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Final battle over Colony ownership rages in court

STEVE REID
Editor & Publisher
sreid@lbknews.com

It is a known fact that following death nothing can be more painful, contentious and divisive than children and relatives fighting over the estate. And nothing has died more slowly and with more waves of litigation than the once world-famous Colony Beach & Tennis Resort, which brought generations to its 17.3 gilded acres on the Gulf of Mexico.

Fortunately, it appears that the battling is coming to its final days and if a court hearing this week is any indication, the Judge will push for closure at an “expedited” pace.

At issue is the request by Unicorp to terminate the Condominium Association and provide a path to consolidate ownership using the court.

 

In court…

Unicorp received approval from the Town of Longboat Key to redevelop the property almost a year ago, but it cannot receive a building permit until it consolidates ownership.

Since approving Unicorp’s plan, which is to build 166 St. Regis Hotel Suites and 78 condominium residences, the entire site has been demolished and cleared by court order. That action was sought by the Town after the town’s Building Official deemed the structures a hazardous threat and public nuisance to the community. That action once and for all ended any assertion or speculation made by some parties that the old resort could be rehabbed.

All of these issues came into play this week in Sarasota Circuit Judge Hunter Carroll’s courtroom when Unicorp’s desires were fought by Andy Adams and his legal team.

Adams owns more of the former Colony units, 74, than anyone else and has fought the demolition, the approval of the St. Regis project and now the request by Unicorp to terminate the condominium and consolidate ownership.

In court, Adams and his attorneys filed and argued what is known as an “affirmative defense,” which is an assertion of fact or law that if true, would stop the action desired by Unicorp.

The defenses ranged from stating that Unicorp is seeking to violate the rights of Adams to statements arguing that the Association of Unit Owners did not and does not have the right to enter into either a development plan or “the purported termination plan.”

Adams made other arguments, 11 in total, that also asserted that the termination plan sought by Unicorp would favor Unicorp.

One of the more interesting arguments made by Adams is that Unicorp and the Association “acted in consort to neglect repairs to the common elements, or otherwise prohibited such repairs for being made, which has resulted in the demolition or destruction of the property.”

Of course, these assertions and arguments were not met without a strong opposition. Unicorp attorneys asked the Judge to strike all 11 of Adams’ Affirmative Defenses, or arguments, and said they were “insufficiently pleaded, state mere denials or conclusions, and/or are immaterial to this action.”

Unicorp’s arguments as a whole were favored by the Judge who struck most of Adams’ Affirmative Defenses and allowed some to be fleshed out within the next 10 days, but the Judge said he was dubious and doubtful that they would survive.

Many of the arguments by Adams were stricken by the Judge based on misstatements of facts and contractual provisions and in one case because the Affirmative Defense was not an Affirmative Defense by definition.

For instance, at the hearing attorneys for Adams said that before termination can occur, the Association must be bound contractually to settle all claims and debts. But Judge Carroll did not see it so simply.

“I get the point that winding up affairs and that the resolution of what to do with property will impact clients like you who want to collect money, but that will not affect the motion to terminate and I’m going to strike,” said Judge Carroll.

Another attorney for Adams accused Unicorp of conspiring with the Board of the Association to not inform members on the status of redevelopment and he said, “We have a claim against Unicorp for not preparing a proper examination of the cost to redevelop the Colony.”

The Judge asked that attorney if he had filed a counter or cross claim, and the attorney said, “Not at this time.”

The Judge struck a motion made by Adams and his attorneys that essentially found fault with the Association’s behavior in deciding to go with Unicorp. The argument about this matter continued with attorneys saying that the Association was also negligent in not getting other bids and advising on the cost for repairs.

At this juncture, Judge Carroll said he questioned whether the theme of conspiracy being alleged was relevant to the termination procedure at hand. He did grant the attorney 10 days to flesh out and amend the motion to make a conspiratorial argument. That attorney said he will bring, “unclean hands,” claim over the conduct over the Association.

The Judge replied, “I’ll give you 10 days but I’m dubious where you are going to go.”

Another attorney for Adams argued to the Judge that his side had “attempted to lay out the bad conduct of Unicorp.” He added that Unicorp is asking the court to pick an appraiser and ask the appraiser for fair market value of the units.

The attorney was arguing against the request by Unicorp for the Judge to terminate the Association and then implement a termination plan that would value the units and a sale would occur under what is known as “Equitable Relief.”

At this point Adams’ attorney said his client owns more than 30 percent of the property.

The Judge said that he had read that Adams wants the property divided wherein he would receive specific waterfront land of about five acres in compensation for his units. In essence, Adams wants to cut the property up physically among the unit owners.

Judge Carroll said that how the ownership is divided or valued or is the path of Equitable Relief and that the position that makes the most sense is the end of that path.

 

The Association attorney speaks

The attorney for the Colony Association of Unit Owners, which is aligned with Unicorp in the plan to redevelop and in the court actions, told the Judge, “With all due respect, unit owners don’t own the land; they own space between the walls. The question is, is this property divisible or indivisible? We will ask that the court find it indivisible. We will ask for a magistrate to hold a public sale.”

The Judge asked the attorney for Adams if Adams really sought to rebuild the property. The attorney for Adams replied that Unicorp and the Association were attempting to take the property from the largest owner at the Colony.

The Judge then said he had divorced the idea of termination of the condominium from the issue of how to settle out the ownership assets.

Adams’ attorney said the whole issue is about the rights of the property owners. To this, the attorney for the Association countered that he represents owners who have been denied use of the property or able to enjoy the right to the redevelopment agreement they made three years ago with Unicorp.

Next, a Unicorp attorney mentioned that two people who owned units had recently died.

The hearing was running out of its allotted time and Judge Carroll said he was thinking of appointing a receiver for the assets and interests of the unit owners. He said he was concerned that with so many disparate interests that he would have to find someone everyone could look to and believe has the best interests of everybody.

“That may be a way to get parties to realize it may come to be more in the court’s hands than your hands,” said Judge Carroll.

The attorney for Adams made a final argument that appeared in the courtroom to aggravate the Judge. He asked the Judge what the basis was for expediting the hearings and the resolution of the entire matter.

The Judge said there are a lot of good issues and reasons to move quickly and the parties have a right to expedite. The attorney for Adams continued to argue and question the pace the Judge is moving and the Judge shot back, “If you are objecting to expediting, file a motion and we will hear that at the next hearing.”

The ownership saga will continue at the next court hearing scheduled at 8 a.m. for Thursday, March 7 in front of Judge Carroll.

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Longboat Key News

3 Responses for “Final battle over Colony ownership rages in court”

  1. Steviep says:

    To think I almost bought one of these units 20 years ago…..

    What a shame this whole mess is!

  2. Bob Haley says:

    Andy Adams and the remaining owners of condos never owned the land!
    They should have taken reasonable offers made to them from Unicorp on their existing units.
    The land should belong to Unicorp and this ridiculous circus should end and they should be allowed to proceed with the development.
    Bob Haley –Seaplace

  3. Always a pleasure to receive and read your Lonboat News. Wolfgang Will

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