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TALLAHASSEE, Fla. (WFLA) — The new year means a few new Florida laws will go into effect, after passage during the 2022 legislative session, as well as the bills passed in December’s special session.
Eight new laws go into effect on Jan. 1, 2023. Among the various bills’ effects, Floridians can expect changes to newborn healthcare, public notices, and ways to file taxes in 2023.
Arguably the least controversial is a bill that requires newborns to be tested for congenital cytomegalovirus within three weeks of birth. CMV is the most common infectious cause of birth defects in the United States.
The virus affects one in every 200 babies each year. Senate Bill 292, passed with widespread support in the March 2022 legislative session, aims to catch long term health problems that cmv causes like hearing and vision loss.
Also taking effect in January is a bill allowing local government agencies the option to publish legal notices on a publicly accessible website instead of in a print newspaper.
House Bill 7049 also takes effect Jan. 1, 2023, but hasn’t seen the uniform support that the newborn screening bill did. Lawmakers weighed in on the impacts.
“This is the most available legal notices will be for people in the history of Florida,” Sen. Jason Brodeur (R-Lake Mary).
However, former Sen. Gary Farmer (D-Broward), the former Senate minority leader, argued against the bill.
“The bottom line is the underlying intent of bills like this throughout the country are to weaken news outlets and close the vice grip of corporate control over the news,” Farmer said.
Another piece of legislation, Senate Bill 2514 allows more taxpayers to file taxes electronically by authorizing the Florida Department of Revenue to lower the payment threshold from $20,000 to $5,000.
Those were just a few of the laws going into effect next year. Also starting in January are the bills passed during the December special session of the legislature focused on property insurance, toll relief, and Hurricane disaster recovery.
2022 Laws Already in Effect:
Taking Effect in July:
Laws Taking Effect in 2023
How many times have you read a story about an HOA foreclosing on some unfortunate family for a fraction of the value of the home? For example, the veteran who, upon returning from active duty, finds that his HOA has foreclosed and taken title to his house for 
a mere pittance? “Soldier in Iraq Loses Home Over $800 Debt” reads the story, and life goes on at the HOA.
Should the HOA have foreclosed on this person’s house? Why did they foreclose on this property? What could have been done to prevent this gross injustice from happening in the first place? Condo and HOA lien foreclosures should not be the first go-to solution when a unit becomes delinquent.
For too long, community associations have been a national disgrace, rather than a source of national pride. No HOA wants their name to be mentioned on the nightly news because we all know it is far more likely to be an exposé than a feel-good piece. But if we want the bad press to stop, we need to take a good, hard look in the mirror.
When you buy a house or condo in a community association, most likely you’ve taken out a mortgage, and if you don’t pay your mortgage, the lender has the right to foreclose and force a public sale of the property. So too can condominiums and homeowner’s associations foreclose on your property for non-payment of maintenance fees.
In fact, per most state laws, your homeowner’s association or condominium association can potentially foreclose on your property even if you are current with your mortgage. Also, your mortgage will remain in first position and the HOA cannot sell the property with marketable title unless the first position lien has been satisfied.
All that is required is for the association to cause an attorney to file a lien, have the attorney send a notice of foreclosure, have your day in court, and before you know it you are being evicted from your home that may have equity in it because you were delinquent for a much smaller amount than what the property is worth. Not a good deal for you and certainly not a smart business move for the association.
It’s not to say that the community is in the wrong. The assessment fees are rightfully owed to the association, and they have the right to attempt to collect it. However, jumping to the nuclear option prior to attempting diplomacy (negotiating with the owner to satisfy the debt) never goes well for anyone.
In an appeals court decision in Supreme Court South Carolina, the association foreclosure was REVERSED and REMANDED. In the case of WINROSE HOA v. DEVERY HALE the court was shocked by this action and even stated so in their decision: “As a result, in determining whether the purchase price was grossly inadequate …. the bid shocks the conscience of the court.” The story is quite simple and may sound familiar to you as this happens every day and really should not.
The Hales were solid citizens who purchased their home twenty-one years ago for $104,250.00 and paid their mortgage and fees on time. The home is valued at $128,000.00 and the property has $60,000.00 of equity in it. After missing a $250.00 maintenance fee payment the HOA foreclosed on their $566.41 lien (to satisfy delinquent assessments and interest) and the winning bid on the house was $3,036.00. The Hales had been robbed, and the association had acted too rashly in moving to foreclose upon a house for such a pittance. The buyer was Regime Solutions, LLC who are investors that seek out and purchase properties at foreclosures.
