"Treasure Island" Update: Florida Mutual Files Its Defense

On Wednesday, New Times published "Treasure Island", the story of serious civil and criminal fraud allegations involving the Grandview Palace condo association in North Bay Village, the building's father-and-son developers, and an insurance provider accused of being a shell corporation. 


That same day, the attorneys representing the insurance company and the developers -- Dr. Charles C. Edwards, a famed Baltimore spine surgeon; and his son James -- in the civil case filed their official defense in court.

For the most part, the filing is bogged down with cumbersome legalese. But the defense attorney, Alvin B. Davis, makes a few interesting arguments in his clients' defense:

  • "The Association accepted and consented to the purchase of insurance

    policies from Florida Mutual... The management company hired by the

    Association issued the checks paid to Florida Mutual."

In other

words, the condo association's members had a chance to do their research

beforehand and object to the Florida Mutual contract. They didn't.

  • "The

    Association has not suffered any damages. Florida Mutual offered to

    defend the Association for any and all claims properly covered under

    the Florida Mutual policies."


So even if the insurance company

wasn't licensed, according to state prosecutors in the criminal case,

Florida Mutual would've paid out all claims anyway. A document filed in

2006 claims the company paid $800 to a Grandview Palace tenant whose

car was allegedly damaged by a garage door -- but the plaintiff's

attorney, Aaron Cohen, says he "doubts" that payment was actually

made.

  • "Plaintiff alleges, at most, a breach of contract

    action, for which claims of conversion, civil theft, conspiracy for

    fraud, and aiding and abetting fraud are not actionable."

  • "Plaintiff

    and Defendants were operating under a mistake of fact and/or law...

    Defendant acted on and relied upon the advice of counsel."


This is perhaps the most compelling claim, and echoes what Attorney Davis told New Times:

that "[Florida Mutual's founders] received advice that state licensing

wasn't required. Davis wouldn't identify the origin of that advice,

though, and this document doesn't either. The claim contradicts a North

Bay Village Police report that had Vidal Sainz, a Miami insurance agent

listed as a managing agent for the company, saying he informed Dr.

Edwards that running an insurance carrier without a license

"constituted a felony."

  • "The current non-developer members of

    the Board of Directors of the Association are pursuing this action in

    bad faith and with unclean hands."


Them's fighting words -- and an

echo of Davis's condemnation of the condo association's suit as "a

vendetta and a money-grab."

In related news, North Bay Village

Mayor Oscar Alfonso has weighed in with his opinion on the criminal

charges. As of now, only the insurance company as a corporation -- not Charles or James Edwards -- has

been charged with felonies, and Alfonso

agrees with state Rep. Julio Robaina that if a crime was commited,

individuals need to be be charged. "It would be an awful precedent if

the State Attorney's Office said, 'Okay, give the money back and be

nice from now on,'" Alfonso says. "I'm not here to pass judgment, but if in fact they

created the insurance company for the purpose of defrauding the condominium association, they should be charged with a crime."


Sponsor Content

Newsletters

All-access pass to the top stories, events and offers around town.

  • Top Stories
    Send:

Newsletters

All-access pass to top stories, events and offers around town.

Sign Up >

No Thanks!

Remind Me Later >