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Live Webinar
Friday, July 23, 2010 from 10:00 Am–11:00 PM EDT
(9:00 PM-10:00 PM CDT)

Anatomy of a Disaster Claim
With hurricane season upon us, now is the time to gear up for the potential of a disaster claim against your insurance company. Learn what you can do now to prepare a complete and well-documented claim, thereby lessening the worry and ensuring the likelihood of a maximized recovery.

Steven B. Lesser, Esq.	Herbert O. Brock, Jr., Esq.	Rick Slider, P.E.

Join Board Certified Construction Lawyers Steve Lesser, Esq., and Herb Brock, Esq. of Becker & Poliakoff, along with Rick Slider, P.E., of Slider Engineering Group, a firm specializing in structural engineering and forensic investigation, for this live webinar on the Anatomy of a Disaster Claim.

Register below and you will receive a confirmation email with information on how to participate.

http://event.vcallinteraction.com/r.htm?e=226711&s=1&k=023C0E8B69E94BF7A3493AF48E9B32E9

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With the oil still gushing off our shores and no end in sight, only one thing is for certain, the impact on the environment and economy of Florida’s Gulf Coast will be devastating.

By John Cottle, Esq.

Governor Crist said Floridians must “prepare the worst and hope for the best”. We completely agree with the Governor. It is imperative that anyone with a financial or other vested interest that needs protecting begin doing so as quickly as possible.  Some prompt actions are recommended while it may be wise to consider waiting (as difficult as that may be) regarding others.

Make a Record of Everything
Having been through major disasters and the arduous claims process that follows, I can assure you that there is no such thing as “too much information” when it comes to establishing conditions prior to a casualty loss or in proving “damages”.  Some actions which should be taken immediately include:

• Take photographs – lots of them – and as soon as possible, before any physical damage is caused by the oil spill.  If any damage is sustained, photographs of the damage are indispensable.
• Prepare a  video with narration.
• Rental losses due to canceled reservations should be well-documented. 
• Document all information you receive from anyone who contacts you regarding the oil spill.

Governmental Jurisdictions Can Be Confusing
Beaches, in general, fall under the regulatory authority of several agencies including the Army Corps of Engineers (“ACE”) and on the state level the Florida Department of Environmental Protection (“DEP”).   It is essential to confirm in advance what regulations apply and to obtain any required permits before proceeding with any actions that may violate state or federal laws.

Engaging Professionals
Engaging professionals may be a prudent course of action.  Condominiums and community associations should consider securing the services of a competent coastal engineer.  The advice and recommendations of a professional may provide significant assistance in protecting property and in navigating the confusing web of state and federal regulations applicable to beachfront property. Additionally, it would be wise to seek legal assistance to help protect your assets and income. Some pundits are predicting that this incident will create more lawsuits than any other single event in history. Beware of the contractors, public adjustors and attorneys from all over the country trying to get in on the action.  While many are competent, capable, and professional,  others are not.  It is important to check the history and credentials of any professional before engaging their services.  No substantial claims are likely to be settled quickly, and prudence rather than haste in choosing legal representation will pay off in the long run.

The cleanup from the oil spill will take years.  The litigation and claims processes will take even longer.  Property owners who follow the steps outlined above and keep on top of the news will be in a better position than those who act out of desperation and panic.

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Take a well deserved bow. You did it! Today the Florida House of Representatives overwhelming passed CS/CS/CS/SB 1196 (passed on 4/16/2010 by the Florida Senate) sending it to Governor Crist for his signature. Please take a moment to contact the Governor (http://www.flgov.com/contact_governor) and urge him to sign the bill right away. This is very important given his veto of similar last year.

This bill is of SIGNIFICANT POSITIVE IMPACT to community associations. It addresses everything from mortgagee liability (foreclosure crisis) to elevators, to sprinklers, to renters, etc. CALL has sent out earlier alerts containing details and be on the lookout for another summary to be released via the CALL website soon. Please contact your Legislators (both Representative and Senator) and thank them for their support.  From your CALL team on the ground at the Capitol…..THANK YOU!

