Judge orders Rainbow, Sabra N.V. to pay damages to apartment owners

PHILIPSBURG--The Court of First Instance of St. Maarten has ruled in favour of the Rainbow Beach Club apartment owners, and has ordered Rainbow to pay damages on grounds that the building in which the apartment owners reside was built in conflict with the building and planning permit and in violation of the sales and purchase agreement that was signed by the parties.

The developer of the project, Sabra N.V., was also deemed liable for damages. Attorney Michiel Noordhoek of law firm HBN Law, which represented the owners, explained that the planning permit stipulates that if a building is equipped with an elevator, the maximum number of floors allowed is four, and if no elevator is present, the maximum number of floors allowed is three.

Noordhoek explained that the buildings at Rainbow are much higher than what was allowed in the planning permit and this has been confirmed in the judgments. The West and South Building have five to six floors, the Tennis Building has at least six floors, and the Tower Building has eight floors with roof top units. This means that all together more than 80 apartments in the Rainbow Beach Club are built in conflict with the planning permit.

Noordhoek further explained that when the owners purchased their units, they trusted that the building would be no higher than four floors, as stipulated in the sale brochures of the project. Additionally, Noordhoek also explained that the court rendered its verdict on damages based on the poor state of the buildings, which had walls filled with mould, cracks, a failing drainage system and other aspects that were also deemed in violation of the sales and purchase agreement.

Attorney for Rainbow Beach Club Mark Kortenoever of law firm Lexwell said his client will appeal the decision based on "irregular arguments" within the judgment. He said the way the judge established certain facts as they relate to construction deficiencies will be challenged. He also contended that the judge did not motivate the decision sufficiently, did not conduct any site visits and didn't call any witnesses or hear any expert testimony.

"In our opinion the conclusion cannot be supported by what was presented in court," Kortenover said, adding that his client's position is that the subdivision permit is not relevant considering the zoning for the area, which allowed much higher buildings to be built in the general area, such as The Cliffs and Blue Mall, both of which are higher than Rainbow.

When asked what his position was on owners who contended that the two high buildings were constructed after Rainbow had built and their purchase agreements had been signed, Kortenoever said, "The judge didn't make a ruling on whether or not there were any expectations regarding the number of floors when they signed it.
"The judge said because of the conflicts in the planning permit, this was enough to rule in favour of the claim for damages. Our argument on the damages claims because of the height of the building is this: if you are a neighbour in an adjoining project, then you may have an issue if your neighbour's project has more floors, but if you are in the project itself you cannot say suffer damages because of violation of the planning permit," Kortenoever said.
The amount of damages to be paid by Rainbow and Sabra N.V. will be established in separate proceedings.

23 September 2011

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