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Florida Condo & HOA Legal Blog

News & Updates on Condo & HOA Laws & Legislation in the State of Florida

HOA Can Pass on Late Fees To A Member and Lien for Nonpayment of Assessments

By Joseph Adams on Posted in Assessment Collection, Reader Q&A

Question: I would like to know what rights a Florida homeowners’ association has to enforce collection of assessment from the individual members. I believe the Florida Statutes say something about late fees and interest, but can they place a lien on my property even if the amount owed is minimal? Also, can the association pass its attorneys fees associated with collection of assessments I owe on to me? G.R. (via e-mail)

Answer: Chapter 720 of the Florida Statutes, which governs homeowners’ associations, permits the association to charge interest on assessments that are not paid by the due date established in the association’s governing documents. The right to charge interest need not appear in the association’s governing documents. However, if the association’s declaration or bylaws prescribes a rate of interest, that is the rate of interest that must be applied, so long as it does not exceed the maximum rate allowed by law. If the declaration and bylaws are silent, the default rate of 18 percent per year applies.

The association is not automatically entitled to charge an administrative late fee on assessments that are not timely paid. Rather, this right must be contained in the association’s declaration or bylaws and the fee established therein may not exceed the greater of $25 or 5 percent of the amount of each installment that is paid past the due date.

The association can pass on the costs and reasonable attorneys’ fees incurred in collecting assessments to the member who has failed to timely pay. Any payment made by the member is applied first to any interest accrued, then to any administrative late fee (if the association is authorized to charge such a fee), then to any costs and reasonable attorney’s fees incurred in collection, and then to the delinquent assessment.

Similar to the administrative late fee, the right of a homeowners’ association to record a claim of lien against a property to secure payment of past due assessments must be authorized by the association’s governing documents. If the association has the right to record a claim of lien, Chapter 720 also bestows upon the association a right to foreclose a lien for assessments, no matter how small the amount owed. Similarly, the association can collect the amounts owed by bringing an action to recover a money judgment. The association may recover any interest, late charges, costs, and reasonable attorney’s fees incurred in a lien foreclosure action or in an action to recover a money judgment for the unpaid assessments.

2013 Legislative Session Overview and Webinar Announcement

By Yeline Goin on Posted in CALL Alert, Legislation

The 2013 Legislative Session ended on May 3, 2013 and unlike last year, a number of bills passed that will impact community associations.

Join us for a live Webinar on May 16, 2013 from 9:30 to 10:30 a.m. which will update you on the bills that passed and how they will affect your association.  Our special guest will be Representative George Moraitis, the sponsor of HB 73, Relating to Residential Properties.  The webinar will focus primarily on HB 73, Relating to Residential Properties (impacting condominiums, cooperatives, and homeowners’ associations) as well as HB 7119, Relating to Homeowners’ Associations and HB 87, Relating to Mortgage Foreclosures.

CLICK HERE to sign-up for the webinar.

Being in Tallahassee full-time has given me the opportunity to be involved in the legislative process on a daily basis.  Before the legislative session started, I was able to meet personally with a majority of the members on the committees that hear the community association bills, including many of the new members of the House and Senate.  I was also invited by the House Civil Justice Subcommittee to testify at their workshop regarding mortgage foreclosures, which gave me an opportunity to explain to them how the foreclosure crisis was impacting community associations.  So I was very pleased that the Legislature kept in the provision in the mortgage foreclosure bill (HB 87) that gives associations the ability to file for an expedited order to show cause proceeding, even though many of the persons opposed to the bill focused their opposition on the order to show cause provision.  I was at the committee meetings on HB 87 (and the Senate companion SB 1666) to make sure that the committee members knew that community associations were closely watching the bills and to remind them to keep the order to show cause provision in the bills as a way to help community associations.  Thank you to all of our CALL members who helped give the bill a final push at the end of session by writing to Sen. Gaetz and Sen. Thrasher when the bill was stuck in committee.  Ultimately, it was the hard work of the bill sponsors, Rep. Passidomo and Sen. Latvala, as well as key members of the Legislature including Sen. Richter, that got the bill through at the end.

