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KJB Village Property, LLC v. Craig M. Dorne, P.A.

Florida Court of Appeal, Third District

November 23, 2011

KJB VILLAGE PROPERTY, LLC, and Siam Bagel, Inc., Appellants,
v.
CRAIG M. DORNE, P.A., and Craig M. Dorne, Appellees.

Rehearing Denied Feb. 2, 2012.

Page 728

Warren R. Trazenfeld, Miami, for appellants.

Beasley & Demos and Stephanie E. Demos, Miami, and Jennifer Perez Alonso, for appellees.

Before CORTIÑ AS, ROTHENBERG, and LAGOA, JJ.

LAGOA, J.

KJB Village Property, LLC, and Siam Bagel, Inc. (collectively " Appellants" ), appeal from an Order Granting Motion for Entry of Final Judgment and Final Judgment in Favor of Defendants Craig M. Dorne P.A. and Craig M. Dorne, Esq. (collectively " Dorne" ). For the following reasons, we affirm.

I. FACTUAL AND PROCEDURAL HISTORY

Jerome Berman (" Berman" ) purchased Siam Bagel, a store located in the Shoppes of North Bay Village (" Shoppes" ). When Berman purchased Siam Bagel, he took over the existing lease, which ran several

Page 729

more years. Dorne represented Berman in the purchase of Siam Bagel.

When Berman bought Siam Bagel, he believed the shopping plaza was going to be improved or updated; Shoppes, however, intended to develop the property into condominium units. On or about July of 2002, the principal of Shoppes, Scott Greenwald (" Greenwald" ), introduced himself to Berman, and later offered $100,000 for Siam Bagel's early termination of its lease. Berman refused that offer and countered with a demand for $500,000, which Greenwald did not accept. Greenwald then offered 1600 square feet of retail space in exchange for early termination of Siam Bagel's lease, which Berman accepted. When it came time to memorialize the agreement, however, Greenwald instead offered Berman one of ten condominium units to be built on the property. Berman discussed this offer with Dorne, and Berman ultimately agreed to accept Unit 1105.

In the course of negotiating the final agreement, Berman communicated directly with Greenwald. Counsel for Shoppes drafted the first lease termination agreement. In the process of finalizing the negotiations, Dorne wrote to Shoppe's attorney and requested a copy of the agreement for his review. Berman reviewed the multiple drafts of the Agreement exchanged between the parties, participated in the revisions to the draft, and read the final draft (at least in part) before its execution.

In the course of the negotiations, Berman contemplated the possibility that there could be a lien on the property when he received it. Thus, Berman negotiated that Siam would receive a condominium unit that was " free and clear" of any liens or mortgages. Dorne told Berman that " marketable title" meant " free and clear," and Berman admits he was warned by Dorne that it was possible that the unit would not be delivered if the condo was never built. Despite the warning, Berman decided to go through with the deal, which included a provision requiring Shoppes to " transfer and convey fee simple marketable title in and to Unit 1105" to Siam Bagel within sixty days from the date of the certificate of occupancy. In the event Shoppes did not deliver the Unit within forty-two months of the lease termination date, Shoppes agreed to payment of $443,900.

Near the end of the forty-two months, the new owner of the property, Lexi Development (whose principal was also Greenwald) delivered a Special Warranty Deed conveying Unit 1105 to KJB Village Property LLC (an entity owned by Berman). This deed failed to disclose that Unit 1105 was encumbered by a construction loan mortgage. As a result of the undisclosed construction loan, Siam and KJB sued Shoppes, Lexi and Greenwald (collectively, the " Developer" ) for the failure to deliver a unit free of any encumbrances and for their failure to disclose the mortgage at the time of conveyance. Appellants, however, dropped the lawsuit [1] ...


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