Florida couple losing condo they’ve owned for 32 years to investor who changed the rules (2024)

Howard and Melissa Fellman say it’s bad enough that they lost their lawsuit to prevent an investor from terminating their Boca Raton condominium and forcing them to sell their unit for a below-market price.

Then the Fellmans watched a court in Miami side with condo owners there who waged a similar fight. Yet the couple say they can’t use the ruling to compel their district court to reconsider its decision.

And now the investor who terminated the condominium has sent a letter to the Fellmans’ longtime tenant telling her to stop paying rent to the couple. “We, as the new owner, would like to offer you a NEW LEASE so you may continue to occupy the Leased Premises without any interruption,” the letter says.

Court records and correspondence provided by the Fellmans present a story of a long legal battle to prevent The Scully Company, a Pennsylvania-based operator of rental communities, from taking over a condo unit the couple purchased for $65,000 in 1992 — back when the condominium’s declaration stated it would take 100% of unit owners to approve any termination.

But after buying 175 of the Mission Viejo Condominium units — all of them except the Fellmans’ — the investor took over the governing association and voted to reduce to 80% the threshold of unit owners required to approve the termination, court records show.

“I am still not sure what I did wrong and/or what Melissa and I could have done differently to have kept the free-and-clear condo in our possession,” Howard Fellman wrote Gov. Ron DeSantis on July 16 in an email begging him to intervene.

“Simply put, we bought a beautiful condo 32 years ago that was supposed to be our forever home. We have never been late on a mortgage, a monthly condo fee, a special assessment, an insurance premium or a tax. My wife and I worked very hard for the right to make that claim. This is so unjust.”

But a spokeswoman for The Scully Company, which operates the complex under the name Complex Palms Apartments, contended in a statement to The South Florida Sun Sentinel that the company made the decision to terminate the condominium “after years of enduring Mr. Fellman’s dissonance as it related to him sharing financial responsibilities associated with his rental unit.”

Howard Fellman cites a list of issues with how money at the condominium has been spent and reported, including its use of association property for what he says is the operation of the apartment complex.

When The Scully Company filed notice of its intention to seek termination in 2021, it offered the Fellmans $210,000 for their unit, saying the price was determined by an appraiser it had hired, Howard Fellman said.

While the Scully spokeswoman said the price offered was “above market value plus closing costs,” Howard Fellman contends that a Zillow search shows his property is worth more than $300,000.

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On Monday, Howard Fellman’s attorney sent a letter to Scully objecting to its acquisition price and other terms of its proposed settlement, including the fact that the appraisal was conducted more than three years ago and the offer fails to credit him with 2.5% of the association property that includes Fellman’s building and all of the recreation areas and offices.

The Fellmans sued in 2021 to prevent the termination. But two courts have since upheld the investor’s right to terminate with 80% approval.

A Palm Beach County circuit judge agreed in 2022 that the bylaws did not prohibit the association from enacting future amendments to reduce the voter threshold. In April 2023, the Fourth District Court of Appeal in West Palm Beach affirmed the earlier order with no comment.

Fortunately for the couple, they won’t be homeless regardless of how their fight concludes. They bought a house in Boca Raton in 2005 to accommodate their growing family and have since been renting the condo unit to tenants. But they said they always planned to retire to the condo unit and spend the rest of their lives there.

Miami court rules for holdout unit owners

Last March, the Third District Court of Appeal in Miami sided with a group of condo owners who sued to prevent termination of Biscayne 21 Condominium, a waterfront community about a mile and a half north of the Kaseya Center in downtown Miami.

That court found that language in the condo declaration incorporating all future amendments to the state’s Condominium Act, “as amended,” did not override a specific provision that was intended to give every unit owner veto power over any termination plan.

The appellate ruling found that the unit owners “have shown a substantial likelihood of success” to prevail in their lawsuit to stop the termination. It reversed a lower court order that denied the owners a temporary injunction but did not settle the case, which is ongoing.

According to a recent story by the Wall Street Journal, the case is being watched closely by developers who are planning to use termination to take over numerous high-rise condo buildings in South Florida and build even larger projects on their sites.

The Fellmans cited the Miami ruling in a motion filed in March asking a Palm Beach County circuit judge to vacate the 2022 order. The judge denied the motion, saying the plaintiffs failed to cite a case in which a ruling by a trial court was affirmed by an appellate court, then vacated by the trial court based upon a contrary decision from another district.

Regarding a possible appeal of the Fourth District Court of Appeal ruling, Fellman said he was told by the supervising partner of the law firm that argued his case, Kaye Bender Rembaum, that the couple has no grounds to seek a reversal by the state Supreme Court.

The reason is the appellate court provided no written statement explaining its affirmation of the lower court ruling, the partner said.

In a letter provided by the Fellmans, the partner cited a decision in an earlier case that noted such rulings occur “when the points of law raised are so well settled that a further writing would serve no useful purpose.”

A possible way forward

Andrew Schwartz, a Palm Beach County based attorney who specializes in condominium issues, said while he is not familiar enough with the details of the case to offer an opinion, the Fellmans could file a separate motion seeking a written opinion from the Fourth District.

“The rule requires (the couple) to make certain allegations regarding the necessity of the written opinion, etc.,” Schwartz said.

Then the couple could “potentially seek review from the state Supreme Court based upon purported conflict resolution between the two district courts of appeal,” Schwartz said.

The couple’s current attorney, Mike Simon, declined to predict whether the Fellmans would try to reverse the appellate court ruling. Howard Fellman declined to reveal the couple’s next move, saying that the parties are still hashing out other issues, such as whether the investor is willing to reimburse them for recent improvements to the unit.

As of Monday, the Palm Beach Property Appraiser’s website still shows the Fellmans as owners of the unit, but the county’s Official Records shows a deed transfer filed on July 26 by the association to a group controlled by The Scully Company, asserting ownership through the “plan of termination.”

So far, the cost of the legal fight has exceeded the $210,000 that The Scully Company is willing to pay for the unit, Howard Fellman said. In addition to their own lawyers’ bills, the couple have been ordered to pay $82,624 for the investor’s legal fees, and they want another $60,816 for additional legal fees tied to the appeal.

According to a letter sent to the Fellmans, the investor is proposing to deduct $72,894 for legal fees and other expenses from the price of the unit, leaving the Fellmans with $137,124.

DeSantis’ office has responded to multiple letters from the Fellmans by referring them to the state Department of Business and Professional Regulation’s Division of Florida Condominiums, Timeshares & Mobile Homes. But a DBPR representative told them that the department lacks jurisdiction over termination issues, Howard Fellman wrote to a DeSantis spokesman.

“He said only your office has the power to intervene at this point,” he told the spokesman. “My wife and I kindly ask you to please do so.”