I also worked closely with Rep. Moraitis on HB 73, which was a collaboration of efforts by CALL and other community association groups.  The passage of HB 73 was really a two-year process.  As you may remember, most of what is in HB 73 was in last year’s HB 319, which did not pass.  The bill was filed again for the 2013 legislative session, in a modified format.  One of the new provisions in HB 73 was a fix to the insurance section of the Condominium Act regarding the responsibility of the association after a casualty, which was a suggestion of CALL’s.

I am also generally pleased with the final version of the HOA bill (HB 7119).  This bill was not an initiative of CALL’s and we did not initially support the bill.  However, although I do not agree with all of the provisions, the final version is much better than the original versions of HB 7119 and the companion, SB 580.  I spent much of my time this session with the House and Senate staff that worked on the HOA bills, and with the bill sponsors, providing them with suggestions for changes to the bill and explaining to them why some of the provisions in the bill would not work or would not be beneficial for associations.  As a result, we were able to remove a number of provisions that were not in the best interest of associations, including the “internal dispute resolution” provision that was originally in HB 7119.  CALL also provided the language which clarifies that nominations from the floor are not required if nominations are permitted in advance of the meeting and which provides that an election is not required unless there are more candidates than open positions.  These new election provisions will save associations the time and expense of holding an election when the election is not contested.

Thanks to all of the CALL members to wrote to the legislative members regarding the various bills and for keeping in touch with me throughout the session.  I look forward to talking with you at the May 16 webinar.  If you have any comments or suggestions for how we can better serve you, please feel free to e-mail me at call@becker-poliakoff.com.

The following is a list of bills of interest that passed as well as those that did not pass.  Keep in mind that a bill that passed does not become law until approved by the Governor, and thereafter on its effective date.  To date, the only bill in the list below that has been approved by the Governor is SB 286, Relating to Design Professionals. Continue Reading

Ex-President Refuses to Return Keys

By Joseph Adams on Posted in Operations, Reader Q&A

Question: The former president of our condominium association was voted out of office at the last annual meeting. However, he has refused to return certain property of the association, including the keys to all of the residents’ units. What recourse does the association have? M.M. (via e-mail)

Answer: That is an unfortunate situation. The condominium association, through the new board of directors, should contact the prior president in writing requesting that he return all of the association property and records, including the keys, by a specific date. Depending on the association’s prior attempts to recover its property from the prior president, this letter could be a polite request that he provide the property to the extent he has failed to return it due to an oversight. However, if this is clearly a willful retention of the association’s property, the demand to the former president should be more strongly worded and advise him that in the event he fails to return the association’s property, the association will take appropriate legal action, which could include a claim against the prior president for conversion, which can carry significant penalties. You might also advise him that he could be held responsible for the cost of re-keying the building. I recommend that this letter come from the association’s legal counsel.

If the former president fails to comply, the association’s recourse would be to file legal action for the return of the association’s property and to the extent appropriate, seek money damages and possibly the recovery of attorney’s fees.

Live Webinar on May 16, 2013 — The 2013 Florida Legislative Session: Analysis of the Impacts on Community Associations

By Yeline Goin on Posted in CALL Alert, Events, Legislation

The 2013 Florida Legislative Session just ended with a number of bills passing that will impact the operation of community associations. Join us on May 16, 2013 at 9:30 AM – 10:30 AM to get the latest analysis of the bills that passed and how they will affect your association.

The webinar will be presented by CALL Executive Director Yeline Goin, with special guest Rep. George R. Moraitis, Jr., the sponsor of House Bill 73, relating to residential properties.

CLICK HERE to sign up for the webinar.

