Motion-Secondary: VILLAS AT EMERALD LAKE HOMEOWNERS ASSOCIATION INC vs. ROYAL OAK HOMES LLC

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                                Filing # 192455528 E-Filed 02/21/2024 04:27:53 PM



               IN THE CIRCUIT COURT OF THE NINTH JUDICIAL CIRCUIT
                       IN AND FOR OSCEOLA COUNTY, FLORIDA

          VILLAS AT EMERALD LAKE
          HOMEOWNERS ASSOCIATION, INC., a
          Florida not for profit corporation,

                    Plaintiff,

                                                                         CASE NO.: 2020-CA-002942-
                                                                        ON

          ROYAL           OAK HOMES,            LLC, a Florida           DEFENDANT, ROYAL OAK
          limited         liability      company,
                                            fikia AVH                   HOMES, LLC’S, RESPONSE
          ACQUISITION                LLC;  ADVANCED                         IN OPPOSITION TO
          WRAPPING                  AND     CONCRETE                      PLAINTIFF’S OMNIBUS
          SOLUTIONS              OF CENTRAL FLORIDA,                      MOTION FOR PARTIAL
          INC., a Florida corporation; DON KING’S                        SUMMARY JUDGMENT AS
          CONCRETE, INC., a Florida corporation;                        TO VARIOUS DEFENDANTS’
          HUGH           MACDONALD           CONSTRUCTION,              BETTERMENT, ECONOMIC
          INC.,      a    Florida     corporation;
                                            IMPERIAL                      WASTE, AND VALUE OF
          BUILDING             CORPORATION,  a Florida                       BENEFICIAL USE
          corporation;        PREMIER PLASTERING OF                      AFFIRMATIVE DEFENSES
          CENTRAL  FLORIDA, INC.                     n/k/a   TGK
          STUCCO, INC., a Florida                    corporation;
          WEATHERMASTER                              BUILDING
          PRODUCTS, INC., a Florida corporation;
          WEINTRAUB       INSPECTIONS          &
          FORENSICS,              INC.     n/k/a WEINTRAUB
          ENGINEERING                    AND    INSPECTIONS,
          INC., a Florida corporation; THE DIMILLO
          GROUP, LLC, a Florida limited liability
          company;     WOLF’S    IRRIGATION      &
          LANDSCAPING,        INC.,   a    Florida
          corporation;   SUMMERPARK      HOMES,
          INC.,     a     Florida     corporation,   BROWN       +
          COMPANY                ARCHITECTURE,          INC.,       a
          Florida corporation;
          EXPERT             PAINTING           &    PRESSURE
          WASHING,            INC., a Florida corporation,

                                                             1
         135124066.2
Defendants.



 ROYAL OAK HOMES, LLC, f/k/a AVH
 ACQUISITION,
        Crossclaim Plaintiff,

 v



 ADVANCED     WRAPPING     AND
 CONCRETE SOLUTIONS OF CENTRAL
 FLORIDA,        INC.,   a   Florida    corporation;
 DON KING’S CONCRETE, INC., a Florida
 corporation; HUGH       MACDONALD
 CONSTRUCTION,     INC.,    a   Florida
 corporation; IMPERIAL      BUILDING
 CORPORATION,            a   Florida     corporation;
 PREMIER PLASTERING OF CENTRAL
 FLORIDA, INC. n/k/a TGK STUCCO, INC.,
 a Florida corporation; WEATHERMASTER
 BUILDING        PRODUCTS,        INC.,    a Florida
 corporation, WEINTRAUB            INSPECTIONS
 & FORENSICS, INC. n/k/a WEINTRAUB
 ENGINEERING     AND     INSPECTIONS,
 INC., a Florida corporation;  WOLF’S
 IRRIGATION & LANDSCAPING, INC., a
 Florida corporation; BROWN            + COMPANY
 ARCHITECTURE,       INC.,               a  Florida
 corporation; EXPERT       PAINTING &
 PRESSURE WASHING, INC., a Florida
 corporation,

              Crossclaim Defendants.



 WEATHERMASTER BUILDING
 PRODUCTS,



135124066.2
INC., a Florida Corporation; DON KING’S
 CONCRETE INC., a Florida Corporation,

        Third-Party Plaintiff,

 v



 ALL    GLASS     NSTALLATION              COPRP.,        a
 Florida corporation; CASEY      HAWKINS
 GLASS, INC., a Florida corporation; DEAN
 NESBIT, LLC, a Florida limited liability
 company;        HELBERG           ENGERPRISES,
 LLC,    a Florida   limited   liability       company;
 HOBBIT         WINDOWS,         LLC,         a Florida
 limited liability company;                       T&M
 CONSTRUCTION OF SANFORD,                       INC., a
 Florida corporation; WELL                       DONE
 WINDOWS, INC., a Florida corporation;
 and WELL HUNG         WINDOWS             & DOORS,
 LLC,    a Florida   limited   liability      company;
 E.R.O. CONSTRUCTION,              INC., a Florida
 Corporation; LIOS CONCRETE CORP., a
 Florida    Corporation; and ATLANTIC
 CONCRETE         SYSTEMS, INC., a Florida
 Corporation,

        Third-Party Defendants.
                                                  /

         DEFENDANT, ROYAL OAK HOMES, LLC’S, RESPONSE IN
     OPPOSITION TO PLAINTIFF’S OMNIBUS MOTION FOR PARTIAL
          SUMMARY JUDGMENT AS TO VARIOUS DEFENDANTS’
     BETTERMENT, ECONOMIC WASTE, AND VALUE OF BENEFICIAL
                    USE AFFIRMATIVE DEFENSES

