February 17, 2025
Share$5.8M Hurricane Mitigation Claim Settled
Kelley Kronenberg Partner and Construction Law Division Chair Gary Brown and Attorney Ethan Goldstein secured a favorable settlement in a complex post-Hurricane Ian water mitigation dispute. The case involved both breach of contract and lien foreclosure claims for our client’s completed emergency mitigation work at a beachfront condominium, with initial unpaid claims exceeding $5.8 million.
When the condominium association received but failed to properly distribute insurance proceeds specifically earmarked for our client’s work, Gary successfully secured receipt by the client of $3.2 million through negotiations backed by threats of immediate litigation including injunctive relief to prevent misappropriation of these funds. When further negotiations stalled regarding the remaining amount owed, our team then filed suit to foreclose on the client’s lien and simultaneously demanded binding arbitration under the contract to recover the remaining $2.6 million balance due.
The association raised multiple defenses, including allegations of insurance fraud, fraud, lack of authority of the association’s property manager to sign the contract, negligent performance of the work resulting in over $765,000.00 in damages, and that the client received overpayments exceeding $1 million. However, Gary and Ethan effectively countered these claims by demonstrating express or implied authority, waiver, and/or estoppel on the property manager’s authority, that the demolition work was performed within industry standards, and that the contract terms and billing records fully supported the amount due.
The matter resolved the day prior to arbitration, with our client receiving $2.1 million plus an assignment of rights to pursue additional flood carrier benefits valued at $1.5 million. This outcome successfully avoided potential exposure to the client of $300,000.00 to $400,000.00 in attorney’s fees and nearly $1.8 million in claimed damages if the association prevailed.
This hard-fought resolution vindicated our client’s claims while providing both immediate compensation and potential future recovery opportunities through the assigned claims.
Learn more about Kelley Kronenberg’s Construction Law Division here.