Berkley v Mitchell Sussman, Esq.

Summary:

Berkley alleged that Attorney Sussman published false advertisements inducing plaintiffs’ timeshare owners to retain his services to cancel their timeshare contracts, and to cease making payments to plaintiffs. The developers alleged that Sussman mailed form letters to plaintiffs to negotiate a release from such timeshare contracts, without citing any investigation justifying rescission. Berkley alleged that if the negotiation failed, Sussman would cause Florida attorneys to prepare and record fraudulent deeds purporting to convey the timeshare interest back to the developers or “to an individual serving as a strawman.” Finally, Berkley alleged that Sussman would send his customer a letter and the deed congratulating the plaintiffs’ owners for their release from their timeshare contract, when in reality, the deeds failed to convey the interest, because Berkley “never requested or approved the transfers of ownership, leaving the timeshare owners responsible for their obligations” to Berkley.

For his part, in his answer, Sussman denied liability and asserted that prior to Plaintiffs filing their lawsuit, he has been assisting timeshare owners for 20 years in the same manner without complaint from the timeshare developers. Sussman cited correspondence from the plaintiffs in which they responded to his negotiating efforts by “amicably releasing” Attorney Sussman’s clients from their timeshare contracts. Furthermore, Sussman alleged that transferring timeshare interests back to plaintiffs gives a “substantial benefit” to plaintiffs, because the property goes back in their inventory to resell.

Sussman additionally asserted that “Plaintiffs’ failed to mitigate their damages where a disproportionate percentage of Plaintiffs’ customers are destined to default upon their contractual obligations.” Sussman argued that Florida Statute 721.80, the Timeshare Lien Foreclosure Act, was enacted “specifically to deal with the large number of foreclosures in the timeshare industry and to streamline timeshare lienholder’s ability to foreclose and recover distressed and defaulted interests.” He went on to argue that “[t]o the extent Plaintiffs’ failed to utilize the remedy provided by the Timeshare Lien Foreclosure Act, and suffered increased costs and expense in foreclosing, Plaintiffs failed to mitigate their damages.” Sussman argued that “this Act provides a way to foreclose without harming defaulted timeshare owners and Plaintiffs’ negligent failure to utilize this remedy is harm both to Plaintiffs and timeshare owners in default which could have been easily avoided without additional cost to Plaintiffs.”