Saturday, July 18, 2015

Fines Authorized by Statute?

The great debate:  Can the HOA fine if the governing documents do not authorize it but Fla. Stat. 720.305(2) establishes procedures for fining? 

Many community association lawyers and community association managers say yes.

My answer is no despite many of my colleagues disagreeing with me. The statute starts out "The association may levy reasonable fines of up to $100 per violation....." which my colleagues have interpreted to mean the association has a statutory right to levy fines. 

My argument is the Florida Constitution prohibits retroactive application of a statute to change an existing contract (Declarations, bylaws and articles of incorporation are contracts) as reinforced by Cohn v. The Grand Condominium. Additionally, S&T Anchorage v. Lewis held an association cannot act in any way not authorized by its governing documents. The exception to the retroactive application is statutes which are public policy (such as the Florida Friendly Landscaping Act), statutes which are remedial or curative (the recall statute) and statutes which are procedural. The fining statute is procedural, but the part that would allow for a statutory right to fine is not nor was it a public policy statute. 

From Haven Fed. Savings and Loan v. Kirian: “Substantive law has been defined as that part of the law which creates, defines, and regulates rights, or that part of the law which courts are established to administer. It includes those rules and principles which fix and declare the primary rights of individuals with respect towards their persons and property. On the other hand, practice and procedure 'encompass the course, form, manner, means, method, mode, order, process or steps by which a party enforces substantive rights or obtains redress for their invasion. 'Practice and procedure' may be described as the machinery of the judicial process as opposed to the product thereof." It is the method of conducting litigation involving rights and corresponding defenses.” 

My colleagues disagree and until an appellate court rules on the subject we will not know who is right. Does your HOA want to foot the bill for an appellate case to figure this out? My suggestion is err on the side of caution.

Friday, July 10, 2015

BUYER BEWARE!! Your HOA Answers to No One!!


The question I get several times a day asks who can the owner go to in order to file a complaint against their HOA.  The unfortunate answer is: NO ONE.  Unlike condominiums (COAs), the HOAs answer to NO ONE.

Florida does not regulate HOAs.  There has been legislation posed the past two years authorizing the Department of Business & Professional Regulation to create a division to oversee HOAs, but the legislation failed so far both years.  All we can do is try again next year.

Where does that leave the owner?  Digging deep into their pockets to fund a private lawsuit, which can, for a 3-day trial, take 3-4 years and $135,000 - $150,000 to complete.  Often the owner figures they will file the lawsuit and the HOA will settle quickly.  That is a dangerous strategy because the HOAs don't settle all that often and if you drop the lawsuit, you owe the HOA it's legal fees and costs.

You best approach to your problem is to educate yourself about HOAs and attend board meeting, or better yet, don't buy a house in a HOA.

Saturday, May 23, 2015

Correct Mailing Address is Critical to Association Living!

Questions about past due assessments, collection fees and liens almost always include a statement the inquirer did not receive notice.  Not having your correct mailing address on file with the association puts the liability on you. Just like not signing for the certified letter is on you and the association will receive it back marked "UNCLAIMED."

If you are going to dispute any charges, here is my advice:

Pay off the lien first and then bring a separate action for recovery of any fees if the association violated your due process rights. Never risk the loss of your property to prove a point or fight over improper fees.

Hire a HOA/condo lawyer  to audit the fees and bring any possible action.  You need someone who is experienced not only in this area of the law, but the industry practices.

Tenants Attending HOA Meetings!

A common question I run into involves HOAs and condo associations (COAs) denying tenants attendance at meetings.  This is a big mistake for the associations.

The problem started with revisions to the Florida Statutes. Years ago Chapter 720 (HOAs) and Chapter 718 (COAs) used to provide rights for the members or "their authorized representatives" to attend meetings.  Over the years revisions to the statutes removed that language and the HOAs now erroneously believe they can ban non-owners from meetings.

This thinking runs afoul of the Fair Housing Act because Fla. Stat. 720.305(1) requires members, their tenants, guests and invitees to all comply with the governing documents and Chapter 720.  The FHA requires associations to provide those governed by the HOA access to attend meetings

Tuesday, May 19, 2015

HOA Rant

There is a great article posted on CyberCitizens for Justice yesterday.  It's a rant from Lindsey Nesmith in an article she wrote which printed in the Florida Weekly.  My hat is off to Ms. Nesmith for saying the obvious, but what many of us are afraid to say.

You can read the article at:  http://www.ccfj.net/HOARANT.html


Wednesday, April 15, 2015

How An Association Can Get Into Trouble Over Assessments - BOARD MEMBERS PAY ATTENTION!

With the volatile economy more and more associations are changing property management firms and law firms, but there are some problems which can arise and the association would probably be on the losing end of litigation.

Many owners contact me because their associations have made these changes and now they are unable to pay their assessments because the information regarding where to send payments is not timely distributed to the members.  When a member's check or electronic payment is returned, this is a refusal of a tendered payment, which is not permitted by Florida law.  Should the association attempt to lien and foreclose, the member not only has a valid defense, but could also bring a counter claim for breach of contract.

It is imperative for associations to notify their members immediately of any changes to make sure payments are not being rejected.

Tuesday, April 14, 2015

What to Do If Your Condo Association is Harassing You

I recently answered a question on avvo.com from a unit owner being harassed by their condo association (COA) because they were wanting maintenance and repairs done which were the responsibility of the COA.  I thought I should share my answer here.  This will work for HOAs too except the part about noticing the COA of your intention to arbitrate.  Currently the Dept. of Business and Professional Regulation (DBPR) does not have jurisdiction over HOAs.  Hopefully that will change July 1, 2015 if we can get a bill passed.  

One other point to note, arbitration is expensive.  It's not as expensive as litigation, but it still takes money if you want to be represented by a lawyer.  I don't recommend arbitration without a lawyer and you will see why in my answer below, which is:

Unfortunately your situation is not unusual in Florida.  The associations have too much power to abuse and harass the owners.

First, document everything. Start gathering evidence.  You have a statutory right to inspect and/or copy the records of the association by submitting a certified letter, return receipt with your request stating you are exercising your rights under FS 718.111(12).  The association cannot ask you why you want to inspect the records and have ten (10) days to provide you access.  Use a smartphone or some other device to scan the documents so you can avoid being charged for copies.

You can also submit a certified written inquiry and ask the association questions. This right is provided for under FS 718.112(2)(a)(2) and is unique to condo associations.  HOAs do not have the same benefit.  The association has thirty (30) days to respond.  They have sixty (60) days if they send the request to the association attorney, but they have to provide notice of the request being turned over to the attorney within thirty (30) days.

Next, you should send a certified letter to the association outlining your dispute, the resolution you would like and your intention to submit a petition for the dispute to arbitration before DBPR pursuant to FS 718.1255 if the dispute is not resolved.

Finally, you can file a complaint with the Dept. of Business & Professional Regulation (DBPR) against the license of the CAM and the CAM's firm, but you must be able to include proof of your allegations or nothing will be accomplished. The link is below.

While you can do all this without a lawyer, I don't recommend it, especially for the arbitration, which has specific procedures for bringing an action.  If you decide to send the letters, you may want a lawyer to review the facts of the case and the letters first so you can make sure you are requesting things which will support your case.  If the request is overly broad you can end up getting nothing useful or nothing at all.