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NO ASSOCIATION WEBSITE? WHAT ARE YOU WAITING FOR? By Eric Glazer, Esq.

NO ASSOCIATION WEBSITE? WHAT ARE YOU WAITING FOR? By Eric Glazer, Esq.

  • Posted: Oct 05, 2021
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NO ASSOCIATION WEBSITE?  WHAT ARE YOU WAITING FOR?

By Eric Glazer, Esq.

 

When the original bill was filed that required condominiums to have a website, the statute was only going to apply with condominiums of 500 units or more.  In effect, the statute would have applied to less than one percent of all condominiums in the state.  I met with the legislator who drafted the bill and suggested that the bill be revised to apply to all condominiums with 50 units or more.  The compromise was 150 units.

As we know, The Florida Legislature does not like to regulate HOAs, so for whatever reason, HOAs with 150 homes or more are not required to have a website.  Instead, if a homeowner wants access to records, they must make the request by certified mail, return receipt requested.  If the association ignores them, the unit owner has to ask for pre-suit mediation.  If that fails, the unit owner has to file a lawsuit.  All because they wanted copies of some of the official records.  It’s ridiculous.

Why not make your community more transparent and accessible now?  Who cares if you’re an HOA and you’re not required by law to have a website?  Set one up anyway, regardless of the number of homes you have.  Are homeowners in a 50 home community less entitled to see the records than an owner in a 150 home community?  Of course not.

If you’re in a condominium of less than 150 units, I understand that the law does not require your condominium association to have a website containing the official records.  So what?  Create one anyway.  I can tell you that over the past two years, as least as far as the larger condominiums go, there has been less arguments between owners and the board when it comes to being able to access the official records, simply because the association is required to have these official records on an association website.

I will also warn condominium associations that the DBPR is not fooling around when making sure that condominium associations with 150 units or more comply with the law.  They will investigate any complaint received from an owner who claims their association is not complying with the law.  They want those records posted on-line.  The association’s failure to do so can and will result in a fine for several thousand dollars.

Placing the records on-line frees up the manager’s valuable time because now they are less likely to have to respond to unit owner requests for access to records.  I’m looking forward to see how Rafael feels about the law.  Have you had success in your community with the association’s website?  If your community doesn’t have one, would you want one?

 

THE SITE OF THE CHAMPLAIN TOWERS — NOT AN EASY TASK TO DECIDE WHAT TO DO By Eric Glazer, Esq.

THE SITE OF THE CHAMPLAIN TOWERS — NOT AN EASY TASK TO DECIDE WHAT TO DO By Eric Glazer, Esq.

  • Posted: Sep 29, 2021
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THE SITE OF THE CHAMPLAIN TOWERS — NOT AN EASY TASK TO DECIDE WHAT TO DO

By Eric Glazer, Esq.

I don’t envy Judge Michael Hanzman, the judge who is assigned to decide the fate of the property where The Champlain Towers South Condominium once stood. The question of what to do at this sacred site is not easy. Some families want no re-development and only a memorial. The City of Surfside needs to see residential redevelopment at that site or lose an incredible about of annual real estate tax dollars.

At present, there is an offer to buy the land for $120 million dollars. But that offer doesn’t promise to even put up a memorable plaque marking the spot of the tragedy. Suggestions of rebuilding on the site and forming a memorable tribute somewhere else in Surfside have also not progressed.

According to The Daily Business Review, Hanzman said he is sympathetic to those who want a memorial, but his job is to get the most money for all families of those who died and the approximately 35 families who survived but lost their homes. He has scheduled the auction for late February or early March and said that date is firm because many of the survivors need money to buy new homes.

Judge Hanzman is right, his job is to get the most money for the victims. And, while 120 million sounds like a lot of money, it isn’t when we consider the fact that there were 140 units. There’s another 50 million or so in insurance and this still isn’t even close to being able to compensate the victims and their families all that they are rightfully entitled to.

Then comes an even harder part. How does the court decide who gets what from the limited pot? Does the court allow the family of a 30 year victim to collect more that the family of an 80 year old victim? What about people who survived but were injured? Do they get anything? Of course, everyone needs to get reimbursed for the loss of their unit as well. These are Solomon like decisions the court will ultimately be faced with and they are not easy tasks. Of course, whatever decisions are made there will be people that agree with the court’s conclusions and method of pay-out and those who do not. There is simply no way to make everyone whole financially. And in the end……it’s only money anyway.

