REB sues developer over alleged unsecured buyer deposits for luxury complex
Published:Sunday | April 20, 2025 | 12:09 AM
In what it says is a move to protect property buyers, the Real Estate Board (REB) has taken registered developer DCL Castles & Cottages Development Limited to court, accusing the company of breaching key legal duties tied to a luxury apartment complex in St Andrew.
At the centre of the Supreme Court case is DCL’s upscale development, Palaise De La Richesse, a 25-unit apartment complex under construction at 11 Old Stony Hill Road in St Andrew. The REB alleges that DCL failed to lodge a legal charge on the property titles – a requirement when developers accept upfront payments from buyers. This charge offers a layer of protection by securing buyers’ investments should the project run into trouble.
According to court documents, DCL withdrew funds from a trust account intended to hold purchasers’ deposits without first lodging the required charge. This and other alleged breaches prompted the REB to file a fixed-date claim form on November 11, 2024, seeking various court declarations and orders against the developer.
When contacted by The Sunday Gleaner on April 16, director and sole shareholder Durvan Lewis declined to comment. Follow-up emails went unanswered.
In a supporting affidavit, Claudia Allen, manager of the REB’s Inspectorate Department, warned that DCL’s actions “may prejudice the purchasers” and undermine the integrity of Jamaica’s real estate regulatory framework. She detailed a timeline of missed deadlines, incomplete documentation, and ignored warnings from the REB to comply with the Real Estate (Dealers & Developers) Act.
The REB is asking the court to order DCL to “forthwith” lodge the charge on the titles for the development and forward all executed and dated prepayment contracts.
It also wants an architect’s or quantity surveyor’s certificate outlining how trust funds were used and payment of $121,000 in outstanding developer renewal fees.
Under Section 28 of the Real Estate (Dealers and Developers) Act, developers must submit all prepayment contracts to the REB within 14 days of signing. However, Allen said DCL has signed at least 14 such agreements but has “failed, neglected and/or refused” to submit them.
Allen noted that DCL Managing Director Daval Bell acknowledged the contracts in a September 2023 affidavit in a separate court case, stating that as of August 28, 2023, the company had signed 14 agreements for sale. This disclosure prompted the REB to request documentation.
Allen explained that while developers can withdraw from trust accounts under limited conditions – such as paying taxes or reimbursing construction costs – this must be supported by a certified statement from an architect or quantity surveyor, and even then, withdrawals cannot exceed 90 per cent of the certified amount. She said DCL withdrew funds without meeting these requirements, potentially putting buyers at risk.
A July 2023 inspection by the REB found the project 65 per cent complete with $6.4 million remaining in the trust account. The estimated total cost of construction is $485 million, with financing from the Jamaica Mortgage Bank (JMB), which holds a $1.1 billion mortgage lien on the property. The total projected value of the units is $2.2 billion.
In the unrelated case mentioned earlier, Bell also disclosed that the JMB holds a $1.1 billion mortgage lien on the development, which comprises 21 apartments and four townhouses. The total projected value of the units is $2.2 billion.
According to the project’s website, apartment prices start at US$275,000, penthouses at US$500,000, and townhouses at US$1.2 million.
Allen said the REB first requested proof of the charge in August 2020. In June 2021, following a buyer’s complaint, it lodged a caveat on the titles “out of an abundance of caution”. However, she noted that a caveat does not offer the same legal protections as a registered charge.
After the REB learned of the prepayment contracts through the unrelated court case, it issued a formal notice on September 7, 2023, demanding the documents contained in the notice, including copies of all prepayment contracts.
Allen said DCL replied the next day, requesting an extension of time to comply.
She said DCL wrote again on September 26, indicating that “ ... deposits and further prepayments were used by DCL to purchase materials on site for finishing the project”.
Allen said, “in purported compliance with the notice”, DCL supplied undated contracts to the REB.
Despite follow-ups in June and October 2024, the REB said DCL has continued to fall short of its legal obligations.
“The orders sought are necessary for the fair, just, and equitable disposal of this matter,” Allen said. “If they are not granted, the situation may serve to prejudice the purchasers.”
DCL was incorporated in October 2014, according to Companies Office of Jamaica records, and applied for registration as a developer with the REB in 2019. Jamaican law requires all developers undertaking six or more units to be registered and to pay annual renewal fees.
A hearing is scheduled for October 6, 2025.