A good reason why society provides for prevailing party attorney fees and costs is to make a potential plaintiff think twice before filing a lawsuit. Imagine being able to sue your adversary in court without worry that if you lose you will NOT have to pay prevailing party attorney fees and costs to the other side. Such a situation could lead to an avalanche of lawsuits, and that is exactly what happened when Florida laws permitted contractors holding an “assignment of benefits” in their favor, who were unhappy with the award from the insurance company, to sue the insurance company with nothing to lose but to pay for their own attorney. Simply put, an assignment of benefits is an agreement transferring a homeowner’s insurance benefits to a contractor who may then file a claim against the homeowner’s insurance policy without the involvement of the homeowner. Notwithstanding the assignment of benefits, the homeowner is still responsible to pay the insurance premium and deductible. If the contractor then makes a claim against the insurance policy and is unhappy with the insurance proceeds received, the contractor can sue the insurance company with no threat of having to pay prevailing party attorney fees if the contractor lost its lawsuit against the insurance company. Without the fear of a prevailing party attorney fees award, these types of lawsuits became very prevalent. Insurers claim that this led to ever increasing insurance premiums. Not anymore!
Due to the passage of House Bill 7065 (“HB 7065”), officially taking effect on July 1, 2019, consumers may begin to notice a decrease in their insurance premiums as HB 7065 creates liability for the contractor for attorney fees and costs based upon the difference between the amount recovered and the amount offered during settlement negotiations as compared to the disputed amount. When HB 7065 takes effect, if the contractor holding the assignment of benefits sues and the difference between the judgment obtained by the contractor and the presuit settlement offer by the insurer is less than 25% of the disputed amount, the insurer is entitled to an award of reasonable attorney fees. On the other hand, if the difference between the judgment obtained by the contractor and the presuit settlement offer by the insurer is at least 50% of the disputed amount, the contractor is entitled to an award of reasonable attorney fees. Finally, if the difference between the judgment obtained by the contractor and the presuit settlement offer by the insurer at least 25%, but less than 50%, of the disputed amount, no party is entitled to an award of attorney fees.
Insurers claim that the old system resulted in abuse of property insurance claims, as contractors were inflating repair costs and essentially operating without significant financial risk during insurance litigation, thus allowing contractors to assert numerous claims in hopes that one would stick. As a result, insurance companies were left bearing the costs of these lengthy litigation’s, and thus, sought to recover their litigation expenses through the consumer – the homeowner – by increasing insurance premiums. While a homeowner is still able to enjoy the benefits of the one-way attorney fee privilege, this right is no longer transferable to the contractors through assignment of benefits. Clearly, this is a drastic change that will affect contractors around the entire State.
If you have any questions regarding the impact of this new law, please discuss them with your association’s attorney.
With hurricane season approaching, in the event you experience a casualty, before signing an assignment of benefits in favor of the contractor who shows up, often uninvited, not only do you need to read the fine print, but it is strongly suggested you have an attorney review the assignment of benefits contract first.
http://rembaumsassociationroundup.com/2019/06/19/hurricane-season-is-here-if-you-suffer-a-casualty-you-need-to-know-about-this-new-law/
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EMERGENCY POWERS
HOMEOWNERS’ ASSOCIATIONS
720.316 Association emergency powers.—
(1) To the extent allowed by law, unless specifically prohibited by the declaration or other recorded governing documents, and consistent with s. 617.0830, the board of directors, in response to damage caused by an event for which a state of emergency is declared pursuant to s. 252.36 in the area encompassed by the association, may exercise the following powers:
(a) Conduct board or membership meetings after notice of the meetings and board decisions is provided in as practicable a manner as possible, including via publication, radio, United States mail, the Internet, public service announcements, conspicuous posting on the association property, or any other means the board deems appropriate under the circumstances.
(b) Cancel and reschedule an association meeting.
(c) Designate assistant officers who are not directors. If the executive officer is incapacitated or unavailable, the assistant officer has the same authority during the state of emergency as the executive officer he or she assists.
(d) Relocate the association’s principal office or designate an alternative principal office.
(e) Enter into agreements with counties and municipalities to assist counties and municipalities with debris removal.
(f) Implement a disaster plan before or immediately following the event for which a state of emergency is declared, which may include, but is not limited to, turning on or shutting off elevators; electricity; water, sewer, or security systems; or air conditioners for association buildings.
(g) Based upon the advice of emergency management officials or upon the advice of licensed professionals retained by the board, determine any portion of the association property unavailable for entry or occupancy by owners or their family members, tenants, guests, agents, or invitees to protect their health, safety, or welfare.
(h) Based upon the advice of emergency management officials or upon the advice of licensed professionals retained by the board, determine whether the association property can be safely inhabited or occupied. However, such determination is not conclusive as to any determination of habitability pursuant to the declaration.