        Defendant, Royal Oak Homes, LLC (“Royal Oak”), responds in opposition to

Plaintiff, Villas at Emerald Lake Homeowners Association, Inc.’s (““Association” or

“Plaintiff’),   Omnibus    Motion       for     Partial       Summary   Judgment   as   to   Various

                                                      3
135124066.2
Defendants’ Betterment, Economic Waste, and Value of Beneficial Use Affirmative

Defenses (the “Motion”):

I      INTRODUCTION

       Plaintiff's    Motion        is self-defeating.       Plaintiff argues     that the Defendants’

“Affirmative Defenses” of betterment, economic waste, and value of beneficial use

are insufficiently pled as a matter of law                   “because   they failed to provide      any

specificity” and they are supported by “no record facts or proffered evidence” -- with

no discussion of any evidence.              Motion, § II, III (b).! But Plaintiff admits that these

defenses      “are not an affirmative          defense,   but a restatement        of various   rules of

damages....”       Motion, § III (c). Royal Oak agrees.             Indeed, Royal Oak did not plead

betterment or economic waste as defenses. For this reason and other reasons set forth

more fully below, the Motion should be denied.

I.     ARGUMENT               AND SUPPORTING MEMORANDUM                              OF LAW

       A         Plaintiff’s Request for Partial Summary Judgment on Betterment,
                 Economic Waste, and the Value of Beneficial Use Should be Denied
                 Because They are not “Affirmative Defenses” but are Rules for
                 Calculating Damages for Deficient Construction.

       Plaintiff     argues    in     its   Motion    that     “Summary         Judgment   Defendants’

respective pleadings are not an affirmative defense, but a restatement of various rules

of damages.” Motion, § III (c). Plaintiff cites Moore Meats, Inc. v. Strawn, 313 So.




' Section headings are referenced because the Motion is not paginated.

                                                     4
135124066.2
2d 660, 662 (Fla. 1975) in support of this argument and quotes the Florida Supreme

Court’s definition of an affirmative defense from this case: “All affirmative defenses

are pleas by way of confession or avoidance. They admit the allegations of the plea

to which they are directed and allege additional facts that avoid the legal effect of

the confession.” Jd.

       Royal Oak       agrees with Plaintiff that betterment,    economic    waste, and the

value of beneficial use are not affirmative defenses. They do not satisfy the Florida

Supreme Court’s definition of an affirmative defense, and instead, are merely rules

for calculating damages.       As the Florida Supreme      Court explained    in Grossman

Holdings Ltd.     v. Hourihan,   414   So. 2d   1037,   1039 (Fla.   1982), the measure   of

damages for defective or unfinished construction is either:

                (i) the reasonable cost of construction and completion in
                accordance with the contract, if this is possible and does
                not involve unreasonable economic waste; or

                (ii) the difference between the value that the product
                contracted for would have had and the value of the
                performance that has been received by the plaintiff, if
                construction and completion in accordance with the
                contract would involve unreasonable economic waste.

Id. (adopting § 346(1)(a) of the Restatement (First) of Contracts (1932)) (emphasis

added). These principles for calculating damages           were followed    in Temple Beth

Sholom and Jewish Center, Inc. v. Thyne Const. Corp., 399 So. 2d 525, 526 (Fla. 2d

DCA    1981).   There, the Second District ruled “The proper measure of damages for



135124066.2
construction defects is the cost of correcting the defects, except in certain instances

where the corrections involve unreasonable destruction of the structure and a cost

which is grossly disproportionate to the results to be obtained” — that is, economic

waste. /d. (internal citations omitted) (emphasis added).                        Similarly, the Third District

held in Magnum              Constr. Mgmt.         Corp.   v. City of Miami Beach, 209 So. 3d 51, 56

(Fla. 3d DCA 2016) that “[t]he trial court was correct to exclude betterments from

its award, as the measure of damages for breaching a construction contract is the

reasonable cost of construction and completion in accordance with the contract, if

this is possible and does not involve unreasonable economic waist.” Jd. It added,

“The measure of damages in a breach of warranty action similarly does not include

what   the trial court defined              as betterments.”            Jd. at 56, n. 3 (internal citations

omitted) (emphasis in original).

       Royal         Oak     did   not    plead     betterment,         economic    waste,   or the    value    of

beneficial     use     as    “Affirmative         Defenses.”       In    fact,   Royal   Oak’s   Answer        and

Affirmative      Defenses          to    Plaintiff's      Second        Amended     Complaint    and    Second

Amended Crossclaim Complaint (the “Answer”) (a copy of which is attached hereto

as “Exhibit A”) sets forth its “Defenses” with this preface: “[w]ithout admitting

liability in the alternative, and without assuming the burden of proof or persuasion

on any issue unless required by law, Royal Oak asserts the following defenses.”

Answer,       p. 8. Royal Oak did not choose to plead the Defenses of betterment or



135124066.2
economic waste in the Answer, as the Motion acknowledges, and the law does not

so require. Motion,     § (D.) As the parties agree, betterment, economic waste, and

value of beneficial use are merely elements of damages.”

        Because Plaintiff and Royal Oak agree that betterment, economic waste, and

value   of beneficial use are not affirmative         defenses,   Plaintiff's   Motion   seeking

summary judgment on the grounds that these concepts are insufficiently pled or

proven as affirmative defenses should be denied.

   B.          There is Sufficient Record Evidence of Betterment and Economic
               Waste to Overcome Plaintiff's Request for Partial Summary
               Judgment on these Defenses.

        As part of its damages claim, Plaintiff seeks the cost to remove and replace

all upper and lower roofs on all 76 townhomes at Emerald Lake constructed by Royal

Oak’s subcontractors. (Deposition of Felix Martin (“Martin Dep.”), Vol I, Ex. 6, p.

