Dear PACC2 Unit Owner,

Below is a copy of a point-by-point response to the misleading statements contained in letters that were recently posted and mailed by the majority Directors. Also attached or enclosed, please find a copy of the violation letter dated July 22nd, 2015 sent via certified mail from the Florida DBPR to the majority Directors, as immediate evidence for your examination, that directly contradicts their stated ‘point #2’ in those letters. To obtain copies of other multi-page documents (Arbitrator’s Final Order, Order to deny appeal for rehearing, Motions filed by both parties, etc.), please email Tom Anthony at or Brian Moran at . The majority Directors, having recently lost both their case and their subsequent appeal under State Arbitration, are now wasting more Association funds on additional legal costs to drag their same futile case before the Circuit Court. Added to these loses is the denial of James Martin’s retaliatory complaint to the Florida Bar (also enclosed), backed by the Association counsel and the majority Directors, against Norman Arnoff as an attorney for several owners. A prior complaint to the Florida DBPR filed by Mr. Arnoff to expose improper record keeping by the Association was upheld by the State as indicated in the DBPR violation letter. Those holding power over PACC2 are consistently being overruled by the proper authorities whenever subjected to official scrutiny, while consuming your dollars to fund their legal losses. “Using the same methods and expecting different results” was Albert Einstein’s definition of insanity. ______

From: P Kretz

Sent: Sunday, August 30, 2015 12:31 PM

To: Jerry Messina ; Jack McCandless ; Irwin Salbe ; Marie Barnes ; Gino Colarossi ; Joe Englese ; charlie Kemplin ; Joe O'Neill ; Martin Novoa ; Jean Bowdren

Cc: James Martin at M&M ;

Subject: Sept 2/15 Board Director meeting notice Aug 29/15

Without Prejudice

To Gerard Messina, PACC2 President, all PACC2 Board Members with Copy to M&M Property Management

The following represents my personal opinion as a Director of the Association and is further to the email of James Martin of Aug 28/15 at 5:34 pm on the upcoming Sept 2/15 Board meeting open to all owners.

As a Member of the PACC2 Board, I believe it is my fiduciary responsibility to update each PACC2 Board Member on recent events and new information that may affect Association matters related to deficiencies, governance and costs.

I plan to attend the Board meeting Sept 2/15 by Skype with the Wi-Fi System at the Skolnick Center and a computer provided by owner Tom Anthony. We have tested this out and it works. Florida Statues allows such electronic communication. Would Jerry Messina or his representative get back to me to indicate the Chair of the meeting will recognize me and provide me the opportunity as a Director to provide input and vote where needed.

This is to advise Tom Anthony will be taping this meeting as he has done in the past as allowed by Florida Statutes.

The agenda provided by James Martin shows the “Adjournment” of the meeting before the “Good and Welfare” section. This looks to be an error or if not then there would be no opportunity during the meeting to allow owners their statutory rights to provide input during the meeting on other matter not on the agenda. There have only been two 45 minute Board meetings open to all owners in the first six months of the new term with very restricted chances for owners’ input, despite significant events where more meetings and input should have been provided for. This agenda should be fixed for the one posted for all owners in each building tomorrow.

The following should also be added to the Agenda: “March 4/15 election related matters”. Considering James Martin authorized he or his staff to post the undated letter of the Group of 6 Majority Members on matters related to governance and the undated Board letter on the new election on or about Friday Aug 28/15 in the locked bulletin boards, this upcoming board meeting will give owners the opportunity to comment on such letters. In fact, due to the very limited chance for input by owners in the first 6 months of the new term, it is reasonable to conclude this will be the most important subject on owner’s minds whether you are for or against a new election ordered by the independent Florida Arbitrator. Significant PACC2 funds are being spent on the aftermath of the March 4/15 election with no input by owners and no approval by a duly call Board meeting, whether open or closed, on a significant matters that goes to governance, deficiencies and costs.

