Should We Avoid a Building Whose Board Is Suing a Developer Over Construction Defects?

Sept. 1, 2015 — The condo we want to buy is in a building where the board is suing the developer over construction defects. What should we do?

Run, buyer, run! In almost all situations the ordeal – the battle – begins with the burden of proof falling on unit-owners by having to document construction defects with costly engineering reports and seemingly endless attorney correspondence. And when paperwork is together and complaints are filed with the state’s attorney general – an arduous process – the already difficult developer makes things worse by strategically “taking responsibility” for only parts of a complaint. This developer tactic turns what should have been a resolution into punch-list-item argument between engineers and lawyers over what is or isn’t a repair.

Expensive lawsuits become inevitable, where settlements or awards, after deducting attorney and engineering fees, leave little or nothing to pay for the repairs. In the end, condo boards have little choice but to turn to unit-owners to foot the bill for developer defects. The dream apartment soon becomes a nightmare.

Carl Borenstein is president of Veritas Property Management.