HomeMy WebLinkAbout2007 12 10 Regular 606 Notice of Default and Claim against National Union Fire Insurance Company of Pitsburgh Surety Bond No: 948843
COMMISSION AGENDA
ITEM 606
Consent
Informational
Public Hearing
Regular x
Add-On
December 10. 2007
Meeting
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Mgr. /
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Att. / Dept.
REQUEST:
The City Attorney's Office requests the City Commission to authorize the filing of a Notice of
Default and Claim against National Union Fire Insurance Company of Pittsburgh Surety Bond No:
948843, ensuring the maintenance for construction defects relating to improvements of potable
water, sanitary sewer, and storm and roadway facilities in Jesup's Reserve Subdivision.
PURPOSE:
The purpose of this agenda item is to allow the City Attorney's office to file a claim against a
maintenance surety bond for water and sewer facilities purchased by Levitt & Son's of Seminole
County, LLC, for which the City of Winter Springs is the beneficiary; undertaken to ensure the
maintenance for construction defects relating to improvements of potable water, sanitary sewer, and
storm and roadway facilities in Jesup's Reserve Subdivision.
APPLICABLE LAW AND PUBLIC POLICY:
1. Florida Municipal Home Rule Authority, Chapter 166, Florida Statutes
2. Surety Performance Bond No.: 948843
CONSIDERATIONS:
1. On August 8, 2005, the City of Winter Springs approved final development plans for the
establishment of Jesup's Reserve Townhomes.
2. In consideration of the approval, the City required Levitt to purchase a maintenance surety
bond for water and sewer facilities purchased by Levitt & Son's of Seminole County, LLC,
for which the City of Winter Springs is the beneficiary; undertaken to ensure the maintenance
for construction defects relating to improvements of potable water, sanitary sewer, and storm
and roadway facilities in Jesup's Reserve Subdivision.
3. In October, 2007, Levitt closed construction on Jesup's Reserve and filed for bankruptcy,
leaving portions of the common property incomplete, exposed, unsafe, and otherwise
contrary to the health, safety, and welfare ofthe community. Certain portions of this unsafe
property includes damaged water and sewer facilities, previously accepted as "completed"
by the city.
4. The City has identified the portions ofthe damaged water and sewer facilities believed to be
covered by the Maintenance Bond for Water and Sewer Facilities. The total cost for repair
as estimated by the City Engineer is approximately $46,000.00, significantly less than the
maximum bond coverage in the amount of $131,684.41. The City Attorney's Office is
prepared to file a claim.
5. On November 27, 2007, Levitt and Son's received court approval to abandon certain property
mortgaged by Bank of America, including J esup' s Reserve property. This order removes the
property from the bankruptcy estate and allows for Bank of America to foreclose on their
mortgage. However, at this time, we are unaware ofthe time frame for the foreclosure, and
whether the property will be repaired by the next owner.
6. Filing a claim against the surety bonds for the maintenance for construction defects relating
to the improvements of potable water, sanitary sewer, and storm and roadway facilities in
Jesup's Reserve Subdivision will require the Surety to begin repair of these subdivision
improvements within sixty (60) days of the Notice of Default and Claim, or will allow the
City legal recourse if the City is forced to complete the improvements without assistance
from the Surety.
STAFF RECOMMENDATION:
Approve the City Attorney's Office request to file a Notice of Default and Claim against National
Union Fire Insurance Company of Pittsburgh Surety Bond No: 948843. ensuring the maintenance
for construction defects relating t improvements of potable water. sanitary sewer. and storm and
roadway facilities in Jesup's Reserve Subdivision.
ATTACHMENTS:
Lexon Insurance Surety Bond No.: 948843
City Engineers Estimate for Completion
Bankruptcy Court Order Removing the Property from the Bankruptcy Estate
COMMISSION ACTION:
SUBDIVISION AND SITE PLAN
MAINTENANCE BOND FOR WATER AND SEWER FACILITIES
KNOW ALL MEN BY THESE PRESENTS:
BOND NO. 948843
That we LEVITT AND SONS OF SEMINOLE COUNTY, LLC, whose address is
2200 West Cypress Creek Road, Fort Lauderdale, Florida 33309 hereinafter referred to as
"Principal" and NATIONAL UNION FIRE INSURANCE COMPANY OF PITTSBURGH
PA, whose address is 175 Water Street, New York, NY 10038, hereinafter referred to as
"Surety", are held and finnly bound unto THE CITY OF WINTER SPRINGS, a political
subdivision of the State of Florida, whose address is 1126 East SR 434, Winter Springs, Florida
32708, hereinafter referred to as "City", in the sum of ONE HUNDRED THIRTY-ONE
THOUSAND SIX HUNDRED EIGHTY-FOUR AND 41/100 DOLLARS ($131,684.41) for
the payment of which we bind ourselves, heirs, executors, successors, and assigns, jointly and
severally, finnly by these presents.
