MASTER ASSOCIATION V. SUB ASSOCIATION – WHO WINS?  (Part 1) By Eric Glazer, Esq.

MASTER ASSOCIATION V. SUB ASSOCIATION – WHO WINS?  (Part 1)

By Eric Glazer, Esq.

Published January 18, 2021

A very interesting case was just decided by Florida’s Second District Court of Appeal.  RIVIERA-FORT MYERS MASTER ASSOCIATION, INC., v. GFH INVESTMENTS, LLC.  2020 WL 7767856.  To simplify, in a mixed-use community, meaning a community made up of commercial property and residential housing, the Master Association adopted seven amendments to the community’s master declaration. The court referred to the sub associations as the “Liner Buildings.”  In general terms, the amendments addressed the Master Association’s authority to approve proposed uses of the property located in the sub communities, (Liner Buildings) increased assessments on them, and imposed additional restrictions on the Liner’s tenants.

I write about the case because it is a great learning case about the relationship between a Master and a Sub and about community living in general.  The court said so much that we will break up this blog over a two week period.  Let’s start:

Are all amendments voted on by owners to the governing documents legal?

 “In determining the enforceability of an amendment to restrictive covenants, the test is one of reasonableness.”Holiday Pines Prop. Owners Ass’n v. Wetherington, 596 So. 2d 84, 87 (Fla. 4th DCA 1992). This court defined “reasonable” as “not arbitrary, capricious, or in bad faith.” Hollywood Towers Condo. Ass’n v. Hampton, 40 So. 3d 784, 787 (Fla. 4th DCA 2010). In other words, as we stated in Holiday Pines, the modification of restrictions cannot “destroy the general plan of development.” Holiday Pines, 596 So. 2d at 87 (citing Nelle v. Loch Haven Homeowners Ass’n, 413 So. 2d 28 (Fla. 1982)). Amendments which cause “the relationship of lot owners to each other and the right of individual control over one’s own property” to be altered are unenforceable. Id. at 88. Such an alteration is considered a “radical change of plans.” Id. Klinow v. Island Court at Boca W. Prop. Owners’ Ass’n, 64 So.3d 177, 180 (Fla. 4th DCA 2011) (footnote omitted). Klinow further defined “radical change” as “a change which would create an inconsistent scheme, or a deviation in benefit from that of the grantee to that of the grantor.” Id. (citing FlamingoRanch Estates, Inc. v. Sunshine Ranches Homeowners, Inc.,303 So. 2d 665, 666 (Fla. 4th DCA 1974)).

Can the HOA Be More Restrictive than the local zoning authority?

It is well established that restrictive covenants can be more restrictive than limitations imposed by municipalities. See, e.g., Luani Plaza, Inc. v. Burton, 149 So. 3d 712, 714–16 (Fla. 3d DCA 2014) (allowing a business owners’ association to prohibit residential use of a commercial property despite municipal permission for residential use); Stuart Sportfishing, Inc. v. Kehoe, 541 So. 2d 169, 170 (Fla. 4th DCA 1989) (holding that a less-restrictive zoning ordinance did not control over a more-stringent restrictive covenant); Tolar v. Meyer, 96 So. 2d 554, 556 (Fla. 3d DCA 1957) (holding that a zoning decision allowing property to be used as a church did not control over a restrictive covenant prohibiting such a use).

Do Owners Give Up Some Freedom When They Move Into a Condo or HOA?

owners of property in condominium complexes necessarily accept a greater degree of restriction on their property rights); Hidden Harbour Estates, Inc. v. Basso, 393 So. 2d 637, 640 (Fla. 4th DCA 1981)

Next week I’ll write about some other facets of the law discussed in the opinion.