We are happy to feature video clips from time to time on this blog. The post from the other day spurred several questions regarding unit owner access to official records. Please listen to our Community Association Practice Group Leader discuss this important subject.
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The 2012 Florida Communities of Excellence
Conference & Awards Ceremony
Friday, March 30, 2012
9:30 a.m. – 7:30 p.m.
Seminole Hard Rock Hotel & Casino Conference Center
Hollywood, Florida
Join board members, managers and residents from hundreds of Florida communities for this annual celebration of community association excellence. Attend stimulating educational sessions and CEU classes, discover the latest solutions from top industry vendors, and network with industry professionals and community leaders from across the state.
Admission is free for Community Association board members, manager and residents.
Event Agenda
9:30 a.m. – Event registration opens
10:00 a.m. – Exhibition area opens
10:00 a.m. – 12:00 noon – CAM classes
12:15 p.m. – 1:15 p.m. – “Managers of Excellence" Awards Luncheon
The "Managers of Excellence" designation is given to those individuals who manage communities that have received Florida Communities of Excellence Awards.
1:30 p.m. to 4:30 p.m. – Seminars and Panels
Hosted by Communities of Excellence Awards 2012 Diamond Level Sponsors: Associa, BB&T Bank, Continental Group and Envera Systems.
4:30 p.m. – Gala Reception
5:30 p.m. – 7:30 p.m. – Florida Communities of Excellence Awards ceremony
Register Now to attend the 2012 Florida Communities Excellence Awards!
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Becker & Poliakoff announces its 36th Annual Community Association Leadership Conference series beginning on January 24, 2012 through March 23, 2012 at various locations throughout the state. This FREE conference will focus on new laws impacting Florida's shared ownership communities. Attendees will learn about significant amendments enacted during the 2011 legislative session in Tallahassee, as well as get an update on new case law. A special feature: a panel discussion focusing on covenant enforcement "How To Maintain Smooth Operations at Your Community". CAMs will earn two continuing education credits in Legal Update 2012. To register, click on the event nearest you (below). |
| Southwest Florida | |
| Tuesday, January 24, 2012 Barbara B. Mann Center 8099 College Parkway Ft. Myers, FL 33919 Register Now |
Friday, March 9, 2012 Naples Grande (formerly The Registry) 475 Seagate Drive Naples, FL 34103 Register Now |
| For further information contact: Franklin Scott (239) 433-7707 or fscott@becker-poliakoff.com |
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| Miami Dade and The Keys | |
| Saturday, February 4, 2012 Hawk’s Cay Resort 61 Hawk’s Cay Blvd. Duck Key, FL 33050 Register Now |
Saturday, March 10, 2012 Hilton Miami Airport 5101 Blue Lagoon Drive Miami, FL 33126 Register Now |
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For further information contact: |
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| Tampa Bay | Port St. Lucie |
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Friday, February 17, 2012 For further information contact: |
Saturday, January 28, 2012 For further information contact: |
| Sarasota | |
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Saturday, February 4, 2012 For further information contact: |
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| Broward | West Palm Beach |
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Saturday, March 3, 2012 For further information contact: |
Friday, March 16, 2012 For further information contact: |
| Central Florida | |
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Friday, February 10, 2012 |
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| Wednesday, February 29, 2012 Plaza Resort & Spa 600 N. Atlantic Ave. Daytona Beach, FL 32118 Register Now |
Friday, March 23, 2012 Holiday Inn-Viera Conference Center 8298 N. Wickham Rd. Melbourne, FL 32940 Register Now |
| For further information contact: Allison Martin (772) 871-9320 or amartin@becker-poliakoff.com |
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| Panhandle | |
| Friday, February 10, 2012 Emerald Coast Conference Center 1250 Miracle Strip Parkway SE Ft. Walton Beach, FL 32548 Register Now |
Friday, February 17, 2012 Bay Point Wyndham 4114 Jan Cooley Drive Panama City, FL 32408 Register Now |
| For further information contact: Melissa Bond (850) 664-2229 or mbond@becker-poliakoff.com |
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Drought conditions, watering restrictions, bank foreclosures and abandoned homes - all have an impact of yard and grounds maintenance. All have an impact on the look and feel of a community as well as owner/resident satisfaction. As a member of a board of directors you have to ask yourself, "is the time, energy, money and aggravation of fighting with cash-strapped homeowners to re-sod, re-plant annuals, perform property inspections, hold violation/fining hearings, etc. worth the effort?" That question is especially relevant in light of pertinent Florida laws. One of the provisions of the Homeowners' Association Act says:
§720.3075(4):
(a) The Legislature finds that the use of Florida-friendly landscaping and other water use and pollution prevention measures to conserve or protect the state’s water resources serves a compelling public interest and that the participation of homeowners’ associations and local governments is essential to the state’s efforts in water conservation and water quality protection and restoration.
(b) Homeowners’ association documents, including declarations of covenants, articles of incorporation, or bylaws, may not prohibit or be enforced so as to prohibit any property owner from implementing Florida-friendly landscaping, as defined in s. 373.185, on his or her land or create any requirement or limitation in conflict with any provision of part II of chapter 373 or a water shortage order, other order, consumptive use permit, or rule adopted or issued pursuant to part II of chapter 373.
Another chapter of the Florida Statutes defines the term "Florida-friendly" landscape. It likewise prevents HOAs from enforcing deed restrictions in a way that precludes the use of these techniques.
