Condominium Association Represented by MBM Prevails in Damages Hearing Against Developer

Condominium Association Represented by MBM Prevails in Damages Hearing Against Developer

In a recent decision of the Worcester County Superior Court, a condominium association represented by Moriarty Bielan & Malloy LLC prevailed against the developer of the condominium and was awarded damages in excess of $670,000. The issue stemmed from the developer’s failure to complete the roadway running through the condominium pursuant to a Comprehensive Permit issued by the town of Harvard in 2005. The condominium was substantially completed and turned over to unit owner control in approximately 2020. However, the developer left the project without completing the roadway, and years of litigation have ensued between the town, the developer, and the condominium association, as well as others.

While it is never a guarantee how a case is going to turn out, the outcome of this case shows how important it can be to have expert witnesses on your side who can testify on your behalf in litigation.

Specifically, the condominium association brought claims of negligence and breach of fiduciary duty against the developer. After the developer failed to contest the issue of liability as to the completion of the roadway, the parties conducted a hearing to determine the amount of damages to which the condominium association is entitled as a result of the developer’s negligence and breach of fiduciary duty. At the damages hearing, the condominium association produced reports from two expert witnesses detailing the issues with the roadway and the expected costs for repairing those issues. Those expert witnesses also took the stand and testified as to the contents of their reports.

The main issue raised on cross examination by the developer’s counsel was whether the work the experts claimed needed to be performed was actually required under the Comprehensive Permit. Counsel to the developer claimed that much of the work outlined in the expert reports was a result of normal wear and tear of the roadway over a number of years and that the developer cannot be held responsible for what he deemed normal “maintenance” of the roadway. To counter that argument, the experts pointed out that the work the developer failed to perform, namely, failing to install a topcoat on the roadway, contributed to its more rapid deterioration and exacerbated the issues with the roadway, and also pointed to a number of items that were simply never completed and thus could not be considered “maintenance.”

The developer claimed it was only responsible for approximately $95,000 worth of damages; the association claimed the developer was responsible for over $900,000 in damages. Ultimately, the court awarded damages of $492,821.25. With prejudgment interest of $184,999.68, the total judgment amount came out to $677,820.93. In the Decision, the court explained that it based that amount on the expected lifespan of a roadway minus the amount of time the roadway had been in existence. While the association does not necessarily agree with that method of assessing the damages, and while the association did not recover all of the damages it felt it was entitled to, the outcome for the association was still very much a positive.

While it is never a guarantee how a case is going to turn out, the outcome of this case shows how important it can be to have expert witnesses on your side who can testify on your behalf in litigation. In this case, the condominium association came to the damages hearing with two experts, both of whom prepared reports and testified in court. The developer did not have a single expert to refute their reports or testimony, and was left to rely entirely on the cross-examination by their counsel. Without a competing expert report to rely on, the judge was left to mostly accept the damage totals submitted by the association.

It was necessary for the condominium association to proceed against the developer, even though they knew they were unlikely to collect on the judgment against the developer, which had conveyed all of its assets. There are two reasons for that. The first is that the developer was required to deposit a bond during the development process, which is still being held by a bond company. The judgment should permit the bond company to release the bond directly to the condominium association or the town so that it can be used towards completion of the roadway. The second is that the town of Harvard cannot sign off on the Comprehensive Permit and issue a certificate of compliance until the roadway is completed to its specifications. The condominium association now has a judgment for the developer’s liability, which means the town would be unable to now claim that the association was responsible for completing the roadway.

Stephen M. Wiseman

If you have any need for legal services related to this article, or any similar matter, you can email Stephen at swiseman@mbmllc.com or any of our other attorneys at Moriarty Bielan and Malloy LLC at 781-817-4900 or info@mbmllc.com.

Stephen M. Wiseman