Our firm has a proven track record in the area of deposit recovery. While we are currently aggressively representing the interests of many purchasers at the St. Regis Bal Harbour, ICON Brickll, the IVY, and other prominent South Florida projects, recover their pre-construction deposits, we previously spearheaded many of the defenses that the developers are currently using against purchasers.
A New York Federal Judge recently ruled that the developer, The Related Companies, must return a $510,000 buyer’s deposit. This was because the developer failed to comply with the Interstate Land Sales Full Disclosure Act (ILSA). The developer’s failure to comply with ILSA allowed the purchasers to rescind their $3.4 million dollar sales contract and get their deposit back, plus interest.
This ruling may be serve as a catalyst to entitle hundreds of recent condominium buyers to seek the return of their full deposit in such prominent South Florida projects such as the St. Regis Bal Harbour, ICON Brickell and others. Indeed, this ruling makes it possible for every buyer of a newly constructed condominium which has sold more than 100 units within the last three years to potentially obtain a refund of their deposit.
The reason this case is significant is because developers have scored many victories against purchasers on ILSA related issues. But this ruling may change the legal landscape as it relates to ILSA issues both nationally, and right here in South Florida.
ILSA is a federal law enacted back in 1968 that requires full disclosure from developers. It was originally intended to protect out-of-state land buyers from getting duped into putting money down for a piece of property they’d never seen before. But the law also applies to condo buildings with more than 100 units. Specifically, ILSA requires developers to record each condo purchase with the government. In other words, and according to this recent NY ruling, ILSA imposes an obligation to record every sales contract.
More often than not, however, the developers fail to record the sales contract. From the developers perspective, that requirement could be very burdensome and have collateral impact not necessarily intended by the consumer oriented ILSA. But that failure to comply with ILSA, and record those contracts, could be fatal to developers in the event a purchaser seeks the return of their full deposit. And this ruling, coupled with its rationale, and analysis, is certainly persuasive and helpful to all purchasers attempting to secure the return of their deposits in such projects as the St. Regis Bal Harbour, and others.
Consider Your Options. Contact Us Today.
If you are a contract purchaser in a development that has not been completed, or you are seeking the return of your deposit, then please contact our office today.
Call us toll free at 1-866-518-2913 or at 305-263-7700.