WHEREAS PRINCIPAL has constructed certain potable water, sanitary sewer,
storm and roadway facilities in that certain subdivision described as JESUP'S RESERVE, a
plat of which is recorded in Plat Book 69, Page 4, Pubic Records of Seminole County, Florida;
and
WHEREAS, the aforesaid improvements were made pursuant to certain plans and
specifications dated August 15, 2005 and filed with the City; and
WHEREAS, PRINCIPAL, is obligated to protect City against any defects resulting
from faulty materials or workmanship of said improvements and to maintain said improvements
for a period of two (2) years from November 30,2006 and filed with the City; and
NOW, THEREFORE, the condition of this obligation is such that if Principal shall
promptly and faithfully protect City against any defects resulting from faulty materials or
workmanship of the aforesaid improvements and maintain said improvements for a period of two
(2) years from November 30, 2006, then this obligation shall be null and void, otherwise it shall
remain in full force and effect.
The City shaH notify the Principal in writing of any defect for which the Principal is
responsible and shall specify in said notice a reasonable period of time within which Principal
shaH have to correct said defect.
LAND DEVELOPMENT CODE:
The Surety unconditionally covenants and agrees that if the Principal fails to perform,
within the time specified, the Surety, upon thirty (30) days written notice from City, or its
authorized agent or officer, of the default will forthwith correct such defect or defects and pay
the cost thereof, including, but not limited to, engineering, legal and contingent costs. Should the
Surety fail or refuse to correct said defects, City, in view of the public interest, health, safety,
welfare and factors involved, and the consideration in approving and filing the said plat shaH
have the right to resort to any and all legal remedies against the Principal and Surety and either,
both at law and in equity, including specifically, specific performance to which the Principal and
Surety unconditionally agree.
The Principal and Surety further jointly and severally agree that City, at its option, shall
have the right to correct said defects resulting from faulty materials or workmanship, or, pursuant
to public advertisement and receipt of bids, cause to be corrected any defects or said defects in
case the Principal shall fail or refuse to do so, and in the event City should exercise and give
effect to such right, the Principal and the Surety shall be jointly and severally hereunder to
reimburse City the total cost thereof, including, but not limited to, engineering, legal and
contingent costs, together with any damages either direct or consequent which may be sustained
on account ofthe failure of the Principal to correct said defects.
IN WITNESS WHEREOF, the Principal and Surety have executed these presents this
30th day of November 2006.
Attest:
C~~~~
Alfred G. West,. President
LEVITf AND SONS OF SEMINOLE COUNTY, LLC
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By:
Harry T. Sleek, Sr. Vice President
Address: 2200 W Cypress Creek Road
Fort Lauderdale, FL 33309
NATIONAL UNION FIRE INSURANCE
COMPANY OF PITTSBURGH. PA - Surety
~---- \~
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BY:~__ f:.--- c'~
Timothy R. Dolan Attorney-in-Fact
American Home Assurance Company
National Union Fire Insurance Company of Pittsburgh, Pat
Principal Bond Office: 175 Water Street, New York, NY 10038
POWER OF ATTORNEY
No. 01-8-33710
KNOW ALL MEN BY THESE PRESENTS:
That A mencan Home A ssurance Company, aNew York corporation, and National Union Fire Insurance Company of Pittsburgh, Pa., a
Pennsylvania corporation, does each hereby appoint
--Robert W. Collins, Timothy R. Dolan, Grace J. Gray, Blair E. Torelli, Donna M. Bishop: of North Adams, Massachusetts-
its true and lawful Attomey(s)-in-Fact, with full authority to execute on its behalf bonds, undertakings, recognizances and other contracts of
indemnity and writings obligatory in the nature thereof, issued in the course of its business, and to bind the respective company thereby.
IN WITNESS WHEREOF. American Home Assurance Company and National Union Fire Insurance Company of Pittsburgh, Pa. have each
executed these presents
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STATE OF NEW YORK }
COUNTY OF NEW YORK }ss.