As a Director with fiduciary responsibility, it is important to provide my opinion and input to all Directors on the letters posted by James Martin or his staff referred to above. There is significant misinformation in these letters. My comments and on the first letter by the group of 6 directors is as follows:

1.  Regarding point 1 of the first posted letter, The Fucco Group Audit Report last year was dated Oct 15/14, not Oct 4 /14, and it was presented by the then Auditor in the Nov 19/14 Board Meeting after the transfer to M&M November 1/15, not the Oct 4/14 meeting referred to in this posted letter. This posted letter significantly understates the serious nature of this Audit opinion of the Financial Statements of the Association who is fully responsible for them regardless of who does the bookkeeping for the Association. James Martin has been the Property Manager continuously since Aug /09 for both the last management firm and the current one. This audit opinion stated “The Association’s records do not permit the application of other auditing procedures to special assessments – unbilled, or to deferred special assessments. In addition, we have been unable to make inquiries and apply audit procedures necessary to obtain sufficient appropriate audit evidence about the classifications and amounts comprising the balance sheet of Dec 31, 2013……… Accordingly we do not express an opinion of the financial statements…….. We do not express an opinion or provide any assurance on the information …..” This is a major red flag for anyone who understands the nature of an Audit. I asked at the meeting Nov 19/14 what was the reason for the lack of an audit opinion that I was shocked to find out about. The Auditor told me and those at the Nov 19/14 board meeting the problems go back to prior years not only with assessment accounting but with reserve funds accounting in addition to problems reconciling other accounts. There are also several significant concerns regarding the new draft audit opinion dated Aug 25/15 to be reviewed in the Sept 2/15 meeting by the new Auditor Hinkle, Richter and Rhine who was selected by the Majority Directors who did not like the last audit opinion. However I will point out some concerns here where this new auditor said on page 3 in the Disclaimer “We do not express an opinion or any assurance on the information….” I have several other concerns regarding the supplemental information in the financial statements, where the auditor provided no opinion on, and regarding Notes 1, 7, 9, 11, and 12 among other concerns in the financial statements.