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TO ARBITRATE OR MEDIATE? By Eric Glazer, Esq.

TO ARBITRATE OR MEDIATE? By Eric Glazer, Esq.

  • Posted: Sep 21, 2021
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TO ARBITRATE OR MEDIATE?

By Eric Glazer, Esq.

Prior to July 1st, 2021 if a condominium dispute arose, the parties were forced to first arbitrate the matter before the Department of Business and Professional Regulation.  The law has now changed and reads as follows:

(a) Before the institution of court litigation, a party to a dispute, other than an election or recall dispute, shall either petition the division for nonbinding arbitration or initiate presuit mediation.

As you can see, now the plaintiff has a choice to start the matter in arbitration or mediation.  So which one do you choose?

If you decide to go to arbitration, your case will be assigned to an arbitrator in Tallahassee.  The arbitrator will read the briefs, hold hearings and ultimately enter an order.  Someone will win and someone will lose.  The loser will pay the winner’s attorney’s fees.  The loser can then file in court for a trial de novo.  In effect, it’s an appeal of the arbitrator’s order and the case starts all over again.  The winner of the trial de novo gets their attorney’s fees and costs from the loser, including the arbitration fees.

So….the risk in going to arbitration is that if you lose, you may wind up not only paying your lawyer, but the other side’s lawyer too.

The alternative is to mediate the dispute.  I have been certified since 2007 as a Circuit Court mediator.  I truly enjoy mediating cases and helping the parties resolve their disputes.  At mediation, the parties appear with their attorneys.  The mediator explains that today is a good day to settle the case on mutually agreeable terms, rather than leave your fate up to a judge or jury.  If an agreement is reached, it is enforceable in a court of law.  The mediator allows the parties to make opening statements, then separates the parties and goes back and forth trying to achieve a settlement.

There is very little risk in going to mediation.  There is no “winner” or “loser” at mediation, so neither party has to worry about paying the other side’s attorney’s fees.  The parties split the cost of the mediator.

When I act as a mediator, I explain to the parties that neither side will get everything they want today, and that if at the end of the day both parties feel a little miserable, I probably achieved a fair result.

 

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BEG, STEAL OR BORROW – OR FORECLOSURE?

BEG, STEAL OR BORROW – OR FORECLOSURE?

  • Posted: Sep 21, 2021
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BEG, STEAL OR BORROW – OR FORECLOSURE?

Many of the old condo buildings in the State of Florida are facing serious structural repairs that will cost millions of dollars. And – from what I hear from many owners – most of these buildings have no reserve funds that will cover even most of the cost of these structural repairs.

But these repairs have to be done if the building doesn’t want to face the same fate as the Champlain Towers South in Surfside. And you can be sure that building departments will now push the issue of certification requirements.

That begs the question: How are these associations are paying for these very costly repairs?

The smart associations took care of fully funded reserves, but as we have seen, most of these associations are not really “smart!”

But having reserve funds may cause another problem: Big amounts of money are very tempting – and we have seen in the past that board members and CAMs can’t resist the temptation – and the money is gone when needed.

Asking for fully funded reserves require laws that protect these reserve funds and answers any scams and/or embezzlement with harsh punishments, not just a slap on the wrist. And that should go as well for board members who buy nice palm trees with the money that was in the roof reserve fund!

The other option to pay for these repairs are bank loans, an option available to most of these associations if properly done. But don’t forget: Owners will have to pay in the future monthly quite a lot of money to service this loan. Now owners are paying the money they didn’t pay in the reserve funds earlier – but now with lots of interest added. Smart move? Definitely not!

But the only other option to pay for these repairs is to levy a special assessment. That’s the worst of all options because these special assessments can be very huge, in the tens of thousands of dollars. Amounts many families living in these condos don’t have available – and the worst scenario will happen: FORECLOSURE! Families will be losing their homes. Is that the option you want to go?

 

CAMs – a CAM has no part in a board decision regarding the use of the reserve funds.
How about the responsibility of owners to look after their investment? It’s easy to point fingers at usually well-meaning but inexperienced boards.
Rather than pointing fingers left and right, how about encouraging owners to participate in a constructive manner?
And last not least – the people coming to Florida to buy a condo with the proceeds of their home sale should be aware that you get what you pay for. You pay 500 K for a waterfront two bedroom condo built in the 60’s and expect that is all it will cost you?

