Judge Says $48M in Coverage for Collapsed Condo Tower Won’t Be Enough

Five lawsuits have been filed against the Champlain Towers South Condominium Association in Surfside, Florida as of Thursday afternoon as plaintiffs move to preserve evidence at the site of the partially collapsed high-rise to stake a claim to a share of the reported $48 million in insurance coverage available.

Miami-Dade Circuit Judge Michael Hanzman held an online emergency meeting Thursday morning. Attorneys for the condo association told him that they are aware of a $30 million property insurance policy from Great American and $18 million in liability insurance, according to a webcast of a segment of the hearing posted by the Miami Herald.

“It looks like for the property damage claims and for the injury and death claims there’s going to be a total of $48 million, which will obviously be inadequate to compensate everyone fully for the extent of their losses,” Hanzman said. “I don’t know whether there are any third-party claims. Maybe there are, maybe there aren’t. But we are dealing certainly with a limited pot as far as insurers go.”

As of Thursday, rescuers had found the remains of 18 people who had perished in the collapse of the condo tower and 145 residents were missing. The search and rescue effort was suspended on Thursday after movement in the debris pile raised concerns that the still-standing portion of the condo tower may fall as well.

A public relations firm hired by the condominium association board issued a statement on Friday saying that an independent receiver should be appointed to oversee the legal and claims process. Hanzman said during Thursday’s hearing that he was considering such an appointment.

“The collapse of Champlain Towers South is an unspeakable tragedy that has devastated our community, our neighbors, and our friends,” the association said. “We are grieving and our hearts ache for those who have been lost and for their families. They have our deepest condolences.”

Miami-Dade court records show that plaintiffs are suing the association and also a structural engineering firm and an architectural firm that participated in the 40-year recertification of the building. Morabito Consultants inspected the building in 2018 and reported that the pool deck was improperly constructed, causing water damage to the concrete below. SD Architects also participated in the recertification process.

The suits filed so far:

• A construction defects lawsuit by plaintiffs Steven, Mark, Shoshana and the estate of Harold Rosenberg against the association; Morabito Consultants and SD Architects.
• A premises liability lawsuit filed against the association by Alex J. Anton and the estate of Beatrice Guerra Rodriguez.
• A contract and indebtedness lawsuit filed against the association by Raysa Rodriguez.
• A construction defect lawsuit filed against the association by Manuel Drezner
• A construction defect lawsuit filed by Steve Rosenthal.

“There will be many people to blame for the tragic collapse of the Champlain Towers South Condominium. Therefore, it is crucial now to locate and preserve all of the relevant discovery and materials,” states the lawsuit filed by Rodriguez, who owns Unit 907 of the destroyed condo building.

At least one insurers has already agreed to pay up. The Miami Herald reported that an attorney for James River Insurance pledged during the hearing to tender the full $2 million limit on a liability insurance policy issued to the condominium association.

Donna Berger, an attorney who represents the condominium association, told USA Today that it was “despicable” that a lawsuit had been filed assigning blame while emergency crews were still searching for survivors.

But Chip Merlin, a Tampa attorney whose law firm represents Rodriguez, said a two-year claim filing deadline imposed by Senate Bill 76, signed into law by Gov. Ron DeSantis on June 11, forces attorneys to assert their clients rights early on. Merlin railed against the bill during his regular Tuesday webcast, saying it will harm people with complicated claims, such as his Champlain Towers South clients.

“How can you make a claim for law and ordinance in two years when the claim for it will not ripen for three years because it takes that long to do major work?” he said in an email in response to a question by the Claims Journal.

Attorneys for the Rosenberg family asked the court for permission to fly a drone over the rubble pile, according to media reports.

The Morgan & Morgan and Saltz Mongeluzzi & Bendesky law firms stressed the importance of early intervention to preserve evidence in the complaint they filed in Miami-Dade Circuit Court. The two firms said they have experience in litigation related to previous structural collapses in Philadelphia, Atlantic City and New Orleans.

“On the basis of this extensive experience in building collapse litigation, plaintiffs’ counsel has seen first-hand that the evidence immediately observed and documented at a collapse site is often the most critical evidence in the case and can lead to figuring out how the collapse happened,” the suit says.

Stephen Marino, an attorney with Ver Ploeg & Marino in Miami, said most of the recovery to homeowners for property damage to the Champlain Towers building would likely come from the association’s property insurance policy. He said condo owners often buy additional coverage to insure their personal property, but that would not go toward reconstruction of the building.

He said judging by press reports, lengthy litigation seems inevitable. The Miami Herald reported the condominium association directors resigned their positions in 2019 because of constant squabbling over a potential $15 million special assessment to make repairs. A former city official reportedly told residents that the building was in good condition.

A negligence lawsuit would require the plaintiff to show that a responsible party knew or reasonably should have known of a defect, but failed to correct it, Marino said. More must be known about what caused the collapse before assigning blame.

“There seems to be a several-year history of awareness of a significant structural issues and a seeming, if not failure, at least a seeming slow approach to repairing those issues,” he said.

About the photo: Search and rescue personnel work atop the rubble at the Champlain Towers South condo building, where scores of people remain missing almost a week after it partially collapsed, Wednesday, June 30, 2021, in Surfside, Fla. (AP Photo/Gerald Herbert)