Turnover Traps for Community Associations: Investigate First, Release Claims Later
April 14, 2026 —
Nicholas B. Vargo - Ball Janik LLPTurnover of a community association from developer control to owner control is a uniquely vulnerable moment. Developers are increasingly presenting Florida condominium and homeowners’ associations with “standard” settlement or release agreements at turnover, often being framed as routine steps to finalize the transition of control. In reality, these agreements can have sweeping consequences, including the release of construction-defect claims before the association has conducted any meaningful independent evaluation.
The developer has years of project knowledge and access to plans, subcontractors, and internal records. The newly elected board is just beginning to organize, obtain documents, and understand the property’s condition. Many defects, especially those involving roofing, waterproofing, windows, or structural components, are latent and not yet visible. Signing a release at this stage means the association is making a binding decision under conditions of uncertainty, without full information, to release all future potential claims.
Over the last few years, there has been a rise in reports of developers offering a packaged deal: they agree to complete certain repairs, often minor punch-list or cosmetic items, and to “forgive” an alleged financial deficit (often around $50,000) supposedly owed by the association from the developer-control period. In exchange, the association is asked to sign a broad release covering all claims, including known and unknown construction defects. To a new HOA board that received their community with limited operating and reserve funds, they are left with a difficult decision to either accept the developer’s offer or assess their owners to pay this alleged debt.
These agreements are occasionally presented through community management companies, which may describe them as “standard” or "routine.” Whether due to misunderstanding or influence from the developer, management companies can unintentionally reinforce the idea that signing is expected. Any recommendation provided to HOAs about whether to sign these releases could open community management to liability down the road. The best practice for both associations and community managers is to refer any agreements to be reviewed by general counsel for the association.
The following two case studies illustrate the real-world consequences:
Case Study One: A newly transitioned board relies on its management company to negotiate with the developer-builder to resolve irrigation issues, pond concerns, and signage deficiencies, along with forgiving an asserted financial shortfall. In exchange, the board signs a broad release covering all claims, including latent defects.
Within a year, several punch-list items remain incomplete, and more serious issues arise. When the association demands completion, the developer delays, prompting the association to seek advice on how to enforce the settlement agreement. The association hires counsel to hold the developer responsible for both the previously agreed-upon items and newly identified construction defects. However, when the association brings claims against the developer, the developer points to the release of all potential construction defects in the community. Thus, the only remaining remedy is limited to enforcement of the specific punch-list terms. The community, still relatively new, has no viable claims against the developer-builder for the construction defects. With warranties expired and the release, the association must fund repairs through special assessments, despite defects that would otherwise have been actionable.
Case Study Two: A community is presented with a similar agreement as above. The management company encourages execution, suggesting it is standard and even telling the board to “name your price.” The developer also pressures the newly elected board to sign.
Instead of signing, the board consults with their attorney. Counsel advises the board not to sign the release and recommends further investigation. Engineers are retained and identify early indicators of broader issues, including stucco cracking, water intrusion, and irrigation deficiencies. Based on this information, the association declines to sign the release. Subsequent evaluation reveals potentially significant construction-defect claims, allowing the community to pursue recovery that would have been lost under the proposed agreement.
These scenarios underscore a fundamental point: signing a release at turnover is not an administrative formality—it is a major legal decision. Board members act in a fiduciary capacity on behalf of their community, and their decisions can bind all current and future owners. At turnover, an association’s right is to investigate and pursue claims. Preserving that right until a full and independent evaluation is completed is not adversarial—it is responsible governance.
Accordingly, associations should retain independent evaluations of the property and consult qualified legal counsel before signing any “standard” agreements, especially ones involving a release of future claims.
Nicholas B. Vargo is a partner in Ball Janik LLP’s Construction Practice Group. He may be reached at nvargo@balljanik.com.
A Permitting Base Checklist for Data Centers and Power Plants
June 02, 2026 —
Michael S. McDonough, Stephen J. Humes & Stacey C. Wright - Gravel2Gavel Construction & Real Estate Law BlogThere is a lot of talk these days about “license to operate” for data centers, meaning management of the relationships with stakeholders and broader communities concerning both the benefits and adverse consequences of locating a facility in a particular locale. Here, we are speaking of “license to operate” more literally—namely, the legal and regulatory permitting and approval requirements for a privately owned data center whether by itself or colocated with a power generating plant.
Our Base Checklist includes generally and potentially applicable permitting requirements for development and operation, using California as an example. (Taking legal authority Frank Sinatra out of context, “If you can make it there, you can make it anywhere.”) The actual requirements for a given facility would depend, in part, on local law, including planning and zoning laws and plans, and the environment of the site. Just as examples, additional permitting and mitigation requirements might apply if sensitive receptors are located nearby (e.g., noise mitigation for residential dwellings), if sensitive and protected biological resources (e.g., jurisdictional waters and/or protected species) would be impacted, or if the present or former land uses require additional measures (e.g., hazardous materials remediation, mitigation for conversion of prime farmland, or protection of cultural resources). The scope of permit requirements would ultimately be determined by the applicable regulatory agencies and by the lead and responsible agencies under the applicable state environmental land use regime—in our reference case here, the California Environmental Quality Act (CEQA).
Reprinted courtesy of
Michael S. McDonough, Pillsbury,
Stephen J. Humes, Pillsbury and
Stacey C. Wright, Pillsbury
Mr. McDonough may be contacted at michael.mcdonough@pillsburylaw.com
Mr. Humes may be contacted at stephen.humes@pillsburylaw.com
Ms. Wright may be contacted at stephen.humes@pillsburylaw.com
Read the full story...
