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Florida condo ass'n prevails in bankruptcy spat with developer

D. R Horton can certainly be termed a lot of things.

A national homebuilding colossus. A formidable business entity. A non-stop money-making machine.

U.S. Bankruptcy Judge A. Jay Cristol recently called the Texas-based company "Goliath," and in a manner that was unquestionably pejorative.

Pursuant to doing so, the judge slapped the homebuilding firm with a $16.3 million judgment in a Florida case pitting the titan-sized enterprise against a group of condo unit owners in Miami Gardens. Cristol's ruling was influenced by a review of case-related evidence that convinced him Horton was engaging in "deceptive practices" in its relationship with the Majorca Isles Master [homeowners] Association.

The case was filed against Horton in 2014, following the immense difficulties that hundreds of unit owners had in funding and maintaining their properties after Horton turned over management and abandoned the project in 2011.

The laundry list of wrongdoing that was collectively adjudged by Cristol as "somewhere between not nice and evil" was long, indeed.

During the company's several-year tenure running the planned community's master association, Horton directors unlawfully diverted funds from it, failed to provide required deficit funding and didn't adequately see to maintenance and related upkeep work.

Moreover, noted Cristol, Horton employees fraudulently mislabeled accounting entries that improperly implied solvency, ultimately leaving condo owners with a "materially false and misleading" picture of the association's financial health.

One commentator on the case stated that its judicial outcome "reiterates that developers have an obligation of fairness and transparency to the citizens of Florida."

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