On this H.th day of l.Dn!!Bo!, 20~ before me came the
above named officer of American Home Assurance Company and
National Union Fire Insurance Company of Pittsburgh, Pa, to me
personally known to be the individual and officer described herein,
and acknowledged that he executed the foregoing instrument and
affixed the seals of said corporations thereto by authority of his
office.
~
JOSEPH 8. NOZZOLlO
NotlJrf fJlJblic, StDt" 01 1'\,!f'\,V yon.
No. 01.N046~2754
Puolified in We"ehe'lOs-+oJll!)l,...._
twill i"l!lres J... 31, ~rc;JI
CERTIFICATE
Excerpts of Resolutions adopted by the Boards of Directors of American Home Assurance Company and National Union Fire Insurance Company of
Pittsburgh. Pa. on May I g, 1976:
"RESOLVED, that the Chairman of the Board, the President, or any Vice President be, and hereby is, authorized to appoint Attorneys-in-Fact to represent
and act for and on behalf of the Company to execute bonds, undertakings, recognizances and other contracts of indemnity and writings obligatory in the
nature thereof, and to attach thereto the corporate seal of the Company, in the transaction of its surety business;
"RESOLVED. that the signatures and attestations of such officers and the seal of the Company may be affixed to any such Power of Attorney or to any
certificate relating thereto by facsimile, and any such Power of Attorney or certificate bearing such facsimile signatures or facsimile seal shall be valid ond
binding upon the Company when so affixed with respect to any bond, undertaking, recognizance or other contract of indemnity or writing obligatory in the
nature thereof;
"RESOLVED, that any such Attorney-in-Fact delivering a secretarial certification that the foregoing resolutions still be in effect may insen in such
certification the date thereof, said date to be not later than the date of delivery thereof by such Attorney-in-Fact."
I. Elizabeth M. Tuck, Secretary of American Home Assurance Company and of National Union Fire Insurance Company of Pittsburgh, Pa. do hereby certify
that the foregoing excerpts of Resolutions adopted by the Boards of Directors of these corporations, and the Powers of Attorney issued pursuant thereto. are
true and correct, and that both the Resolutions and the Powers of Attorney are in full force and effect.
IN WITNE:SS WHEREOF, I have hereunto set my hand and affixed the facsimile seal of each corporation
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;t.~. .3.0. th da~ of November
~~?~.t~.~ At
~eth M. Tuck, Secretary
20.0...2-..
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65166 (4/961
POLICYHOLDER NOTICE
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You can review and obtain information about the nature and range of compensation paid
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706-3102.
Case 07-19845-RBR Document 236 Filed 11/29/2007 Page 1 of 3
11 /~'1 / 0 ~
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UeitecI States Bankruptcy Court
UNITED STATES BANKRUPTCY COURT
SOUTHERN DISTRICT OF FLORIDA
FORT LAUDERDALE DIVISION
www,flsb,uscourts.gOV
In re:
Chapter 11 Cases
LEVITT AND SONS, LLC,
a Florida limited liability company, et al. I
R11L
Case No. 07-l9845-BKC-Jt.fe
Jointly Administered
Debtors.
/
ORDER GRANTING DEBTORS' MOTION FOR AUTHORITY
TO ABANDON PROPERTY OF THE ESTATE SUBJECT
TO A LIEN HELD BY BANK OF AMERICA. N.A.