10; Deposition of Sean Heaney (“Heaney Dep.”), 130:8-9, Ex. 27, p. 4.).>

        The record contains ample evidence that complete removal and replacement

of all upper and lower roofs on all 76 townhomes would result in betterment and/or

cause economic waste.‘ Plaintiffs own expert, Mr. Martin, admits that none of the

alleged code violations require complete removal and replacement of all upper and




? Royal Oak did expressly plead “value of beneficial use” as “Defense” but not as an “Affirmative
Defense.” Answer, p. 10, 4 6.
3 The deposition transcripts of Felix Martin and Sean Heaney, along with pertinent exhibits, were
filed separately with this Court on January 19, 2024.
4 Royal Oak does not intend to argue “value of beneficial use” at trial.

                                                7
135124066.2
lower roofs on      all 76 townhomes.    (Martin   Dep.,   Vol.   I, 185:25,   186-188:1-9).

Further, there is no evidence of any damage to the upper or lower roofs. (/d., 174:7-

16, 179:9-19, 180:21-25, 181:1, 15-17, 182:4-25, 183:1-2; Vol. III, 471:6-8, 482:22-

25, 483:1-12).    Plaintiff's Motion makes no attempt to dispute this record evidence.

Il.    CONCLUSION

       For the foregoing reasons, Plaintiffs Motion should be denied as to its request

for partial summary judgment on the defenses of betterment, the economic waste

doctrine, and value of beneficial use.

DATED:        February 21, 2024

                                          Respectfully submitted,

                                         /s/ James Michael Walls
                                         James Michael Walls
                                         Florida Bar No. 706272
                                         Luis Prats
                                         Florida Bar No. 329096
                                         Robin H. Leavengood
                                         Florida Bar No. 0547751
                                         Fiona E. Foley
                                         Florida Bar No. 118668
                                         Alexa M. Nordman
                                         Florida Bar No. 1025863
                                          CARLTON FIELDS, P.A.
                                          4221 W. Boy Scout Boulevard
                                          Tampa, FL 33607-5780
                                          Telephone: (813) 223-7000
                                          Facsimile: (813) 229-4133
                                          mwalls@carltonfields.com
                                          Iprats@carltonfields.com
                                          rleavengood@carltonfields.com
                                          anordman@carltonfields.com

                                            8
135124066.2
slambe@carltonfields.com
                                         ffoley@carltonfields.com
                                         nbonilla@carltonfields.com
                                         krick@carltonfields.com
                                         fgonzalez@carltonfields.com

                                         Attorneys for Defendant/Crossclaim
                                         Plaintiff; Royal Oak Homes, LLC

                          CERTIFICATE OF SERVICE

       I HEREBY      CERTIFY     that   on   February   21,   2024,   the   foregoing   was

electronically filed with the Clerk of the Court by using the E-filing Portal, which

will electronically serve this document to all registered counsel of record.



                                         /s/ James Michael Walls




135124066.2
EXHIBIT A
Filing # 169610315 E-Filed 03/24/2023 04:13:16 PM



                  IN THE CIRCUIT COURT OF THE NINTH JUDICIAL CIRCUIT
                          IN AND FOR OSCEOLA COUNTY, FLORIDA

          VILLAS AT EMERALD LAKE
          HOMEOWNERS ASSOCIATION, INC., a
          Florida not for profit
          corporation,

                   Plaintiff,
          v                                                             CASE NO.: 2020-CA-002942-ON

          ROYAL          OAK
                          HOMES, LLC, a Florida                         ROYAL OAK HOMES, LLC’S
          limitedliability company, f/k/a AVH                            UNOPPOSED MOTION FOR
          ACQUISITION        LLC;   ADVANCED                              LEAVE TO FILE SECOND
          WRAPPING          AND      CONCRETE                             AMENDED CROSSCLAIM
          SOLUTIONS OF CENTRAL FLORIDA,                                        COMPLAINT
          INC., a Florida corporation, DON KING’S
          CONCRETE, INC., a Florida corporation;
          HUGH          MACDONALD            CONSTRUCTION,
          INC.,     a    Florida    corporation;
                                          IMPERIAL
          BUILDING           CORPORATION,  a Florida
          corporation;      PREMIER PLASTERING OF
          CENTRAL           FLORIDA,           INC.   n/k/a   TGK
          STUCCO,          INC.,        a   Florida   corporation;
          WEATHERMASTER                               BUILDING
          PRODUCTS, INC., a Florida corporation;
          WEINTRAUB       INSPECTIONS          &
          FORENSICS,             INC.     n/k/a WEINTRAUB
          ENGINEERING                   AND    INSPECTIONS,
          INC., a Florida corporation; THE DIMILLO
          GROUP, LLC, a Florida limited liability
          company;     WOLF’S    IRRIGATION      &
          LANDSCAPING,        INC.,   a    Florida
          corporation;   SUMMERPARK      HOMES,
          INC.,     a    Florida   corporation,       BROWN       +
          COMPANY               ARCHITECTURE,            INC.,      a
          Florida corporation;
          EXPERT           PAINTING             &     PRESSURE
          WASHING, INC., a Florida corporation,

                                                              1
         132022252.3
Defendants.