All your emails, calls, visits and involvement were invaluable. We are only as good as the rest of our team…YOU! Thanks for once again proving you are THE voice for good community association public policy. Attention has been paid.

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This week marks the second week of the legislative session and things are getting downright hot inside the capitol as it relates to community association bills. While only mid-week, I have been involved with numerous meetings regarding SB 1196 and HB 561, the ca package getting the most attention by the Legislature. I have met with the sponsors…Sen. Fasano, Sen. Ring, Rep. Bogdanoff, Rep. Hudson…with interest groups ranging from bankers, managers, CPA’s, insurance agents, with committee staff, etc. Progress is being made on several fronts and as language is negotiated which provide workable solutions to real challenges, we will get that out via the CALL website (www.CALLbp.com) for your review and input.

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A couple of CA bills of interest were heard by the House Civil Justice & Courts Policy Committee on Tuesday (February 4, 2010) morning. HB 329 by Rep. Robaina was debated and it was decided by the Committee to hold off on taking a vote due to some concerns with the provisions pertaining to the ability of associations to go after payment of assessments from renters when unit owner landlords aren’t paying.

HB 561, a omnibus CA bill which CALL is working on very closely with sponsors Bogdanoff and Hudson, was passed by the committee after adopting several amendments pertaining to the contentious sprinkler retrofit issue. It would move the date of compliance to 2019 from 2014 and say that if an association has voted to forego retrofitting that 10 percent of owners could petition to have a special meeting “re-vote” once every 3 years. CALL will continue to monitor this issue to make certain a workable solution is found which doesn’t jeopardize the bill.

There was also a discussion on the Florida Supreme Court’s administrative order re the mandatory mediation process for residential mortgage foreclosure cases. David Muller of CALL was asked by the Committee to testify and was able to provide helpful information on the foreclosure crisis many associations are facing and how this mediation process must not cause further delay and cost. This issue remains a top priority of CALL. We need you to let your Legislators know how your association is being impacted and ask for action.

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Free Educational Forums for Board Members, Property Owners and Managers Announced at 15 Locations Around Florida. Conference will focus on Strategies for Communities to Deal with Economic Crisis.

Becker & Poliakoff announces its Annual Community Association Leadership Conferences beginning on January 15, 2010 where attendees will learn strategies to deal with the financial issues facing their Florida communities. Topics will include liability of owners versus subsequent purchasers, collecting rents in lieu of assessments, depositing rents into the court registry, extraordinary receiver appointments and extra-judicial remedies, among others.

A panel of Becker & Poliakoff’s attorneys from a variety of practice groups will answer questions during the third hour of the conference. You may submit questions in advance for the panel members by email to questions@beckerpoliakoff. com. Please indicate which event you are attending in the subject line of the email, so that the panelists can do their best to respond at the event you attend. See page 3 for Conference dates and locations.

Register today for this free conference at www.becker-poliakoff.com/events/ca/ for the event nearest you.

For dates, locations and registration information - continue reading (below)

Register today for this FREE conference at www.becker-poliakoff.com/events/ca/ for the event nearest you.

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The Maison Grande and other bankruptcy filings by community associations have spurred interest in reorganization of debt.  Is bankruptcy an option for your cash strapped community?  What issues do you need to consider?   Bankruptcy Attorney Aleida Martinez Molina answers the following questions for community associations struggling with bills and bad debt.

CAN CONDOMINIUM OR HOMEOWNERS ASSOCIATIONS FILE FOR BANKRUPTCY?  Yes. Under certain circumstances, condominium associations have successfully reorganized under Chapter 11 of title 11 of the United States Code, 11 U.S.C. sections 101, et seq. (“Chapter 11” and “the Code,” respectively). This phenomenon is not unique to Florida – there have been successful condominium association reorganizations throughout the United States.

WHAT IS A BANKRUPTCY IN THE CONTEXT OF A COMMUNITY ASSOCIATION? The first point to understand is that Chapter 11 is a reorganization process – not liquidation under Chapter 7 of the Code. As such, it can provide associations the protections of the automatic stay and other relevant Code provisions while allowing them to formulate a plan of reorganization to extricate themselves from the particular financial situation.