Due to the Hales failure to file a responsive pleading to the foreclosure complaint, a huge mistake on their part, they were ultimately defaulted and were not served with any further court papers. In fact, they did not even receive a copy of the judgment of foreclosure. When they found out they were at risk of losing their property, they tried to make good to redeem their house and paid a bill to the master and in fact, the law firm representing the HOA sent the Hales a notice that the lien had been satisfied. The HOA, however, did not withdraw its suit.
Three months after, the HOA filed the affidavit of default and the master authorized a judicial sale of the property at public auction. The Hales were not notified of this order due to a rule in South Carolina, which essentially states the time to appeal doesn’t change, despite lack of notice (rule 77(d), SCRCP). Two weeks later without notice to the Hales, the property was sold and the new owner moved to evict them. This of course led to court complaints, a trial, and finally an appeal before the Supreme Court who reversed and remanded the foreclosure order saying that the sale at auction for $3,036.00 “shocked the conscience of the court,” which is quite strong language from the Supreme Court.
It came to light that Regime’s business model was not to assume the senior mortgage to own the property but to give back the property to the original owners at a hefty fee. (Sadly, this is not an uncommon practice.)
The court decision went on to say: “While the HOA had the legal right to pursue collection of the debt owed, including foreclosure of the Property to satisfy that debt, this foreclosure action quickly morphed into a proxy to capitalize on a small debt. We are especially troubled by Regime’s participation in a foreclosure proceeding to accommodate its business model of leveraging a nominal debt to secure an exorbitant return from homeowners who fear the prospect of eviction.”
Most important the court stated: “Regime would not have had an opportunity to engage in its questionable business practices had the HOA and its attorney not chosen to pursue foreclosure in the first place. The Hales were minimally in arrears on their HOA dues, yet the HOA foreclosed on a $128,000 home in its eagerness to collect the outstanding $250—an overdue amount less than 0.2% of the fair market value of the home, notwithstanding the amount of the outstanding mortgage.”
Finally, the court opined: “A foreclosure proceeding is a last resort, not a business model to be swiftly invoked for the purpose of exploiting property owners. We do not countenance the improper use of foreclosure proceedings by the HOA, its attorney, or Regime.”
Justice ultimately prevailed in this case, and the Hales kept their house and were not evicted although there can be no doubt that they had suffered and worried throughout this entire process. Not every homeowner who goes through this process is so lucky to get away with only a terrible story to tell.
What went wrong is an amazingly simple question to answer. The association was convinced that they should foreclose on a delinquent unit before they even tried to engage the owners to review the consequences of their situation. While it may be true that they received one notice, they were advised by an attorney that the matter had been resolved. This was a total failure of communication.
The association could have had more contact with the owners and advised them as to the course of action that was being taken against them. Nobody said anything to them – and in this industry, such a thing is not uncommon.
When a delinquent unit goes over to an attorney the object is to “enforce the security interest” and not to collect. The association’s board was not properly informed that less drastic action could be taken. Somehow the board was convinced not to recover money from the Hales but rather to take the property.
No collections activity is reported in the narrative that is presented in the case. It was a bad business decision because eventually, the association had to pay a lot of legal fees. This situation could have been resolved much more easily and cost-effectively.
This matter did not have to be resolved by a “legal solution” but rather by a “collections solution.” As a matter of fact, in a case decided by the Supreme Court of The United States, DENNIS OBDUSKEY v. McCARTHY & HOLTHUS LLP the Court held, “A business engaged in no more than the enforcement of security interests is not a “debt collector” under the FDCPA, 1032*1032 except for the limited purpose of § 1692f(6). Pp. 1035-1040.” This means that the association did not even try to collect the past due debt and if they used an attorney, he/she is not even bound by the Fair Debt Collections Practices Act.
The Supreme Court in South Carolina in all its wisdom said loud and clear: “A foreclosure proceeding is a last resort”
So how should a community association collect delinquent fees? In a way this question just about answers itself. The answer is that they use a collection agency that is specialized in collections for community associations. Community Associations need to COLLECT, not foreclose and evict owners from their homes. Associations need to have adequate cash flows and a minimum amount of legal cases.
Axela Technologies would be honored to be that company for your community association. We are a licensed collection agency and we only work on delinquencies from Condos and HOAs. We are different because our objective is not to foreclose on a house, which is the action of last resort.
