25-Dec-17 – The Gold Coast condominium association that needed a $500,000 special assessment to pay for legal expenses is now in a dispute with its law firm that says it’s owed $117,000.

State Parkway Condominium Association approved the special assessment on July 24. The 160-unit condo cannot claim the expenses on its insurance policy because the carrier says they are maxed out and is refusing to pay.

Travelers Indemnity Company says State Parkway exhausted a $1 million insurance policy that covered legal expenses. The condo association had planned on using Great American Insurance Group as the excess carrier, but Great American has refused to pay and has asked a federal judge to declare it owes no insurance coverage obligations to State Parkway. Much of the legal expenses were incurred responding to complaints and lawsuits filed by one unit owner who is deaf. Michael Novak has filed complaints with the City of Chicago and battled his condo association in Cook County Circuit Court, Illinois Circuit Court, and United States District Court.

The disputes between Novak and his condo association include Novak being cited for a “pet violation” for having a service dog. Novak has accused the association of discrimination, harassment, and retaliation. United States District Judge Edmond Chang called a lawsuit Novak filed in 2013 a “long lasting and highly contentious case.”

Motion to withdraw as counsel filed over unpaid legal bills

Litchfield Cavo LLP says it is owed $117,607.24 for legal expenses incurred between March 1 and October 31. The law firm, with an office in Chicago, has filed a motion in United States District Court to withdraw as counsel for State Parkway in Novak’s lawsuit against the condo association.

In a November 11 letter to property manager William Southall, Jason Hunter of Litchfield Cavo points out the condo association was able to pay travel expenses for its former property manager, Donna Weber, to give a deposition in the case in Florida but “now takes the position that it is not responsible” for any legal expenses.

State Parkway responded to the threat with a threat of its own, that the condo association would oppose a motion by Litchfield Cavo to withdraw from the case.

State Parkway Condominium Association “will hold Litchfield accountable for any injuries caused by any breaches of Litchfield’s duties,” said William Jones (right) of Canel, King & Jones, another Chicago law firm hired by the condo association. Jones says Litchfield Cavo has been paid about $1 million so far to represent State Parkway and now “relatively little is left to do.”

He says Travelers has “decided to abandon its responsibilities” and State Parkway is now suing them to get more money. Still, he suggests the law firm contact Travelers about money it’s owed, as it was the the insurance company, not State Parkway, that hired them.

State Parkway has asked the court to deny the motion to withdraw, filed on December 4, saying non-payment of bills “is not a sufficient reason” for a lawyer to withdraw as counsel. Having to pay new lawyers to takeover the case would be a hardship for the condo association, asserts Jones, but finishing the case “will not be an unreasonable burden on Litchfield.”

Legal expenses will total $2 million, says unit owner

Between regular assessments, the special assessment, and insurance money, Novak estimates State Parkway will have spent $2 million on legal expenses.

“State Parkway never told unit owners it was going to stiff Litchfield Cavo and take the more expensive step of retaining new attorneys,” says Novak (left). He says that starting in November 2017 and through October 2019, State Parkway will collect $20,833 per month in special assessments to pay for legal fees.

“I don’t think the [Litchfield Cavo] attorneys can wait that long to receive their payments,” says Novak. “However, other State Parkway attorneys...are being paid in a timely manner.”