Resort Condo Assoc., Unit Owner Reach Settlement

OCEAN CITY – A lawsuit against a resort condominium association has been settled.

In July 2022, Pasadena, Md., residents Kenneth and Amber Hyde filed a lawsuit against the Seaward Villas Condominium Council of Unit Owners, its board president and property managers seeking damages for a ceiling collapse that occurred in their Ocean City condo unit in July 2017.

Now, more than a year later, the defendants and plaintiffs have reached a settlement agreement, the terms of which remain confidential.

“Hindsight is 20/20, and I think everyone recognizes a lot could have been done in 2017 to avoid this whole situation,” said James Almand, attorney for the defendants. “It’s unfortunate. I characterize it as a breakdown in communication.”

Amber Hyde, a plaintiff in the lawsuit, said she was visiting her Ocean City condo in July 2017 when she discovered a crack running through the ceiling in her living area. She said she quickly got to work bracing the ceiling until repairs could be made. When she returned two weeks later, however, the ceiling had collapsed entirely.

“If my family had been there, someone could’ve been killed,” she said.

Upon further inspection, Hyde had discovered that the kitchen cabinets had pulled away from the wall and that the kitchen counter had become misaligned. Almand said the insurance adjuster reported the collapse as a result of moisture that had accumulated in the attic space above the unit. An insurance claim filed for water damage was subsequently denied.

“The experts said the ceiling collapsed because of plastic put in the attic of the unit …,” Almand said. “My clients said Mr. and Mrs. Hyde put it up there without authority, and that’s what caused the ceiling to collapse.”

What followed was a years-long dispute between the Hydes and condo association over engineering reports, the cause of the damage and the remediation of the incident.

Nearly a year after the collapse, Hyde said she hired MAD Design Group to determine the cause of the collapse. She said an engineering report identified several structural issues, including that the east wall of the condominium was leaning and that the roof trusses in the attic showed signs of movement.

“All seven of these issues point to there being a structural failure and stability issue with the East wall and possibly other areas of the property,” the report reads. “It is our Professional Opinion that there is a serious structural issue with the East wall of Unit #304. If not corrected, or at a minimum stabilized immediately, there is the possibility of a catastrophic failure.”

Within 30 days of that report, the condo association hired another engineer, George, Miles and Buhr (GMB), to conduct a second assessment. Almand said their report opined the collapse was the result of vertical load on the ceiling and that the leaning wall was the result of the ceiling collapse. GMB suggested several repairs be made to the unit.

“Roland Holland of that firm said there were no structural problems at all,” he said. “He did then say work was needed in the attic, but that it wasn’t a dangerous situation.”

The Town of Ocean City also got involved at that point. In June of 2018, the town’s building inspector posted a no occupancy sign on the unit until the necessary repairs could be made.

“Please note due to possible structure failure this unit has been posted ‘no occupancy’ until deemed not hazardous by a licensed engineer in writing to this office,” a letter from former chief building official, Kevin Brown, reads.

Almand said his client made the necessary repairs to the attic space in the fall of 2018.

Hyde, however, argued it was just a fraction of the work identified in the GMB report.

“It was the minimum just to secure the building,” she said.

In July 2022, following a years-long dispute over damages, insurance claims and remediation, Hyde filed suit against the condo association, its management company and the board president.

The complaint, filed in Worcester County Circuit Court, alleges violations of condominium bylaws and the Maryland Condominium Act, breach of fiduciary duties, gross negligence, slander and libel. It also seeks damages for loss of use and rental income.

“I did everything I was supposed to do as a condo owner and everything I was instructed to do by the Town of Ocean City, and I think the condo association is bound by what is set forward in its bylaws …,” she said. “This is the direct result of them not filing proper insurance claims at the proper time.”

Almand, however, maintained that there were no structural damages at the property, and that his client had made the necessary repairs.

“Ms. Hyde from day one was looking for insurance money,” he said. “Multiple claims were filed with the insurance carriers for Seaward Villas and all were denied.”

The case set to go to trial this week in Snow Hill. Last Friday, however, the plaintiffs and defendants settled.

“I think the board was glad it’s over because it could’ve been a day-and-a-half, two-day trial …,” Almand said. “I think they were happy to settle and not cost the association more money.”

About The Author: Bethany Hooper

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Bethany Hooper has been with The Dispatch since 2016. She currently covers various general stories. Hooper graduated from Stephen Decatur High School in 2012 and the University of Maryland in 2016, where she completed double majors in journalism and economics.