Nearly $1 Billion Settlement Tentatively Reached in Surfside Condo Collapse

More than 20 entities have agreed to pay nearly $1 billion to settle a class action lawsuit over the 2021 collapse of a residential building in Surfside, Florida. 

Carolyn Casey, J.D.

Written by
— Updated on June 1, 2022

Nearly $1 Billion Settlement Tentatively Reached in Surfside Condo Collapse

Ninety-eight people died in the tragic building failure. The proposed settlement announcement was a surprise in this slow-moving class action. Presiding Miami-Dade Circuit Judge Michael Hanzman must approve the proposed settlement. Hazman called the development “fantastic” and commented that the amount was higher than he expected.

The Surfside Condo Class Action Settlement

The $997 million agreement is the second largest class action settlement in Florida’s history. The state’s $11.3 billion Tobacco lawsuit settlement is the only one surpassing this agreement. Plaintiffs in the class-action lawsuit argued that the poor construction and maintenance of Champlain Towers South were exacerbated when a luxury tower was constructed immediately next door to the Champlain building.

The condo association, the city of Surfside, and engineering, architectural, and other property development and maintenance companies are all part of the tentative settlement agreement.

Surfside Condo Settlement Contributor Breakdown

There are some specifics available on how much each entity has agreed to pay. The security and safety systems operator company settled for approximately $500 million. About $400M will come from the ultra-luxury condominium adjacent to the failed building. Champlain South Tower condominium association legal and engineering contractors’ share makes up about $50 million. Surfside city is also on the hook for $2 million. The developers and general contractors who built the condo next door will also pay an undisclosed amount without admitting to negligence. Claimants say the sheet-pile driving during construction of this adjacent condominium weakened Champlain South’s structure.

Who Gets the $1Billion?

Survivors of the catastrophe and the families of those who died will receive payouts under the settlement. Furthermore, a receivership will oversee all funds for the victims. The individual amounts from the settlement to be paid to the litigants have yet to be determined.

The group of people victimized in the Champlain Towers South collapse cut a broad swath. The group ranges from members of a  local closely-knit Jewish community to families from Argentina, Paraguay, and Colombia. Elderly couples, young children, families, and tourists perished.

Finalization of the Settlement

Many expected this class action to drag out and last for years. Now, the judge wants the settlement finalized by June 24, 2022, the one-year anniversary of the disaster. Moreover, motions for preliminary approval are due by late May. The judge’s goal is for payouts to be issued by the fall.

The Deadly Collapse

In the early hours of June 24, 2021, a beachside condominium building located just north of Miami collapsed. The collapse destroyed 55 of 136 units and killed scores of residents sleeping unknowingly in their condos. Questions swirled on how a large concrete structure built in 1981 could suddenly fall to the ground in a heap. After rescuers completed search and recovery and recovery operations, they found and identified the last of the 98 victims.

Champlain Towers South had started its required 40-year safety checkup and was working on structural renovations when the structure fell. News stories told the tale of a pool deck coming loose from the structural wall. The collapse of half the tower followed minutes later.

Ongoing Problems with the Pool Deck and Garage Concrete Structures

As early as 1996 there were reports that the Champlain Towers South’s pool deck and garage ceiling had structural problems with the concrete. After work was done on the necessary two areas, the City of Surfside certified the repairs in November 1997.

A structural engineering firm inspection in 2018 again found structural damage ​to “concrete structural slabs on the pool deck due to failed waterproofing.” The report and construction repair plan estimated it would cost more than $9 million to fix the problems. Unfortunately, the repairs at the facility were never finished.

City records also show that the Surfside building inspector informed residents of Champlain Tower South at a November 2018 board that their building was “in very good shape.”

Prior Settlement Now Controversial

In a separate settlement agreement, unit owners had agreed to $83 million in compensation. This amount paid only a fraction of what many believed to be their condos’ actual worth. These Champlain South Tower owners will surely ask Judge Hanzman to increase their portion of compensation considering the nearly $1 billion settlement announcement.

Impacts of the Massive Surfside Settlement

A settlement of this size is sure to embolden other victims of building failures in the U.S. Claimants who can document a long history of structural problems and calls for expensive repairs that went unheeded like in the Surfside disaster now have a blueprint for pursuing mammoth settlements.

The fact that the adjacent luxury condominium developers’ insurers made the business decision to join the settlement rather than face the time and expense of litigation could signal a new approach.  Litigants fiercely fight most class actions of this size for several years if not decades. The quick arrival of this mammoth settlement may cause other insurers with clients in similar lawsuits to make the same economic call to cut bait rather than fish for better results in years of protracted negotiations or uncertain trial outcomes.

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