§373.185(3)
(a) The Legislature finds that the use of Florida-friendly landscaping and other water use and pollution prevention measures to conserve or protect the state’s water resources serves a compelling public interest and that the participation of homeowners’ associations and local governments is essential to the state’s efforts in water conservation and water quality protection and restoration.
(b) A deed restriction or covenant may not prohibit or be enforced so as to prohibit any property owner from implementing Florida-friendly landscaping on his or her land or create any requirement or limitation in conflict with any provision of part II of this chapter or a water shortage order, other order, consumptive use permit, or rule adopted or issued pursuant to part II of this chapter.
So - what are the rules in homeowners associations? Is the requirement to maintain a lush green lawn still the norm? If so, should that be the case? Doesn't seem so in light of these requirements. Consequently, HOA boards and committees are updating architectural control
guidelines to reflect current thought about Florida landscape with an eye towards maintaining the aesthetic quality of the neighborhood while making life a little easier (and less expensive) for the homeowners.
The West Volusia Beacon reported that several homeowners in a DeLand HOA removed all of the St. Augustine grass and replaced it with Florida native plantings. Neighbors were thrilled with the results and so were the homeowners - they capped off sprinklers for good and hardly ever have a need to water the landscape. Water collected in a rain barrel provides enough of a supplement during dry spells and weekly mowing has been replaced with quarterly care of jasmine, palms, coco plum and other drought-tolerant plants.
Support from the HOA makes a huge difference. Have you really taken a look at the Architectural Control Criteria or landscape guidelines in the past few years? If not, I encourage community leaders and managers to work with your local University of Florida - IFAS Extension and residents to develop updated guidelines that work for everyone. You can find out more about Florida-Friendly landscaping at www.floridayards.org. Check out the plant database to see what beautiful options are available.
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Florida HOAs are in the national spotlight again. This time the attention doesn't center around the housing market meltdown, the foreclosure crisis or budget shortfalls though. It concerns what commenters have called overzealous enforcement of use restrictions. A community in Palm Beach County shut down a lemonade stand operated by neighborhood children. Here is the video spot that aired on television:
Use restrictions are a very important part of community association living. Many people choose to move into a particular community due to enforcement of use, maintenance and architectural restrictions. It makes sense, residents may not want to look at basketball hoops, soccer goals and other play or sports structures when driving to and from work everyday. They may not want to see 5 cars, campers and trailers parked in a driveway or on the front lawn. Car repair, cooking in the front yard (BBQ) and yard sales are almost universally prohibited in community associations. The same is true with respect to operation of unlicensed businesses, most business or commercial uses, signage (other than specific signs of certain shapes and sizes) and solicitation.
Is a lemonade stand or door-to-door Girl Scout cookie sales the evils sought to be avoided by these restrictions? Probably not.
Nonetheless, there are competing interests the board of directors must take into account. If the board does nothing about a lemonade stand will it have a hard time stopping someone from selling other products from their home (whether visible to the public or not)? If a child is permitted to go door-to-door selling cookies, can a resident real estate agent walk door to door soliciting listings?
This example shows that community leaders need to carefully tailor their own rules and regulations, as well as architectural restrictions, to meet the needs of the community.
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Associations, community leaders and managers are often the target of housing discrimination claims. It is against Florida law to discriminate against anyone with respect to sale, rental or terms and conditions of housing based upon race, color, national origin, sex, handicap, familial status or religion.
New HUD rules would expand the categories of persons entitled to protection on a federal and sometimes state level, depending on the program. HUD seeks to clarify that housing cannot be denied based on marital status, sexual orientation, or gender identity and, further, specify that all eligible families will have the opportunity to participate in HUD programs. These categories of protected class are already included in many local ordinances throughout Florida. You can review the proposed text of the rule HERE.
HUD already defines the term “family” with a broad scope in connection with many of its housing programs. Its definition includes a single person and families with or without children. HUD’s proposed rule would clarify that families where one or more members of the family may be an LGBT individual, have an LGBT relationship, or be perceived to be such an individual or in such relationship would not constitute a basis for excluding those families from HUD benefits. The current definition of the term ‘‘family,’’ is based on the U.S. Housing Act of 1937 (42 U.S. 1437a) (1937 Act). Section 3(b)(3)(B) of the 1937 Act provides as follows:
Families.—The term ‘‘families’’ includes families with children and, in the cases of elderly families, near-elderly families, and disabled families, means families whose heads (or their spouses), or whose sole members, are elderly, near-elderly, or persons with disabilities, respectively. The term includes, in the cases of elderly families, near-elderly families, and disabled families, 2 or more elderly persons, near elderly persons, or persons with disabilities living together, and 1 or more such persons living with 1 or more persons determined under the public housing agency plan to be essential to their care or well-being.
There are various resources on this site that address discrimination issues, such as:
Condos & HOAs: It Pays NOT to Discriminate - Case Examples
Do Group Homes & Assisted Living Facilities Violate HOA Covenants & Restrictions?
55 & Over Housing: What is the 80/20 Rule?
We will continue to address discrimination issues in the future and alert you to new cases or administrative decisions from time to time.
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Are you proud of the special programs and services that make your community stand out from the crowd? Then submit a nomination for an award in one or more of the ten categories judged in this year's program. The Florida Communities of Excellence Awards honor and document the admirable achievements of condominium and homeowners associations throughout the state.