 

 

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SHOULD RESERVES BE MANDATORY?

SHOULD RESERVES BE MANDATORY?

  • Posted: Sep 10, 2021
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I hate beating around the bush, so I want to get to the point. A financial crisis is coming and it’s
going to be a big one. It’s also going to hit those that can least afford it. It’s going to result in massive
amounts of foreclosures. It’s going to result in countless cases of elderly persons being displaced
from their homes. The worst part is, it’s absolutely avoidable but I don’t believe any legislator would
ever have the courage to float a bill to save the pending disaster.
I was at a meeting last night in a 55 and over condominium. Elderly owners were complaining that the pipes are getting
old, there are leaks, and they sometimes have to come out of pocket a few hundred bucks in order to clean up the mess in their unit
and/or repair that broken pipe. They are complaining about bills for a few hundred bucks and find it difficult to pay them because
their sole income is social security.
To state the obvious, there is no reserve account. There never will be. Generally, senior citizens don’t believe in reserving
funds for repairs that may be necessary a decade or two from now because they believe they won’t be here anyway. So, year after
year goes by, decade after decade goes by and there is never a reserve fund to fall back on should a major repair become necessary.
Think of how much building has gone on in the past 50 years. It is staggering. But the buildings are getting older. As the buildings
start to approach the 40 year mark or more, things start to break down and repairs become unavoidable. Concrete restoration is
incredibly expensive, and unavoidable. Replacement of pipes is incredibly expensive, and unavoidable. And the same goes for
electrical renovations and roof replacements. All unavoidable. Yet, so many people, especially seniors, are rolling the dice thinking
that none of these repairs will be necessary while they own the property. That may be true for now, but eventually, everyone rolls
a 7.
Like it or not, some form of reserves should be mandatory
and not subject to being waived. There, I said it. Let’s get rid of the
“life expectancy” formula the state says you should follow but nobody
does. It’s a joke anyway. We all know the truth that the life
expectancy of the roof somehow gets longer, the closer you get to the
original estimate of how long it was going to last. Five years ago it
had a five year life expectancy. Money is tight, so today it has a new
10 year life expectancy. Somehow, like fine wine, the roof got better
with age. We all know that happens, and it happens every day. So
how about we make things simple. Let’s just say every condominium
must contribute 10% of its annual budget to reserves for roof,
plumbing, electrical, structural and painting. It all goes into one pot
and it can be used for any repair necessary for those categories. It
can’t be waived. If however an association wants to contribute more,
they can.
If we implemented this, I’m guessing the average monthly
increase for most condominiums that are not already reserving funds
would be anywhere from $25.00 to $75.00 per month per unit. I know
that for some that increase is not easy. However, it’s going to be a lot
more expensive if any one of these inevitable repairs become
necessary and it’s time to pass a special assessment in the thousands
or tens of thousands of dollars. What do you think?

 

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AND WHILE YOU’RE AT IT…. PLEASE FIX THE INSURANCE STATUTE

AND WHILE YOU’RE AT IT…. PLEASE FIX THE INSURANCE STATUTE

  • Posted: Sep 08, 2021
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No doubt some changes are on the way for condominiums as a result of the Surfside tragedy. The changes are long overdue. Here’s another long overdue change that is necessary..the condominium insurance statutes.

Suppose I told you that under Florida law, there is no absolute requirement that your condominium association insure the building(s). Sounds crazy right? Yet, here is what the law actually says:
d) An association controlled by unit owners operating as a residential condominium shall use its best efforts to obtain and maintain adequate property insurance to protect the association, the association property, the common elements, and the condominium property that must be insured by the association pursuant to this subsection.

What in the world does “best efforts” mean? Does it mean that “We made a few calls…..the premiums were too high…..so we forgot about getting insurance?” Is that using best efforts? Have you ever read such a contradictory statute? On the one hand it says the board must use its best efforts. On the other hand, the same statute says that the condominium property “must be insured.” Which is it?
Think for a second if Champlain Towers was not insured? The very thought of it sounds impossible, but it isn’t.
But wait…..it gets worse. Even if the property is insured the statute says:
The coverage must exclude all personal property within the unit or limited common elements, and floor, wall, and ceiling coverings, electrical fixtures, appliances, water heaters, water filters, built-in cabinets and countertops, and window treatments, including curtains, drapes, blinds, hardware, and similar window treatment components, or replacements of any of the foregoing which are located within the boundaries of the unit and serve only such unit. Such property and any insurance thereupon is the responsibility of the unit owner.

