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Top Real Estate Lawyer Didn't Understand Real Estate Loan Documents

That's a tough argument to make, but if anyone can sell it, it's Gerry Richman:

Feeling burned by a bad real estate deal? Real estate legal eagle and onetime bank chairman Conrad DeSantis can relate.

DeSantis is being sued over a personal guarantee on a $3.5 million loan for a failed Bahamian real estate venture.

It sounds like this should be a plain-vanilla lawsuit, but the dispute has turned into an extraordinary fight. That's because DeSantis, a North Palm Beach lawyer, has launched a blitzkrieg of paperwork against the lender, Cordell Funding LLLP.

DeSantis' main complaint: He and his company were "induced" into borrowing money for the real estate deal.

Tricked into a loan? Hard to fathom, given DeSantis' 41-year legal career as a virtual dean of the Palm Beach County real estate market. The Web site for his law firm, DeSantis, Gaskill, Smith & Shenkman, brags of his specialities in real estate and business law, "and in business itself." Included in his ventures: A stint as chairman of Enterprise National Bank in North Palm Beach.

But DeSantis insists in five thick volumes in Palm Beach County Circuit Court that he is a victim. Time and again, DeSantis claims he was fooled into onerous loan terms and exorbitant fees by Cordell, a private Miami lender. Through a company called North Andros Assets Ltd., DeSantis and partners borrowed from Cordell in 2005 to complete construction of nine Bahamian condos. DeSantis guaranteed the loan.

Among DeSantis' partners in the deal: Bahamian Sen. Philip Galanis.

All would have been well if Cordell had not delayed closing the loan, DeSantis alleges. The delay, plus piles of extra fees, ate up the money for construction of the condos. "They dragged their feet and killed the whole thing," said DeSantis' lawyer, Gerald Richman. He added that DeSantis was distracted by health concerns and wasn't able to focus as closely as he would have liked on the deal's machinations. The loan went into default in October 2006.

But Cordell and its general partner, Robin Rodriguez, aren't impressed by DeSantis' arguments. In court filings, Cordell calls its April lawsuit against DeSantis "a straightforward written guarantee agreement," despite DeSantis' 14-point counterclaim.

"I keep waiting for the kitchen sink. He's throwing everything else in," said Irwin Gilbert, Cordell's attorney.

Cordell also mocked DeSantis' bid to stall discovery. Case in point: DeSantis objected to the word "communications" in a request for written correspondence. DeSantis said the word's meaning is vague.

Cordell's response: Look it up in a dictionary!

Ugg. I like the way Gilbert told the reporter about objecting to the word "communications," as if to belittle everything else about the way Richman is litigating this case.

For all we know, given the context, this could be a perfectly valid objection.

Full post as published by South Florida Lawyers on December 17, 2007 (boomark / email).