A distinguished panel of independent experts with backgrounds in community management, consulting, public safety, public policy, education, journalism, energy & water conservation and environmental advocacy, will evaluate entries in these categories:
Judges include representatives from the University of Florida and the University of Florida's Extension Service, the Florida Fire Chiefs Association, the Sun-Sentinel, Nova Southeastern University and AARP, among others. Learn more about the Judges HERE.
There's not much time left - nominations must be submitted no later than January 15, 2011. Click HERE for the nomination form.
Becker & Poliakoff will conduct its 35th Annual Community Association Leadership Conference series beginning on January 24, 2011 to March 26, 2011 at various locations throughout the state.
This FREE conference will focus on legislative changes impacting Florida's communities. Attendees will learn about significant amendments enacted during the 2010 legislative session in Tallahassee. Topics include new remedies for collecting delinquent accounts, changes to suspension of use rights and voting rights, board elections and qualifications, as well as the most recent case law affecting shared ownership housing communities.
A special feature: A panel of Becker & Poliakoff's construction attorneys discussing common construction issues facing community associations, followed by a Q&A session where attendees can get answers to whatever questions they may have. You may also submit your questions in advance to questions@becker-poliakoff.com.
Locations & registration information can be found here.
Showcase Your Excellence - Submit Your Entry for Consideration by Independent Judges in the Florida Communities of Excellence Awards!
This independently judged program enables the top communities in the state to promote their accomplishments and raise their profiles while documenting their success and enabling others to learn from their accomplishments across numerous categories. Publisher and sponsor Jim McMurray noted the awards "saw 100% growth in its first two years and the program will expand even further for 2011.” Florida Community Association Journal co-founded the Awards with the law firm Becker & Poliakoff, P.A.
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Communities often rely upon the advice, effort and fortitude of their managers. Therefore, "Managers of Excellence” will also be selected. This award is to recognize professionals working with communities that have distinguished themselves with consistently high rankings in the initial three years of the Awards.
There are plenty of categories so every size, type and shape of community can participate. Go to: Florida Communities of Excellence for more information and entry forms.
In nearly every case where a first mortgage of record exists on a property, the association's lien is subordinate or inferior to that mortgage. This means if an association elects to foreclose its lien and takes title to the property, it will take title subject to the right of the first mortgagee to foreclose its mortgage. Associations in the past were reluctant to foreclose when the mortgagee already commenced its own foreclosure action or when the value of the property did not exceed the amount of debt secured by the first mortgage. That's changing now.
Associations are now making the decision to foreclose more often under these circumstances. The primary reason for this is serious delay in the prosecution of the mortgagee's foreclosure case. These delays are brought on by a variety of factors including the sheer volume of cases handled by the mortgagee's law firm, protracted efforts to work with the borrower either to short sale the property or modify the loan, problems associated with serving necessary parties with the foreclosure complaint or locating original documents that are to be filed with the court, back log in the courts and even strategic decisions by mortgagees to slow down the process.
In some cases, associations can obtain favorable results when foreclosing, even against properties that have fair market values below their mortgaged amount. Sometimes the homeowner has the means to pay the association but has elected to spend money on other concerns. Because foreclosure results in the owner losing title to the property, if the owner has the means to pay and does not desire to walk away, they pay rather than lose title. Foreclsoure can be a powerful deterrent for owners who have the means to pay but elect not to or to pay late because they hear others doing the same. Another option is the association's right to rent the property once it takes title, if permitted by the association's governing documents. For some associations, the rental market is favorable and significant income can be recovered before the mortgagee forecloses and takes title.
Many times the owner cannot or will not pay and rental is not a viable option. However, associations still make the decision to foreclose for any number of reasons. Because so many mortgage foreclosures are being contested by owners raising defenses unique to the mortgage foreclosure action, and thus stalling the mortgage foreclosure case for months or even years, the association can effectively render those defenses moot as they relate to the mortgagee's foreclosure by foreclosing the association's lien. When the owner is divested of title by the association, the owner will drop or lose the fight against the lender in the mortgage foreclosure action, thus paving the way for the lender to take title and begin paying assessments. Another option for associations taking title is negotiating a short sale with the lender or tendering a deed in lieu of foreclosure to the lender. I have also filed motions in mortgage foreclosure actions notifying the court that the association has taken title and does not contest the mortgagee's foreclosure, therefore, speeding up the lender's acquisition of title. These associations understand the key is getting a paying owner into the property sooner rather than later. That way, more in terms of future assessments are recovered rather than lost while a mortgage foreclosure lingers on for years and no one pays the assessments.
What every association should consider is each case is different and the association is well served if it carefully considers all of its options and selects a strategy that works best in any given case. In this ever changing environment, there is no one size fits all approach.
In the wake of Attorney General investigations, self-imposed lender moratoriums on foreclosures and a mounting back up of pending mortgage foreclosure cases, community associations are searching for alternatives to waiting out the storm. It was once the norm that associations would take a wait and see approach when an owner delinquent in the payment of assessments was also facing a mortgage foreclosure. Particularly, in this economy when the amount due on the mortgage exceeds the fair market value of the property. However, now it is too often that associations are left withering on the vine while the mortgage foreclosure action goes on for months or even years.Common Exemptions for Condominium and Cooperative Associations do not Apply to Homeowners' Associations.
The Florida Department of Health enforces regulations on public swimming pools. While community association pools are generally not open to the public, its likely they are considered public pools for the purpose of compliance with Chapter 514 of the Florida Statutes and Rule 64E-9 of the Florida Administrative Code.
