Developer accused of breaching buyer protections in $2b project gets time to comply
Published:Friday | May 9, 2025 | 12:09 AM
A developer behind a $2 billion luxury apartment complex in St Andrew asked for time to comply with real estate laws after allegedly collecting payments from buyers without securing their interests through certain legal requirements, the Real Estate Board says.
Chief Executive Officer of the REB, Phillip Chambers, told The Gleaner about DCL Castles & Cottages Development Limited’s intention.
“The defendant’s attorney has asked for time to comply with the requirements/provisions under REDDA (Real Estate (Dealers & Developers) Act) by the next hearing date,” he said in a response on April 23.
He was commenting on the outcome of a Supreme Court hearing on March 25. The matter is to continue on October 6, 2025. The developer has declined requests to comment on the case.
The REB filed a lawsuit against DCL on November 11, 2024, accusing it of breaching several provisions of the REDDA in connection with its 25-unit Palaise De La Richesse development at 11 Old Stony Hill Road.
The agency alleges that DCL failed to lodge a required legal charge on the property titles despite collecting payments from at least 14 buyers. The charge offers a layer of protection by securing buyers’ investments should the project run into trouble.
“This may prejudice the purchasers,” warned Claudia Allen, the REB’s inspections chief, in a supporting affidavit that outlined a series of allegations, including missed deadlines, regulatory violations, and stalled responses from the developer.
Allen also said that DCL had not provided details on its withdrawals from a trust account into which the payments were made. She 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. Withdrawals also cannot exceed 90 per cent of the certified amount for the project. Allen alleged that DCL withdrew funds without meeting those requirements.
A July 2023 REB inspection found the project 65 per cent complete, with $6.4 million remaining in the trust account.
Allen said the board first demanded proof of a charge on the titles in 2020 and only placed a caveat the following year after a complaint from a purchaser. But it said that the caveat was not sufficient protection.
The REB said it sought information on the contracts last September after DCL’s Managing Director, Daval Bell, disclosed in a separate case that the company had signed 14 sale agreements by August 2023. The REB said that disclosure prompted it to formally request documentation last September.
It said DCL responded with undated contracts and a letter explaining that the funds had been used to purchase materials for the project.
Allen said, despite reminders, including in June and October 2024, that DCL did not comply with its legal obligations.
The watchdog is seeking court orders compelling DCL to lodge the charge, submit all executed contracts, account for the use of trust funds, and pay outstanding renewal fees.
The estimated total cost of construction was $485 million, with financing from the Jamaica Mortgage Bank, which holds a $1.1-billion mortgage lien on the property. The total projected value of the units is $2.2 billion.