Abuse of Power – Living in A Florida Community Association Wednesday, Apr 16 2014 

If I had to briefly describe Florida community associations (COAs, HOAs, Mobile Home Parks) I would sum it up to “abuse of power.”  


A majority of the associations in the State of Florida abuse the power granted to them by the statutes and the governing documents (Declarations, Bylaws, Articles of Incorporation, and Rules and Regulations) of the association.  In the early to mid0-2000s, House Representative Julio Robaina, who was head of the House Select Committee on Condominium and HOA Reform set up town hall meetings all over the state to listen to the complaints by owners regarding their associations.  Hundreds of people attended these town hall meetings and only one or two people ever spoke up to say they were happy with their association.  As you can guess these one or two people were board members.


Don’t get me wrong; there are a number of good associations out there who do their job without abusing the owners.  I know because the associations I represent operate their communities that way or I would not be representing them.


The problem lies with the association attorneys, as well as the courts and the Florida Bar for letting the association attorneys behave badly.  The problem lies with the Florida Legislature for not enacting more laws to protect the owners or creating an agency to properly regulate the associations.  Homeowner associations are not regulated at all.  The other types of associations that are regulated do not provide adequate protection for the owners or do not have jurisdiction to investigate the biggest problems, such as assessment disputes.  This means the only remedy available to homeowners is costly litigation and the attorneys know this.  They advise their clients the likelihood of someone litigating against the association is slim and even if they do chances are they will drop the case when they realize the money it will take, which is between $100,000 and $150,000 on average to get a case to court.  In fact one association law firm gave a  sales presentation that I sat in on and stated that 95% of the homeowners cannot afford to litigate against you. Their motto was “do now, defend later.”  The board members, once educated on this fact, then start to abuse the power they have to suppress the property rights of the owners. 


Tactics include censorship of those outspoken owners and litigation against them if possible.  Associations will foreclose on an owner who is past due a few hundred dollars and is outspoken rather than foreclose on someone who owes more but doesn’t make trouble.


Attorneys’ fees are the biggest problem with association abuse.  The statutes actually provide for the owner to reimburse the association the attorneys’ fees without a court action!  Even worse, any payments are applied to interest, late fees and attorneys’ fees first.  Payments are applied to assessments last, so if you are past due, unless you pay the amount in full, you will always be at risk of foreclosure.  Knowing this, the law firms representing the associations pad their bills heavily.  A recent case I was involved in, where the association lost the client’s monthly payment of $160 resulted in almost $800 the first month and $62.50 each month, minimum, just for handling an account in collections and processing the payment.  This client paid in advance several months at a time and there was only one month in dispute, but the association sold off the debt to a finance company who then applied hundreds of dollars in legal fees almost every month on top of the legal fees the association attorney charged.  The attorneys’ fees reached $20,000 quickly despite one $160 payment being in dispute.


I have had clients who are turned over to the association attorney for collections and they are told they cannot go by the law firm and cannot call.  They are given the email address of a contact person to discuss settlement.  Guess what?  That person no longer works there and the owner is given two or three email addresses of former employees.  While I complained about this to the law firm several years ago, I recently discovered the firm is still engaging in this practice.  When they finally do read the emails the owner sent, they want to bill the owner for all the emails sent despite no one reading them when they were sent.


Violations are another area of abuse.  If your association doesn’t like you, you will be targeted with violation notices and possibly fines, which then can be a lien and foreclosure on your home if the fines exceed $1,000 and are unpaid.


Life in an association does not have to be this way.  There is a better way of operating these associations, but until the State of Florida wises up and realizes they are promoting a “cash cow,” not just for the attorneys, but for the community association managers, as well, life in an association will be a living hell with a dictatorship form of government.  By the way, the courts have ruled long ago associations are not governments or quasi-governments.

Community Association Living – Notice Requirements for Meetings Monday, Apr 14 2014 

Very rarely is a statute clear enough to avoid debate by lawyers taking different positions. Even if the law seems to be clear, it will still generate lots of questions with lawyers taking different positions.  The notice requirements in Fla. Stat. 720.303(2)(c) are a good example.

