Turnover Traps for Community Associations: Investigate First, Release Claims Later
April 14, 2026 —
Nicholas B. Vargo - Ball Janik LLPTurnover of a community association from developer control to owner control is a uniquely vulnerable moment. Developers are increasingly presenting Florida condominium and homeowners’ associations with “standard” settlement or release agreements at turnover, often being framed as routine steps to finalize the transition of control. In reality, these agreements can have sweeping consequences, including the release of construction-defect claims before the association has conducted any meaningful independent evaluation.
The developer has years of project knowledge and access to plans, subcontractors, and internal records. The newly elected board is just beginning to organize, obtain documents, and understand the property’s condition. Many defects, especially those involving roofing, waterproofing, windows, or structural components, are latent and not yet visible. Signing a release at this stage means the association is making a binding decision under conditions of uncertainty, without full information, to release all future potential claims.
Over the last few years, there has been a rise in reports of developers offering a packaged deal: they agree to complete certain repairs, often minor punch-list or cosmetic items, and to “forgive” an alleged financial deficit (often around $50,000) supposedly owed by the association from the developer-control period. In exchange, the association is asked to sign a broad release covering all claims, including known and unknown construction defects. To a new HOA board that received their community with limited operating and reserve funds, they are left with a difficult decision to either accept the developer’s offer or assess their owners to pay this alleged debt.
These agreements are occasionally presented through community management companies, which may describe them as “standard” or "routine.” Whether due to misunderstanding or influence from the developer, management companies can unintentionally reinforce the idea that signing is expected. Any recommendation provided to HOAs about whether to sign these releases could open community management to liability down the road. The best practice for both associations and community managers is to refer any agreements to be reviewed by general counsel for the association.
The following two case studies illustrate the real-world consequences:
Case Study One: A newly transitioned board relies on its management company to negotiate with the developer-builder to resolve irrigation issues, pond concerns, and signage deficiencies, along with forgiving an asserted financial shortfall. In exchange, the board signs a broad release covering all claims, including latent defects.
Within a year, several punch-list items remain incomplete, and more serious issues arise. When the association demands completion, the developer delays, prompting the association to seek advice on how to enforce the settlement agreement. The association hires counsel to hold the developer responsible for both the previously agreed-upon items and newly identified construction defects. However, when the association brings claims against the developer, the developer points to the release of all potential construction defects in the community. Thus, the only remaining remedy is limited to enforcement of the specific punch-list terms. The community, still relatively new, has no viable claims against the developer-builder for the construction defects. With warranties expired and the release, the association must fund repairs through special assessments, despite defects that would otherwise have been actionable.
Case Study Two: A community is presented with a similar agreement as above. The management company encourages execution, suggesting it is standard and even telling the board to “name your price.” The developer also pressures the newly elected board to sign.
Instead of signing, the board consults with their attorney. Counsel advises the board not to sign the release and recommends further investigation. Engineers are retained and identify early indicators of broader issues, including stucco cracking, water intrusion, and irrigation deficiencies. Based on this information, the association declines to sign the release. Subsequent evaluation reveals potentially significant construction-defect claims, allowing the community to pursue recovery that would have been lost under the proposed agreement.
These scenarios underscore a fundamental point: signing a release at turnover is not an administrative formality—it is a major legal decision. Board members act in a fiduciary capacity on behalf of their community, and their decisions can bind all current and future owners. At turnover, an association’s right is to investigate and pursue claims. Preserving that right until a full and independent evaluation is completed is not adversarial—it is responsible governance.
Accordingly, associations should retain independent evaluations of the property and consult qualified legal counsel before signing any “standard” agreements, especially ones involving a release of future claims.
Nicholas B. Vargo is a partner in Ball Janik LLP’s Construction Practice Group. He may be reached at nvargo@balljanik.com.
Supreme Court Strikes Down IEEPA Tariffs: The Refund Process Will Be Messy
March 10, 2026 —
Brett W. Johnson, Derek Flint, T. Troy Galan & Thomas Williams - Snell & WilmerOn February 20, 2026, the U.S. Supreme Court held in Learning Resources, Inc. v. Trump, and the consolidated case Trump v. V.O.S. Selections, Inc., that the International Emergency Economic Powers Act (IEEPA) does not authorize the President to impose tariffs unilaterally.1 The decision invalidates both the “reciprocal” tariffs and the drug-trafficking tariffs imposed under IEEPA.
For importers, the immediate question is whether, how, and when refunds can actually be obtained. On that issue, the U.S. Supreme Court provided no roadmap. To the contrary, the dissent warned that the United States “may be required to refund billions of dollars,” that the process is likely to be a “mess,” and that the majority opinion “says nothing today about whether, and if so how, the Government should go about returning the billions of dollars that it has collected from importers.”
