By NEIL HARTNELL
Tribune Business Editor
The developers of the controversy-torn Oceania Heights project are now feuding with each other, Tribune Business can reveal, having fallen out over the proposed solution to the long-running dispute with homeowners.
Canadian citizen Howard Obront, who handled Oceania’s sales and marketing, is threatening to leave Bahamian attorney Anthony Thompson with exposure to a potential $400,000 liability unless he allows him to regain “exclusivity” in selling Oceania Heights’ remaining 21 lots.
Unless this happens, Mr Obront’s advisers have warned he will leave Mr Thompson to fight a battle over legal costs, related to a dispute involving 11 Oceania Heights lots, on his own.
And Tribune Business has also seen correspondence that strongly suggests some $400,000 sent to Mr Thompson by Oceania Heights homeowners, to pay the Stamp Duty due to the Public Treasury on their real estate transactions, was instead used to “pay for work done for Oceania”.
The row that has broken out between Mr Thompson and Mr Obront, which each seemingly blaming the other for the Oceania Heights debacle, is revealed in a series of letters and e-mails obtained by Tribune Business.
A November 5, 2013, e-mail sent to Mr Thompson and others by Canadian attorney Stephen Hart, who is Mr Obront’s brother-in-law, appears to be using the legal costs battle as a way to exert pressure/leverage over the Bahamian attorney.
The legal costs relate to the dispute over the ultimate ownership of 11 lots of Oceania Heights, which ended up being resolved by the Privy Council in the development’s favour.
However, the UK-based court did not overturn the Court of Appeal decision that ordered Oceania Heights to pay the legal costs for both itself and the attorneys representing the 11 ‘lot owners’.
Oceania Heights and Mr Thompson are now trying to overturn the Court of Appeal costs award, and Mr Hart warned in his e-mail: “The amount at risk, I’m told, is in excess of $400,000.
“If Oceania Heights loses the current dispute, it will be responsible to pay in excess of $400,000.”
Mr Hart alleged that Mr Obront had spent $500,000 of his own money to cover legal fees relating to this dispute. He then linked the continuation of this support to Oceania Properties, an entity controlled by Mr Obront, remaining “the sole and exclusive person/entity entitled to market and sell the Oceania Heights properties”.
Following up with the ‘hammer blow’, Mr Hart, alleging that this exclusivity had been “illegally cancelled”, warned Mr Thompson: “Please be advised that unless you are prepared to restore Oceania Heights’ exclusive right to market the remaining properties on a 75 per cent split to Oceania Properties, and 25 per cent to Oceania Heights, you will have to fight the current dispute on your own, and at your own risk and expense.”
Slamming Mr Thompson’s claim for legal fees against Mr Obront and Oceania Properties as “bogus”, Mr Hart then proceeded to blame Mr Thompson for the project becoming mired in controversy amid numerous homeowner complaints.
“It was your failure to pass the [title] deeds [to the homeowners] in the first place which is at the source and root of the whole Oceania debacle,” Mr Hart blasted.
“This was done by you despite my repeated requests and warnings from me to you to pass the deeds.”
The split between Mr Obront and Mr Thompson appears to have been sparked by efforts to resolve the dispute with the Oceania Heights homeowners and allow them to form a Property Owners Association to exercise control over the amenities and common areas.
Mr Obront appears to have been sidelined in this, and a May 1, 2013, letter sent by Mr Thompson to his attorney, Keod Smith, makes this clear.
Referring to a lunch with Mr Obront, Mr Thompson said the Canadian was “concerned about the direction Oceania was moving in”, specifying the Property Owners Association, plus the collection of maintenance fees and sale of the remaining lots.
Mr Thompson replied that the Association “was a must and is a necessary part of the resort”. Mr Obront, though, appeared more concerned that he would he would lose the maintenance fees as a source of income, and felt the homeowners should only get licences.
And Mr Thompson warned Mr Obront that Oceania Properties was “no longer acceptable” to sell and market the remaining lots, and Bahamian realtors would have to be hired instead.
Then in a further revealing May 3, 2013, letter to Mr Obront’s Bahamian attorney, Michael Scott, Mr Thompson appeared to concede that a key complaint from several homeowners - that they had paid him money to cover Stamp Duties, which were never passed to the Government, was accurate.
“Part of the conflict relates to the matter of certain sums paid to my firm, which were not applied to the payment of Stamp Duties but were used to pay for work done for Oceania which, at December 2012, was some $400,000,” Mr Thompson wrote.
He added that $385,000 was due to his firm for conveyances it had issued to Oceania Heights investors, but who had never paid their fees.
“The bottom line is that the firm is owed over $800,000, and would like at least $300,000 of this to be paid promptly,” Mr Thompson said.
Suggesting that Mr Obront had told him he could sell lots at Oceania Heights for $400,000, Mr Thompson suggested he sell two lots mortgaged to him for $300,000 to “eliminate over 50 per cent of the problem”.
And, noting that Oceania Properties had been “struck off”, Mr Thompson said it could not sell any more lots or receive maintenance fees or instalment payments.
Mr Thompson estimated that the remaining lots could generate $6 million in sales revenues.
The main complaints of Oceania Heights homeowners are that they have been unable to obtain title/conveyancing documents to the properties they have bought; there are questions whether more than $880,000 in Stamp Tax they paid has been passed on to the Treasury; Mr Thompson failed to disclose he was also a beneficial owner of Oceania Heights when acting for the buyers in their purchases; the same lots have been sold to different buyers; and the hotel and other promised amenities have not been constructed.
Messrs Thompson and Obront have consistently, and vehemently, denied all the allegations against them.