Client: Bermuda Dunes Homeowner Association
Our firm represented an Association in Bermuda Dunes, California. The project was originally constructed as apartments and then converted to condominiums in the 2004 to 2006 timeframe. Unfortunately, the converter improperly established the reserves for the Association by representing that all the components including private streets, tennis courts, and roofs were new instead of sixteen years old. As a result the Association quickly ran out of funds as components came to the end of their useful life expectancies. In addition, there were numerous construction defects including hundreds of linear feet of water supply pipes with deteriorating insulation. Settlement was complicated by the fact that the carrier for the converter was defending under a very strong reservation of rights and in fact filed a declaratory relief action against the converter during the pendency of the underlying case. After several mediations Mr. Naumann was able to negotiate a settlement of $1,702,500 for the Association.