This statute provides the Bylaws will determine the notice requirements and if they do not then the following apply….  The statute then goes on to state BOD meetings are to be posted 48 hours in advance of the meeting in a conspicuous place in the community.  Exceptions to this are meetings to “levy” assessments or to change rules governing parcel use, which require fourteen (14) days notice to the members by U.S. mail to their home address.
The confusion comes in because the statute reads:
An assessment may not be levied at a board meeting unless the notice of the meeting includes a statement that assessments will be considered and the nature of the assessments. Written notice of any meeting at which special assessments will be considered or at which amendments to rules regarding parcel use will be considered must be mailed, delivered, or electronically transmitted to the members and parcel owners and posted conspicuously on the property or broadcast on closed-circuit cable television not less than 14 days before the meeting.”
Breaking this down, you can see the confusion.  First, what is the meaning of “an assessment may not be levied..”  It is unbelievable how much you can debate if an increase to an existing assessment is levying an assessment.  My opinion is each year when you set the rate of assessments you are “levying” an assessment. The next issue is the second sentence states the fourteen (14) day written notice is required for “special assessments” and ignores regular assessments.
Leave it to the lawyers to muck it up, right?  Just use common sense!  Play it safe and use the fourteen (14) day notice.  If your Bylaws have a longer period (many have fifteen days), then use that.  Out of precaution, don’t use less even if the Bylaws permit it.  Industry practice has been to use the fourteen (14) day notice as a guideline.  When in doubt, be conservative!

Community Association Living – Staying Out of Trouble with Your HOA Monday, Apr 14 2014 

My practice consists mostly of representing homeowners against their HOA (single-family homes) or COA (condos) and about half of my clients retain my services because they are being sued or about to be sued by their association. The problem is most homeowners do not understand their associations are in a superior position. Most people do not respond well to the covenant violation notices or intent to lien notices. The first reaction is usually “this can’t be legal, this has to be wrong.” Unfortunately, common sense doesn’t dictate right or wrong in these cases and the law is very much on the side of the associations.

The first step to staying out of trouble with your association is to attend board meetings. Keep an eye on what’s going on and what your board of directors are doing. If no one is holding them accountable they will think they can do and get away with anything. Even the most well-intentioned board members can lose sight of reality and what is legal if they are contributing a lot of their time to manage the association and no one cares to question their actions.

So what do you do if you are already in trouble? Do not ignore those notices!!! The problem will not go away. Even if you think the notice is wrong, rarely do the associations say they are wrong, they made a mistake and please forgive them. In fact, some will even tell you not to worry, its a mistake and then file a lawsuit to take your home.

If you have a notice for past due assessments, pay it in full. If you don’t have the money, get a loan. If you can’t get a loan, consider Chapter 13 bankruptcy. Chapter 7 will not save the home, but if you have income, Chapter 13 will save your home. If the notice came from an attorney, don’t try to pay the association directly thinking you can avoid the attorneys’ fees. You can’t. By law any payments are applied to attorneys’ fees first, then late fees and interest plus any other collection costs, and the assessments last!!While the association may accept your payment, the payment will be forwarded to the attorney and you will still be past due in paying your assessments. Even if you are past due $5, legally, the association can foreclose on your home. Trying to call the attorney and set up a payment plan will only incur more attorneys’ fees. You can send the attorney a written offer of a payment plan, which is what the attorney will request anyway, but most law firms charge $250 or more to set up the payment plan and around $50 to process each payment. That’s a lot of money to add to an already past due bill. Most associations have required the bill to be paid in two to six months, but with the state of the economy, many are considering one year payment plans and some will offer two years. Just keep in mind the extra fees the law firm charges for handling a payment plan. Also remember your association can foreclose even if your mortgage company is already foreclosing.