Inaccurate Representations Can Lead to Differing Site Conditions Claim
May 26, 2026 —
David Adelstein - Florida Construction Legal UpdatesIn the
prior posting, I discussed a case dealing with a differing site condition. In that case, the owner did not have an affirmative duty to make a representation and there was no inaccurate representation made by the owner that misled the contractor.
Well, what about when there is an inaccurate misrepresentation regarding the site? This was the circumstance in an older Florida case where a dredging contractor had a successful differing site conditions claim. See Jacksonville Port Authority v. Parkhill-Goodloe, Co., Inc., 362 So.2d 1009 (Fla. 1st DCA 1978).
The government provided inaccurate information as to the lack of rock that would be encountered during the dredging that was relied on by the dredging contractor. But the government had “
superior knowledge” that there was rock in an adjacent location based on a prior claim from a contractor, yet the government did not disclose the possibility that rock could be encountered.
Read the full story...Reprinted courtesy of
David Adelstein, Kirwin NorrisMr. Adelstein may be contacted at
dma@kirwinnorris.com
HHMR Attorneys Steve Heisdorffer and Dave McLain Named to 2026 Super Lawyers List
April 08, 2026 —
Higgins, Hopkins, McLain & Roswell, LLCHiggins, Hopkins, McLain & Roswell, LLC is pleased to announce that Steve Heisdorffer and Dave McLain have been selected to the 2026 Colorado Super Lawyers list for construction litigation.
Mr. Heisdorffer has been consistently recognized in recent years for his work in construction litigation and related business disputes. Mr. McLain has been recognized by Super Lawyers each year from 2020 through 2026, following his earlier inclusion on the Rising Stars list from 2009 through 2012.
Read the full story...Reprinted courtesy of
Higgins, Hopkins, McLain & Roswell, LLC
The Seventh Circuit Rejects Navigators Insurance Company’s Attempt to Escape Additional Insured Coverage For a Gas Explosion
March 24, 2026 —
Kyle A. Rudolph & Anna M. Perry - Saxe Doernberger & Vita, P.C.In a recent Seventh Circuit decision, Atlanta Gas Light Company v. Navigators Insurance Company, the court addressed a theme that policyholders are often confronted with by insurers
[1] – insurers disputing additional insured coverage where the named insured is not named in the underlying action. The court aptly rejected this position since it was undisputed that the bodily injuries alleged in the underlying lawsuits were due to a gas explosion that was “caused, in whole or in part, by” the named insured’s acts or omissions.
I. Background
The additional insureds, Atlanta Gas Light Company and Southern Company Gas (collectively, “AGL”), retained the named insured, United States Infrastructure Corporation (“USIC”), to locate and mark gas lines that AGL owned in Georgia. USIC failed to mark a certain gas line, which was later struck by a boring company, leading to an explosion that injured three people.
Reprinted courtesy of
Kyle A. Rudolph, Saxe Doernberger & Vita, P.C. and
Anna M. Perry, Saxe Doernberger & Vita, P.C.
Mr. Rudolph may be contacted at KRudolph@sdvlaw.com
Ms. Perry may be contacted at APerry@sdvlaw.com
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Los Angeles Times Ranks Lewis Brisbois Third Largest Firm in LA County, Largest for Litigation
June 08, 2026 —
Lewis BrisboisThe Los Angeles Times has ranked Lewis Brisbois the third largest firm in LA County by attorney headcount, and first for number of litigation attorneys.
Lewis Brisbois, whose Los Angeles office is led by Co-Managing Partners Jana I. Lubert and Kathleen Walker, has 273 attorneys working in LA County, including 167 partners.
The firm ranked No. 1 for Litigation in the county, with 206 attorneys under the leadership of Partner Craig Holden.
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Lewis Brisbois
Leaders in Dispute Resolution Need to Make Unbiased Decisions for Mediation to Succeed
March 31, 2026 —
Rick G. Erickson - Snell & WilmerAs a mediator helping to settle construction disputes and as an arbitrator deciding outcomes of these disputes, I found certain lessons to be especially helpful after graduating last summer from the Executive Education program at Harvard Kennedy School (HKS). The exceptional HKS curriculum included courses focused on negotiation strategies for multiparty disputes, decisive leadership during crisis, and human behavior affecting dispute resolution.
In particular, our HKS class debated the impact of cognitive bias in dispute resolution, and we studied a central theme that decision-making is universally scientific. That is, parties making decisions in dispute resolution exhibit and rely upon empirical factors that good mediators and decision makers should appreciate and understand. Bias, for example, can cause key players to discount persuasive witnesses, admissible evidence, and reliable expert opinions that influence the outcome of a construction dispute. Biased decision makers may also choose to withhold key information from the mediator, as though doing so will help rather than hurt what is supposed to be an objective and diplomatic process.
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Rick G. Erickson, Snell & WilmerMr. Erickson may be contacted at
rerickson@swlaw.com
Differing Site Conditions Claim Requires a Misrepresentation
May 14, 2026 —
David Adelstein - Florida Construction Legal UpdatesIf you are entertaining a
differing site conditions claim, consider this Third District Court of Appeals case from the mid-90s.
In Hendry Corp. v. Metropolitan Dade County, 648 So.2d 140 (Fla. 3d DCA 1995), a contractor was hired by Dade County to demolish the old Rickenbacker Causeway in Miami. The original 1941 plans of the causeway were made available to contractors. The lowest bidding contractor that was awarded the project based its bid “on its conclusion that the pilings supporting the old bridge were made of concrete.” Hendry, supra at 141. The contractor based this conclusion on the original plans, its visual observation, and experience.
Read the full story...Reprinted courtesy of
David Adelstein, Kirwin NorrisMr. Adelstein may be contacted at
dma@kirwinnorris.com