If you are a CAM or serve on a community association board you need to know about:

  • New HOA Registration Requirements
  • New Obligations regarding Official Records & Changes to Record Inspection Procedures
  • Changes to Financial Reporting Requirements
  • New Recall Arbitration Laws & Procedures
  • How your Association Can Influence Bank Foreclosures
  • and more…

 

HUD issues memo to housing providers regarding service animals and assistance animals for disabled persons

By Lisa Magill on Posted in Disability, Discrimination/Fair Housing, Reasonable Accommodations or Modifications, Service Animals/Emotional Support Animals

 Fair Housing accommodation cases receive a lot of press.  It seems like there are more and more cases all the time, most of which are resolved at the investigative/agency level than actually filed in court or go to trial. 

 HUD issued a memorandum reminding housing providers of their obligations pursuant to the federal laws with respect to animals that provide “assistance” to individuals with disabilities.  While the memo doesn’t really break new ground, there are some interesting pronouncements of which community leaders need to be aware.

First, the term “assistance animal” is a generalized term used by HUD since there is confusion over use of various terms such as “service animal”, “assistive animal”, “support animal” or “therapy animal”.  ADAcreated a specific definition for the term “service animal”, but that term does not necessarily apply when determining whether a condo or coop resident is entitled to a relaxation of rules prohibiting or limiting animals in a multi-family housing community.  I explain the difference between a service animal and an emotional support animal on my Firm’s blog in Lions, Tigers & Bears, Oh My! The Difference Between Service Animals & Emotional Support Animals which I encourage you to read along with the HUD memo. HUD makes it clear that an emotional support animal (ESA) is appropriate for persons with disabilities who have a disability-related need for such support.

Interestingly, while there is a plethora of case law allowing a housing provider to seek information in order to establish the existence of the disability and the necessity of the accommodation, HUD says that housing providers only need to answer 2 questions, to wit:

1.         Does the person seeking to use and live with the animal have a disability – i.e. a physical or mental impairment that substantially limits one or more major life activities?

2.         Does the person making the request have a disability-related need for the animal?  In other words, does the animal work, provide assistance, perform tasks or services for the benefit of a person with a disability, or provide emotional support that alleviates one or more of the identified symptoms or effects of the person’s existing disability?

These questions raise questions in my mind.  The federal and state laws apply to a resident or anyone associated with the resident.  We are often asked whether a visitor, family member or guest of a resident should be permitted to bring their ESA to the condominium, either for a daytime visit or when visiting for longer periods.  The HUD memo refers to the person “seeking to use and live with the animal” – does that mean an association has no duty to allow a guest or visitor (regardless of whether the guest or visitor is a member of the resident’s immediate family or not) to bring an ESA or service animal on to the condominium or cooperative property?

 My other immediate concern is the standard applied in determining whether an ESA is necessary.  The memo implies that the ESA only needs to alleviate one or more of the indentified symptoms of the disability – when the laws and cases say that the accommodation must be necessary to afford the disabled person the equal opportunity to use and enjoy the dwelling, as opposed to just desirable and helpful.

 That being said, the memo does reiterate that once granted the housing provider:

  • Must allow the animal in all areas of the premises where persons are allowed to go (which raises more questions);
  • Cannot impose breed, size or weight limitations;
  • Cannot apply a fee or damage deposit, even if those fees/deposits are required from all pet owners; and
  • Cannot “unreasonably” delay a decision whether to grant or reject the accommodation request.

We offer free seminars to community leaders and CAMs.  One of the seminars involves this exact topic – check the Events section of our website to see when “Is a no-pet building a thing of the past?” is offered in your area.

It’s Okay To Ask Buyer to Refund Partial Reserves in Condominium Sales

By Joseph Adams on Posted in Budgets, Reserves & Financial, Reader Q&A

Question: I am in the process of selling my condominium unit and want to know if it is appropriate for me to request that the buyer refund me my portion of the reserve funds I have paid at the time of closing? Is this something that is covered in the condominium statute? J.D. (via e-mail)

Answer: As the seller of a condominium unit in a voluntary real estate transaction, you are entitled to contract with your buyer for any terms that you wish. Accordingly, if you wish to include in the purchase price of the unit, the amount you believe you have paid in reserves for the condominium unit and the buyer agrees to pay that, you are free to do so. However, you are not entitled to request that the association refund money you have paid towards the reserves pursuant to the association’s budget.