1 The last four digits of the taxpayer identification number for each of the Debtors follows in parentheses: (i) Levitt and Sons,
LLC (3500); (ii) BankAtlantic Venture Partners 5, LLC (7328), (Hi) Bellaggio by Levitt and Sons, LLC (8507); (iv) Levitt GP,
LLC (9466), (v) Levitt Construction Corp.-East (6292); (vi) Levitt Construction-East, LLC (2487); (vii) Levitt Industries, LLC
(6273), (viii) Levitt Homes Bellaggio Partners, LLC (9490), (ix) Levitt Homes, LLC (1650); (x) Avalon Park by Levitt and Sons,
LLC (2188); (xi) Levitt and Sons of Lake County, LLC (8547); (xii) Levitt and Sons of Manatee County, LLC (3563); (xiii)
Levitt and Sons of Hernando County, LLC (] 563); (xiv) Regency Hills by Levitt and Sons, LLC (9482); (xv) Levitt and Sons at
Hunter's Creek, LLC (5870); (xvi) Levitt and Sons of Seminole County, LLC (1888); (xvii) Levitt and Sons of Osceola County,
LLC (4596); (xviii) Levitt and Sons of Lee County, LLC (1561); (xix) Cascades by Levitt and Sons, LLC (2022); (xx) Levitt and
Sons at Hawks Haven, LLC (4963); (xxi) Magnolia Lakes by Levitt and Sons, LLC (5370); (xxii) Levitt and Sons at Tradition,
LLC (9053); (xxiii) Levitt and Sons at World Golf Village, LLC (4959); (xxiv) Levitt and Sons of Flagler County, LLC (0685);
(xxv) Lev-Bm, LLC (3445); (xxvi) Summerport by Levitt and Sons, LLC (3494); (xxvii) Levitt and Sons of Georgia, LLC
(9568); (xxviii) Levitt and Sons of Cherokee County, LLC (2322); (xxix) Levitt and Sons of Hall County, LLC (4416); (xxx)
Levitt and Sons of Paulding County, LLC (1632); (xxxi) Levitt Construction Georgia, LLC (3043); (xxxii) Levitt and Sons of
South Carolina, LLC (8109); (xxxiii) Levitt and Sons of Horry County, LLC (3186); (xxxiv) Levitt Construction - South
Carolina, LLC (3234); (xxxv) Levitt and Sons of Tennessee, LLC (4793); (xxxvi) Bowden Building Corporation (6090); (xxxvii)
Levitt and Sons of Nashville, LLC (0295); and (xxxviii) Levitt and Sons of Shelby County, LLC (1345). The mailing address for
the Debtors is 2200 West Cypress Creek Road, Fort Lauderdale, FL 33309.
870957-2
Case 07-19845-RBR Document 236 Filed 11/29/2007 Page 2 of 3
THIS MATTER having come before the Court on the 2ih day of November, 2007 at
1:30 p.m. in Fort Lauderdale, Florida, upon the Motion for Authority to Abandon Property of the
Estate Subject to a Lien Held by Bank of America, N.A. (the "Motion") (C.P. No. 77). The
Motion seeks entry of an order authorizing the BOA Debtors2 to abandon the BOA Abandoned
Collateral. The Court has jurisdiction over the matters raised in the Motion pursuant to 28
U.S.C. ~~ 157 and 1334. This is a core proceeding pursuant to 28 U.S.C. ~ 157(b)(2)(A). The
relief requested in the Motion is in the best interests of the BOA Debtors, their estates, and their
creditors. Proper and adequate notice of the Motion and the hearing thereon has been given and,
to the extent necessary, the Court shortens any applicable notice period under Bankruptcy Rule
6007(a) and Local Rule 6007-1(B)(I), such that no other or further notice is necessary. Upon
review of the record before the Court, good and sufficient cause exists to grant the relief
requested. Accordingly, for the reasons announced on the record it is
ORDERED that:
1. The Motion is GRANTED.
2. The BOA Debtors are authorized to abandon the BOA Abandoned Collateral
pursuantto 11 V.S.C. ~ 554(a).
3. The automatic stay is terminated in respect of the BOA Abandoned Collateral.
BOA and any other party asserting a lien against or an interest in the BOA Abandoned Collateral
may enforce or assert such lien or interest under applicable non-bankruptcy law. The
abandonment of the BOA Abandoned Collateral shall be deemed a satisfaction of any secured
claim asserted against the BOA Abandoned Collateral, without prejudice to the right of BOA or
2 All capitalized terms shall have the meanings ascribed to them in the Motion unless otherwise defined herein.
870957-2
2
Case 07-19845-RBR Document 236 Filed 11/29/2007 Page 3 of 3
any other putative secured creditor to assert an unsecured deficiency claim against the estates and
the objections, offsets and defenses of the Debtors in respect thereto.
4. The Court shall retain jurisdiction over any matter or dispute arising from or
relating to the implementation of this Order.
# # #
Submitted by:
Paul Steven Singerman, Esq.
BERGER SINGERMAN, P.A.
200 S. Biscayne Blvd., Suite 1000
Miami, FL 33131
Tel. (305) 755-9500
Fax (305) 714-4340
Singelman@bergersingerman.com
Copies to:
Paul Steven Singerman, Esq.
(Attorney Singerman shall serve a copy of this Order upon all interested parties upon receipt
andfile a certificate of service.)