 ROYAL OAK HOMES, LLC, f/k/a AVH
 ACQUISITION,
        Crossclaim Plaintiff,

 v



 ADVANCED     WRAPPING     AND
 CONCRETE SOLUTIONS OF CENTRAL
 FLORIDA,        INC.,   a   Florida     corporation;
 DON KING’S CONCRETE, INC., a Florida
 corporation; HUGH       MACDONALD
 CONSTRUCTION,     INC.,    a   Florida
 corporation; IMPERIAL      BUILDING
 CORPORATION,            a   Florida     corporation;
 PREMIER        PLASTERING        OF      CENTRAL
 FLORIDA, INC. n/k/a TGK STUCCO, INC.,
 a Florida corporation; WEATHERMASTER
 BUILDING        PRODUCTS,        INC.,    a Florida
 corporation, WEINTRAUB            INSPECTIONS
 & FORENSICS,   INC. n/k/a WEINTRAUB
 ENGINEERING      AND     INSPECTIONS,
 INC., a Florida corporation; WOLF’S
 IRRIGATION & LANDSCAPING, INC., a
 Florida corporation; BROWN            + COMPANY
 ARCHITECTURE,       INC.,               a  Florida
 corporation; EXPERT       PAINTING &
 PRESSURE WASHING, INC., a Florida
 corporation,

              Crossclaim Defendants.



 WEATHERMASTER BUILDING
 PRODUCTS,


132022252.3
INC., a Florida Corporation; DON KING’S
 CONCRETE INC., a Florida Corporation,

        Third-Party Plaintiff,

 v



 ALL GLASS         INSTALLATION              COPRP., a
 Florida corporation; CASEY      HAWKINS
 GLASS, INC., a Florida corporation; DEAN
 NESBIT, LLC, a Florida limited liability
 company;  HELBERG      ENGERPRISES,
 LLC,    a Florida     limited   liability    company;
 HOBBIT  WINDOWS,    LLC,                    a Florida
 limited liability company;                       T&M
 CONSTRUCTION OF SANFORD,                       INC., a
 Florida corporation; WELL                       DONE
 WINDOWS, INC., a Florida corporation;
 and WELL HUNG               WINDOWS         & DOORS,
 LLC,    a Florida     limited   liability    company;
 E.R.O. CONSTRUCTION, INC., a Florida
 Corporation; LIOS CONCRETE CORP., a
 Florida    Corporation; and ATLANTIC
 CONCRETE           SYSTEMS, INC., a Florida
 Corporation,

        Third-Party Defendants.
                                                 /

 ROYAL         OAK HOMES, LLC’S UNOPPOSED MOTION FOR LEAVE TO
              FILE SECOND AMENDED CROSSCLAIM COMPLAINT

        Defendant/Crossclaim Plaintiff, Royal Oak Homes, LLC                 (“Royal Oak’), by

and through its undersigned counsel, and pursuant to Florida Rule of Civil Procedure

1.190(a),     respectfully    moves   this    Court   for leave   to file its Second   Amended




132022252.3
Crossclaim Complaint in the form attached hereto as “Exhibit A,” and in support

thereof, states as follows:

        1       On November 23, 2020, Plaintiff, Villas at Emerald Lake Homeowners

Association, Inc. (“Plaintiff”), filed its Complaint and Demand for Jury Trial against

Royal Oak and the other Defendants in this action for alleged defects in the design,

planning and construction of certain townhome buildings in the Villas at Emerald

Lake townhomes community.

        2       On December 29, 2020, Royal Oak filed its Answer and Defenses to

Plaintiff's Complaint and Crossclaim Complaint against the Crossclaim Defendants.

        3       On April 30, 2021, Plaintiff filed its Amended Complaint, and on May

10,   2021,    Royal    Oak     filed     its Answer       and     Defenses       to Plaintiff's     Amended

Complaint and Amended Crossclaim Complaint.

        4       On     December         9, 2021,   Royal    Oak     filed its Unopposed            Motion        for

Leave to Amend Party Name by Interlineation (the “Motion to Amend Party Name”)

on the basis that due to a scrivener’s               error, Royal           Oak   had incorrectly named,

“Premier      Plastering      of Central      Florida,     Inc.,    n/k/a    TGK      Stucco,      Inc.,”   as     a

Crossclaim Defendant instead of, “TGK Stucco, Inc.” This Court granted the Motion

to Amend Party Name on December 13, 2021 and entered an Order substituting the

name “TGK Stucco, Inc.” for “Premier Plastering of Central Florida, Inc. n/k/a TGK




132022252.3
Stucco,       Inc.”   in   the   Amended      Crossclaim   Complaint.   No    other    changes    or

amendments were made to the Amended Crossclaim Complaint.

          5       After entry of the Order granting the Motion to Amend               Party Name,

Royal Oak discovered that it failed to remove               from the Amended         Crossclaim its

subcontract agreement with Premier Plastering and include, in its place, Royal Oak’s

subcontract agreement with TGK Stucco.

          6       Royal     Oak now seeks leave to file its Second Amended              Crossclaim

Complaint to replace the Premier Plastering subcontract agreement (attached to the

Amended Crossclaim as Exhibit F) with the TGK Stucco subcontract agreement. A

copy of Royal Oak’s Answer and Defenses to Plaintiff's Amended Complaint and

Second Amended Crossclaim is attached hereto as Exhibit A.

          7       Additionally, Royal Oak now seeks leave to file its Second Amended

Crossclaim to amend its allegations in Count Twenty-Eight, Count Twenty-Nine,

and   Count      Thirty     against   Brown    + Company     Architecture,   Inc.,    (“Brown”)   to

describe the design failures alleged by Plaintiff and to remove                 all references to

construction administration duties.

          8       No other changes or amendments            are made to the Second Amended

Crossclaim Complaint.

          9       Florida Rule of Civil Procedure          1.190(e) provides, “[a]t any time in

furtherance of justice, upon such terms as may be just, the court may permit any ...



132022252.3
pleading         ... to be amended or material supplemental matter to be set forth in an

amended or supplemental proceeding.”                   Further, Rule 1.190(a) states that “leave of

court shall be freely given when justice so requires.”                     Leave to amend should not be

denied unless the privilege has been abused, there is prejudice to the opposing party,

or the amendment would be futile. See Life Gen. Sec. Ins. v. Horal, 667 So. 2d 967,

969 (Fla. 4th DCA 1996).

