Pre-Construction Condominium Litigation

Holding Real Estate Developers Accountable in Alabama and Florida

Pre-construction condominiums along the Gulf Coast are often advertised as glamorous out-of-state investment opportunities to purchasers in other states. When the market changes, however, buyers may scrutinize the project and find out that the developer deviated from what was promised at the time of purchase. If you entered into a pre-construction contract for the purchase of a condominium and made a deposit on it, only to find the developer lied to you or has made a material adverse change to the building plans, you may be wondering what recourse you have. If you need to pursue pre-construction condominium litigation in Alabama or Florida, the attorneys of Milam & Milam can help you.

Developers that Fail to Make Full Disclosures

When a developer fails to make appropriate disclosures, lies about the property's attributes, fails to follow the specified design, or is not going to complete a project on time, it may be appropriate to file suit. The Interstate Land Sales Full Disclosure Act (ILSFDA) is a federal law designed to prevent fraud that requires developers in all states to make specific disclosures to buyers. Under the Act, "developer" is broadly defined as a person or entity that sells or leases a lot in a subdivision, or offers or advertises to sell or lease it. Although not originally enacted to protect condominium purchasers, the Act is now a common basis for pre-construction condominium litigation. The purchaser sues to terminate the contract and receive a return of the deposit plus interest.

There are strict time limits for lawsuits based on ILSFDA. The statute bars claims brought more than three years after the date of signing a pre-construction contract or purchase agreement. Rescission claims have a two-year statute of limitations. If the time period passes, the purchaser may not be able to terminate the pre-construction contract.

Recovering Your Pre-Construction Deposit Under Florida State Law

Fraudulent conduct by a developer or seller is also prohibited under Florida state law. Like federal law, Florida Statute Chapter 718 requires specific disclosures of rights in a contract or purchase agreement for condominiums. Among other things, developers or sellers must advise of any material or adverse changes to the development of the property. Purchasers are entitled to rescind a contract if they reasonably relied on any misleading or materially false information in the condominium documents. Under section 718.202, the developer or seller must keep purchaser deposits in separate escrow accounts under strict legal requirements.

Most pre-construction contracts include language that is intended to bring a developer in compliance with any applicable statutes. Many legal protections are also binding terms of a pre-construction contract. Accordingly, many purchasers can bring breach of contract claims in connection with a developer's failure to abide by the contract, including its failure to timely complete a project.

The statute of limitations for federal and state claims varies depending on the circumstances. Accordingly, it is important to consult an attorney as soon as you become aware of a material change to the plans or a developer's misrepresentation.

Consult a Gulf Coast Pre-Construction Condominium Litigation Attorney

Some major developers keep defense lawyers on retainer. These developers may brush off your requests unless you have a lawyer to advocate on your behalf. Milam & Milam can represent you in the event that a developer fails to follow through with promises made at the time you entered into a purchase contract. We use our 25 years of combined experience to pursue pre-construction condominium litigation in the Gulf Coast. If you discover construction defects, and it is too late to bring a claim under the laws described above, we can help you start the procedure for identifying construction defects and take you through the process of a construction defect lawsuit. We are located in Fairhope in Baldwin County, Alabama on the eastern shore of Mobile Bay. Our clients come from Alabama and Florida cities including Montgomery, Birmingham, and Pensacola. Contact us by calling 251-928-0191 or set up a consultation through our online form.