Reprinted courtesy of
Brett W. Johnson, Snell & Wilmer,
Derek Flint, Snell & Wilmer,
T. Troy Galan, Snell & Wilmer and
Thomas Williams, Snell & Wilmer
Mr. Johnson may be contacted at bwjohnson@swlaw.com
Mr. Flint may be contacted at dflint@swlaw.com
Mr. Galan may be contacted at tgalan@swlaw.com
Mr. Williams may be contacted at twilliams@swlaw.com>
Read the full story...
It’s That Time of Year: Contract Review Time
February 02, 2026 —
Garret Murai - California Construction Law BlogMy father used to make me wash the family cars every weekend . . . rain or shine. The nice thing about washing a car in the rain is that you don’t need to dry it. Once, while sudsing up one of the family cars in the rain I spotted a couple of Jehovah Witnesses making house calls along our street. As they approached our house, they looked at me, said something to one another, and decided membership probably wasn’t a good fit for our family. If my dad saw that he probably would have thought that was reason enough to have me wash the family cars in the rain. Obviously, I never mentioned it to him.
This is all a rather nostalgic way of reminding myself to get off my duff. The holidays are over. There’s stuff needing doing. Whether you like it or not. Like updating my contracts. You might consider doing the same. A few suggestions:
Retention
For certain private works construction contracts entered into on or after January 1, 2026, retention is now capped at 5%, mirroring the 5% retention cap on state and local public works construction contracts. The 5% retention cap applies to contracts between owners and direct contractors, between direct contractors and subcontractors, and between subcontractors. So, basically, everyone up and down the construction change.
Read the full story...Reprinted courtesy of
Garret Murai, Nomos LLPMr. Murai may be contacted at
gmurai@nomosllp.com
EPA Proposes New WOTUS Definition, Narrowing Clean Water Act Jurisdiction
December 30, 2025 —
Patrick J. Paul, Chris P. Colyer & John Habib - Snell & WilmerOn November 17, 2025, the United States Environmental Protection Agency (EPA) published a proposed rule that would significantly narrow its regulatory authority over Waters of the United States (WOTUS). Under the new proposed WOTUS rule, EPA would effectively have jurisdiction only over relatively permanent waters and a smaller subset of directly connected wetlands.
The WOTUS definition outlines the geographic reach of the U.S. Army Corps of Engineers’ and EPA’s authority under the 1972 Clean Water Act to regulate streams, wetlands, and other water bodies. As such, it has been reviewed in boardrooms, courtrooms, and government offices for over fifty years. Most recently, on May 25, 2023, the U.S. Supreme Court issued its opinion in Sackett v. EPA. In Sackett, the Supreme Court determined that WOTUS are only (1) relatively permanent bodies of water, such as oceans, lakes, rivers, and streams; or (2) adjacent wetlands indistinguishable from those waters because of a continuous surface connection.
Reprinted courtesy of
Patrick J. Paul, Snell & Wilmer,
Chris P. Colyer, Snell & Wilmer and
John Habib, Snell & Wilmer
Mr. Paul may be contacted at ppaul@swlaw.com
Mr. Colyer may be contacted at ccolyer@swlaw.com
Mr. Habib may be contacted at jhabib@swlaw.com
Read the full story...
Collapse Claim Dismissed as Untimely
January 26, 2026 —
Tred R. Eyerly - Insurance Law HawaiiThe insureds’ suit for coverage due to a collapse of their barn was dismissed while the bad faith against the insurer survived. Funaro v. State Farm Fire & Cas. Co., 2025 U.S. Dist. LEXIS 227346 (W. D. Pa. Nov 19, 2025).
The insureds’ barn was insured by State Farm. The insureds alleged that the barn roof collapsed from the weight of snow, causing damage to the structure of the barn itself and the contents of the barn (including a custom French stove that the insureds alleged was worth between $90,000 and $100,000).
Read the full story...Reprinted courtesy of
Tred R. Eyerly, Damon Key Leong Kupchak HastertMr. Eyerly may be contacted at
te@hawaiilawyer.com
Celebrating BWB&O’s 2026 Super Lawyers Rising Stars in San Diego!
March 31, 2026 —
Dolores Montoya - Bremer Whyte Brown & O'Meara LLPBremer Whyte Brown & O’Meara, LLP is proud to announce that Partners
Jocelyn Russo,
Christina Matian, and Associate
Angelo Perillo have been named to the Super Lawyers 2026 San Diego Rising Stars list. This recognition highlights their outstanding dedication and distinguished service in Family Law, Civil Litigation, and Personal Injury Litigation.
SUPER LAWYERS
Jocelyn Russo: 2023-2026
Christina Matian: 2024-2026
Angelo Perillo: 2024-2026
Read the full story...Reprinted courtesy of
Bremer Whyte Brown & O’Meara, LLP