If you have received a notice of a covenant violation, do not ignore that either. Many times owners receive a notice for something that may have existed, but was recently corrected. Still do not ignore the notice!! Let the association know the condition was recently cured!! If your association is threatening a fine please note you are entitled to a hearing before a three member independent committee (no relation to board members or property managers) and the association has to give you fourteen (14) days notice of the hearing. You will have a chance to present your case and the committee has to vote whether or not to fine you. If they choose not to impose a fine, the board of directors cannot override the decision. If you have not fixed the violation they are accusing you of, then contact the association and let them know how soon you can fix it. Don’t make the mistake of thinking they cannot force you to fix it. Most of the time they can.

Finally, always get approval from the association before making changes to your property. This is required in every association and the association has the right to make you restore your property to the original condition.

You have to keep in mind you gave up valuable property rights purchasing property subject to an association. You entered into a contract, even though you may not have known it at the time, and you are bound by the terms of that contract (the Declarations, Bylaws and Articles of Incorporation.)

While you can litigate against your association, it is very expensive and the loser has to reimburse the winner their attorneys’ fees. These cases are not the type a lawyer will handle on a contingency because there are no physical injuries that would warrant big judgments. If you find an attorney who says they will take the case on a contingency, there is a high chance they have never handled an association case before. There are many procedural requirements to litigating against associations and a mistake could be very costly.

There are very few defenses to a lawsuit by your association. There is no excuse for not paying assessments, even if the board members are stealing money. The only possible defense is if the assessment imposed is invalid, which is rare. There are few defenses to not obtaining the association’s permission before making improvements to your property.

Know the rules, play by the rules and make sure your association plays by the rules. If they don’t your best and most inexpensive option is to organize a recall of the board.

Last but not least, pay attention to any bills that are being voted on by the Florida Legislature. Every year several bills are introduced and make their way through both houses. Contact your elected officials and let them know why they should or should not vote for a bill. A good example is the hard work my group of colleagues did years ago to remove the right of associations to lien and foreclose on homes for unpaid fines. The law was re-enacted, with a requirement the fine has to exceed a $1000, a couple of years later because the associations put pressure on the politicians. The change didn’t help homeowners because now the associations just make sure your fine exceeds $1,000.

Does this sound all doom and gloom? If it got your attention and made you realize your association has way more power than our Constitution intended, then my job is done. Protect yourself by getting involved. Know what your board of directors is doing and know what your legislators are doing. The only way to stop the abuse is to hold everyone accountable.

Associations – There is a Better Way! Monday, Apr 14 2014 

It’s no secret I have been an advocate for homeowners embroiled in disputes with their associations.  I originally went to law school to practice employment law.  I changed directions when I bought my home in a HOA and my welcome to the neighborhood consisted of a volley of “f-bombs” from someone claiming to be the HOA president.


In the past couple of years I have changed direction in my practice of community association law.  Not only did I realize individual owners suing an association is difficult for my clients, both emotionally and financially, but creates a hostile environment for everyone that often lingers even after the dispute is resolved. I now focus my attention on representing the associations.  I figure I can make a difference by helping associations proactively avoid litigation rather than helping the owners litigate.  Not all disputes can avoid litigation. There will always be those one or two homeowners in every community that will be stubborn or even aggressive and want to fight, but litigation should be a last resort.


Let’s face it — if your association has a bad reputation it will affect property values and the resale of homes. Desirable associations attract home buyers.


The ingredients for a good association are education, communication, the right CAM and the right lawyer.


Most homeowners do not intentionally violate the covenants.  Just because the homeowner received a copy of the governing documents, doesn’t mean they understand them.  If they did, most members who are past due in their assessments would realize the association can lien and foreclose on their home and would keep the assessments current.  I come across homeowners every day who believe if the bank is foreclosing the association cannot foreclose.  They are surprised when their homes are sold by the association with a bank foreclosure pending.


There is a simple fix to this.  The association should have a website the provisions of the governing documents can be explained, broken down in individual topics, and then promote this website regularly. Make sure new owners receive the web address right away.  Encourage members to review the website before undertaking improvements to property.  There are a number of services out there which help those technology-challenged individuals build a website.  If a website isn’t feasible, create a newsletter!  Now you have education and communication!


