Attention to detail. A simple phrase that’s not always so simple to comply with, especially in a community association context.
Attention to detail. A simple phrase that’s not always so simple to comply with, especially in a community association context.
by Howard J. Pearl / Becker
There are several technical provisions in the statutes governing community associations that
must be complied with. Chapters 607, 617, 718, 719, and 720, Florida Statutes have numerous
requirements that associations must adhere to. A few examples include meeting notice
requirements, board member eligibility requirements, record inspections, and others.
Associations must be cognizant of changes to the statutes regarding such requirements, some of
which pertain to regular or recurring events.
As associations go through the process of annual and election meeting notices, budget meeting
notices, etc., one cannot just blindly use the previous year’s notice as a template for the current
year’s notice. Associations must review any changes in the statutes to ensure this year’s notices
are still in compliance. Having your association attorney prepare, or at least review, all such
notices before they are sent out will help ensure the association is in compliance with the most
recently enacted statutes.
For example, Section 718.112(2)(d)(2.), Florida Statutes, previously provided that a person who
is delinquent in the payment of any monetary obligation due to the association, is not eligible to
be a candidate for board membership and may not be listed on the ballot. That provision was
changed in 2021 to now provide that a person who is delinquent in the payment of any
assessment due to the association, is not eligible to be a candidate for board membership and
may not be listed on the ballot. A small but significant difference. If your election meeting notice
includes any information about candidate eligibility, blindly copying the previous year’s notice
would have the association sending out inaccurate information regarding board member
eligibility. Attention to detail.
Another example pertains to a condominium unit owner’s suspension of voting rights due to a
delinquency. Section 718.303(5), Florida Statutes, previously provided an association may
suspend the voting rights of a unit or member due to nonpayment of any fee, fine, or other
monetary obligation due to the association which is more than 90-days delinquent. That
provision was changed in 2017 and now provides that an association may suspend the voting
rights of a unit owner or member because of nonpayment of any fee, fine, or other monetary
obligation due to the association which is more than $1,000 and more than 90-days delinquent.
While this change went into effect a few years ago, unfortunately I still run across associations
attempting to suspend voting rights of owners who are more than 90-days delinquent, but such
delinquency is not more than $1,000. Again, attention to detail.
Another area where attention to detail is necessary is the preparation of limited proxies. When
voting on a waiver of reserves in a condominium, Section 718.112(2)(f)(4), Florida Statutes,
provides that proxy questions relating to waiving or reducing the funding of reserves or using
existing reserve funds for purposes other than those for which the reserves were intended must
contain the following statement in capitalized, bold letters in a font size larger than any other
used on the face of the proxy ballot: “WAIVING OF RESERVES, IN WHOLE OR IN PART,
OR ALLOWING ALTERNATIVE USES OF EXISTING RESERVES MAY RESULT IN
UNIT OWNER LIABILITY FOR PAYMENT OF UNANTICIPATED SPECIAL
ASSESSMENTS REGARDING THOSE ITEMS.” When reviewing limited proxies prepared by
associations for such votes, very frequently I notice that while the disclaimer language is in
capitalized, bold letters, it is not in a font size larger than any other used on the face of the proxy
ballot. Attention to detail.
Posting of meeting notices is required by the statutes. Forty-eight (48) hours’ notice for a regular
board meeting; fourteen (14) days for some board meetings; 60-days for election meetings, etc.
Only mailing, or emailing notices is not sufficient. Some meeting notices require an association
to execute a proof of meeting notice (usually an affidavit signed by an association board member
or manager). While these notice requirements may seem trivial, especially since the notices are
mailed and/or emailed to owners, they are required by statute. Failure to properly post such
notices may result in any action taken at said meeting being void. Failure to maintain proof of
meeting notices when required may have the same effect, if any action taken at said meeting is
challenged. Attention to detail.
In regard to homeowner associations, Section 720.306, Florida Statutes, previously provided that
official notices were to be sent to the address on the property appraiser’s website. That provision
was changed to provide that official notices once again are to be sent to the mailing address in
the official records of the association under section 720.303(4), Florida Statutes. Attention to
detail.
There have been technical changes in how associations must notify owners of delinquent
assessments before the owner can be sent to the attorney for collections. These are technical
requirements that should be discussed with your association attorney. Blindly following previous
practices in regard to such collection notices and actions will result in delays and owner defenses
to association collection actions. Attention to detail.
In regard to budgets, remember that budgets mailed to association members must contain the
period of the budget year (for example, Jan 1, 2022 – Dec 31, 2022). I have seen many
associations go through the arduous process of preparing and adopting a budget, only to have
such budget challenged by a member because it did not contain the actual budget period, even
though there was enough information on the budget to know what period it was for. Attention to
detail.
While some of the above matters may seem minimal in regard to their impact on the association
or its members, the Florida Department of Business and Professional Regulation, Division of
Condominiums, Timeshares and Mobile Homes (“Division”) has recently changed its approach
in regard to association education versus fining. In the past, a first violation of one of the above
provisions, or another what would appear to be “minor” violation, was generally resolved by the
issuance of a warning letter from the Division, recounting the violation, the remedial measures,
and a warning to the association that future similar violations could result in a fine. Those
“warning” days appear to be over, as the Division has adopted a much more stringent
enforcement posture, which usually results in a fine to the association, even for a first violation
of a seemingly minor provision. Fines range from $10 to $30 per unit, with a maximum fine of
$5,000. I have seen recent cases where the Division initially sought to impose the maximum
$5,000 fine for an initial, minor violation (minor in accordance with Rule 61B-21, Florida
Administrative Code.)
Howard J. Perl
Shareholder
Tags: Condo and HOA Law
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