Sides far apart in disputes over Surfside compensation claims, mediator tells judge

Disagreements over how to divide money to compensate victims of the Champlain Towers South collapse are so strong and bitter that it may be impossible to reach a compromise, a mediator told the judge overseeing the Surfside class-action case on Wednesday.

“This is a heartbreaking situation,” court-appointed mediator Bruce Greer said. “There are very recalcitrant positions. The talk has been more gentle in court than in my conversations.”

He summed up the most extreme all-or-nothing positions this way during a court hearing on lawsuits surrounding the building’s collapse: Some condominium owners argue that as property owners they should receive the money as compensation for the loss of their units and everything inside them. Some relatives of those who died argue the money should pay their wrongful death claims — and that condo owners are to blame and should shoulder liability for not maintaining the safety of the building.

Greer’s pessimistic assessment threw Miami-Dade Circuit Judge Michael Hanzman’s hopes for fast and amicable payments of property claims into disarray four months after the partial collapse of the beachfront condo tower killed 98 residents, renters and visitors. The entire building was demolished within two weeks, reducing all 136 units to rubble.

Greer, a prominent Miami attorney with expertise in mediation, gave an update two weeks after he began “extremely intensive and extensive conversations” with lawyers and their clients about how money from the sale of the property and from the building’s insurance should be divided among victims and survivors.

“There are innumerable positions as to what people believe should happen, with three major buckets — and two of those are diametrically opposed,” Greer said. “One position from property owners asserts that proceeds from the land sale and insurance is solely for the owners of the property.

“A second position from wrongful death and personal injury lawyers is that property owners should be assessed and are subject to individual liability, so they would lose the value of their entire unit and could have personal liability also.”

Greer said a group in the middle of those two points of view believes it is premature to mediate over limited funds because too many facts are unknown and more time is needed for investigation.

Hanzman, clearly perplexed, said he was disappointed by the hard line the two sides had taken. He wants to avoid an ugly fight over money and protracted litigation. His plan was to allocate money for property loss claims quickly so that displaced condo owners could be reimbursed for at least the appraised value of their units, find new homes and get their lives back on track, and then focus on the more complicated death claims.

“It’s extremely unfortunate news,” Hanzman said. “I had hoped they’d see the wisdom of resolving this. An allocation dispute is risky and will likely delay any compensation in the near future. But if people want to dig in — I’m disappointed to hear this broke down so quickly and people are taking such extreme positions and mediation turned out to be nonproductive.”

At stake is about $170 million in potential funds for compensation. The nearly 2-acre property at 8777 Collins Avenue will be put up for auction in late February. A stalking horse offer stands at $120 million from a developer in Dubai who is also one of Donald Trump’s business partners, but other developers could submit higher bids. The Champlain Towers South condo association held $30 million in property insurance for the building and another $19 million in personal injury insurance. Millions more might be recouped from third parties who could be sued, such as the town of Surfside and the condo association’s engineer for its renovation project that had barely commenced before the June 24 collapse of the building.

Hanzman has indicated he wants to allocate $95 million for property claims based on an appraisal of each unit. But many owners disagree with him over that cap and assert their units are worth more than the amounts they were appraised for.

“I think Mr. Greer is the finest mediator in the country, and he’s telling me people who suffered death in their families say that under no circumstances should property owners get any money for their units and should even be assessed liability for defective maintenance, while the property owners are suggesting they’re entitled to the whole value of the property and the insurance and none should go to the people who died on the property.”

Lawyers on the conference call urged Greer to try again and Hanzman to be patient.

“In these types of disasters it often requires multiple mediation sessions,” said Jorge Silva, who is representing people who lost family members in the collapse. “To foreclose on mediation now would be an error on the part of the parties.”

Harley Tropin, representing people who suffered economic loss, said mediation should proceed.

“I would let things cool down,” he said. “Mr. Greer is the perfect person to do this. I don’t think he’s a magician who can do this today. Give it more time.”

Rachel Furst, representing relatives, said time is of the essence.

“I’m not sure how far down the road we can extend this,” she said. “In order for the property to be sold some issues will have to be resolved.”

Hanzman asked Greer, who is working pro bono, to make another round of phone calls and Greer agreed.

“I want to get this case settled. Every case can be settled,” Greer said. “I’ll get back on the phone. I don’t know what will be changed.”

Hanzman renewed his call for all sides to find middle ground, but told Greer to “pull the plug” if he saw no progress.

“Let’s see if we can reach a compromise on the allocation to avoid an unseemly dispute between people who all suffered losses,” Hanzman said. “There is a lot of emotion and anger. On one side, the argument is that unit owners should get nothing, that ‘my son or my daughter died because they didn’t maintain the building.’ On the other side, the owners say ‘we did nothing negligent, we are not to blame, we lost our nest egg and now we’re out on the street.’”

“I don’t expect unanimity. Whatever deal is reached I will not be shocked to see lawyers and victims come in and say it’s unfair.”

In other topics covered during the status hearing, Michael Goldberg, appointed receiver for the condo association, said he will take possession of the property from Miami-Dade County.

“I will govern access and that will allow us to start the investigations by the professionals and engineers who have been waiting patiently,” he said. “Next week they will fly drones, film, view and measure, with boring and core sampling set for Nov. 8.”

Goldberg also asked Hanzman to allow investigators to visit a lot where the county has deposited debris, combed through it and determined it has no evidentiary value. All human remains and belongings have been removed and the county wants to dispose of the debris.

Andrea Langesfeld objected. Her daughter Nicole and son-in-law Luis Sadovnic died in the collapse.

“We received only a portion of my daughter’s body,” she said “It’s important that they continue to search for bodies.”

But Hanzman reassured Langesfeld the area had been swept several times and “the professionals on top of this are very confident the area does not contain any human remains.”

Goldberg also reported that he will be present with a locksmith and police officers when safes found in the rubble are opened next week. Contents will be photographed and put up for claim.

Decontamination and cleaning of photos found in the rubble has also begun, and returning them to family members “is a personal mission of Mayor Daniella Levine Cava who recognizes certain items cannot be replaced,” Goldberg said.