“Fortunately for us, we had a very smart, attentive and perceptive jury that understood the issues that were very complicated, because we were able to simplify them and ultimately they were able to arrive at a decision that was not only a right and fair decision but a decision that was based upon the evidence.”Stevan Pardo
The $16.3 million jury verdict on Dec. 8 against private equity fund Z Capital Partners and its affiliate Carillon Hotel in a lawsuit where the homeowners association claimed homeowners were overassessed is more than just a win for unit owners and their attorneys.
It’s a case that shows the importance of breaking down complex evidence to the jury, says attorney Stevan Pardo of the firm Pardo Jackson Gainsburg. Pardo, who along with Joe Pardo, and Gene Stearns, Jason Koslowe and Ezra Greenberg of Stearns Weaver Miller Weissler Alhadeff & Sitterson and Paul Shelowitz and Gabe Mandler of Stroock & Stroock & Lavan convinced a jury in a five-day trial that the defendants overassessed unit owners at The Carillon Hotel and Spa millions of dollars in property expense from 2015 to 2022.
“When you have a case that takes this long to get to a jury trial, the parties and their counsel should be able to sit down and resolve it without having to go through a full-blown jury trial,” Pardo said. “Fortunately for us, we had a very smart, attentive and perceptive jury that understood the issues that were very complicated, because we were able to simplify them and ultimately they were able to arrive at a decision that was not only a right and fair decision but a decision that was based upon the evidence.”
The three law firms collaborated to obtain the jury verdict against the Carillon Hotel lot owner and Z Capital, its affiliate, for breaching its agreements and obligation of good faith and fair dealing. The Carillon, located at 6899 Collins Ave. in Miami Beach, consists of three towers and four governing bodies. The Carillon Hotel lot owner runs the spa, hotel and restaurant areas.
Miami-Dade Circuit Court Judge Michael Hanzman oversaw the trial in which the jury awarded the unit owners $16.3 million after ruling the three associations were overassessed for hotel, electricity and spa fees.
In a letter to residents, Carillon Hotel says that while it disagrees with the jury’s decision, the amount is half of what the HOAs sought when the trial began.
“The HOAs initially sought approximately $460 million, which was reduced to $33 million by the court at the start of the trial. The jury’s decision further lowered the damages to approximately $16 million, a fraction of the initial claims, which may be further reduced on the final verdict,” said a spokesperson for the Carillon Hotel.
Representatives of the hotel believe the unit owners will not receive any recovery that will be greater than the “exorbitant legal fees already incurred.”
For Pardo, the biggest challenge was simplifying complex documents for the jury, and what made the case unique was figuring out how to allocate expenses in a mixed-use community.
“When you’re dealing with a complicated document like a master declaration and you’re dealing with complex accounting issues relating to the books and records of companies that are not prepared and segregated in a way that you understand the financials,” Pardo said, “the culmination of those and then trying to present that to a jury can be very, very challenging.”
For attorneys with similar cases in the future, it’s important to develop the themes of the case early on, Pardo said.
“Look for the evidence that is consistent with those themes, and simplify the case so that anyone who hears the evidence will reach a clear decision on what is the right and fair way to decide the case,” he said.
Although this is a win for unit owners, it’s not the end of litigation in the case.
“The court directed the Carillon to file motions to set aside the jury’s decision, and those motions will likely be heard in February or March 2023. Other legal claims in the case remain unresolved, with overall attorneys’ fees continuing to climb,” a hotel spokesperson said. “Despite our continued belief that this lawsuit is without merit and our best efforts to fully resolve this case, we will keep working tirelessly to maintain a world-class property for the benefit of the homeowners and our hotel guests.”