Belfor USA Group v. Bray & Gillespie
N/AOUTCOME: Affirmed on appeal an payment recieved
Florida's appellate court upheld the trial court's judgment in favor of the restoration contractor. Following the 2004 hurricane season, a very large restoration client of mine contracted with a group ... of seven hotel owners to remediate the beachside hotels in Daytona Beach, FL. The parties prepared a long form contract. Before signing, it was presented to me for review. The contract did not have the seven, sole purpose entities that each owned one of the hotels as parties to the contract. That omission would have resulted in the loss of lien rights on the properties because the contractor had already been working on the project for several months before the contract was signed. The oversight was corrected before the contract was signed. The hotels were all insured under one policy with multiple layers. The first layer had $50 million coverage and the second layer had potentially $225 million. After exhausting the first layer of coverage, the hotel owners secretly settled with the excess layer for $66 million and obtained the monies directly in violation of their contract with the contractor. The owners then terminated my contractor with a $13 million unpaid contract balance. We immediately recorded liens and filed a lawsuit. Through legal maneuvering, I was able to get the contractor the final insurance check of $6.8 million, leaving a balance of $6.2 million. The parties proceeded to a two-week trial, in which I represented the contractor. The owners raised every defense in the book: defective work, improper contract accounting, false qualifier and improper lien. The trial court awarded judgment in full for the contractor with only a small setoff. At this point, the title policy for a lender intervened claiming that because the complaint was amended after the loan was issued; the lender had priority over the contractor’s lien. The trial court disagreed; pointing out that the lis pendens put the lender on notice of the lien, which then took priority as of the date of the notice of commencement. Both the owners and the lender appealed. After briefing and oral argument, which I also handled, the appellate court upheld the $8.8 million judgment in full. The above case demonstrates the complexities involved in the litigation process. The restoration contractor had a distinct advantage over the other parties. I was involved in all phases, contract drafting, construction overview, termination, lien recording, discovery, trial and the appeal. The other parties engaged various counsel at various stages; no one for them had the entire view to tie the case together.