UNDER WHAT CIRCUMSTANCES DOES IT MAKE SENSE TO REORGANIZE? The Code has unique provisions which in essence give associations a more level playing field to negotiate with creditors. A number of associations find themselves with daunting contracts or leases which they might renegotiate or simply reject if able to do so. A reorganization could, under the appropriate circumstances, accomplish this goal. Another example is filing for bankruptcy protection in order to prevent a judgment creditor from seizing or garnishing bank accounts. An association with a judgment or upcoming trial could turn to a reorganization as a way to automatically stay the lawsuit/collection of the judgment and permit a realistic settlement. Finally, associations finding themselves threatened with the shut-off of service by utilities or other providers can, under certain circumstances, resort to reorganizations to temporarily prevent this drastic action.

WHAT IS REQUIRED FOR AN ASSOCIATION TO REORGANIZE? Proper authority from the Board and appropriate attorney fees and costs. In addition, an association should file a reorganization with a clear understanding of its exit strategy (i.e., a plan of reorganization).

COSTS ASSOCIATED WITH A REORGANIZATION: Reorganizations are not inexpensive and simple matters – filing fees to the bankruptcy court alone exceed $1,000. The debtors also need to pay quarterly fees to the United States Trustee while the reorganization is pending. Any debtor (association or otherwise) needs to contact competent counsel in time to prepare budgets and plan accordingly. It can and is done – even in dire situations where utility services are about to be interrupted. Counsel can advise how to properly prepare the necessary documents, authority and budget to reorganize under the Code.

WHAT HAPPENS TO ASSOCIATION RESIDENTS WHEN A COMMUNITY ASSOCIATION REORGANIZES? Ideally, nothing directly. If the association files with appropriate board authority and a reasonable game plan, the association should be able to function and provide the necessary services to the association property and residents.

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The Florida Consumer Collection Practices Act Prohibits Associations From Posting Delinquency Lists and Taking Other Actions to Collect Assessments and Maintenance Fees.

 There have been a number of newspaper articles explaining actions taken by community association boards and managers to collect delinquent assessments.  The Miami Herald reported that some associations post lists of the names of the owners behind on their fees and others deny security access devices to tenants of delinquent owners.  

The Wall Street Journal reported that some associations were taking control of the unoccupied units and renting them on a short term basis until the bank foreclosed.  

While we are all familiar with the idiom "drastic times call for drastic measures",  community leaders and property managers should understand that Florida law prohibits unfair or abusive tactics with regard to debt collection, including the collection of assessments.   Although the prohibitions in the Federal Fair Debt Collection Practices Act do not apply to the person or entity owed the debt (the 'creditor', which in this case is the Association), both community associations and their managing agents are responsible for compliance with the Florida Laws.

Among other practices, Section 559.72, Florida Statutes, prohibits the following:

• Use of profane, obscene, vulgar, or willfully abusive language in communicating with a debtor or any member of his or her family;
   
• Communication with a debtor under the guise of an attorney by using the stationary of an attorney or forms or instruments which only attorneys are authorized to prepare;
   
• Orally communicating with a debtor in such a manner as to give the false impression or appearance that such person is associated with an attorney;
   
• Publishing or posting, threatening to publish or post, or causing to be published or posted before the general public individual names or any list of names of debtors, commonly know as a deadbeat list, for the purpose of enforcing or attempting to enforce collection of consumer debts;
   
• Mailing any communication to a debtor in an envelope or postcard with words typed, written, or printed n the outside of the envelope or postcard calculated to embarrass the debtor. An example of this would be an envelope addressed to “Deadbeat, Jane Doe” or “Deadbeat, John Doe”;
   
• Communicating with the debtor between the hours of 9 p.m. and 8 a.m. without the prior written consent of the debtor.

While every association must be diligent with its collection efforts, those efforts must be in compliance with legal and ethical standards.

On the other hand, the Florida Courts are cognizant of the problem and have allowed Associations to have receivers appointed for the purposes of collecting rent from tenants when the owners of those units are facing foreclosure as a result of non-payment of assessments.  Remember to check this site in the future for more information about proactive methods to collect assessments.

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