Another point about communications — confrontational notices do not work.  It is human nature to become defensive when being harshly reprimanded.  I believe the first notice to a homeowner should be a gentle reminder and an invitation to discuss the issue at a meeting if necessary.  The old saying “you catch more flies with honey” is true. You will get more owner cooperation if you acknowledge they either did not know better or forgot and have a chance to remedy the situation.  Threatening to send them to the association lawyer if they do not obey demands only ends up costing the association and owners more money for legal fees.


The right CAM is important.  Identifying the right CAM is not so easy and there is no one size fits all.  Some associations need the CAM to be very involved and some only need a CAM to collect assessments, pay bills and send out violation notices.  The right CAM will meet your expectations and work well with the association.  The wrong CAM will partner with the lawyer to increase billable hours for both of them by fueling disputes.  The wrong CAM will control the association funds and keep board members out of financial decisions.  The wrong CAM will make board decisions without the board members being involved. The wrong CAM will think it’s their job to run the association, not the board.


The same applies to the lawyers.  The right lawyer will answer the board’s questions and encourage the resolution of disputes early.  The wrong lawyer will lead the board to believe they have the ultimate power and cannot lose a dispute. The wrong lawyer will bully and abuse homeowners.


Associations should be proactive when dealing with violations and collections.  Identify the problem areas and work on them proactively.  Make sure your owners know not paying assessments means they risk losing their home and usually quickly.  Let them know the association doesn’t want their home, but has a duty to collect assessments from everyone.  Let them know financial hardship is not a defense the courts will entertain.  Offer a payment plan to help out those who are already past due, but be aware that if the association lawyer handles the payment there are outrageous fees to set it up and process payments.  The association can facilitate the payment plan so it stands a better chance of success.  If your association has authority to impose fines, make sure the members know about the process and don’t try to rig it by appointing members to the fining committee who are friends and supporters of the board or biased against the owner.  Make it a fair hearing before the fining committee or the association will most likely end up in litigation.  Make sure all members are aware of the process for applying for approval to implement improvements to their property.  Communicate on a regular basis those items that require approval as well as those that do not.


There is a better way to have an association and not make everyone in it miserable.  It’s not easy because most members of the association don’t care to be involved or hear about it, but it is possible.

Victory for Homeowners Monday, Apr 14 2014 

Yesterday was a good day for the homeowners who scored a victory in their fight over deed restrictions in Bayhead Landings.  It was a tough battle with me, being the only attorney with my firm handling HOA cases, against Becker & Poliakoff.  For those of you who do not know B&P, they are the biggest association law firm in Florida.  


This battle was over deed restrictions which included a specific expiration date without any of the usual automatic renewals.  In order to extend the deed restrictions, 75% of the owners and mortgagees had to vote to amend the expiration date.


The issue in this case was the method for obtaining the approval.   For this community it meant just one method — voting in person or by proxy at a meeting.  This was the method provided for in the bylaws. Additionally, Fla. Stat. 720.306(1)(a) states “Unless otherwise provided in this chapter or in the articles of incorporation or bylaws, decisions that require a vote of the members must be made by the concurrence of at least a majority of the voting interests present, in person or by proxy, at a meeting at which a quorum has been attained.”


The HOA didn’t follow these rules and instead collected ballots door-to-door.  Their argument was one we see a lot.  Fla. Stat. 617.0701, governing not-for-profit corporations, allows voting by written consent.  The problem is this conflicts with Fla. Stat. 720.306 and Fla. Stat. 617.1703 states in the event of a conflict with Chapter 720, Chapter 720 will prevail.


The funny thing is this case was not about not wanting deed restrictions.  My clients actually supported keeping the deed restrictions.  What they could not support was the way the HOA went about doing it.  It’s pretty much a safe bet to say that if a HOA doesn’t follow the rules and procedures for one issue, they tend to ignore the rules and procedures for dealing with other issues.  This wasn’t about not wanting deed restrictions, but about playing by the rules.

