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Ormond Beach Observer Tuesday, Feb. 12, 2019 3 years ago

'A new era': Ormond Heritage Condominium moves on from Hurricane Matthew

Ormond Heritage intervened in a federal court suit filed by its insurance carrier against Paramount, receiving a $2.5 million settlement for its claims.
by: Jarleene Almenas Associate Editor

The residents of the Ormond Heritage Condominiums popped bottles of champagne on Jan. 10 — 27 months after Hurricane Matthew — in celebration of its $2.5 million claim settlement.

Board President Jerry Cutter bought 12 magnums and a large cake for the 100 homeowners that attended the 15 minute-meeting held in the condominium's ballroom, the same place they were all told in 2017 that mold had been found in the building and all homeowners needed to evacuate. 

"Life isn't getting back, it is back to normal," Cutter said. 

After Hurricane Matthew, the previous board signed away the condominium's claim to Paramount Disaster Recovery LLC via an assignment of benefits contract. This relinquished all of the condominium's rights to Paramount, which was put in charge of handling the insurance claim. 

In November 2017, as residents dealt with air scrubbers, barricades and put up signs on their doors to keep Paramount out of their units, a new board was put in place, and Cutter became president. About 60 days later, the board hired attorney Michael Ciocchetti to help them with the condominium's claim. 

It took almost a year and a "hard, hard fought" legal battle, said Cutter, but Ormond Heritage is finally closing its Hurricane Matthew chapter.

Paramount claimed $66 million

The stars aligned for Ormond Heritage. The condominium's insurance carrier, Ariel Syndicate 1910, filed suit against Paramount in federal court over Paramount's $66 million claim for Ormond Heritage. 

Ciocchetti said Ariel defended its lawsuit on the basis that there was no hurricane-related damage, and that any damage was pre-existing. It also asserted that Paramount's $66 million claim was fraudulent. If Ariel had won the lawsuit on that defense, Ormond Heritage would not have received any money for its claim.

“The only way for us to counteract that was to intervene in Federal Court in the action between Ariel and Paramount," Ciocchetti said.

Ciocchetti said they saw this as the quickest and most efficient way to resolution, as well as a way to protect Ormond Heritage's interest in the litigation. 

"Certainly, it’s the board’s position that there was some damage to the property as a result of Hurricane Matthew," Ciocchetti said. "The disagreement there, is the extent of the damage.”

Paramount claimed that all of the roof systems in the condominium were damaged, all exterior walls needed to be stripped and that there was mold in the wall cavity between the drywall and the exterior walls. Ariel, having conducted an investigation where its experts and engineer's reports differed from Paramount's findings, disagreed with the claim. 

So did Ormond Heritage.

“While he was fighting the legal battle of intervention, we were fighting a battle to restore the property, but the litigation was in the way of trying to restore the property, so we had to work jointly," Cutter said.

Ciocchetti said the condominium presented about 20 unit owners during litigation who got their own experts — some homeowners got a second opinion as well — and found no mold in their units. 

Paramount also shouldn't have claimed the roof Ciocchetti said, as the flat roof is warranted by the roofing company for up to 140 mph winds. If it had been damaged by Hurricane Matthew, the repairs would have been directed back to the roofing company.

The $2.5 million settlement given to Ormond Heritage as a result of the litigation was for repairing and replacing the tiles surrounding the flat roof, repairing the outside wall scarring, and repainting and sealing the building. 

"Because of [Ciocchetti's] involvement, we got a seat at the table," Cutter said.

Rise in morale

Ormond Heritage settled its claim in the litigation between Ariel and Paramount on Dec. 6, 2018. It was a happy day, not only for the residents, but for Ciocchetti.

His son was born. 

The mood in the condominiums has also changed drastically. The current board, which was re-elected in November 2018, is now working on restoring the Ormond Heritage. Previously closed-off rooms like the library, billiards and card rooms have been re-opened, and the board is working on renovating some common areas. 

Every week, Cutter said realtors and agents call them asking what they have for sale and rent.

“The morale has been miraculous," Cutter said. "The change in the attitudes — we had despair, we had people fighting amongst themselves...And in the 12 months we restored people’s confidence and trust.”

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