Ex-Dezer Real Estate Exec Gets Second Chance at Profit-Sharing Lawsuit

A former Dezer Development LLC executive who is suing the big-name developer and its namesake owners for alleged nonpayment got the green light to take a second whack at a breach-of-guarantee count.

Andrew Chesnick, who joined Dezer Development as chief operating officer under a five-year contract in January 2013, argues that he agreed to a below-market annual salary of $250,000 in exchange for 3% profit sharing in company projects on which he worked.

It’s the profit sharing that’s in dispute. Chesnick’s attorney, Glen H. Waldman, estimates $15 million to $25 million is at stake.

Chesnick was in line for profits on projects that include Dezer’s most preeminent condominiums, Porsche Design Tower and Residences by Armani Casa in Sunny Isles Beach, according to the employment contract.

The complaint said Chesnick was entitled to payment after assets were liquidated and after equitable receipt of distributions by the Dezers.

The Third District Court of Appeal on Wednesday upheld the lower court’s dismissal of Chesnick’s civil conspiracy count but reversed and remanded on his breach-of-guarantee claim.

[falcon-embed src="embed_1"]

Chesnick, who sued in October 2017 in Miami-Dade Circuit Court and amended his complaint in June 2018, alleges Dezer Development founder Michael Dezer and his son and company president, Gil Dezer, became hostile to Chesnick about two years after hiring him. He claims they berated him in private and in front of others, yelled at him and threatened him with firing.

The change in attitude was due to the profit-sharing rights. Under the contract, Chesnick still would be entitled to profits if the Dezers fired him but not if he resigned. Waldman, a partner at Waldman Barnett in Miami, claims that distinction triggered a premeditated campaign of verbal attacks to push Chesnick to quit.

In 2015, the younger Dezer pressed Chesnick to sign a revised contract reducing his profit share to 1% on fewer projects.

Chesnick claims he resigned three years after joining the company as the verbal attacks chipped away at his 25-year reputation working in South Florida real estate, but Waldman maintains the departure amounted to constructive termination.

Chesnick worked for other major South Florida real estate companies, including Terra Group LLC and Turnberry, according to Waldman.

“Remaining at Dezer Development was untenable given the hostile and abusive work environment that they purposefully created and perpetrated on almost a daily basis,” Waldman wrote in the complaint.

Attorneys for the Dezers, Dezer Development and other defendants have a different take.

Chesnick resigned when he was confronted about his “substandard job performance and inability to do his job,” Susan Raffanello, a Coffey Burlington shareholder in Miami, wrote in a motion to dismiss. She represents the defendants with Coffey attorney Scott Hiaasen.

In a motion to dismiss, she also rejected Chesnick’s constructive-termination theory, saying he wasn’t subjected to illegal or discriminatory conduct by the Dezers. Even if the alleged aggressive conduct were true, there still isn’t enough to support the constructive-termination claim.

The “grievances amount to nothing more than his inability to handle workplace stress,” Raffanello wrote. “Regardless of how mean, harsh, or expletive-driven the criticism of Chesnick, such conduct is simply not illegal or discriminatory.”

Miami-Dade Circuit Judge Beatrice Butchko granted Raffanello’s motion to dismiss declaratory relief, civil conspiracy and breach-of-contract counts and allowed others to stand.

The amended complaint that followed listed breach of contract, breach of contractual guarantee, civil conspiracy, unjust enrichment and equitable accounting counts.

Raffanello filed another motion to dismiss, arguing Chesnick was attempting to resurrect some of the dismissed counts.

Butchko dismissed the civil conspiracy and breach-of-guarantee counts in the amended complaint and denied a motion for entry of default judgment for some of the defendants.

Waldman appealed, and the Third DCA affirmed the breach-of-guarantee count.

“We are very pleased with the outcome. We look forward to prevailing on Andrew’s claim for very substantial sums of money and seeing it through to fruition,” Waldman said.

Hiaasen declined to comment on the appellate court opinion.

Butchko agreed to a defense motion to bifurcate. A bench trial is set early next year on the issue of liability under the constructive-termination claim. If the outcome is favorable to Chesnick, a jury would decide damages.

Related stories: 

Porsche Design Tower Developer Dezer Named in Profit-Sharing Lawsuit