When purchasing a unit from a sponsor/developer, whether new construction or a conversion of an older building, Purchasers should fully understand their rights when it comes to accepting the condition of the Unit prior to closing. Unfortunately, it sometimes occurs that a Purchaser is (or feels) somewhat rushed through the pre-closing walk through, which can be an intimidating experience in and of itself. Recently, we represented a Purchaser of a high end condominium, which was scheduled to close. Our client attended the “walk through” the day before the closing was to occur, discovering a number of deficiencies, but most notably improperly laid and defective flooring. The Sponsor’s representatives attempted to pass the defects off as “normal variations” in the wood, however, following our review of photographs taken of the areas, and after hearing specific descriptions of gaps, buckling and mismatched colors, it became apparent that these were material defects, beyond the dismissive explanation that they were reasonable and acceptable.
Our clients did not close as planned and a further investigation revealed that certain lots of materials that had been used were indeed defective, and warranted replacement. We reiterated that a unit must be delivered “as contemplated by the Offering Plan,” and anything less than that would not constitute acceptable delivery of the product. One of the reasons that our attorneys review offerings so thoroughly, including the engineer’s reports, is to familiarize ourselves with what is supposed to be delivered. Based upon the requirements provided for in the offering plan, we were able to negotiate that the floors would be replaced at no cost or expense to our client and this was resolved prior to the closing taking place.
This transaction closed successfully and was handled by partner Steven Matz, Esq.