The Florida Administrative Code defines a "public pool" as basically any pool that does not qualify as a private pool. Section 514.011, Florida Statutes defines a private pool as a facility used only by an individual, family, or living unit members and their guests which does not serve any type of cooperative housing or joint tenancy of five or more living units. Condominium and cooperative associations have the benefit of the exemptions set forth in Section 514.0115 which say:
Pools serving no more than 32 condominium or cooperative units which are not operated as a public lodging establishment shall be exempt from supervision under this chapter, except for water quality.
Pools serving condominium or cooperative associations of more than 32 units and whose recorded documents prohibit the rental or sublease of the units for periods of less than 60 days are exempt from supervision under this chapter, except that the condominium or cooperative owner or association must file applications with the department and obtain construction plans approval and receive an initial operating permit. The department shall inspect the swimming pools at such places annually, at the fee set forth in s. 514.033(3), or upon request by a unit owner, to determine compliance with department rules relating to water quality and lifesaving equipment. The department may not require compliance with rules relating to swimming pool lifeguard standards.
Unfortunately, these exemptions do not mention homeowners' associations. Even condominium communities (with more than 32 units) must comply with new safety requirements and must remember to apply for renewal as required by the code.
Enforcement of the revised pool regulations has put a strain on some community associations, such as the Rose Garden Villas in Lee County where the residents will have to spend over $200,000 on rebuilding costs. Community leaders question why it is necessary to comply with these stricter requirements after the pool has been open without incident for years and years.
The government may require reasonable changes in existing buildings in order to comply with new requirements and standards for the protection of health and safety of the public, regardless of the fact the buildings complied with the applicable codes at the time of construction. Nonetheless, not all regulations are retroactive and variances are available in the appropriate circumstances. If your community faces this dilemma, its a good idea to discuss whether you can appeal a denial of an exemption or obtain a variance.
The rule of caveat emptor is sage advice.
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Now is a terrific time to buy a home, whether a condominium, single-family home or other type of housing. Homes prices have fallen, interest rates are low and there are plenty of homes on the market to choose from. I encourage you to take advantage of this opportunity if you can. However, please know what you are buying - save yourself from heartache and future troubles. HOA Examiner recently ran a string of articles with advice for home buyers, particularly first time buyers. A couple of them are posted below:
I'd like to reiterate and expand on some of the points mentioned.
Your home is your Castle, right? This maxim, originating as far back as the 1700's, stands for the proposition that a homeowner may do as he (or she) pleases in his (or her) home, free from invasions of privacy. Well, when you buy a home in a community governed by an association, you cannot always do what you please, so its important to understand both the benefits and the obligations of shared ownership housing.
One Florida appellate court explained this concept succinctly. It said:
Every man may justly consider his home his castle and himself as the king thereof; nonetheless his sovereign fiat to use his property as he pleases must yield, at least in degree, where ownership is in common or cooperation with others. The benefits of condominium living and ownership demand no less. The individual ought not be permitted to disrupt the integrity of the common scheme through his desire for change, however laudable that change might be.
[Stirling Village Condominium Association v. Breitenbach, 251 So.2d 685 (Fla. 4th DCA 1971].
With that in mind, here is some additional advice for home buyers:
As I said to Adam Sinclair, you can live very happily in an association setting, once you find the right place for your lifestyle. Neighbors can turn into life-long friends, you and your family can enjoy the amenities, comfort, security and maintenance standards community associations have to offer. Don't fret, the right community is waiting for you to find it!
Wednesday, September 29, 2010
2:00 PM – 3:00 PM EDT (1:00 PM – 2:00 PM CDT)
An insurance claim that develops into a lawsuit can be a process fraught with obstacles. We will review actual Florida cases where claimants filed suit against their insurance companies, each with very different outcomes. Ken Direktor, Chair of Becker & Poliakoff's community association law practice group will moderate, with Rob Rubin, a trial lawyer in the firm's West Palm Beach office, who will provide insightful legal analysis of the cases. Special guest Andrea Northrop, a commercial insurance agent with Insurance Office of America, Florida 's largest privately-held insurance agency, will present an insurer's perspective.
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| Kenneth S. Direktor, Esq. Becker & Poliakoff Ft. Lauderdale |
Robert Rubin, Esq. |
Andrea C. Northrop Insurance Office of America Jupiter  |
Wednesday, September 29, 2010
2:00 PM – 3:00 PM EDT (1:00 PM – 2:00 PM CDT)
Register below and you will receive a confirmation email with information on how to participate.
Parton v. Palomino Lakes Property Owners Association, Inc.
While the legal process may seem slow and involve a significant amount of paperwork, this case shows what can happen if owners and directors decide to take enforcement matters into their own hands.
The Partons owned a lot within the Palomino Lakes Community, subject to the governance by the Palomino Lakes Property Owners Association, Inc. The governing documents prohibited mobile homes. The Partons decided to install a modular home and attempted to have it delivered to the homesite. Four (4) owners, (three [3] of which being members of the board of directors of the association) blocked the delivery by blockading the entrance to the subdivision. This happened on three (3) separate occasions.
As a result, the Partons filed suit against these owners and the Association and immediately obtained injunctive relief, as the Court apparently agreed that the modular home to be permanently attached to a concrete slab, was not a mobile home. The Partons amended their complaint to add counts for damages based upon tortuous interference with contract and civil conspiracy. A jury awarded the Partons $5,000.00 in compensatory damages and further awarded punitive damages against Larry Vinson in the amount of $60,000.00, Ila Vinson in the amount of $40,000.00 and against Linda Drielbelbis in the amount of $50,000.00! The Court also awarded the Partons prevailing party attorney’s fees and costs.
