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FOURTH DISTRICT COURT OF APPEALS AFFIRMS FINAL JUDGMENT ORDERING TURNOVER OF PALM BEACH POLO AND COUNTRY CLUB PROPERTY OWNERS ASSOCIATION

West Palm Beach, Florida – On May 8, 2014, the Fourth District Court of Appeals affirmed the Final Judgment entered by the Trial Court on November 21, 2012, bringing to an end years of litigation and over thirty years of developer control of the master homeowners association at the Palm Beach Polo development in Wellington, Florida. Following a three day non-jury trial, the Trial Court entered a final judgment holding that the events requiring turnover of the master Palm Beach Polo and Country Club Property Owners Association (“POA”) from the developer to the homeowners had occurred as of 2005 and that the Declarant, Palm Beach Holdings, Inc., was required to relinquish control of the POA at the next annual meeting. The litigation was commenced by Plaintiffs, who are 19 condominium and homeowners associations at Palm Beach Polo comprised of over 700 homeowners, along with two individual plaintiffs, Bob Bushey and Duane Christensen. The action was brought by Plaintiffs seeking a declaratory judgment that the turnover threshold of the developer-controlled POA had been reached and that the developer should have turned over operation of the POA to its members in 2005.

Under the POA’s governing documents, turnover is triggered when the Developer sells at least 95% of the total number of platted lots or recorded condominium declaration parcels. Plaintiffs contended that this threshold was reached on or before January 1, 2005, at which time the Declarant had sold approximately 96% of the platted lots. The POA and the Declarant, which is controlled by Glenn F. Straub, the developer who has been in control of Palm Beach Polo since 1993, contended that the 95% threshold should be determined by reference to the maximum number of developable units, or dwelling units, as shown on the Palm Beach County-approved land use plan, regardless of whether the units were platted or not. Under the developer’s theory, the POA could possibly never be subject to turnover.

At trial, the Declarant asserted that its own documents were unclear and that they should be interpreted to benefit the POA’s and Declarant’s argument that the 95% threshold had not been met. The Declarant even took the position that a mistake had been made in the drafting of the documents and that, after 17 years, they had suddenly just discovered it. Both sides presented a number of witnesses addressing the turnover threshold and whether it had been met, as well as the drafting of the documents themselves. Defendants’ arguments, however, proved unpersuasive to the Court, which found the documents to be clear and unambiguous as to the requirements for turnover and that those requirements had long ago been met.

The Defendants’ arguments were similarly unpersuasive to the Fourth District Court of Appeals which per curiam affirmed the Trial Court’s decision, as well as granted Appellees’ Motions for Appellate Attorneys’ Fees.

As a result of the Trial Court’s order, the developer-controlled majority of the Board of the POA has been replaced by popularly elected representatives from each of the classes of homeowners within Palm Beach Polo. The Developer now has only one remaining seat on the Board of nine members. Importantly, the time of developer control of the POA has finally come to an end. For the Plaintiffs, the turnover decision represents a vindication of years of hard work and effort and the end of a difficult chapter in the history of Palm Beach Polo.

The Plaintiffs have been represented by Howard K. Coates, Jr. and Mary F. April of McDonald Hopkins, LLC throughout the proceedings.

About McDonald Hopkins
McDonald Hopkins is a business advisory and advocacy law firm with offices in Chicago, Cleveland, Columbus, Detroit, Miami, and West Palm Beach. In January 2013, McDonald Hopkins launched a new subsidiary based in Washington, D.C., McDonald Hopkins Government Strategies LLC, led by former Congressman Steven LaTourette. McDonald Hopkins Government Strategies is not a law firm and does not provide legal services.

For more information about McDonald Hopkins, visit mcdonaldhopkins.com.

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