          10.       No party will be prejudiced if the Court grants the relief requested here.

In fact, the relief requested will ensure the parties are appropriately named and the

causes      of     action   against   such   parties       are   clearly    plead,   thus   promoting   the

furtherance of justice.

          WHEREFORE, Royal Oak Homes, LLC respectfully requests this Court enter

an Order granting it leave to file its Answer and Defenses to Plaintiff's Amended

Complaint         and Second      Amended     Crossclaim Complaint              in the form attached as

Exhibit A, and granting such further and other relief as this Court deems just and

proper.

                                                  CARLTON FIELDS, P.A.

                                                  Respectfully submitted,

                                                  /s/ James Michael Walls
                                                  James Michael Walls
                                                  Florida Bar No. 706272
                                                  Robin H. Leavengood
                                                  Florida Bar No. 0547751
                                                  CARLTON FIELDS P.A

                                                       6
132022252.3
4221 W. Boy Scout Boulevard
                                                Tampa, FL 33607-5780
                                                Telephone: (813) 223-7000
                                                Facsimile:   (813) 229-4133
                                                mwalls@carltonfields.com
                                                rleavengood@carltonfields.com
                                                lhough@carltonfields.com
                                                ejohnson@@carltonfields.com
                                                mramos@carltonfields.com
                                                anordman(@carltonfields.com

                CERTIFICATE OF GOOD FAITH CONFERENCE

       On March 9, 2023, counsel for Brown reviewed Exhibit A and confirmed that

Brown has no objection to its filing.           On March 15, 2023, counsel for TGK Stucco

reviewed Exhibit A and stated that TGK Stucco has no objection to its filing.              No

other party objected to its filing.

                              CERTIFICATE OF SERVICE
       I HEREBY       CERTIFY that on March 24, 2023, the foregoing was electronically filed

with the Clerk of the Court by using the E-filing Portal, which will electronically serve this

document to all registered counsel of record.

                                                      /s/ James Michael Walls
                                                      James Michael Walls
                                                      Florida Bar No. 706272




132022252.3
Exhibit A

               IN THE CIRCUIT COURT OF THE NINTH JUDICIAL CIRCUIT
                       IN AND FOR OSCEOLA COUNTY, FLORIDA


VILLAS AT EMERALD LAKE HOMEOWNERS
ASSOCIATION,         INC., a Florida not for profit
corporation,

        Plaintiff,
Vv.                                                         CASE NO.: 2020-CA-002942-ON

ROYAL OAK HOMES, LLC, a Florida limited
liability company, f/k/a AVH ACQUISITION LLC;                 ROYAL OAK HOMES, LLC’S
ADVANCED         WRAPPING     AND   CONCRETE                  ANSWER AND DEFENSES TO
SOLUTIONS OF CENTRAL FLORIDA, INC., a                       PLAINTIFF’S SECOND AMENDED
Florida corporation; DON KING’S CONCRETE,                      COMPLAINT AND SECOND
INC., a Florida corporation; HUGH MACDONALD                     AMENDED CROSSCLAIM
CONSTRUCTION,         INC., a Florida corporation;                    COMPLAINT
IMPERIAL BUILDING CORPORATION, a Florida
corporation; TGK    STUCCO, INC., a Florida
corporation;  WEATHERMASTER = BUILDING
PRODUCTS,      INC., a Florida corporation;
WEINTRAUB      INSPECTIONS & FORENSICS,
INC. n/k/a WEINTRAUB ENGINEERING AND
INSPECTIONS,         INC., a Florida corporation;     THE
DIMILLO GROUP, LLC, a Florida limited liability
company;     WOLF’S     IRRIGATION            &
LANDSCAPING, INC., a Florida corporation;
SUMMERPARK       HOMES,   INC,, a Florida
corporation;   BROWN      +       COMPANY
ARCHITECTURE,          INC., a Florida corporation;
EXPERT     PAINTING        & PRESSURE       WASHING,
INC., a Florida corporation,

        Defendants.


ROYAL OAK HOMES, LLC, f/k/a AVH
ACQUISITION,

        Cross Claim Plaintiff,

Vv.

ADVANCED          WRAPPING  AND   CONCRETE
SOLUTIONS        OF CENTRAL FLORIDA, INC., a
Florida corporation; DON KING’S CONCRETE,
INC., a Florida corporation; HUGH MACDONALD
CONSTRUCTION,         INC., a Florida corporation;
IMPERIAL BUILDING CORPORATION, a Florida
corporation; TGK     STUCCO, INC., a Florida
corporation;  WEATHERMASTER = BUILDING
PRODUCTS,       INC., a Florida corporation;
WEINTRAUB      INSPECTIONS & FORENSICS,
INC. n/k/a WEINTRAUB ENGINEERING AND
INSPECTIONS, INC., a_ Florida corporation;
WOLF’S IRRIGATION & LANDSCAPING, INC.,
a Florida corporation; BROWN + COMPANY
ARCHITECTURE,            INC.,   a   Florida       corporation;
EXPERT        PAINTING     & PRESSURE           WASHING,
INC., a Florida corporation,

       Cross Claim Defendants.
                                                        /

WEATHERMASTER             BUILDING PRODUCTS,
INC., a Florida Corporation; DON KING’S
CONCRETE INC., a Florida Corporation,

       Third-Party Plaintiff,

Vv.