The Partons actually appealed from the Final Order, primarily on two grounds claiming:
The Court agreed with both contentions and instructed the trial court to revise the judgment to reflect that all four (4) individual defendants were responsible (jointly and severally) for both the compensatory damage award of $5,000.00 and the attorney fee award for that portion of the work was likewise the responsibility of all of them, jointly and severally.
Having those portions of the judgment reflect joint and several liability enables the Partons to collect the entire sum from one or less than all defendants, leaving those payors responsible for seeking contribution from the other defendants.
The extreme personal liability in this case could have easily been avoided by consultation with legal counsel when the problem first arose. Proper interpretation of the deed restrictions, as well as counseling regarding the procedures by which to enforce the deed restrictions is crucial to successful association operations. The reported decision doesn’t explain how the board members were held personally liable, but resorting to self-help under these circumstances was clearly wrong, leaving an undesirable outcome.
Within hours of any disaster, affected communities will be besieged with offers by companies and individuals offering disaster recovery assistance.
Please resist the urge to contract with these initial providers until you have done the following:
Following these ten steps will help communities recover and rebuild as quickly and effectively as possible.
Best Advice: Make sure every contract is with a Florida Licensed and Insured Contractor and that it is reviewed by a Licensed Florida Attorney, prior to signing.
We thank all the webinar participants who shared personal experiences and submitted well thought-out questions to the facilitators. If you could not attend today, please return to this site for a link to the recorded presentation.
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In anticipation of Friday's webinar, here is the first in our two-part checklists for community associations.
Becker & Poliakoff's 12-point Hurricane Preparedness Checklist includes the following tips for those who need to prepare their communities for the upcoming hurricane season:
Learn more valuable tips during the free webinar Anatomy of a Disaster Claim, presented by Board Certified Construction Law attorneys and special guest engineer Rick Slider. Return to this site for a checklist of items for communities to consider immediately after a storm.
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Lawsuits Against Employers for Violations of the Fair Labor Standards Act & Other Employment Claims are on the Rise.
Some community associations have one employee, while others may have a hundred or more employees. Think about it - maybe your community employs a CAM, grounds maintenance people, a concierge, office assistants, front desk personnel, activity coordinators, beach attendants, valet, building engineers, cleaning staff - the list of people necessary to operate many community associations goes on and on. These individuals may have access to sensitive or proprietary information, such as unit owner or resident medical or health related records. When the economy is tight (like now) employment related claims and lawsuits rise dramatically - I read one article that said the number of lawsuits filed against employers for violations of the Fair Labor Standards Act (FLSA) rose by 40% each year for the past several years in a row!
If you are a member of a Board of Directors of a community association and have answered "yes" or don't know the answer to any of these questions, an employee manual should be a priority. Unfortunately, many community associations neglect to spend the time or devote the funds to this task. A well-drafted employee manual can minimize your exposure to both employment related and third-party liability claims - but make sure to have a Labor and Employment Attorney from your state draft and/or review the manual. Since employment laws vary from state to state and change quite frequently, using a 'form' from a neighboring community or from the Internet may do more harm then good.
HOA restrictions and covenants typically contain provisions limiting use of the property to a "single-family" residence. These use restrictions likewise typically prohibit any "business" or "commercial" use of the home. However, as discussed in other posts on this blog, enforcement of deed restrictions or covenants may implicate other laws, particularly the Fair Housing laws. Associations are prohibited by Federal, State and many local laws from discriminating against protected classes. Unlawful discrimination includes, among other things, the refusal to make a reasonable accommodation in policies or practices and interference with the lawful use and and enjoyment of the residence.
In the past, Florida courts have interpreted Section 419.001(2), (addressing community residential houses), and Section 393.062, (addressing developmental disabilities), of the Florida Statutes as support for the premise that a group home is the functional equivalent of a single family residential unit and does not justify enforcement of deed restrictions to the contrary. In at least one of the cases the court found that the association must show the use (three unrelated disabled adults) constitutes a nuisance and the mere fact that the residents of the home were not related was not a violation of the single-family use restriction. Another case found that enforcement of the prohibition against commercial or business use was discriminatory as applied against a particular small group home.
The county has joined efforts on behalf of an owner, based upon a legal memorandum prepared by the County Attorney's Office, after a finding of reasonable cause was issued by the Pinellas County Office of Human Rights. TBO.com reported the story.
What does this mean for Homeowners Associations?
Finally, there are many educational resources available to community leaders and managers. Take advantage of those opportunities.
Today is Earth Day - so I'm re-posting some information about energy efficiency, waste and water reduction improvements or techniques that have saved building owners money as well as information about the $1.7 million in savings Fannie Mae enjoyed by employing "green" practices.
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Condominium Associations can reduce their energy consumption costs by installing renewable energy devices and are in a position to possibly create a new revenue stream. Condominium Associations are uniquely positioned to take advantage of these rebates, cost saving techniques and possible new revenue streams as a result of Section 718.113(8), Florida Statues, which provides:
"Notwithstanding the provisions of this section or the governing documents of a condominium or a multicondominium association, the board of administration may, without any requirement for approval of the unit owners, install upon or within the common elements or association property solar collectors, clotheslines, or other energy-efficient devices based on renewable resources for the benefit of the unit owners."