What Axela does is engage the owner and work with them to pay their past due assessments. Axela will send demand letters, provide internet portals to delinquent owners, make outbound calls, report delinquencies to credit bureaus, receive inbound calls, work out payment plans, and notice mortgage holders that the borrower is delinquent on their maintenance fee payments as per the PUD Rider.
Now is the time for your community association management company and/or community association to put the right process into place when you are confronted with delinquencies. Foreclosing and evicting does not have to be the way. Click here to request your free, no-obligation collections analysis today.
Tags: Collections, Condo and HOA, Management News
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The recent arrests of Hammocks Community Association members have cast a long-overdue light on the plight of helpless homeowners when the directors of a homeowners association (HOA) go deliberately wrong.
The Florida Legislature specifically designed the state’s HOA law to limit government’s ability to regulate HOAs, explaining, “It is not in the best interest of homeowners’ associations or the individual association members thereof to create or impose a bureau or other agency of state government to regulate the affairs of homeowners’ associations.”
While this may be a virtuous conceptual approach, it has created the unintended consequence of leaving homeowners with little, if any, protection or opportunity of redress when HOA board members raid association bank accounts. In this criminal case, we believe the evidence can prove the theft of well over $1 million of homeowners’ monies. But we think the actual loss is much higher.
Sadly, we have seen instances of greedy or unscrupulous board members take advantage of this lack of oversight before. They often hide their misconduct by making it extraordinarily difficult and expensive for homeowners to effectively access and examine any records. Ironically, homeowners typically are stuck paying exorbitant legal fees for accessing information to which they should be entitled. Current law renders the only Florida agency with the slightest regulatory authority, the Department of Business and Professional Regulation (DBPR), impotent to provide the oversight that HOA residents deserve. The law also makes it unnecessarily burdensome for law-enforcement officers to obtain evidence of wrongdoing.
In 2016, I brought similar problems regarding condominium oversight and financial records accessibility to the attention of our grand jury. Their detailed report included a number of recommendations to alleviate the problem. While condominiums are not HOAs, the problems of records accessibility and financial mismanagement are surprisingly similar.
Homeowners in HOAs should be protected. Based on experiences learned during our criminal investigation, the Florida Legislature can take several steps that would go far to help vulnerable homeowners throughout Miami-Dade County, and all of Florida, without creating the government overreach the lawmakers rightfully wished to avoid:
▪ Amend the HOA law to include the same minimal protections given to condominium owners.
▪ Amend the HOA and condominium laws to provide criminal penalties for the destruction of association records or the failure to provide records upon lawful request.
▪ Amend both statutes to include criminal penalties for election fraud.
▪ Amend the law to allow DBPR to oversee HOAs and condominiums more effectively. At a minimum, the Legislature should authorize DBPR to inspect records and to personally fine board members for failing to comply with the law or provide reports to members in a timely manner.
▪ Expand the Florida condominium ombudsman’s ability to oversee condominiums and allow the ombudsman to review HOA complaints.
I was gratified to see the Miami Herald’s Editorial Board recognize some of the challenges we face during our ongoing criminal prosecution and continued investigation into the Hammocks Community Association and the clear need for focused change in the oversight of Florida’s thousands of HOAs.
As always, I would welcome the opportunity to work closely with any of our legislators who want to address the homeowners victimized by one of Florida’s largest HOAs. This issue is far too important to ignore.
The State of Florida has issued a recent update to the State of Florida Elevator Code that requires that all existing elevators must be in compliance with part 3.10.12 of ASME A17.3-2015, Safety Code for Existing Elevators and Escalators.
A17.3-2015 Contains the Retroactive Requirement 3.10.12 System to Monitor and Prevent Automatic Operation of the Elevator with Faulty Door Contact Circuits. All conveyances licensed by the State of Florida Bureau of Elevator Safety, including those located within the 5 contracted jurisdictions (Broward, Miami-Dade, City of Miami, City of Miami Beach, Reedy Creek Development District) must be in compliance with the above Code by December 31, 2023. This system is referred to as Door Lock Monitoring.
By December 31, 2023 ALL Existing Elevator Must Have Been:
· For Elevators Installed Prior to A17.1 2000 (MOST ELEVATORS)
Equipped with a New Hardware and Software Upgrade and Inspected by a Licensed Elevator Contractor.
· For Elevators Installed Under A17.1 2000 or Newer
Inspected by a Licensed Elevator Contractor to Ensure Door Lock Monitoring is Functional and Code Compliant. These elevators may STILL require New Hardware and Software Upgrades depending on the Controller Manufacturer.
Frequently Asked Questions
Is Door Lock Monitoring Mandatory for my County?
