The saga of One Museum Park West, the 53-story South Loop condominium project, continues; after facing a litany of setbacks that delayed the project for years and losing the backing of more than half the building’s buyers, developers Ronald Shipka and Gerald Fogelson were sued by five of those buyers – and lost.
Two of the buyers, Craig Stepnicka and Janet Elston, allege that they put down $98,500 on a $985,000 condo in 2006 with the expectation that the unit would be completed in 2008. After delays involving permits, adverse weather conditions and building supply shortages, the condo was available in 2010, but now, Stepnicka and Elston want their money back, citing a breach of contract.
“These people should get their money back,” said Robert Minetz, the two buyers’ attorney.
Robert McLaughlin, who represented one of the other buyers, said the developers had to prove the validity of the project delays in the trial.
“This trial was about whether (the developers) could prove whether various delays had occurred, and if they did occur, that they had an impact on the critical path of construction for the individual units,” McLaughlin said.
The lawsuit is an unusual one, as the plaintiffs are essentially arguing that they should not have to pay for a tardy development, especially one with substantially less value than the original purchase price at the height of the housing market.
Howard Dakoff, a partner at Chicago-based law firm Levenfeld Pearlstein LLC who was not involved in the case, said the decision should be taken as a warning.
“This decision is a judicial warning to developers that they will be strictly held to the terms of their purchase contracts and not be given flexibility due to the economic climate,” Dakoff said.
Ironically, Shipka and Fogelson have themselves been plaintiffs in condo disputes. A few years ago, the developers sued 100 buyers of another Museum Park project, settling in most of the cases. Now, as the defendants, they face another 30 lawsuits over One Museum Park West, according to McLaughlin, who represents 15 additional buyers.