HOAs have many options available to reduce annual budgets. There are plenty of examples of the “business case” for simple retrofits and changes in practices.
FBI Field Office, Chicago, Illinois:
Total improvements and modifications lowered operating costs by more than $400,000.00 annually. How many of us would reject a 400% return on an investment?
USAA Realty Company:
Spending $140,000 resulted in $71,000 annual savings.
Adobe Towers / Multiple Hi-Rise Buildings:
Major improvements cost initially over $1 million, but rebates reduced those costs by approximately $300,000 (net cost $700,000) and the annual savings of $900,000 increased the value of the building by over $10 million!
Can your community afford not to reduce its future expenses?
Fannie Mae's data center saves an average of $340,000 per year in operating expenses as a result of the use of energy efficient systems and sustainable landscaping practices.
Can your community benefit from some changes? Some changes are easy and very affordable. Please let us know if your community is interested in an evaluation of the property for this purpose and please share what your community has done to reduce its expenses.
We will post more information concerning Florida-friendly landscaping and water conservation methods to continue examples of how community associations can save money by embracing new ideas.
55 & Older Housing - what does that mean?
The Federal Fair Housing Act prohibits discrimination because of race, color, religion, sex, handicap, familial status or national origin. Many States have their own Fair Housing Act - in Florida Chapter 760 of the Florida Statutes is dedicated to discrimination issues that expand the protection to age and marital status. The term 'familial status' generally refers to occupancy by children (person under 18) with parent, guardian or designee of the parent. So why or how are there 55 & older communities? Well, every rule has exceptions, right? The Fair Housing Act is no different.
The Housing for Older Persons Act (HOPA) is an exception that allows communities to operate as “55 or over” housing. To qualify for this exemption, the following criteria must be met: 
Ok - at least one person 55 or older must reside in at least 80% of the occupied units. What do you do with the other 20%?
On April 1, 1999 the United States Department of House and Urban Development (“HUD “) published Federal Regulations implementing the Housing For Older Persons Act of 1995 (“HOPA”). Basically, HUD does not care how a community handles the 20% “cushion" as reflected below:
There continues to be confusion concerning what is often referred to as the 80/20 split. HOPA states that the minimum standard to obtain housing for persons who are 55 years of age or older status is that “at least 80%” of the occupied units be occupied by persons 55 years or older. There is no requirement that the remaining 20% of the occupied units be occupied by persons under the age of 55, nor is there a requirement that those units be used only for persons where at least one member of the household is 55 years of age or older. Communities may decline to permit any persons under the age of 55, may require that 100% of the units have at least one occupant who is 55 years of age or older, may permit up to 20% of the occupied units to be occupied by persons who are younger than 55 years of age, or set whatever requirements they wish, as long as “at least 80%” of the occupied units are occupied by one person 55 years of age or older, and so long as such requirements are not inconsistent with the overall intent to be housing for older persons.
Does that mean a community that desires to sustain is Housing for Older Persons status should let everyone in up to the 20%? No, not really. The "cushion" is designed to allow the housing provider (association) to permit exceptions when appropriate. If a couple resides in a property and one is 55 and the other not, do you, as a community leader or manager, want to be put in a position that requires you to say "you're in violation" if the resident over 55 passes away? What if the couple gets divorced? What if someone resides with their adult child? In our view, the 'cushion' is exactly that - something that protects you or softens the requirements to avoid unpleasant results.
Does your community qualify as Housing for Older Persons? Community leaders that aren't sure should consult with counsel, as penalties for discrimination (even unintentional discrimination) can be harsh.
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What policies does your community have in place regarding the use, storage and operation of golf carts? Can owners ride the golf carts to the local convenience store, coffee shop or hair dresser? Adoption of a new proposal will allow local governments to create their own regulations governing the use of golf carts, which pleases many Condo & HOA owners. In Bradenton, Florida seniors listed golf cart usage as a priority, as the cost is insignificant and many of them have given up driving automobiles. The Bradenton Herald recently included a story describing what changes would result from SB 2448.
Ambiguities regarding the use of golf carts are not new. In 2002, the Florida Attorney General released an Advisory Legal Opinion in reply to an inquiry regarding whether a municipality may impose a minimum age requirement for the operation of a golf cart which was more restrictive than those found in the Florida Statutes or whether a City may require the operator of a golf cart to have a valid Florida Driver’s License, the answer to both being 'no'. In 2004, Charlie Crist, as Florida's Attorney General, issued an Advisory Legal Opinion (AGO 2004-60) implying that a community association could not adopt rules prohibiting persons under the age of 16 from using golf carts on public streets in the country club community. He also indicated that the Association could not force golf cart users to use child safety devices, which resulted in changes to the Florida Statutes.
Under proposed SB 2448, the local government would be obligated to:
Community associations need to address golf cart, scooter and other transportation device use and storage issues carefully - even with respect to private property. Consult with counsel to determine what types of regulations are appropriate and enforceable. It is also a good idea to check whether the insurance policies contain exclusions or specific requirements for claims involving golf carts.
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The Office of Program Policy Analysis & Government Accountability (OPPAGA) Issues Report Outlining Various Options for Regulation of Homeowners Associations (HOA).