So, let’s say your condominium property is insured, but you did not purchase a separate HO-6 policy for your unit. All you get back is your four walls. That’s right, basically a shell.
What about flood insurance? Is that mandatory in Florida for your condominium? No, it isn’t. The association “may” purchase it.
Just to make things crystal clear for our esteemed legislators, at the moment there is absolutely no requirement to fund reserve accounts so that the money is there should major life threatening repairs become necessary. And to make matters worse, if a tragedy does befall the property and the owners, there’s not even a requirement that the building was to be insured.

This would almost be comical if it weren’t so sad. We live in a state that:
1. Every year gets hit with tropical storms and hurricanes;
2. Suffers sinkhole collapses;
3. Has thousands of buildings lining our coasts and the buildings take a beating from the salt water;
4. Does not require unit owners in a condominium to put away reserve funds should major repairs be necessary
5. Does not require associations to purchase insurance, but only use their “best efforts” which is undefined;
6. Is home to more senior citizens on fixed incomes than almost any other state in the country.

You do the math. When the special assessments start coming as a result of massive repairs that are required on our aging buildings, associations will look to save money elsewhere. Yes, many boards believe it or not will take the position that insurance is not necessary, or that despite their “best efforts” it is simply unaffordable. I have met boards like that already.
In the upcoming legislative session, The Florida Legislature has a real tough job on their hands. Passing laws that reflect the true cost of actually living in a condominium, and no longer giving unit owners and board members enough rope to hang themselves with.

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BOARDS ARE NOT POWERLESS WHEN IT COMES TO COVID By Eric Glazer, Esq.

BOARDS ARE NOT POWERLESS WHEN IT COMES TO COVID By Eric Glazer, Esq.

  • Posted: Aug 17, 2021
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BOARDS ARE NOT POWERLESS WHEN IT COMES TO COVID

By Eric Glazer, Esq.

It’s hard to believe that we have been dealing with COVID for a year and a half now.  It’s harder to believe that it looks like we will be dealing with it for at least another year and a half.  It’s a never ending nightmare with no end in sight apparently.  Who would ever have thought this could happen?

While we are constantly being told about social distancing, wearing masks, getting vaccinated and avoiding gatherings, as many of you know it is extremely difficult to mandate and practice these objectives in a condominium setting.  Now that the State of Emergency has been lifted (obviously too soon) it is even harder, because the Boards of Directors don’t have the emergency powers any longer.

So what do we do now?  Are Boards prohibited from making rules that protect the health, welfare and safety of the community in regards to COVID, simply because the emergency powers statute is no longer in play?  I say HELL NO.

Florida Statute 718.123 (for condominiums) states the following:

The entity or entities responsible for the operation of the common elements, common areas, and recreational facilities may adopt reasonable rules and regulations pertaining to the use of such common elements, common areas, and recreational facilities.

Florida Statute 720.304 (for HOAs) states the following:

The entity or entities responsible for the operation of the common areas and recreational facilities may adopt reasonable rules and regulations pertaining to the use of such common areas and recreational facilities.

In Hidden Harbour Estates, Inc. v. Norman, 309 So.2d 180, 181–82 (Fla. 4th DCA 1975), the court explained the unique character of condominium living which, for the good of the majority, restricts rights residents would otherwise have were they living in a private separate residence:

It appears to us that inherent in the condominium concept is the principle that to promote the health, happiness, and peace of mind of the majority of the unit owners since they are living in such close proximity and using facilities in common, each unit owner must give up a certain degree of freedom of choice which he might otherwise enjoy in separate, privately owned property. Condominium unit owners comprise a little democratic sub society of necessity more restrictive as it pertains to use of condominium property than may be existent outside the condominium organization.  Neuman v. Grandview At Emerald Hills, Inc., 861 So.2d 494, 497 (Fla.App. 4 Dist.,2003)

 

The statutory test for rules regarding the operation of the common elements of the condominium is reasonableness.  Neuman v. Grandview At Emerald Hills, Inc., 861 So.2d 494, 497 (Fla.App. 4 Dist.,2003)

There is no doubt in my mind that at this point in time, an association may continue to impose rules and regulations regarding the common elements that the association previously had in effect during the State of Emergency. I doubt highly that an arbitrator or judge would say that limitations on the number of people in the pool, elevator, clubhouse or exercise room during this pandemic is an unreasonable rule. I can’t imagine requiring masks in the common areas would be considered an unreasonable rule, especially when the CDC is recommending it. There are obviously other rules that absolutely may be considered reasonable, especially if you’re in a 55 and over community and the population is at great risk.

