Two South Florida Firms Face Allegations of Wrongdoing in Bankruptcy of Property Owners' Group
Two South Florida law firms face allegations of wrongdoing in adversary proceedings filed in a bankruptcy case for a property owners’ association, the Daily Business Review reported yesterday. Boca Raton-based Jay Steven Levine P.A. and Kaye Bender Rembaum in Pompano Beach once represented Spanish Isles Property Owners Association Inc. in Saddlebrook. But Chapter 11 Trustee Margaret J. Smith claimed that the firms allowed the association's governing documents to lapse, leaving it with no valid declaration and bylaws to direct its operations, enforce its rights or levy liens for unpaid homeowner dues. Her complaints claim "constructively fraudulent transfers of estate property and … professional negligence" against both firms, which allegedly overlooked the association's governing documents until after it was too late, and the group had already filed for bankruptcy. The association's documents date back to its incorporation in 1979 and needed to be renewed or preserved in 2009 under Florida law. Without valid documents, the nonprofit lacked legal authority to collect homeowner fees or govern itself under its bylaws, but it continued to assess about $350 per home for annual revenue of about $100,000, according to Smith.