870957-2
3
Est. Cost
Item Performance Bond Items: these Items are shown on the approved final development plans and have not
# been comoletelv or correctlv Installed to date
1 Place finallifl of asphalt on all streets. $~~
2 Complete construction of all unfinished allevs. $25.
3 Complete construction of all unfinished sidewalks. $10,00
4 All disturbed areas not planned for building construction in the near future need to be seeded or sodded. $5,00
5 Install decorative street slons Der the approved plans. $20.00
6 Correct the handicapped parallel parking spaces in front of the 0001 to meet ADA ouidelines. $5,00
The fire line valve covers have not been marked as required by the City and instead have standard water meter $4.000
7 boxes. The Citv reouires red valve box covers marked "Fire."
Reconstruct the curb return at the southwest comer of McLeod's Way and Old Ferm Lene to comply with the $2,500
B approved plans.
Repeir damaged streellight poles end fixtures. Many streellight poles are bent, leaning, damaged, or not set to
grade. Many streetlights are still not working, but have been nagged for repeir. Streellight service has been N/A Progress Energy
9 intermillent. should cover this
Clean concrete spillage from streeUight pole at the southeest comer of McLeod's Way and SR 434 and streighten $1,000
10 base. Straiahten Pedestrian sianel pole in this same location.
The end of the screen wall along the western boundary extends too far towards S.R. 434 and needs to be pulled $2.500
11 back bv about 1 O-feet to comDI with the approved plans.
12 Complete sionaoe and stripino at Roberts Familv Lane per the approved plans. $5,000
13 Install pavers in parallel arkino sDaces manv Dlaces and desianate sDaces with striDino. $12,000
Site landscaping is incomplete. mulching is minimal or non existent, and the areas that have been installed are
being poolty maintained. Vegetation is dying in many places (including trees. grass. and shrubs) and needs to be $50,000
14 replaced.
15 Install valve boxes around irrioation valves that protrude haphazardlv into sodded areas. $500
The construction/sales trailer has been abandoned and thus Innisbrook Lane should be constructed to Roberts
16 Familv Lane per the approved plans. covered in item #2
17 Complete Gazebo construction including addition of benches and Dlacement of trash receptacles. $10,000
Complete Pool construction including any remaining issues required for a Certificate of Occupancy, including but
not limited to completion of cabana building, outside shower installation. jacuzzi controls. tile around the fountain,
1B repair of eroded planting beds, mulching around landscaDino, and olacement of lounging furniture. $20.000
Subtotal $202 50
Maintenance Bond Items: these are Items that have been Installed and accepted by the City, but are In need
of orooer maintenance and/or reoalr to comolv with Cltv standards.
Repair damaged and cracked concrete work throughout the community (curbs, gullers. sidewalks, ramps, etc.). $25.00C
19 The maintenance bond covers the Citv-owned portion of this work.
20 ReDlace missino or damaaed sanitarY sewer cleanout caps. $1,000
21 Remove sediment and erosion control where no longer needed; repair or install where II is needed. $1,500
22 Repair stormwater inlet on Crimson Lane structure is offsell $2,000
23 The entire sanitarY sewer svstem needs to be cleaned out. $2,000
24 Repair washouts undermining the sidewalk near the intersection of Sarasoarilla and McLeod's Wav. $1,000
Done by ClIy
25 Repair washouts .underminino the sidewalk near the Kave Looo and Old Farm Lane ad'acentto the pool fencina: $5.000 alreadv
At the east end Solaris Wharf Street, the area needs to be re-graded, stabilized. and cleaned up from the end of
2B the pavers to the ouardrail. $3,000
27 Reoair the depression in Blue Bavou Lane. $1,50
2B Install detectable waminos where missino at sidewalk ramDS and secure anv that are loose. $3,000
29 Repair all broken utilitv boxes and valve box covers manv places . $1,000
Subtotal $46 000
Code Enforcement lIems:
Cleanup the enUre community of trash. construction debris, materials stored ansite, etc. With no additional building
construction work planned in the near future. the slle needs to be cleaned and restored to have a finished.
permanent appearance. All construction dumpsters, porta pottles, portable storage containers, construction/sales $10,000
30 trailer, temoorarv mailboxes, construction sions, and all other construction materials shall be removed.
At the buildings where construction has been suspended, the areas around the buildings need to be cleaned and $5.000
31 secured. including the removal of exposed utililv lines.
HOA Items: the HOA Is resoonslble for the maintenance of the followlno Items
32 The stonnwater pond is overQrown and needs treatment for algae and weed orowth. $2.00
33 The entire stormwater svstem has sediment built UP and needs to be cleaned out. $2,500
34 Repair the pond fountain. $500
Subtotal $20 000
Total $268 500