ALL GLASS INSTALLATION                    COPRP., a Florida
corporation; CASEY HAWKINS GLASS, INC., a
Florida corporation; DEAN NESBIT, LLC, a Florida
limited   liability          company;            HELBERG
ENGERPRISES, LLC,            a Florida      limited liability
company;      HOBBIT     WINDOWS,           LLC,     a Florida
limited liability company; T&M CONSTRUCTION
OF SANFORD, INC., a Florida corporation; WELL
DONE WINDOWS, INC., a Florida corporation; and
WELL HUNG WINDOWS                    &    DOORS,       LLC, a
Florida limited liability                company;       E.R.O.
CONSTRUCTION,           INC., a Florida Corporation;
LIOS CONCRETE          CORP., a Florida Corporation;
and ATLANTIC CONCRETE                    SYSTEMS,       INC., a
Florida Corporation,

       Third-Party Defendants.




132080218.2
ROYAL OAK HOMES, LLC’S ANSWER AND DEFENSES TO PLAINTIFF’S SECOND
 AMENDED COMPLAINT AND SECOND AMENDED CROSSCLAIM COMPLAINT

       Defendant/Crossclaim         Plaintiff, Royal    Oak   Homes,   LLC,   hereby    files its Answer   and

Defenses to Plaintiff's Second Amended            Complaint and Demand           for Jury Trial (the “Second

Amended Complaint”) and Second Amended Crossclaim Complaint, as follows:

                                                  ANSWER

       Responding to the allegations of the Second Amended Complaint by Plaintiff, Villas at

Emerald Lake Homeowners Association, Inc. (“Plaintiff”), Royal Oak Homes, LLC specifically

and expressly denies each and every allegation except those allegations specifically and expressly

admitted       below.   In further response    to the numbered      paragraphs     of the Second   Amended

Complaint, Royal Oak states:

                                         NATURE OF THE CASE

           1        Admitted that Plaintiff purports to bring an action related to property located in

Kissimmee, Osceola County, Florida.           Denied that Plaintiff is entitled to any relief.

                                     JURISDICTION AND VENUE

                    Admitted for jurisdictional purposes only.

                    Admitted.

                    Without knowledge.

       5            Admitted that Royal Oak Homes, LLC f/k/a AVH Acquisition, LLC (“Royal Oak’’)

conducted business in Osceola County, Florida; otherwise, without knowledge.

       6.           Admitted for venue purposes only.
       7
                    Denied.

       8            Denied.




132080218.2
PARTIES

       9      Admitted that Plaintiff is a Florida non-profit corporation.   Otherwise, without

knowledge.

       10.    Without knowledge

       11.    Without knowledge

       12.    Admitted.

       13.    Royal Oak   is without knowledge with respect to what Plaintiff means      by the

undefined term “developer.”   Admitted that Royal Oak was qualified as a construction business

by a licensed contractor during the construction of seventy-six (76) townhome units within the

subject community. Admitted that Royal Oak contracted with independent contractors to construct

seventy-six (76) townhome units. Otherwise, denied.

       14.    Without knowledge.

       15.    Without knowledge.

       16.    Without knowledge.

       17     Without knowledge.

       18.    Admitted.

       19     Admitted.

       20.    Admitted.

       21     Admitted.

       22.    Admitted.

       23     Admitted.

       24,    Admitted.

       25     Admitted.

       26.    Admitted.


132080218.2
27.    Admitted

       28,    Admitted

       29,    Admitted

       30.    Admitted

       31     Admitted

       32.    Admitted

       33     Admitted

       34,    Admitted

       35     Admitted

       36.    Admitted

       37.    Admitted

       38,    Admitted

       39,    Without knowledge.

                   FACTS COMMON         TO ALL CLAIMS       FOR RELIEF

       40.    Admitted,   except that the community   consists of eighty-eight   (88) residential

townhome units.

       Al.    Without knowledge.

       42.    Admitted    that Royal Oak contracted with independent   contractors to construct

seventy-six (76) townhome units known as Units 110-149 and 162-197.    Otherwise, denied.

       43.    Without knowledge

       44.    Without knowledge

       45.    Without knowledge

       46.    Without knowledge




132080218.2
47      Without knowledge.

       48,     Without knowledge.

       49      Denied.

       50.     Denied.

       51      Without knowledge.

       52.     Denied.

       53      Denied.

       54,     Denied.

       55      Denied.

       56.     Denied.

       57.     Denied.

       58,     Denied.

       59.     Denied.

       60.     Denied.

       61      Denied.

       62.     Denied.

       63      Denied.

       64.     Denied.

       65     Admitted that Plaintiff delivered a 558 Notice to Royal Oak; denied that the notice

complied with Chapter 558, Florida Statutes.   Otherwise, denied.

       66.    Admitted that Plaintiff delivered a 558 Notice to Royal Oak; denied that the notice

complied with Chapter 558, Florida Statutes.   Otherwise, without knowledge.

                COUNT I- NEGLIGENCE AND VICARIOUS                   LIABLITY
                             (against ROYAL OAK)



132080218.2
67.    Royal Oak re-alleges its responses to paragraphs 1-66.

       68.    Royal     Oak   admits   that   it contracted     with   independent   contractors   for   the

construction of certain townhomes at the community.           Otherwise, denied

       69.    Denied.

       70.    Denied.

       71     Denied.

       72.    Denied.

                 COUNT Il —- BREACH OF FLORIDA BUILDING CODE
                                (against ROYAL OAK)

       73     Royal Oak re-alleges its responses to paragraphs 1-66 and 67-72.

       74,    Royal     Oak   admits   that   it contracted     with   independent   contractors   for   the

construction of certain townhomes at the community.           Otherwise, denied

       75     Denied.

       76.    Denied.

       77.    Denied.

       78.    Denied.

       79.    Denied.

                  COUNT II - BREACH OF IMPLIED WARRANTIES
                              (against ROYAL OAK)

       80.    Royal Oak re-alleges its responses to 1-66, 67-72, and 73-79.

       81     Denied.

       82.    Without knowledge.

       83     Denied.

       84.    Denied.



132080218.2
85        Denied.