Annual Reporting by Associations (HOA & Condominium) Thursday, May 23 2013 

The annual financial reports your association is required to prepare depends on the total annual revenue generated from all sources.  This is also known as the total income and should be easily identified on the annual budget which the association is required to prepare and provide to owners.  There is no requirement all associations submit to audits.


For Homeowner Associations, Fla. Stat. 720.303(7)(a) provides: 

1. An association with total annual revenues of $100,000 or more, but less than $200,000, shall prepare compiled financial statements. 

2. An association with total annual revenues of at least $200,000, but less than $400,000, shall prepare reviewed financial statements. 

3. An association with total annual revenues of $400,000 or more shall prepare audited financial statements. 

Fla. Stat. 720.303(7)(b) provides: 

1. An association with total annual revenues of less than $100,000 shall prepare a report of cash receipts and expenditures. 

2. An association in a community of fewer than 50 parcels, regardless of the association’s annual revenues, may prepare a report of cash receipts and expenditures in lieu of financial statements required by paragraph (a) unless the governing documents provide otherwise. 


For condominium associations, Fla. Stat. 718.111(13)(a) provides:


1. An association with total annual revenues of $100,000 or more, but less than $200,000, shall prepare compiled financial statements.

2. An association with total annual revenues of at least $200,000, but less than $400,000, shall prepare reviewed financial statements.

3. An association with total annual revenues of $400,000 or more shall prepare audited financial statements.

Fla. Stat. 718.111(13)(a) provides:


1. An association with total annual revenues of less than $100,000 shall prepare a report of cash receipts and expenditures.


2. An association that operates fewer than 75 units, regardless of the association’s annual revenues, shall prepare a report of cash receipts and expenditures in lieu of financial statements required by paragraph (a).


Stand Your Ground Gun Law Abuse Monday, May 20 2013 

I think our legislators in Florida need to review the Stand Your Ground Law. I doubt they were thinking of HOA drama when they passed the bill, but we are about to have another Trayvon Martin issue.


I represent a client in a voluntary HOA. They refused to admit they were voluntary until I stepped in to represent the client. Another homeowner is friends with my client and accompanied her to the mediation (these are elderly and/or disabled people and a co-pilot was needed for the drive). We thought all was worked out, but evidently the HOA has some hot heads in the community.


The client and her friend were followed by the HOA president and two board members. When they arrived home this man began a verbal altercation with the friend. Later that day the HOA president sees the friend and her husband headed for their evening bike ride to the common areas and not only locks them out of the common areas, but pulls a gun on them when they asked him if he was going to unlock the gate. Using his cell phone to tape the incident, he announced “I fear for my life” and pulls out the gun.


If this guy feared for his life by two disabled people, both smaller than him, then why did he go to their home earlier? Why did he follow them when he saw them on their bikes? Why didn’t he leave after locking the gate?


Yes, the law has no duty to retreat, but I don’t think it was intended for you to stalk people either.

2013 Florida HOA Legislation Pending Approval by the Governor Tuesday, Apr 30 2013 

Last week the House of Representatives and the Senate passed Bill 7119 providing many needed amendments to Florida Statute 720, the statute regulating homeowner associations. We are now waiting for the governor to sign the bill into law, which would go into effect July 1, 2013.

One of the most important amendments to the statute removes a director or officer from the Board of Directors of an association if the director or officer has been accused of committing a crime of theft or embezzlement involving the association. The bill also includes an amendment to Chapter 468, which regulates community association managers (“CAM”), and calls for discipline by the Department of Business & Professional Regulation (“DBPR”) if the CAM commits violations of Florida Statutes 720, 718 and 719, if the CAM contracts on behalf of an association with any entity in which the CAM has a financial interest without disclosure, obtaining a license or certification by fraud, misrepresentation or concealment, being convicted of or pleading no contest to a felony, violation of any DBPR order or rule, committing gross misconduct or gross negligence, or any other violation of Fla. Stat. 468.436.

