SB 1196; Suspension of Voting & Use Rights; Fines
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Associations have new enforcement mechanisms available - due process requires careful planning & paperwork for associations to take advantage of these new remedies effectively.
Condominium Associations:
Up until now condominium associations had to have authority to levy fines in the recorded governing documents and did not have the ability to tell delinquent owners to stay out of the pool or gym. That changes as a result of SB 1196.
After July 1, 2010 (the effective date of the new law), condominium associations will be able to levy fines as a result of violations of the governing documents or rules. Of course the association must still provide 14 days written notice of the violation and the opportunity for a hearing before a committee of unit owners before imposing any fines, The fine cannot be levied or imposed if the committee does not agree.
Delinquent condominium owners have more to worry about than fines - the new laws will allow the association to suspend voting rights and use of common, recreational facilities if they are more than ninety (90) days past due in paying a monetary obligation. The term "monetary obligation" is not defined - it could include non-assessment obligations such as late fees, fines, transfer approval or screening fees and the like. The association cannot suspend the use of limited common elements (such as the balcony attached to the unit), nor may it suspend portions of the property necessary to access the unit - such as hallways, elevators, parking spots, etc. The association cannot suspend utilities.
Homeowners Associations:
The new laws actually limit homeowners' associations powers when it comes to suspensions. In the past, suspensions could be imposed in the HOA context for either use violations (violations of the governing documents or rules) or delinquencies. After July 1, 2010, suspensions may only be imposed by HOAs when a member is more than ninety (90) days past due. While it doesn't make sense (especially since Section 720.3085 limits late fees for delinquent assessments), the changes arguably limit fining as well. Fourteen (14) days written notice and an opportunity for a hearing before a committee is required in either case. If the committee (by majority vote) does not agree with the fine or suspension, it may not be imposed.
HOAs cannot suspend use of portions of the property necessary to access the parcel (roads, etc.) or utility services.
The law prohibits the HOA from filing a lien if the fine is less than $1,000 - does that mean that it can lien for fines of $1,000 or more? Well, that remedy certainly needs to be included in the governing documents - so check with counsel. If you're governing documents limit the amount of the fine, now is a good time to consider amendments.
Fines and suspensions must be considered at a properly noticed meeting. Written notice of the fine or suspension (voting or use) must be furnished to the owner (and occupant if applicable).
Will these new procedures and remedies work? Its hard to say, but attempting to take advantage of these remedies without following the required procedures is certainly likely to lead to disputes and may expose the association to liability. Proceed with caution.
Do the owners make the decision to go this route or is this a decision that the Board can make. Some associations have scads of petty rules with many rules formulated based on perhaps one incident. I would think that in some association you could wind up with very puritanical people sitting on rules formulation committes and review boards. There could be retaliation by those who disagree with decisions. It would seem like any homeowner groups would need to proceed with caution. No one is going to want to live in a place with a reputation of being a police state. Word could get out to the general community and those interested in purchasing a home or condo that the situation is hostile, slowing sales and maybe severely lowering home prices. Associations need to think twice before going heavy into rules and enforcement.
As the president of a condo association in Pompano Beach, I have a question about the provision in SB 1196, regarding the rights of a condo association to collect rent from a tenant, as a remedy for a unit owner who is delinquent in paying financial obligations such as monthly dues and assessments.
Has the actual procedure for implementing this remedy -- ie giving notice to the owner, etc - been discussed or mentioned in this forum?
Thank you.
RESPONSE: Not yet. There are still a few wrinkles in the law that require analysis. The language regarding collection of rent is on pages 46 and 47 of the bill. There is a link to the bill (in blue) on the site
If a delinquent owner's voting rights are suspended, does that change the votes required to pass an issue? In other words, if we have 400 units but 20 are delinquent and have their voting rights suspended, do we need 75% of 380 or 400 to approve.
Can a delinquent condo owner be barred from using shared/common laundry facilities?
If an HOA imposes a fine on a homeowner, does the state law specify an appeals process? As a former resident of NY, i know that in NY any civilly imposed fine or sanction must have an independent appeal process.
RESPONSE: Community Associations must give the owner (or violator) written notice and the opportunity for a hearing before a committee of other owners (not board members) before a fine may be imposed (for violations). The committee hearing is the "check and balance" process. If the committee does not agree with the fine, the fine may not be imposed. Please see §718.303 or §720.305 for the procedures.
We had a meeting and passed a motion to send a letter to all owners telling them of the new laws regarding suspension of rights to use common areas for those owners who are 90 days delinquent, and advising them of the new law regarding fining.
Do we have to have another meeting on July 1 to formally suspend those rights, or does this meeting today do that?
Jan,
Check this out.
