Tuesday, April 17, 2018

2018 Legislative Update - Chapter 720 Homeowners' Association Act

Here are the updates to the Homeowners Association Act, with my comments in bold italics, which will go into effect July 1, 2018:

  1. FS 720.303(2)(c)(1) was revised to allow electronic notices by facsimile if the member consents to electronic notices.  Previously electronic notices were limited to email addresses only.
  2. FS 720.306(1)(e) was added to require the underline/strike-through method be used for proposed amendments to documents (Declarations, Bylaws, Articles of Incorporation, Rules & Regulations) to show what language is being added (underline) or deleted (strike-through).  If the amendments are so extensive the reader could be confused, the new language must be proceeded by the disclaimer "Substantial rewording. See governing documents for current text."  This statute also provides an amendment becomes effective when it is recorded in the county records.
  3. FS 720.306(1)(f) was to provide an immaterial error or omission in the amendment process will not invalidate an otherwise properly adopted amendment.  Without a definition of "immaterial" we can expect this to be a source of litigation.
  4. FS 720.306(9)(a) was revised to authorize HOAs to forgo an election if the number of vacancies for the board of directors equals or exceeds the number of candidates provided nominations from the floor are not required by statute or the bylaws and write-in candidates are not permitted. This allows the seating of candidates even if a quorum is not attained at the annual meeting.  Watch out for HOAs which have nominating committees without a provision in the bylaws authorizing nominations from the floor.  The HOA could control the outcome of the election by nominating only candidates they like and not nominating more candidates than vacancies.
  5. FS 720.3085(3)(B) has been revised to require HOAs to accept all payments from owners and allows the HOA to ignore any restrictive endorsements or letters accompanying the payment stating the amount tendered is payment in full.
  6. FS 720.305(2) was amended to provide fines are now due and payable within five (5) days after it is imposed. Watch out for HOAs claiming the payment was not timely received or not sending the notice before the fine is due! There is no language providing for a deadline to provide the notice.
  7. FS 720.303(2) has been amended to allow board members to discuss board business by email, but board members may not vote by email.

Additional updates for 2018 were made to the Marketable Record Title Act ("MRTA") which changes the procedures for preservation.  The required 2/3s vote of the board and the mailing of the notice of preservation to members has been deleted.  The failure to index the notice of preservation against the lots of the members will not affect its validity.  

Likewise the revitalization statute in FS 720.403-720.407 has been revised to remove the requirement a vote for revitalization is done at a meeting and allowing revitalization to be done in writing.  An owner has one year after expiration to file a court action exempting their property from the revitalization process.

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