  1. Contrary to what is said in the first posted letter in point 2, the DBPR in a letter July 22/15 to the Board of the Association said the Association “…failed to maintain sufficient detail in the accounting records…”, and further stating that “The Association has admitted to this violation in its May 7, 2015 response to the Division…”. The letter goes on to say there could be fines of $5000 with further violations which is a huge red flag for every Director and owner.
  2. In point 3 of the first posted letter, James Martin’s complaint to the Florida bar against Norman Arnoff included witnesses of the Association Counsel Tamar Shendell and all six of the Board Members who issued the posted letter. The complaint is quite specific with detailed legal analysis that would require a lawyer in my opinion. It is disingenuous to say there was not wide cooperation of all those involved in this effort. The Florida Bar turned down James Martin’s complaint in a letter dated July 14/15. No Association funds of any kind should be involved in this personal matter of James Martin or spend any funds to advise owners as was done in the posted letter now in Association locked bulletin boards controlled by James Martin.
  3. Regarding Point 4 in the first posted letter, contrary to what is said, there was no special board closed meeting Oct 31/14 or any minutes of this non-existing meeting to decide on the matter of a reported $100,000 payment to break the Association’s contract with the prior management firm to retain James Martin for the new management company. Oct 31/14 the President of the Association made the decision to instruct legal counsel to pay the $100,000 based on calls he made to Directors. When he called me in the afternoon of Oct 31/14 he was very concerned and wanted to pay the $100,000 to retain James martin and avoid lengthy and costly litigation he was worried we would lose. This was new information for me Oct 31/14. I said in that call, we should not pay this $100,000 and not proceed with this hiring of James Martin which would avoid the outrageous amount demanded by the prior management company and avoid future legal costs where the Association had 2 law firms working on this problem. I did not know what the majority opinion would be, based on the rounds of calls, and my opinion is often not followed where the majority rules. I later learned that Jean-Guy St. Onge did not agree nor did James Martin himself as he told me personally in November/14. He told me he ended up paying even more money to the prior company to break the personal agreement he had with them on a non-compete basis and was upset, like me, on how the whole transition was handled by the Majority Members and Counsel. James Martin told me if he had stayed with the prior company he would not have paid a significant amount to break his personal contract and his employment would be intact. If they wanted to get rid of him he would be entitled to a settlement in his opinion and he felt he was well positioned to get a better job with better compensation. The savings referred to in the posted letter would have been achieved without James Martin as Property Manager because of the accounting system of M&M where another Property Manager could be hired. It is interesting to note that the financial statements for 2014 now show $114,947 of Association funds was actually paid to break the Association contract regarding James Martin with the former management company. I have no idea how this increased amount was approved or when.
  4. Point 5 of the first posted letter contains significant misinformation to deflect in my opinion the real situation regarding the lost insurance money from hurricane Wilma. In the spring of 2008 the Association lost $15 million insurance claim at that point. The 4 executives at the time (of which 3 remain on the board to this day) picked an incompetent firm to file in court for payment of this $15 million claim remaining at this point of the original $18.1 million (that was backed up by insurance appraiser’s detailed reports) with the insurance entity involved at this point – FIGA. These same executives did not supervise the firm they picked to ensure the paperwork was filed by the June /08 deadline for this $15 million insurance money recovery. Other Associations did file in time and got the subsequent funds from FIGA, where this process was required. The $15 million was lost at this point because of the actions of the Executives at the time in the spring of 2008. The Association then sued the firm picked by the Executives for the $15 million as it was a real loss and got only about $800,000 as the firm’s insurance liability insurance coverage was capped at $5 million. This company had screwed up several association claims so the $5 million was shared for all the associations they mishandled. Martin Novoa was PACC2 president prior to the spring of 2008 and told me he knew there was a whistle blower with FIGA so backup the full $18.1 million was approved within FIGA. He told me he had suggested a very experienced firm to the new executive in the spring of 2008 to get the $15 million who had access to the Whistle Blower in FIGA which the new executive ignored and hired another incompetent company. He also told me he advised the new Executive in the spring of 2008 to closely supervise the law firm to ensure the deadline was met. Apparently that advice was ignored too. This is the truth of the situation that a review of records and testimony of witnesses can corroborate.

6.  In the matter of the separate letter from “the Board” on the new election posted on the Association bulletin boards last week at the same time as the letter of the six Directors, my comments are as follows. The correspondence referred to is not from Peter Kretz as claimed in this posted letter but by several other Concerned Unit Owners. This posted letter contains significant misinformation that does not reflect the position of the Petitioner in the legal documents submitted by his lawyers for the challenge of the March 4/15 election or the position of the Arbitrator in the Final Order for a new election that the Petitioner won. See the attached 2 documents on the Petitioners response to this request for rehearing. These attached documents speak for themselves and deal with this misinformation contained in this second posted letter. It is my opinion the independent Arbitrator will not agree that in his Final Order “the decision of the Arbitrator requiring a new election from the first notice of election is not supported by the law or Rules” as claimed in this posted letter to all owners. I expect an expedited decision of the Arbitrator, as he has done with the Initial Petition for Arbitration. This second posted letter makes major incorrect claims on the 9 page detailed Arbitrator’s Final Order where the Arbitrator took efforts to cite the law and cases to support his decision. In my opinion there is no basis for rehearing or a complaint to the court to overturn the Final Order of the Arbitrator. Each Director and M&M should read the attached documents carefully to assess for yourself. The group of 6 Directors who control the Board are further wasting not only Association money for their costs but also the Petitioners costs that will be awarded on wining the arbitration and also subsequent lawsuit if pursued. The only one who wins are the lawyers in increased billings.