Yes, Door Lock Monitoring is mandatory for ALL elevators in the State of Florida
Do I need to use my Current Vendor to install Door Lock Monitoring?
No, you can use any experienced vendor to perform your Door Lock Monitoring installation. This is considered work outside your Service Agreement.
What happens if I do not comply?
Failure to comply with Door Lock Monitoring will result in failed inspections and fines from the State and/or County.
Contact your Elevator Contractor or find top companies on our Directory for Florida Members
SINGER ISLAND, Fla. — Many South Florida condo owners are getting a holiday surprise they weren’t expecting — paying more for insurance. It’s all part of the state’s insurance crisis that has hit homeowners all year.
“The insurance this year is hitting us hard,” Johannes Neckermann, who sits on a condo board on Singer Island, said.
The rate hikes are not only hitting condo owners but also condo associations, which then pass on the costs to the condo owners.
“We raised this year the rate on unit owners just to afford the insurance,” Neckermann said.
He said in some cases the costs were up 40% over last year.
Florida property owners are already paying the most in the country for insurance, and it’s only getting worse.
Many condo owners are just discovering this, especially the part-time residents who are now arriving for the winter months.
“There’s a little bit of a sticker shock for people who don’t follow Florida year-round,” Robert Norberg of Arden Insurance in Lantana said.
Experts said there are several reasons for the increase in rates, all of which are making it very tough for insurance companies to stay afloat.
“It’s been several years of claim problems, and things like, that impact associations, as well as individual unit owners, plus now the Surfside [condo collapse in 2021], plus the issues with recent hurricanes,” Norberg said. “They’re all taking losses, and it hits not only the unit owner but the association in a big way.”
Condo owners are getting hit twice on those fees and then with their own insurance going up.
As with homeowners, it’s likely to drive condo dwellers to the state-run Citizens Property Insurance, which is already ballooning with more than a million policies.
Florida lawmakers are supposed to meet Dec. 12 for a special session on fixing the insurance issues, but there are no promises anything can be fixed quickly.
“They can’t force insurance companies to charge,” Norberg said. “The only thing they can do is help regulate the rates of admitted carriers.”
By Eric Glazer, Esq.
It has always been difficult to get volunteers to be on the Board of Directors. Even when times are good and the building has made repairs and has some money in the bank, you can never count on owners to volunteer their time for a position where on their best day they will be second guessed and criticized. It’s always touch and go as to whether an election will even be required in most condominiums because there won’t be enough volunteers. Maybe it’s because the job doesn’t pay too much.
Well, if you thought it was hard to get volunteers for the Board before, you ain’t seen nothing yet. Members of Boards starting in 2025, and perhaps some Boards getting a jump on the new laws know that they certainly won’t be winning any popularity contests by serving on the board, especially when they prepare the association’s annual budget. These new Board members will be the ones who have to tell the members of the community that their monthly assessments are about to skyrocket due to:
These board members will need to sit behind barbed wire and Police “Do Not Cross” tape during the budget meeting. They will probably want to be escorted to their units after the meeting by security. Bottom line is they are going to be facing hostile crowds.
Let’s say they make it back to their unit and still wish to remain on the Board. Now the fun begins. These board members will have to hire the architects, hire the engineers, hire the contractors, make sure the repairs get made and pay all of the association’s massive bills. They may also have to negotiate a loan from a local bank so that everyone doesn’t have to come out of pocket for all the repairs. Of course they will also still have the usual responsibilities of Board members such as attending meetings.
So who in the world is going to want to serve on the Board in 2025 when all of these new laws go into effect? Why would anyone stick their neck out so far? Well, if you were always a board member, you may not be scared of the responsibilities to come. On the other hand, if you were shy of becoming a board member before, I don’t doubt that you’re going to remain the same and stay away. It’s going to get tough ladies and gentlemen. But will the tough get going and make the association’s Board the best it can be?
Community association operations rely upon the timely and full payment of all assessments by all of the owners. One of the mechanisms that Florida law provides to put associations in a stronger position when an owner becomes delinquent is the “secured interest” of the association in the unpaid assessments by way of its ongoing lien against the unit or lot for the unpaid assessments. This secured interest puts the claim of the association at a higher priority than most other claims, other than a first mortgage or unpaid property taxes. However, a recent decision in the United States Bankruptcy Court for the Southern District of Florida, In re: Adam, Case No.: 22-10140-MAM, September 23, 2022, has cast a potential cloud on that secured interest.