OPPAGA evaluates performance and accountability of various governmental activities. The Draft Report finds that the legislature showed significant interest in regulating Florida's Mandatory Membership Homeowners Associations over the past several years. In 2007 a Senate interim study recommended alternative dispute resolution mechanisms to facilitate resolution of homeowner issues. The 2008 Select Committee on Condominium and Homeowners Association Governance recommended increasing enforcement, mandatory education for board members and allowing local law enforcement to access association records during an investigation. In 2009, the Community Association Living Study Council recommended immediate legislative action to curtail the powers of homeowners associations.
The Draft Report describes several options available to the Legislature, to wit:
| OPTION | ADVANTAGES | DISADVANTAGES |
| Maintain Status Quo | No Cost |
Inability to effectively calculate # of HOAs and homes governed by HOAs Remains difficult to determine extent of problems |
|
Collect Information |
Allows Legislature to estimate needs/costs of additional services Department of State can perform this service without additional cost |
Requires HOAs to report information |
| Expand Service of Office of Ombudsman to HOAs |
Disputes are similar - staff already has expertise Resolutions without expensive pre-suit mediation or litigation Education designed to minimize disputes Provide tracking data
|
Unknown Cost - needs source of funding |
| Regulate Like Condos/Coops |
State mediation/arbitration services may reduce litigation Education could minimize disputes More uniform enforcement of laws |
Unknown cost - 2006 study estimated $10 million in funding required annually |
The Ombudsman's Office reports that most of the complaints about HOAs concern properties in South Florida. The complaints are largely similar to Condo/Coop complaints - the majority of which include lack of access to association records, election disputes, selective enforcement of covenants and the inability to participate at meetings.
Is it time for Florida to provide more oversight to HOAs? Would Florida homeowners benefit from the services of the Ombudsman or the DBPR? Would the costs justify or outweigh the benefits?
There are a number of bills filed for consideration during the 2010 legislative session - some of which include additional regulations for HOAs. Please refer to other posts on this site for information about pending bills or visit CALL to participate in the legislative process.
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.
WHO IS IN CHARGE WHLE THE ASSOCIATION IS REORGANIZING UNDER THE CODE? An association would file under Chapter 11 as a “Debtor in Possession”. As such, the Board of Director and/or Management Team in place prior to the filing would continue to operate as “usual”. The Association needs to understand that they would operate under a microscope – as any debtor/entity in bankruptcy is subject to the Bankruptcy Court’s jurisdiction and watchful eye all creditors, as well as the Office of the United States Trustee. As such, the Association need to provide proof of insurance, prepare detailed monthly operating reports and otherwise show it is able to continue its operation. Any reasonable indication that the board and/or management are or have acted improperly (usurping funds, etc.) could subject the debtor association to the appointment of a Chapter 11 Trustee or third party to take over the association’s operations.
HOW DO CREDITORS/THE WORLD FIND OUT ABOUT A FILING? When an entity files under any chapter of the Code, all creditors (the list provided by the debtor prior to the filing) will receive directly from the bankruptcy court a “Notice of Commencement”. If there is litigation pending, the debtor’s attorney files a “Suggestion of Bankruptcy” in the non-bankruptcy court proceeding – effectively placing that court on notice of the filing. In addition, bankruptcy filings – as any legal/court proceedings – are public filings.
HOW LONG DOES A REORGANIZATION LAST? Ideally, less than 10 months. Bankruptcy judges will seek to have the case dismissed if they see that no plan of reorganization has been filed or otherwise see no positive role for their court to play in the case.
Would your community benefit from reorganization? Please contact us to find out.
Associations struggling with bad debt pushing the envelope trying to make up for deficits.
Earlier this week news reports showed homeowners living without water service to their homes. The association shut down the water service because the homeowner didn't pay maintenance fees for several months. The homeowners' attorney claims that the Board acted illegally. The Board, on the other hand, wants to put as much pressure on the owners to pay maintenance fees.
In an earlier post I described actions prohibited by Florida's consumer protection laws. I received quite a few comments indicating that associations regularly publish debtor lists to embarrass or harass the delinquent owners and associations have shut down cable or other television programming, restricted access to recreational facilities, deactivated entry devices for security gates to the property (forcing owners to use the guest gate) and stopped other services. But can an association in Florida shut down services when an owner doesn't pay?
Condominium Associations cannot prohibit owners' access or use of the common elements. Section 718.106, Florida Statutes guarantees every owner's right to use the common elements, which would include the recreational facilities (if part of the condominium), regardless whether they have fulfilled their responsibility to pay maintenance fees. However, in response to cries from community leaders throughout the State, legislation was proposed during the 2009 session to permit condominium boards to suspend certain rights of use as a result of non-payment. We are likely to see proposals in the 2010 session addressing this issue as well. Community leaders and managers can stay up-to-date with respect to legislative activities by participating in the Community Association Leadership Lobby (CALL), which is a Statewide not-for-profit advocacy effort that not only monitors, but participates in drafting legislation designed to improve association operations.
Homeowners' Associations do have support to suspend use of "common areas and facilities" if the governing documents are written in a certain way. Section 720.305, Florida Statutes contains the following provisions:
If the governing documents so provide, an association may suspend, for a reasonable period of time, the rights of a member or a member's tenants, guests, or invitees, or both, to use common areas and facilities and may levy reasonable fines, not to exceed $100 per violation, against any member or any tenant, guest, or invitee. A fine may be levied on the basis of each day of a continuing violation, with a single notice and opportunity for hearing, except that no such fine shall exceed $1,000 in the aggregate unless otherwise provided in the governing documents. A fine shall not become a lien against a parcel. In any action to recover a fine, the prevailing party is entitled to collect its reasonable attorney's fees and costs from the nonprevailing party as determined by the court.