       86.       Denied.

       87.       Denied.

       88.       Denied.

                                  COUNTS IV — XXIX
  (against DiMillo, Summerpark, Advanced, Don King, Expert Painting, Hugh MacDonald,
              Imperial,    TGK Stucco, Weathermaster,       Wolf’s, Weintraub, and Brown)

       Counts IV through XXIX         do not state allegations against Royal Oak, and therefore, no

response from Royal Oak is required.       To the extent a response is required, Royal Oak denies the

allegations set forth in paragraphs 89-285 of the Second Amended Complaint.

                                                 DEFENSES

       Without admitting liability in the alternative, and without assuming the burden of proof or

persuasion on any issue unless required by law, Royal Oak asserts the following defenses:

       1         Reservation of Right to Arbitrate:         Royal Oak asserts that Plaintiff's members’

                 purchase agreements, and the warranty incorporated by reference therein, contain

                 a clause requiring certain disputes to be submitted to mediation under the rules of

                 the American Arbitration Association and binding arbitration before the American

                 Arbitration Association. By filing this Answer, Royal Oak does not waive the right

                 to arbitrate the claims that are subject to arbitration, in the event that this Court

                 determines   that Plaintiff's    claims   are not barred   by the applicable   statute of

                 limitation and/or statute of repose, including its claims against the Crossclaim

                 Defendants and any Third Party Defendants.

                 Statute of Repose:     Plaintiff's claims are barred by the statute of repose, Section

                 95.11(3)(c), Florida Statutes.




132080218.2
Failure to State a Claim:         Plaintiff
                                                       has failed to state a cause of action upon which

              relief can be granted.

              Estoppel:      Plaintiffs claims are barred, in whole or in part, by the doctrine of

              estoppel, to the extent that Plaintiff has refused offer(s) of appropriate repair from

              Royal Oak or other Defendants.

              Comparative Negligence:            Plaintiff's claims are barred, in whole or in part, by the

              doctrine of comparative           negligence.    Although      Royal     Oak     denies    liability to

              Plaintiff, if any liability is assessed to Royal Oak, it must be reduced or apportioned

              as a result of the negligence or fault of other persons or entities pursuant to the

              provisions of § 768.81, Florida Statutes. To the extent any recovery is permitted in

              this case, §§ 768.31 and 768.81, Florida Statutes, require that judgment must be

              entered on the basis of percentage of fault, taking into account the percentage of

              fault attributable to all persons, whether or not a party hereto, and not on the basis

              of joint and several liability. Such parties include, upon information and belief, but

              are not limited to the Co-Defendants, Crossclaim Defendants, and any Third Party

              Defendants     in this action,     Plaintiff, the unit owners,         and   any other persons       or

              entities performing maintenance on the Subject Property.                       To date, Royal Oak

              specifically   names     Plaintiff and     the   following     contractors,      including    without

              limitation,    ADVANCED            WRAPPING        AND       CONCRETE            SOLUTIONS          OF

              CENTRAL         FLORIDA,         INC.;   DON     KING’S       CONCRETE,            INC.;     EXPERT

              PAINTING         &     PRESSURE          WASHING,            INC;      HUGH        MACDONALD

              CONSTRUCTION,             INC.;      IMPERIAL       BUILDING            CORPORATION;             TGK

              STUCCO,        INC;      WEATHERMASTER                   BUILDING            PRODUCTS,           INC.;




132080218.2
WEINTRAUB            INSPECTIONS            &     FORENSICS,      INC.      n/k/a   WEINTRAUB

              ENGINEERING            AND    INSPECTIONS,           INC.; THE        DIMILLO       GROUP,       LLC;

              WOLF’S          IRRIGATION      & LANDSCAPING,            INC.; SUMMERPARK                    HOMES,

              INC.; and BROWN             + COMPANY             ARCHITECTURE,          INC.    To the extent not

              otherwise identified, and pursuant to the holdings in Fabre v. Marin, 623 So. 2d

              1182 (Fla.       1993); Nash v. Wells Fargo Guard Services, 678 So. 2d 1262 (Fla.

              1996); and E.H.P. Corporation v. Cousin, 654 So. 2d 976 (Fla. 2d DCA                            1995),

              Royal Oak expressly reserves the right to assert a Fabre defense if any non-parties

              are determined as a result of discovery and investigation to be responsible for the

              alleged damages in this case.        Royal Oak is undertaking reasonable investigation

              and discovery in connection with this affirmative defense as the case proceeds.

              Thus, Royal Oak may later be able to more specifically name or identify potential

              Fabre defendants, or in the alternative, may be in the position to withdraw such

              affirmative defense.

              Value of Beneficial Use:          The damages Plaintiff claims in this lawsuit must be

              reduced by the proportionate value of the beneficial use of the residences and/or

              any products furnished by Royal Oak or any other Defendant.

              Lack of Maintenance:           Plaintiff's damages were caused, in whole or in part, by

              the   failure    of Plaintiff and/or        the    homeowners    to    perform      proper,    routine

              maintenance on their residence.

              Modification,       etc.:   Plaintiff's damages,      if any, must be reduced or its claims

              barred in whole or in part, to the extent Plaintiff's damages were caused by the

              modification, alteration, misuse, abuse, or acts of other parties and/or third persons.




                                                     10
132080218.2
Set-off:      Royal Oak is entitled to set off for any amounts recovered by Plaintiff

              from   any judgments,          awards,    collateral    sources,       settlements,       and/or    insurance

              proceeds.      Plaintiff is barred from any such double recovery, which would unjustly

              enrich Plaintiff.