In the In re Adam case, the Association previously obtained a judgment of foreclosure for over $76,000, which was considered as a secured interest by the Court. The Association was also claiming an additional $36,558 which came due after the judgment was entered. The owners were asking the Court to decide that the $36,000 was not secured and therefore uncollectible in the bankruptcy (or at least not fully collectible).
In deciding whether certain association claims were secured and collectible in the bankruptcy setting, the Court undertook an analysis of Florida law on the subject. The Court noted that both the Florida Condominium Act (Chapter 718 F.S.) and the Homeowner’s Association Act (Chapter 720 F.S.) currently contain express provisions that identify that the lien of the association is effective from the original recording of the declaration (with the added requirement in HOA’s that the declaration specifically expresses this lien right). However, the Court also points out that the Condominium Act was amended in 1992 to provide for this effective date. (The Homeowner’s Association Act was amended to provide for it in 2008.) Prior to these amendments, these Statutes provided for the effective date of the lien to be when it was recorded in the public records of the county. The analysis of the Court required it to consider whether the current version of the Statute applies to the situation or whether an earlier version of the Statute is the controlling authority. (This case involved a condominium so only the Condominium Act was considered in the decision.)
To make that determination, the Court applied the principles of the seminal case of Kaufman v. Shere, 347 So.2d 627 (Fla. 3d DCA 1977), which require declarations to contain the specific phrase “as amended from time to time” when identifying the Statute that governs the documents in order for the current version of the Statute to apply. This is because Statutes are not retroactive in their application unless the legislature expressly makes them so in the Statute itself. Both the U.S. and Florida Constitutions do not allow for the State to make a law that infringes upon the vested rights in an existing contract (which would be the declaration). As a result, the contract (declaration) would need to have the specific “as amended from time to time” language (often called “Kaufman” language) to automatically incorporate changes to the Statute that is not otherwise retroactive.
When the Court reviewed the governing documents, it noted that they were from 1987 and did not have the Kaufman language. As such, the Court held that the provisions of the declaration were the same as the Statute in 1987, which provided that the lien was effective only upon being recorded in the public records of the county. Since the Association did not file another lien for the amount being claimed subsequent to the foreclosure judgment, the Court concluded that this portion was not secured. In the bankruptcy setting, this meant that the Association would likely be unable to recover most, if not all of this claim from the Debtors, Mr. and Ms. Adam.
While this issue may be most relevant to associations when dealing with a case in bankruptcy, it is possible that it could also be raised in state court foreclosure cases under certain circumstances. It is also important to note that this Bankruptcy Court did not include a significant issue in the analysis regarding the Statute at issue, that being whether or not the statutory provision was “substantive” or “procedural”, as those terms apply to this situation, which could have led to a different result. (This portion of the legal analysis is quite technical and beyond the scope of this article.)
For communities whose declarations were recorded prior to the statutory changes described above, the first step in protecting the interests of the association is to review the documents to determine whether Kaufman language is already in them. If not, the board may wish to consider proposing an amendment to the owners to change the documents to include this language, if not for the entire declaration, then at least for the timing of the effectiveness of the lien of the association. Having qualified legal counsel review these issues in the documents is a strong business practice.
About Robert
Robert L. Kaye is Board Certified in Condominium and Planned Development Law. Mr. Kaye attended Michigan State University, graduating with a B.B.A. in General Business in 1976. In 1986, Mr. Kaye graduated from the Detroit College of Law, magna cum laude. Mr. Kaye initially practiced tax law for the firm of Raymond, Rupp, Weinberg, Stone & Zuckerman, P.C. in Troy, Michigan, before moving to South Florida in 1987, joining Becker & Poliakoff to concentrate in the area of community association representation. In 1991, Robert Kaye left that employ to start Kaye & Roger, P.A. He was the managing shareholder of the Firm from its inception, directing all legal operations and overseeing its growth to represent over 1,000 Communities in South Florida at the time of its name change to Robert Kaye & Associates, P.A. on January 1, 2003.
On January 1, 2009 Mr. Kaye joined with Michael Bender to form Kaye & Bender, now known as Kaye Bender Rembaum, after Jeffrey Rembaum joined in 2012. Mr. Kaye serves on the Florida Bar’s Grievance Committee, is a member of the Condominium Committee of the Real Property Section of The Florida Bar, and previously served on the Committee on the Unlicensed Practice of Law. He also lectures on Community Association law and is regularly published on the subject. Mr. Kaye hosts KBR’s appearances on the radio show, ‘Ask the Experts’, from 6pm to 7pm, the first Thursday of each month.
See his full bio HERE.
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