Three owners want Colony buildings fixed up

Three Colony Beach & Tennis Resort unit owners have hired legal counsel to demand the Colony Beach & Tennis Resort Association fix up the dilapidated buildings at the shuttered resort.

Attorney Alan Tannenbaum of Sarasota-based Tannebaum & Hanewich wrote a letter to the Association board of directors dated Oct. 23 on behalf of clients and Colony unit owners Ruth Kreindler and Sheldon and Carol Rabin.

Tannenbaum states the Association’s primary responsibility, per its condominium documents, it to maintain the common elements, which include all walls, plumbing and wiring.

“My clients demand that the Association, through board action, immediately reverse its pattern of neglecting its maintenance and repair obligations and implement a program of rehabilitation to bring all systems serving the units into proper function, all condemned units back to habitability and the property as a whole back to the standard when it was an operating resort hotel,” Tannenbaum wrote.

Consequences of non-action, Tannenbaum wrote, includes “personal liability as a result of continuing to make decisions as a board member contrary to statutory and documentary mandates per the following statutes.”

Tannenbaum requested the Association comply immediately and hold a meeting within 15 days to adopt a plan to make improvements to the resort property.

Association attorney Peter Kelly of Sarasota based-Bush Ross, P.A., responded to Tannenbaum’s letter on Oct. 25, by stating the Association won’t be adhering to Tannenbaum’s request.

Kelly noted that the Colony is a resort condominium “with a bankrupt and dissolved operator,” doesn’t have access to recreational facilities and “experts in resort properties have advised the board that even if fully repaired, the buildings are functionally obsolete and cannot support a profitable resort.”

“The board continues to move forward aggressively in trying to reach an agreement with a developer acceptable both to the board and the owners,” Kelly wrote. “Until that process is completed, expending substantial sums to repair any building, would, in the business judgment of the board, be imprudent and a waste of limited resources.”

Kelly also notes the board’s judgment “is supported by a substantial majority of the unit owners through a straw poll and through board elections.”

Colony Association President Jay Yablon told unit owners in an Nov. 10 email that unit owners are in the middle of the voting period for a proposed legal settlement that, “if approved by the owners and then by U.S. Bankruptcy Judge K. Rodney May, will end the core legal disputes that have made progress impossible at The Colony.”

“We need to show that at a time when it counts more than ever, the Colony Association can agree upon a settlement that is essential in ending the logjam and start to move forward,” Yablon wrote.

Colony Lender LLC, which owns bank loans on longtime Colony Beach & Tennis Resort owner Dr. Murray "Murf" Klauber’s property and is seeking to collect on a $13 million judgment, opposes the proposed settlement and isn’t included as part of the settlement.

May will review the proposed settlement and a series of motions Nov. 22, in his Tampa courtroom.

Contact Kurt Schultheis at [email protected].