Developer D. R. Horton has reached an $11 million settlement with the Majorca Isles Master Association, the Miami Gardens community that was left in the lurch after the builder pulled the plug on the project during the recession.
Horton had appealed the October 2016 decision made by a federal judge in Miami, who ruled the Texas-based developer must pay $16.3 million in damages for engaging in “immoral, unethical, oppressive, and unscrupulous” trade practices “that offend established public policy for its financial benefit, conspiracy, and breaches of fiduciary duty.”
D.R. Horton, the largest residential developer in the U.S., began construction on Majorca Isles in 2005, near the intersection of the Florida Turnpike and NW 215th Street. The company said it intended to build 681 condos and single-family homes. Plans also called for two swimming pools and clubhouses.
But the developer pulled the plug on the project during the recession after completing and selling 355 units at an average price of $300,000 and ceased further construction. In 2012, the Majorca Isles Master Association declared bankruptcy, claiming Horton employees who had doubled as the HOA’s board of directors had not collected fees from unit owners, failed to keep proper financial records and cut amenities that had been promised.
After a three-day trial in October, bankruptcy Judge A. Jay Cristol issued a 52- page opinion concluding, “These actions by D.R. Horton can only be classified somewhere between not nice and evil.”
D.R. Horton appealed the judgment and the parties reached the $11 million settlement on July 7.
“The Majorca Isles community has been suffering since 2011,” said Barry Mukamal, co-managing partner of the accounting firm KapilaMukamal, in a statement. “The settlement completely rights the ship, provides to the homeowners all of the resources to physically restore the community and establish the necessary reserves ensuring the future viability of the Majorca Isles Master Association.”