(i) Mitigate further damage, including taking action to contract for the removal of debris and to prevent or mitigate the spread of fungus, including mold or mildew, by removing and disposing of wet drywall, insulation, carpet, cabinetry, or other fixtures on or within the association property.
(j) Notwithstanding a provision to the contrary, and regardless of whether such authority does not specifically appear in the declaration or other recorded governing documents, levy special assessments without a vote of the owners.
(k) Without owners’ approval, borrow money and pledge association assets as collateral to fund emergency repairs and carry out the duties of the association if operating funds are insufficient. This paragraph does not limit the general authority of the association to borrow money, subject to such restrictions contained in the declaration or other recorded governing documents.
(2) The authority granted under subsection (1) is limited to that time reasonably necessary to protect the health, safety, and welfare of the association and the parcel owners and their family members, tenants, guests, agents, or invitees, and to mitigate further damage and make emergency repairs.
History.—s. 19, ch. 2014-133.
EMERGENCY POWERS
CONDOMINIUM ASSOCIATIONS
718.1265 Association emergency powers.—
(1) To the extent allowed by law and unless specifically prohibited by the declaration of condominium, the articles, or the bylaws of an association, and consistent with the provisions of s. 617.0830, the board of administration, in response to damage caused by an event for which a state of emergency is declared pursuant to s. 252.36 in the locale in which the condominium is located, may, but is not required to, exercise the following powers:
(a) Conduct board meetings and membership meetings with notice given as is practicable. Such notice may be given in any practicable manner, including publication, radio, United States mail, the Internet, public service announcements, and conspicuous posting on the condominium property or any other means the board deems reasonable under the circumstances. Notice of board decisions may be communicated as provided in this paragraph.
(b) Cancel and reschedule any association meeting.
(c) Name as assistant officers persons who are not directors, which assistant officers shall have the same authority as the executive officers to whom they are assistants during the state of emergency to accommodate the incapacity or unavailability of any officer of the association.
(d) Relocate the association’s principal office or designate alternative principal offices.
(e) Enter into agreements with local counties and municipalities to assist counties and municipalities with debris removal.
(f) Implement a disaster plan before or immediately following the event for which a state of emergency is declared which may include, but is not limited to, shutting down or off elevators; electricity; water, sewer, or security systems; or air conditioners.
(g) Based upon advice of emergency management officials or upon the advice of licensed professionals retained by the board, determine any portion of the condominium property unavailable for entry or occupancy by unit owners, family members, tenants, guests, agents, or invitees to protect the health, safety, or welfare of such persons.
(h) Require the evacuation of the condominium property in the event of a mandatory evacuation order in the locale in which the condominium is located. Should any unit owner or other occupant of a condominium fail or refuse to evacuate the condominium property where the board has required evacuation, the association shall be immune from liability or injury to persons or property arising from such failure or refusal.
(i) Based upon advice of emergency management officials or upon the advice of licensed professionals retained by the board, determine whether the condominium property can be safely inhabited or occupied. However, such determination is not conclusive as to any determination of habitability pursuant to the declaration.
(j) Mitigate further damage, including taking action to contract for the removal of debris and to prevent or mitigate the spread of fungus, including, but not limited to, mold or mildew, by removing and disposing of wet drywall, insulation, carpet, cabinetry, or other fixtures on or within the condominium property, even if the unit owner is obligated by the declaration or law to insure or replace those fixtures and to remove personal property from a unit.
(k) Contract, on behalf of any unit owner or owners, for items or services for which the owners are otherwise individually responsible, but which are necessary to prevent further damage to the condominium property. In such event, the unit owner or owners on whose behalf the board has contracted are responsible for reimbursing the association for the actual costs of the items or services, and the association may use its lien authority provided by s.
718.116to enforce collection of the charges. Without limitation, such items or services may include the drying of units, the boarding of broken windows or doors, and the replacement of damaged air conditioners or air handlers to provide climate control in the units or other portions of the property.
(l) Regardless of any provision to the contrary and even if such authority does not specifically appear in the declaration of condominium, articles, or bylaws of the association, levy special assessments without a vote of the owners.
(m) Without unit owners’ approval, borrow money and pledge association assets as collateral to fund emergency repairs and carry out the duties of the association when operating funds are insufficient. This paragraph does not limit the general authority of the association to borrow money, subject to such restrictions as are contained in the declaration of condominium, articles, or bylaws of the association.
(2) The special powers authorized under subsection (1) shall be limited to that time reasonably necessary to protect the health, safety, and welfare of the association and the unit owners and the unit owners’ family members, tenants, guests, agents, or invitees and shall be reasonably necessary to mitigate further damage and make emergency repairs.
History.—s. 15, ch. 2008-28.
In the event of Damage to your Buildings and Filing a Claim:
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