A dispute at the Halcyon of Palm Beach Condominium Association has ended in a settlement nearly a year after litigation began. The case centered on a $2.5 million air conditioning project and questions about $15 million collected through special assessments.
Dr. Michael Montanaro, an orthodontist and resident of the building, filed suit in October against the association. He alleged that unit owners were not given the right to vote on the air conditioning project and questioned how two separate assessments—one for $6 million and another for $9 million in 2021—were spent. Montanaro’s complaint sought a court-appointed receiver to oversee the association’s finances.
Earlier this month, Palm Beach Circuit Court Judge Maxine Cheesman approved appointing a receiver, but under the settlement terms, the association will instead hire a forensic accountant to review its books. Bill Pincus, Montanaro’s attorney, explained: “Having a receiver would be much worse for them than having an accountant, as a receiver is in control of the association. Instead, the association will have a forensic accountant, agreeable to us, look through these books and figure out what happened with this money.”
Court records indicate previous reviews described the accounting as being in “shambles.” David Glickman, another attorney for Montanaro, said: “The main issue was that the association was simply unable to account for all of the $15 million it spent. Its effort to show what happened to all of that money was insufficient.” He added: “There wasn’t necessarily evidence of nefarious activity,” but noted that it “raises a lot of questions,” due to the amount involved.
A spokesperson for Halcyon stated they expect to hire an auditor by early September.
Halcyon is located at 3440 South Ocean Boulevard and consists of two oceanfront buildings with 104 units built in 1980. The property is among several older condominiums in Palm Beach adjusting to new state safety laws enacted after recent legislative changes affecting condominium oversight.
Other aspects of the settlement include reimbursing Montanaro $250,000 for legal fees and excusing him from special assessments related to those fees or any connected legal costs. The agreement also calls for a vote by owners on proceeding with the air conditioning project—a step not previously taken by the association board.
“My client is very glad,” Pincus said. “I think ecstatic is a proper word.”
