A Charleston County jury has ordered three developers to pay tens of millions in damages for shoddy construction during a condominium conversion in Mount Pleasant, one of the largest residential real estate lawsuits in South Carolina history.
The jury found developers East Bridge Lofts LLC, Creekstone Management and Creekstone SC 1 LLC guilty of negligence, breach of warranty, breach of fiduciary duty, unfair trade practices and reckless negligence claims with construction work at East Bridge Town Lofts, a 13-building condo community with about 200 residents off Wingo Way.
The panel determined that the condo community suffered a loss of money or property as a result of "unfair or deceptive acts or practices," according to court documents.
The association, which represented nearly 200 people, was awarded $22 million for actual damages and $33 million in punitive damages, lawyers said.
Amanda Graham, president of the property owner's association, was not available for comment Friday.
The jury's decision followed settlements reached earlier this week with the property owner's association and subcontractors, lawyers said.
The agreements also included the dismissal of the defense lawyers, and the case ended without any closing arguments before jury deliberations, according to Robert T. Lyles, an attorney representing some of the several defendants.
The jury's decision also followed nearly two weeks of testimony about claims of shoddy construction work with the conversion of the former East Ridge Apartments.
The defendants teamed with a group from Texas in 2004 to convert the rental units to condos. The developer and general contractor were owned and controlled by the same persons and as an attempt to shield the assets of their existing companies, they formed a shell corporation in South Carolina to serve as the general contractor for the conversion renovations, according to the court records.
The complaint said the condos were sold as "totally renovated" but contained "many latent building defects." The suit also alleged the developers violated the state's condo conversion law when they used a property condition report from an unlicensed building inspector from Georgia, according to court documents.
The defects to the structure include claims such as water leaks, defective heating, air conditioning, major structural issues with decks, balconies and walkways, in addition to unsuitable windows and holes hidden under exterior sidings.
Testimony from several subcontractors during the trial established that the developer and general contractor actually used a filler product called Bondo to conceal damage to the structural wooden columns, according to a statement released Friday by the plaintiffs lawyers team led by Justin O'Toole Lucey.
Attorney Ed Buckley, who served as counsel for the plaintiffs, said there could be more action on the issue.
"Further litigation may be needed to collect these funds," he said.
As of early Friday night, the identities of the people involved in the three development firms were not immediately available. It was also not immediately known if the developers will appeal the jury's decision.
Reach Tyrone Richardson at 937-5550.
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