Let me know,
Thank you,
Ginny
Can the association tow your car out of your assigned parking spot over unpaid HOA fees?
for HOAs you stated the following:
Fines and suspensions must be considered at a properly noticed meeting. Written notice of the fine or suspension (voting or use) must be furnished to the owner (and occupant if applicable).
Pls cite exact location in 1196 of the requirement for a noticed meeting. I can't find it.
thanks
RESPONSE: For HOAs you need to provide 14 days notice and opportunity for a hearing. Lines 1538-1544 address the board action for condos; lines 2806-2810 address board action for HOAs. There are a number of arbitration decisions in the HOA context that require evidence of the board vote and notice to the owner before imposing any suspension. There is an argument that the board can adopt a policy of suspension based on delinquency status and once that policy is published it constitutes board action, but the HOA cannot skip the actual notice to the owner/tenant.
Regarding the new law/s.1196 Condo Assoc. rights to collect rent is very gray. It states that the Assoc. can collect "future" monetary obligations related to the unit from a tenant when the owner is deliquent in monetary obligations to the Assoc. How can they collect the entire rent from the tenant for "future" monetary obligations related to the unit. Deliquient fees are not "future" and rent is not an obligation related to the the Condo. unit.
Only maintenance fees and assessments are related to the Condo. unit.
RESPONSE: The language of the statute is subject to different interpretations.
Lisa,
you stated "Fines and suspensions must be considered at a properly noticed meeting." I asked for the specific cite and you said "there were a number of arbitration decisions..."
OK, but where in 1196 is the specific requirement for a noticed board meeting for an HOA?
Thanks
I use your blogs to advise my boards, and if you can show me where in 2806-2810 a "properly noticed board meeting" for an **HOA** is required, I'll buy you dinner. Otherwise, please revise your answer so I can use it. Also, those arbitration decisions may come into play in the event of a challenge, but I don't want to use a "possibility" when explaining to a board the requirements of 1196. Thanks
2798 (a) A fine or suspension may not be imposed without notice
2799 of at least 14 days notice to the person sought to be fined or
2800 suspended and an opportunity for a hearing before a committee of
2801 at least three members appointed by the board who are not
2802 officers, directors, or employees of the association, or the
2803 spouse, parent, child, brother, or sister of an officer,
2804 director, or employee. If the committee, by majority vote, does
2805 not approve a proposed fine or suspension, it may not be
2806 imposed. If the association imposes a fine or suspension, the
2807 association must provide written notice of such fine or
2808 suspension by mail or hand delivery to the parcel owner and, if
2809 applicable, to any tenant, licensee, or invitee of the parcel
2810 owner.
RESPONSE: Thank you for your kind comments. Please remember, information on the blog does not constitute legal advice - it is general in nature and there are many considerations that impact procedures for any community. I encourage boards to consult with association legal counsel before taking advantage of the new enforcement options in the statutes.
PS - If I explain the reasoning - do I still get dinner?
Please explain how the language changed from explicitly permitting actions to specifically restricting those same actions. In 2009, Associations could use the leverage of suspension for failure to pay maintenance assessments after notice of default. Voting rights could only be suspended after 90 days. Now - you say that the association is precluded from using any leverage, and instead must wait 90 days before taking such action. That makes no sense. Our experience is that, faced with suspension of common area use rights, owners find a way to pay their contractual obligation sooner.
And how can a law be effective July 1, 2010 and not be published on the State's website, which currently shows only FS up to 2009?
RESPONSE: The law is available on the State's websites. Go to www.flsenate.gov. Pursuant to the new law, suspensions may be imposed after ninety (90) days and there is a specific procedure for both Condos & HOA communities.
What about the condo owner? Their are plenty of us who delegently pay our HOA fees and any complaints are ignored!!! What if the HOA isn't keeping their end of the deal on maintaning shrubbery, etc? Our building is nearly totally obscurred by overgrowth and no-one on the board or at the management company seem to care. Their attitude is, "So what". What recourse do owners have????
RESPONSE: Condo Owners may contact the Division of Florida Condominiums, Time Shares and Mobile Homes and file a complaint with respect to certain statutory violations. They may also contact the Florida Condominium Ombudsman's office for assistance. Ultimately the board is elected by the members and if the board members do not listen or respond to member issues, they will not be elected again.
Can the hoa stop owner or renter who has not paid fees over 90 days from entering the gated area which leads to their townhouse garage by changing the access code ....Thanks
RESPONSE: While the new statutes allow associations to suspend use rights, the association cannot impede ingress or egress to the unit or home. Many associations have suspended the use of entry transponders or other devices, requiring the owner (or tenant, invitee) to use the guest entry.