       10.    Laches:       Plaintiff's claims are barred, in whole or in part, by the doctrine of laches,

              in that Plaintiff has unreasonably              delayed        pursuit of the issues raised              in the

              complaint to the detriment of Royal Oak.

       11     Economic Loss Rule:             Plaintiffs claims are barred, in whole or in part, by the

              Economic       Loss Rule, as Plaintiff has not suffered personal injuries or damages

              beyond the product delivered.

       12.    No Duty in Tort:         The claim for negligence is barred because Royal Oak had no

              duty in tort to the unit owners or Association.                Royal Oak’s duty to the unit owners

              and Association is limited to those duties established by contract or applicable

              statutes.


       13     Express Warranty:          Plaintiff's claims are barred, in whole or in part, by the terms

              of the express warranties issued by Royal Oak.                        These warranties, among other

              things, bar recovery of special, indirect, or consequential damages and expressly

              disavow       any and    all implied      warranties.          Furthermore,        the    unit   owners    and

              Association waived any claim based on implied warranty.

       14     The    Association       has    No   Greater      Rights        than      the    Original        Purchasers:

              Plaintiff's     claims   are    barred,    in   whole     or     in    part,    because     Plaintiff,    as    a

              homeowner’s association existing under Chapter 720 of the Florida Statutes, stands




                                                        1
132080218.2
in the shoes of the original purchasers of the townhomes at issue, and has no greater

              right of recovery than the original purchasers.

       15     Waiver:       Plaintiff's claims are barred, in whole or in part, by the doctrines of

              waiver, in that Plaintiffs conduct is in violation of the warranties applicable to the

              Subject Property.

       16.    Limitation of Remedies:        Plaintiffs claims are barred, in whole or in part, to the

              extent that Plaintiff and its predecessors in interest, if any, waived or agreed to

              limitation of remedies in the warranty language applicable in the Subject Property.

       17     No   Reliance:      To   the extent   that Plaintiff's     claims   are   based   upon   alleged

              representations by Royal Oak, this action is barred as there was no reliance upon

              such representations.

       18.    Failure to Mitigate:       Plaintiffs alleged damages, which Royal Oak expressly

              denies, should be reduced to the extent that Plaintiff has failed to mitigate Plaintiff's

              damages, and by the doctrine of avoidable consequences.

       19     Statute of Limitations:       Plaintiff's claims are barred, in whole or in part, by the

              applicable statute of limitations.

      20.     Approval of Plans/Inspections:             Plaintiff's claims are barred, in whole or in part,

              by the approval of the applicable plans, the passing of all applicable inspections,

              the lack of injury to persons or property other than the Subject Property, and the

              fact that Royal Oak neither knew nor should have known                    of any alleged code

              violations.

      21      Patent Defects:      Plaintiff's claims are barred, in whole or in part, because any

              alleged defects were patent at the time of completion and acceptance of the Subject



                                                    12
132080218.2
Property, and are precluded under the doctrine set forth in Slavin v. Kay, 108 So.

                2d 462 (Fla. 1959) or the principles of waiver, estoppel, and/or disclaimer.

        22.     State of Art:    Royal Oak states that it is entitled to the State of the Art Defense.

                See § 768.1257, Fla. Stats.

        23      Royal Oak Did Not Commit Code Violations:                    Plaintiffs claims are barred, in

                whole or in part, by the fact that § 553.84, Fla. Stats., only allows an action against

                the party who committed the code violation.

        24,     Lack of Standing:       Plaintiff lacks standing to assert certain claims pled in the

                complaint.      Specifically,   Plaintiff lacks   standing     to assert   claims   concerning

                improvements for which the association is not responsible to maintain, repair, or

                replace under the Declaration such as the townhome units and their exterior walls,

                windows, and roofs.       Royal Oak reserves the right to supplement or modify this

                affirmative defense as discovery is ongoing.

        25      Spoliation of Evidence: Plaintiff's claims set forth in the complaint may be barred,

                in whole or in part, by the doctrine of spoliation of evidence to the extent that

                Plaintiff destroyed and/or failed to preserve evidence by conducting destructive

                testing, repairs, replacement, and/or remediation on the Subject Property without

                affording the opportunity to inspect or observe the evidence tested and repaired,

                replaced, and/or remediated.

                                     WAIVER OF JURY TRIAL

        The purchase and sale agreements between the unit owners and Royal Oak contained a

waiver of jury trial, and therefore, the Association is not entitled to a trial by jury.

                                    RESERVATION            OF RIGHTS



                                                      13
132080218.2
Royal Oak hereby reserves its right to supplement or amend the foregoing defenses during

the pendency of this litigation, as discovery and pre-trial preparation remain ongoing.

          WHEREFORE,        Defendant/Crossclaim            Plaintiff, Royal    Oak    Homes,   LLC    f/k/a AVH

Acquisition, LLC, demands that judgment           be entered in its favor, that Plaintiff take nothing from

this action, and that the Court grant to it all relief deemed just and proper.

                     ROYAL OAK’S SECOND AMENDED                          CROSSCLAIM

          Defendant/Crossclaim Plaintiff, ROYAL OAK HOMES, LLC f/k/a AVH ACQUISITION,

LLC (“Royal Oak”), hereby sues ADVANCED                     WRAPPING         AND      CONCRETE      SOLUTIONS

OF CENTRAL FLORIDA, INC. (“Advanced”); DON KING’S CONCRETE, INC. (“Don King”);

EXPERT        PAINTING      &    PRESSURE          WASHING,           INC.      (“Expert     Painting”);   HUGH

MACDONALD           CONSTRUCTION,          INC.      (“Hugh       MacDonald”);         IMPERIAL       BUILDING

CORPORATION