, chose to nevertheless continue construction. Hovnanian then sought to reclassify the building type. The jury agreed with the plaintiff’s position that the reclassification was never approved by governmental authorities. The units were then sold without disclosing the code violations or the lack of approval to the buyers. The claim arose out of construction problems with the six-story, 132-unit residential and commercial building in Port Imperial, West New York, NJ.

Matthew Meyers, a Shareholder in Becker & Poliakoff’s Morristown office, represented the homeowners and initiated the suit against Hovnanian. “Hovnanian knew that the use of combustible materials in the flooring was in violation of the building code, and instead of fixing the mistake, attempted to change the building’s classification. They then sold units knowing that the change in classification had never been approved. They continued to arrogantly defend their conduct at trial but the jury would have none of it. Hopefully, after this verdict, Hovnanian will get the message.”

“A key point making this landmark case particularly unique is that the parent company, Hovnanian Enterprises, was found to have used its shell subsidiary to perpetrate an injustice on the condominium unit buyers,” said Becker & Poliakoff shareholder John Cottle, who was first chair/lead trial counsel in the case representing the homeowners. “This is a rare instance in which the ‘corporate veil’ was pierced, and we expect the result of this will be that Hovnanian Enterprises will ultimately be held responsible for the judgment.”

In addition to Cottle, the Becker & Poliakoff trial team from Florida included: Perry M. Adair, Miami managing shareholder and a board-certified construction law attorney; and Sanjay Kurian, a shareholder and board-certified construction law attorney. The New Jersey team included Vincenzo Mogavero, a shareholder and litigation Chair and Martin Cabalar, in addition to Mr. Meyers. 

About Becker & Poliakoff
Becker & Poliakoff, with headquarters in Fort Lauderdale, Fla., is a multi-practice commercial law firm with attorneys, lobbyists and other professionals at offices across the United States. More information is available at www.bplegal.com.

Friday, May 12, 2017

David Ramsey Receives CAI Distinguished Service Award

Hearty congratulations go out to J. David Ramsey, shareholder in Becker & Poliakoff’s community association practice group. David was recently honored with the Distinguished Service Award at the Community Associations Institute’s (CAI) Annual Conference Awards dinner in Las Vegas.

The Distinguished Service Award is CAI’s most prestigious award and is periodically presented in recognition of longstanding, extraordinary contributions to the Institute. A member of CAI for over 30 years, David served as president in 2003-04 and remains actively involved in CAI’s Government and Public Affairs Committee, chairs the New Jersey Chapter’s Strategic Planning Committee and is a member of the New Jersey Legislative Action Committee. David has spent the majority of his legal career advocating on behalf of community associations, particularly in New Jersey and New York.


Tuesday, February 7, 2017

NO BANK ACCOUNT, NO EMPLOYMENT, NO PROBLEM

 
Once a judgment for condominium arrears is entered and various post judgment enforcement remedies have proved unavailing to locate assets, i.e. there are no bank accounts in the debtor’s name and no employment information can be located, there is one more tool in the toolbox!

New Jersey Court Rule 4:59 - 1 (d) (1) permits a judgment creditor to file a motion for an order to sell real property where the judgment debtor's assets are insufficient or cannot be located. The Appellate Division recently reversed an order denying such relief where the lower court held that notice to the mortgagee was a prerequisite. The relevant consideration under the rule is whether the judgment creditor made reasonable efforts to locate personal property. If you have an unsatisfied judgment, this remedy may be available as an alternative to a lien foreclosure. This strategy has been effective to bring delinquent condominium owners to the table when no bank accounts or employment can be located.

Submitted by :  Angela M. Morisco, Esq.

Thursday, January 12, 2017

Q&A: Disclosure of Tenant Information


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Q:        Does a condominium association board have an obligation to disclose information to an owner about an individual who is leasing a unit? If the lessee has a permanent guest with a criminal background does the board have an obligation to disclose this to the owner? 

A:        Typically, a condominium association in New Jersey would not have an obligation to disclose information to an owner about another resident who is renting a unit or is a guest in a unit. The New Jersey Condominium Act sets forth the duties of a governing board of a condominium association. With respect to disclosures, the Condominium Act specifically requires the association to maintain accounting records, in accordance with generally accepted accounting principles, open to inspection at reasonable times by unit owners. See N.J.S.A. 46:8B-14(g). Such records include (i) a record of all receipts and expenditures and (ii) an account for each unit setting forth any shares of common expenses or other charges due. The Condominium Act further states that the board shall have such other duties as set forth in the master deed or bylaws. N.J.S.A. 46:8B-14(i). Therefore, unless the master deed or bylaws set forth disclosure obligations in addition to those above, there is generally no duty to disclose information with respect to tenants.

Nevertheless, the Condominium Act still requires the board to exercise its power and discharge its functions in a manner that protects and furthers or is not inconsistent with the health, safety and general welfare of the residents of the community. Thus, where there is a risk of foreseeable criminal harm, an association has an obligation to take reasonable action.  What that reasonable action may be depends on the particular facts. Therefore, the board must balance the possibility that any specific notice to other residents of the community may result in the resident that lawfully resides in the community being harassed by other residents, thereby creating a potential liability for the association. This is a very complex balancing act for the board and it should not be undertaken without the advice of the association’s attorney. 


It would be a rare case in which notice of past criminal history of a resident should be reported to the other owners in the community. That determination should be made in consult with the association’s attorney and consider the type of crime committed (such as whether the crime was violent in nature), the age of the person at the time the crime was committed, the length of time since the crime was committed, and the amount of time during which the person has not been subject to incarceration and has not committed another crime. Even where the decision to disclose such matters is made, the board should ensure that the notice is limited to purely factual matters.