Board's hot pursuit of developer for $200K problem turns ice cold after Sutherlands assume Board presidency

In an e-mail dated June 4, 2003 (included, below), Sandra Jones, the first GIL Board President (and until 2011, the only non-Sutherland Board President), asks Mike Beecham (an associate with Piedmont Management Company, the management company GIL used prior to switching to CMA) to have Gary Caruso of Criterium Caruso Engineers investigate 'as quickly as possible' any responsibility the developer, Jerry Miller or Miller-Gallman Developers may have in the failure of the retaining wall behind Phase II - a problem that ended up costing GIL homeowners more than $200K to remedy less than two years later.

Interestingly, Kit Sutherland, who was on the GIL Board at the time - although not yet serving as President - appeared to take an keen interest in the growing problem early on, as that same e-mail indicates that a week prior to Jones' request of Beecham, she had already met with Gary Caruso - the engineer Jones had tapped to look into the reasons behind the failure of the slope's stabilization. (Continued...)


What transpired at that meeting and whether or not Ms. Sutherland made any effort to derail the
Board's interest in determining developer responsibility for the problem, is unknown.  But what is known is that whatever enthusiasm the Board may have had initially in determining the nature and extent of developer culpability while Jones was still serving as President, appears to have quickly evaporated with her departure from the Board following a job transfer, and the Sutherlands immediate assumption of the Board presidency.

Despite dozens of requests by homeowners over the years to see the reserve study and the associated engineering report by Criterium Caruso - if that part of Jones' request was ever even ultimately completed - neither has ever seen the light of day.  The fact that Georgia law clearly states that such information be made available to Association members upon request has never seemed to be much of a concern to the Sutherlands, who routinely stonewall Association document review requests.

The most marked change following Jones' departure was an apparent shift of focus by the GIL Board, newly under Sutherland control, from determining the extent of developer responsibility for the slope stabilization problem to one of exploring the smoothest way possible for the hefty $200K plus price tag to be picked up by GIL homeowners without causing a massive homeowner revolt.  Nor did the Sutherlands waste any time in ousting Piedmont Management as the GIL property management company and no further work was ever requested of Criterium Caruso after Jones left.  In the end, the Sutherland Board decided against a special assessment (estimated to have been about $2,200 for the average homeowner) and, instead, opted to have the Association obtain a $200K plus loan that took GIL homeowners nearly five years of elevated monthly dues to pay off (note: the monthly assessment level has never decreased at Glen Iris Lofts - even after the loan was paid in-full).

Whether there was any quid pro quo between Jerry Miller and the Sutherlands has yet to be conclusively determined.  But, at the very least, Mr. Miller had to have been extremely relieved and grateful that he was able to dodge what was shaping up to be a very expensive bullet, compliments of the Sutherlands.  And what have the Sutherlands themselves had to say about why they decided to slide the bill for what seemed to everyone a pretty clear case of construction deficiency, across the table to their fellow homeowners when it came time to pay?  The question has been asked once - at the Annual Meeting in 2005. And in response, Stuart Sutherland stood in front of the audience and sheepishly mumbled something to the effect that the 'we didn't want to make an enemy of Jerry Miller over the problem in case we need his goodwill and cooperation later on down the road'.

One can't help but wonder, 'what kind of problem could be worse than one with a $200K plus price tag?' The answer is that there almost certainly weren't going to be any.  And even if there were, would a developer who couldn't be called upon to pay for a $200K deficiency be any more amenable to paying for a deficiency costing more? That seems very unlikely. In my opinion, what seems a bit more likely though, in retrospect, is that perhaps by saying 'we', Stuart Sutherland meant himself and his wife - and not his fellow homeowners as may have been wrongly assumed by everyone in the audience.

I know - you might be thinking 'but this is all water under the bridge now', right?  I'm afraid not. Although the loan has recently been paid off, unfortunately, the effect of steep monthly loan payments for so many years has left our reserve account considerably underfunded.  So stay tuned to find out the eventual price tag of the many gifts of inaction given to the developer by the Sutherlands.  We have only just begun to pay for that eight year long party.

Take a look at the e-mail referenced in this post:

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