Oct. 23--In March, lawyer Franklin Zemel called the Miami Beach Police Department to report a stolen hotel. 

It's not that someone absconded with the three-story South Beach building at 634 Washington Ave. Zemel claims his clients, a group of Italian investors that bought the property in 1996, lost it to their real estate agent, who secretly installed himself as the sole officer of their partnership, borrowed about $2 million against the property, then sold it for $2.75 million. 

That charge is now the center of a civil suit against Angelo Pizzuto, a 33-year-old Italian working in Miami as an international developer. His honeymoon plans were recently ruined by a court order barring him from leaving the country. 

Neil Taylor, Pizzuto's lawyer, dismissed the allegations as legal bullying: the partners' attempts at erasing a sale they authorized Pizzuto to make as their overseas representative armed with power of attorney. Taylor said Pizzuto spent five years refurbishing the one-time apartment building for the partners, and they soured on his efforts only when they were about to yield a profit in the sale to local hotel developers Alan and Diane Lieberman. 

"This is a helluva story, except I'm in the middle of it," said Alan Lieberman, who bought the building in December. 

Pizzuto claims the Italian partnership, Pianeta Miami, granted him legal authority to do whatever necessary to sell the 53-bedroom building, and didn't want to be bothered by details. 

In civil court filings, Pianeta alleges a secret, illegal acquisition by Pizzuto -- one it asked police to investigate as well. Pianeta claimed Pizzuto notified the Florida secretary of state's office in June 2000 that he was now Pianeta's president and sole officer, then used the property as collateral for $2.3 million in loans, including a $1.8 million advance from Diane Lieberman. Then she and her husband bought the property outright for $2.75 million -- transactions Pianeta maintains it knew nothing about. 

Pianeta, led by Italian hotel developer Roberto Ciapparelli, has asked Miami-Dade Circuit Court Judge Ronald Friedman to void the December sale, force Pizzuto to return all proceeds and borrowed funds and award unspecified punitive damages. 

The Liebermans, along with their lender, SunTrust Bank, maintain the sale should stand. If anything, the Liebermans said in court filings, Pianeta should have done a better job protecting itself from Pizzuto. Pizzuto maintains he has done nothing wrong, and only owes Pianeta about $500,000 -- the difference between the sale price, development costs and Pizzuto's $800,000 in fees, Taylor said. 

The building, known as the Angler Hotel, hasn't seen regular hotel business in about 20 years, Lieberman said. It was a broken-down boarding house for a time about 10 years ago, but was refurbished after Pianeta bought it in 1996. 

Pianeta hired Pizzuto the next year to bring the property, which had incured civil fines, back into good stead and regain its hotel zoning status, Taylor said. He said Pizzuto borrowed against the property to complete the renovations, and Lieberman said Monday night that the Italian partners were aware of his wife's loan against the property. 

Pianeta claims Pizzuto represented himself as a lawyer and real estate agent. Taylor said Pizzuto is licensed to practice law in Italy, not here, and that he has not yet completed enough courses to make his real estate license active. 

The big question, though, centers around the money. Pianeta has demanded in court papers that Pizzuto turn over the $2.75 million in proceeds, and has asked Friedman to hold Pizzuto in contempt -- which could include jail time -- until he does. 

"I can't turn over what we don't have," Taylor said in an interview Monday night. 

Taylor said Pizzuto has given the court a check for about $500,000 -- enough to cover what he says Pianeta is due. 

The rest of the money -- minus his fees -- was sunk into the development project -- and Taylor said Pizzuto has turned over the receipts to prove it. 

"That's the whole reason they give you power of attorney," Taylor said in an interview Monday night. "They don't participate in the day-to-day affairs. They have someone they trust." 

-----To see more of The Miami Herald, or to subscribe to the newspaper, go to http://www.herald.com 

(c) 2001, The Miami Herald. Distributed by Knight Ridder/Tribune Business News.