A fine or suspension may not be imposed without notice of at least 14 days to the person sought to be fined or suspended and an opportunity for a hearing before a committee of at least three members appointed by the board who are not officers, directors, or employees of the association, or the spouse, parent, child, brother, or sister of an officer, director, or employee. If the committee, by majority vote, does not approve a proposed fine or suspension, it may not be imposed.
The requirements of this subsection do not apply to the imposition of suspensions or fines upon any member because of the failure of the member to pay assessments or other charges when due if such action is authorized by the governing documents.
The term 'common areas' is defined in the Homeowners' Association Act, but the term 'common facilities' is not described. The governing documents may define the term 'common area' more specifically and may even include (generally by an amendment) a definition of 'common facilities', but is the cable service either? What about water service? Are the pipes carrying the water or the wires carrying the television programming owned and/or maintained by the Association? What if the television programming is through a satellite system and you don't even have any wires in the common areas?
These questions have yet to be answered by an appellate court. An adverse ruling with respect to either of these types of actions exposes community associations (and their leaders under certain circumstances) to liability, so it is very important to consult with counsel before trying to shut off any type of service.
It is also important to note that the statutes specifically prohibits restricting access to the individual home. It says:
Suspension of common-area-use rights shall not impair the right of an owner or tenant of a parcel to have vehicular and pedestrian ingress to and egress from the parcel, including, but not limited to, the right to park.
Community leaders can and should be proactive when it comes to collecting assessments and maintenance fees, but they need to be concerned with liability issues. Therefore, I encourage you to consult with counsel to determine what, if any, changes to the governing documents will improve your position, as no association can operate without its primary (and generally only) source of revenue.
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On March 30, 2009 the Division issued a Final Order in Humphrey v. Carriage Park CAI a case involving among other things a request for records where the owner sought “all correspondence, e-mails to or from the Department of Business and Professional Regulation.”
In its ruling the Division stated that there was no violation for failing to produce e-mails which never became the official records of the Association. The Division explained:
The Division in a footnote to its opinion stated a different decision could be reached “if the Association owns a computer on which management conducts business including e-mails…; or if e-mails are printed up and passed around for discussion at a board meeting.”
Given the ever changing trends in technology and the manner in which Associations conduct business, a Board needs to be wary that the status of e-mails as official records despite the Humphrey decision is still in flux. In other words, tomorrow, these very same e-mails which today are not official records could be. Also while a link has never been made equating IM or Twitter transcripts to e-mails this too could change as these forms of e-communication become more and more popular amongst Board members.
For more information on the role of e-communications and Association look at my May 12, 2009 post or the recent article by the Sun-Sentinel titled Boards a-Twitter about laws.
Florida Law Governs Rules or Covenants Prohibiting Solar Collectors or other Renewable Resource Energy Devices.
Many community leaders may not be aware of Section 163.04, Florida Statutes which prohibits enforcement of restrictions precluding homeowners from obtaining energy from renewable resources.
Florida's legislators made sure this law applied to Condominium and Homeowners' Associations with amendments shortly after the Taylor v. The Ridge at the Bluffs HOA case.
Owners of condominium units are specifically permitted to install solar collectors or energy devices, so long as the installation is wholly within the boundaries of the unit and does not involve patio or balcony railings. The Statute says, in relevant part:
A deed restriction, covenant, declaration, or similar binding agreement may not prohibit or have the effect of prohibiting solar collectors, clotheslines, or other energy devices based on renewable resources from being installed on buildings erected on the lots or parcels covered by the deed restriction, covenant, declaration, or binding agreement. A property owner may not be denied permission to install solar collectors or other energy devices by any entity granted the power or right in any deed restriction, covenant, declaration, or similar binding agreement to approve, forbid, control, or direct alteration of property with respect to residential dwellings and within the boundaries of a condominium unit. Such entity may determine the specific location where solar collectors may be installed on the roof within an orientation to the south or within 45° east or west of due south if such determination does not impair the effective operation of the solar collectors.
While many states have adopted similar legislation to encourage the use of renewable energy sources, it seems that community association leaders have yet to embrace improvements requested by homeowners within the communities. In fact, there is an effort to create federal regulations securing home and/or unit owners' access to renewable energy improvements and the public is critical when HOA or Condo Boards reject homeowner requests based solely on aesthetic grounds.
On the other hand, the Philadelphia Business Journal reports that communities with energy efficiencies built in- including solar panels, have retained value, even in this market. Lower utility bills is an attractive feature that causes the property to stand out from the competition.
The boundaries of a unit vary from condominium to condominium. Boundaries are described differently in similar types of properties - so a ruling in one community does not mean that another association cannot prohibit owner modification requests. Community leaders are encouraged to consult with counsel to determine the scope of the Association's rulemaking authority before a dispute arises.
Additionally, condominium associations may take advantage of energy saving devices to reduce expenses. The Condominium Act was amended to permit the installation of solar collectors and other energy efficient improvements. Progressive leaders of community associations will discover long-term savings and increase property values at the same time.
For more information and examples of great projects see 'Green' Practices to Ease Future Financial & Budgeting Concerns.
Many communities were marketed as 'adult communities' and the governing documents contain provisions prohibiting permanent occupancy by children. Are they legal or enforceable? Joseph Adams provides a brief explanation.
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