The Florida Condominium Act, Chapter 718, requires that the budget proposed by the board of directors calculate what is required for fully funded reserves for each fiscal year. While the unit owners may vote for waived or reduced reserves, the association is obligated to calculate what is required for fully funded reserves. Section 718.112(2)(f)2, Florida Statutes, discusses the required reserve accounts for each condominium association and provides that the association must maintain reserve accounts for capital expenditures and deferred maintenance for items including roof replacement, building painting, and pavement resurfacing, regardless of the amount of deferred maintenance expense or replacement costs. Further, the association must also maintain reserve accounts for any other item for which the deferred maintenance expense or replacement cost exceeds $10,000.

Accordingly, the purpose of reserves is for the association to set aside an amount each year necessary to save for the cost of replacing or repairing these elements of the condominium property. These amounts are calculated on an annual basis and unless the unit owners waive or reduce these amounts, are part of the assessment obligation of each unit owner.

Accordingly, if a unit is sold, that owner is not entitled to be reimbursed their reserve payments from the condominium association. However, again, in a voluntary real estate transaction the buyer and seller are free to contract for the sale of the unit and include any amounts they agree to.

Tenants Don’t Have Same Rights As Owners

By Joseph Adams on Posted in Reader Q&A

Question: It is my understanding that Florida law allows renters in a condominium to use the same amenity as owners. Is the right to have a dog considered an amenity? F.F. (via e-mail)

 Answer: Section 718.106(4) of the Florida Condominium Act provides: “When a unit is leased, a tenant shall have all use rights in the association property and those common elements otherwise readily available for use generally by unit owners and the unit owner shall not have such rights except as a guest, unless such rights are waived in writing by the tenant.” This law only applies to use of common amenities. It does not apply to provisions pertaining to the use of a unit. For example, it is my opinion that the declaration can provide unit owners with the right to keep a pet, but not tenants. Conversely, if unit owners and tenants are permitted to keep pets, they would be entitled to the same use rights in a “dog walk” area.

Florida Legislative Session Final Week Update — Call Alert For May 3, 2013

By Yeline Goin on Posted in CALL Alert, Legislation

The 2013 Legislative Session ended today when the ceremonial white handkerchief was dropped to signal “Sine Die.” The big question for community associations on the final day of session was whether the “mortgage foreclosure bill” (HB 87) would pass. The good news is that the bill was taken up by the Senate and passed 26-13 and is now headed to the Governor. Congratulations to Representative Passidomo and Senator Latvala for passing this good bill. It includes a provision that will give associations the right to ask the court for the entry of a final judgment of foreclosure in certain cases. Please contact Governor Scott and ask him to approve the mortgage foreclosure bill. Here is a message you can send to him:

“Please approve HB 87, the mortgage foreclosure bill. Community associations have been prejudiced by unnecessary delays in the foreclosure process and HB 87 will give associations some tools to move cases forward that are ready for a final judgment. Please support community associations by approving HB 87.”

Please make sure to include your name, your association name, and your city. Governor Scott’s contact info is as follows:

Executive Office of Governor Rick Scott
400 S Monroe St
Tallahassee, FL 32399
(850) 488-7146

http://www.flgov.com/contact-gov-scott/email-the-governor/

Another bill that we have been tracking is SB 1770, dealing with Citizens Property Insurance Corporation. The bill passed without any rate increases. The bill sets up a clearinghouse to shop prospective customers in the private market and sets up an inspector general for Citizens.

I am also pleased to announce that CALL will be hosting a Webinar on May 16, 2013 to discuss all of the bills of interest that passed, with our special guest, Rep. George Moraitis. Stay tuned for further information regarding how to sign up for the Webinar.

Other bills that passed this week are:

HB 277 (Rep. Rehwinkel Vasilinda), Relating to Assessment of Residential and Nonhomestead Real Property. HB 277 implements a constitutional amendment approved in 2008 which prohibits consideration of certain improvements in the assessed value of real property. Specifically, the bill provides that, in determining the assessed value of real property used for residential purposes, a property appraiser may not consider the increase in the just value attributed to the installation of renewable energy source device. Originally, the bill also provided that improvements made for the purpose of improving a property’s resistance to wind damage would not be considered in the assessed value of the property. However, that language was removed from the bill.

