Reader’s Letter: “THE PELICAN AT THE YACHT CLUB (II)”

POSTED: 03/17/11 2:24 PM

As mentioned in the first article on this topic the legal frame work provided by our Civil Code for the condomiumizing of a parcel of land and thereon standing building is a rather complex one.
In focusing on the Simpson Bay Yacht Club we nevertheless have to stand still at two special characteristics of this particular type of shared ownership resorts (“SORS”) which factors add even more to the complexity of establishing a legal set-up for such a resort and of the execution of said set-up whereby a proper balance is maintained regarding the input, rights and obligations (the “IROS”) of all stake holders involved.
The first factor is that resorts like the SBYC comprise of more than one condominiumized buildings, which brings along that each individual owner at the resort will be sharing common areas and common services with the other owners in his building as well as some with owners of the other buildings.
A second factor is that the original owner/developer of an SOR, in order to make it more attractive to potential individual buyers, often offers special facilities for common use at the resort, like parking, a swimming pool, etc., of which facilities the developer often maintains the ownership and management.
We must remark here that the condominium law in our Civil Code does not provide specific rules which regulate the consequences of those two factors.
Such, however does not remove the need to have said consequences incorporated in a manner which is in accordance with the basic legal frame work as laid down in our Civil Code for which exercise the most expert legal assistance is required, from the beginning till the end.
Regretfully, at the end such has not been the case at SBYC as a consequence of which the existing total set-up of the SBYC and the execution of same, particularly its first phase (we are not acquainted with the situation of the second phase) is in such violation of the law that, in our opinion, a major part of same, if brought to court will be annulled or even be declared null and void, which we now will explain.
In 1993 the Simpson Bay Club Umbrella Foundation has been established which had a.o. as task to take care of the use and maintenance of the facilities at the resort “not included in the division of property granted by the owner thereof”.
Said exclusion was necessary as (as stated in the first article on this topic) it is the respective Association(s) of Condo Owners (ACOS) which by law, have the compulsory authority to provide the common services directly related to the respective condominiumized buildings.
Mentioned Foundation, however thereafter not only has assumed the task of providing those specific services, but also has practically replaced the ACOS, which ACOS since then, in serious violation of the law, have remained completely dormant.
A very serious consequence of same is that, for example, the providing by the Foundation of common services directly related to the respective buildings and the establishing and the collection of the related fees from the owners (which fees constitute a major part of the total fees and have lately been skyrocketing), in our opinion, have no sound legal base.
The question of a sound legal base can also be raised with regards to the validity of the recent board members of the Foundation as such has not taken place in accordance with its own articles.
A group of minority owners who for some time have not been obtaining a serious hearing from the actual “board” of the Foundation have requested a lawyer to give a legal opinion on the situation, which lawyer has done so in two letters sent to all the owners at the resort, thereby expressing the need to have mentioned and other problems at the resort urgently addressed and corrected.
Regretfully the “board” has not only completely ignored this advice but also, despite giving the lawyer permission to attend a meeting of the Foundation has stopped him from taking the floor right at the first time he wanted to say something to the meeting.
Being said lawyer and the notary at law who was the architect for the original set-up of SBYC I hope that the proposed corrections will speedily be embarked on to the benefit of all involved and the island.

Elco Rosario,
lawyer and former notary at law.

the first article on this topic we called the attention to the complexity of the set-up ( and its execution) of shared ownership resorts (SORS”) on the island.
Now we like to go deeper on SBYC we have to mention that here (as with more SORS on the island) a next level of complexity is added as……
The complexity of the matter will also be intensified in the type of resorts like the Simpson Bay Yacht Club, which consists not of just one but a number of separately condumiumized buildings as such will add a third group to the equation, with the result that now two groups of common areas and services can be distinguished, those directly related to the individual buildings and those regarding to the resort as a whole, like common swimming pool (s), parking lots, walk ways, etc…and, in case the resort has moved into time share- and hotel services, also all types of services related to same, like, a.o. employment of room attendant and other types of hotel employees.

Thanks to the visionary courage of the late Mauricio Katz the Simpson Bay Yacht Club with its rustic, low rise Mediterranean architecture and landscaping has become arguably the major catalyst in making the strip on the Southern side of the island to the airport one of the nicest business and outgoing areas on the island.
Turning one’s attention more inward from the suave appearance the picture in time has gradually become less attractive and more grim.
While a good fight every now and then in the most harmonious families is something healthy a family can start becoming dysfunctional if the fights are becoming more regular and vicious and the alleged causes for those fights are not properly addresses and even ignored by the leaders of the family.
And it starts getting time to ring the bell when some members start talking about going to court or even to the public prosecutor’s office to solve disagreements.
The minority owners decided to ask advice from the notarial architect who has written to the group of owners expressing the urgent need to correct
Some unintended major mistake(s) in the legal set-up of Phase I of this condominium project combined with the arrogant stubbornness of its actual management however have been contributing to it becoming a legal time-bomb ready to explode unless urgent corrections are made.
Mentioned Phase of the SBYC consists of 10 condominium buildings each with their respective association of condo owners (ACO)
For the management of the common facilities of the resort, like the common swimming pool a special
foundation has been established by the developer-company.
Shortly thereafter the major mistake was made to have said foundation replace the 10 ACO which since then has stopped their functioning which functioning is compulsory required by our Civil Code.
By law, namely said ACOs are indissolubly connected to the legal condo-structure of the respective buildings: discontinuation of those ACOs is only possible by discontinuing the condo structures.
While the decision to replace the ACOs by the foundation is such a stringent violation of our laws that makes it null and void the actual management continues on this path.
A report presenting to the management of the foundation is totally being ignored and other illegal acts are being committed.
Decisions are being taken in violation of the articles of the foundation.
Monies are being collected by the managent for the payment of the groundrent to the government which monies have been used for other issues which by itself constitutes embeselment of all those involved.
Advise to activate the ACOs are being ignored by the condo owners.
Outrageous fees are being imposed by the management on the owners in violation of the rules and regulations of the ACOs.
No elections are being held to elect administrator or boardmembers for the ACOs.
Voices to correct the situation are totally being ignored.
In at least one decision of the court has been ruled that the responsibility for…..ACO.
As with more on our island underneath the attractive appearance lies an internal structure wch any moment when put to test can explode in our faces.

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