I’m getting calls from associations who are wondering if they are now powerless to take necessary precautions to avoid the spread of COVID. Again, the answer is you are not powerless and on the contrary, never lost your ability to continue to make reasonable rules to protect your community.

So what do you need to do? Put the proposed rule on an agenda for a properly noticed Board meeting. At the board meeting, make it extremely clear why the rule is being made. Put in on the record and in a resolution or motion that the Board is making this reasonable rule taking into account the health, welfare and safety of the community. Leave no doubt.

And if you’re wrong? I always say that it’s better to be tried by 12, than carried by 6.

 

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EVERYONE IS AN EXPERT By Eric Glazer, Esq.

EVERYONE IS AN EXPERT By Eric Glazer, Esq.

  • Posted: Aug 12, 2021
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EVERYONE IS AN EXPERT

By Eric Glazer, Esq.

 

I agree that a “reserve study” should be done by an accredited firm following the industry standard guidelines. We have used both Association Reserves and Reserve Advisors. The fact remains that both these and most other competent firms are in fact comprised of engineers and architects.

There is an larger issue in this: In a majority of cases, board members are qualified in NOTHING: Not in construction, not in finance, not in personnel management, etc. Which is why they should use a management company. And even so, how can they possibly assess the value of an opinion issued to them by a construction expert, a financial advisor etc…
Being a board member is a huge responsibility, and I always thought they should be qualified or certified before being admitted in a board.

 

Imagine a world where accountants can examine your heart and give you an opinion regarding its condition and your life expectancy.  Suppose an auto mechanic can examine your kidneys and liver and give his opinion on whether or not they are healthy.  Perhaps one day you can walk into my office and one of the attorneys here can take your blood and talk to you about your blood pressure, sugar and cholesterol.  If this all sounds crazy, it should.  This is exactly how the health of our buildings are determined.  Not by qualified experts like architects, engineers and general contractors, but by former cab drivers, teachers, nurses and the like.  Now these people may be the absolute best in their trained professions, but they certainly are not qualified to make a determination of the condition of the condominium property and the life expectancy of things like the roof, structure and electrical systems. Yet, this is what is going on in Florida as we speak.

For about a two year period of time, condominiums were required to have a reserve study performed by an architect or engineer.  But in 2010 Governor Charlie Crist signed a bill which repealed that requirement.  So since then, the reserve study analysis can be performed by the butcher, baker and candle stick maker.

We all know that the analysis is a joke.  If a new Board comes in that wants to save money and decrease assessments, suddenly the roof has a greater life expectancy than before.  Somehow, like fine wine, the roof got better with age.  It’s a miracle!

The current law is dangerous on so many levels.  It’s so obvious that it would be insulting to all of you to even have to explain further.

Next legislative session I urge all of you to contact your legislators and demand that Florida Statute 718 be amended to again require that reserve studies be performed by an architect or engineer.  Unless your Board has an architect or engineer serving, the Board is simply not qualified to do the analysis.

 

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JOIN US FOR A DOUBLE WEBINAR ON JULY 28TH, 2021.

JOIN US FOR A DOUBLE WEBINAR ON JULY 28TH, 2021.

  • Posted: Jul 14, 2021
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JOIN US FOR A DOUBLE WEBINAR ON JULY 28TH, 2021.

GREGG WALLICK WILL BE TEACHING ROOFING 101 AND WILL BE POINTING OUT DANGER SIGNS IN YOUR ROOF AND ANSWERING ALL OF YOUR QUESTIONS.

ATTORNEY ERIC GLAZER KNOWS THAT ASSOCIATIONS ARE MORE EAGER THAN EVER TO BEGIN MAKING REPAIRS, BUT WILL TEACH THE IMPORTANCE OF CONTRACT REVIEW BEFORE SIGNING ON THE DOTTED LINE.

TO REGISTER FOR THIS ON-LINE WEBINAR: CLICK HERE