HB 573 (Rep. Hooper), Relating to Manufactured and Mobile Homes. HB 573 provides that Citizens must offer coverage on mobile homes or manufactured homes for a minimum insured value of at least $3,000. It also specifies the procedure for requesting and obtaining funds from the Florida Mobile Home Relocation Trust Fund to pay for the operational costs of the Florida Mobile Home Relocation Corporation and the relocation costs of mobile home owners.

SB 468 (Sen. Hukill), Relating to Property and Casualty Insurance Rates and Forms. SB 468 includes an anti-consumer provision which will allow insurance companies to file form changes with the Office of Insurance Regulation (OIR) without review by OIR. Historically, over 90% of the policy forms filed with OIR contain a violation of Florida law. To permit no prior approval by OIR, as contemplated by SB 468/HB 335, will permit over 90% of the forms to violate Florida law.

HB 7025 (Rep. Eagle), Relating to Vacation and Timeshare Plans. HB 7025 exempts timeshare plans from the election procedures in the Condominium Act and includes a number of technical changes to the non-judicial foreclosure procedures in the Timeshare Act.

HB 999 (Sen. Altman), Relating to Environmental Regulation. HB 999 will exempt multi-family homes with boat docks, including condominiums, from paying submerged land lease fees for an area equal to or less than 10 times the riparian shoreline times the number of units with boat docks.

I will send another CALL Alert next week with a full recap on the 2013 session. Also be on the look-out for further information about our 2013 Legislative Guide and webinars and classes to fully educate you on all of the new legislation. I will also continue to update you as the bills make their way to the Governor and as he takes action on them. Remember, the bills will not become law until approved by the Governor.

Thank you for all your support this session. I hope you have enjoyed these updates as much as I have enjoyed keeping you updated.

Very Truly Yours,

Yeline Goin, Executive Director
Community Association Leadership Lobby (CALL)

Follow me on Twitter: http://twitter.com/YelineGoin_CALL

Condominium Board May Be Able to Assign Parking

By Joseph Adams on Posted in Developer Obligations, Reader Q&A

Question: Our condominium has “open parking.” The developer did not assign any spaces. We have many parking problems. Can the board of directors assign parking spots? L.S. (via e-mail)

Answer: Probably.

A competent attorney should review the governing documents to understand the nature of parking rights (if any) and the board’s rulemaking authority. If the set-up is truly “open parking” as you believe, and if the board is given broad authority to make rules and regulations, the board has the authority to assign parking spaces.

This was the holding in a 1980 Florida appeals court case called Juno By The Sea v. Manfredonia. It is interesting to note that the appeals court actually issued its opinion against the association and during the period for reconsideration, issued a revised opinion in favor of the association. The Court held that the board’s right to assign parking spaces was subject to the test of “reasonableness”, which depends upon the facts of each case.

It is also important to note that if the board does “assign” parking spaces for the orderly operation of the association, such assignments should not be worded to create “property rights”, such as the designation of the parking spaces as “limited common elements.” This can only be done through the declaration of condominium, and in many cases would require unanimous approval of all unit owners.

Is A Director Required To Be An Owner?

By Joseph Adams on Posted in Reader Q&A

Question: My parents purchased a home for my wife and me as a wedding gift. My parents’ name is on the deed, but we pay all the expenses (insurance, HOA fees, taxes, etc.). A number of people are trying to get me to become involved in the community and run for the board, and I am eager to do so. However, one of the directors does not seem to like me and says I cannot be on the board since I am “just a renter.” What can I do if I want to be on the board? D.D. (via e-mail)

Answer: Nice wedding gift! Florida law does not require a director of a homeowners’ association to be a property owner. If the association’s bylaws require directors to be property owners, then unless your name is put on the deed (i.e., you become a record owner of the property), you would not be eligible to serve on the board.