Directors and officers of a HOA board, if the bill is signed by the governor, will now be required to certify in writing they have read the Declarations, Bylaws, Articles of Incorporation and any other rules and policy of the HOA and completed a state-approved educational course. The bill also requires directors and officers to disclose their financial interest in any entity submitting a bid for a contract with the HOA and if a member objects to the contract, the contract must be put to a vote by the membership for approval. Additional language requires the HOA to insure and bond anyone handling HOA funds prohibits kickbacks. Yes, good old common sense needed to be put into the HOA statutes, but I wonder if those people affected by this law will actually care to stop accepting kickbacks!

Associations would now be required to keep the official records within 45 miles of the community or within the county where the community is located. (I predict we will have some legal battles over the use of the word “or” here.) There should never be a choice in a statute. Associations, at their discretion, can provide the records electronically by posting them on the Internet or allowing members to read them on a computer screen and then requesting a printed copy. If the HOA has a copy machine it must provide the copies if the request is 25 pages or less. The association could still charge 25 cents per page (down from 50 cents) for copies made with the HOA copier or, if the request exceeds 25 pages, the actual cost of copies plus any reasonable hourly fee NOT TO EXCEED $20 PER HOUR) for a vendor or employee to make the copies. No personnel charges are allowed if the request is under 25 pages. The HOA is also required to provide the member with a copy of the vendor’s invoice for outside copying services. The new bill requires the HOA to allow members to scan documents with any portable device they may have or otherwise make electronic copies.

The new bill would require a developer to designate reserve funds by components rather than one general fund if the developer provides for reserves.

The new bill would require associations to register with DBPR. This is the first step to future legislation to regulate HOAs. Currently no one knows for certain how many HOAs are operating in the State of Florida.

The new bill would also require associations to provide copies of an amendment to its members within 30 days of recording an amendment.

One provision I do not like is HOAs would no longer be required to allow members to be nominated from the floor at elections if there is a process for nominations prior to the election. The HOAs will not be required to hold an election if the number of candidates is equal to or less than the vacancies. While this would save the HOAs money because of the expense involved, it takes away some of the power of the members if they cannot nominate at the election and they don’t realize until the election not enough people stepped forward to be elected. Expect a lot of improper conduct with this one. If ever the members of associations needed to be motivated to be involved with their HOA, this provision of the bill should do it.

The new bill has provisions for forcing the turnover of control of the association to the members if the developer abandons its responsibility to maintain or complete amenities, files for Chapter 7 bankruptcy, loses or gives up title to common areas through foreclosure or pre-foreclosure, or a receiver is appointed. The bill also provides the members the right to elect at least one board member when 50% of the properties are no longer owned by the developer and also limits the rights of the developer to amend the governing documents.

Finally, the bill would not wipe out any past due assessments on a property if the HOA takes title to the property to foreclose its own lien. Any buyer would be liable for the past due assessments; however, any assessments accruing while the HOA has title are the responsibility of the HOA.

If you support this bill, please send Governor Rick Scott an email asking him to sign the bill into law. His email address is rick.scott@eog.myflorida.com.

Avoiding Trouble with Your Association Saturday, Apr 20 2013 

A big source of disputes between owners and their associations concerns claims by the association the owner made changes or improvements to their property or unit without permission of the association. The owners often claim they sent an application to the association and after not receiving a response for more than thirty (30) days, proceeded with the changes or improvements, believing approval was automatic if the association failed to respond.

This is a big mistake! At one time there was a statute providing automatic approval if no response was received and many association documents also contain language for the same, but the dispute arises when the association claims it did not receive the application. The owner must be able to prove the application was submitted. This can be done by submitting all applications by certified mail, return receipt in order to track delivery of the request.

Make sure any approval is in writing. Quite often a board member or property manager will give verbal approval only to deny it later when other board members object.

Also, check your Declarations and Bylaws before assuming no response equates to automatic approval. If there is no language granting automatic approval, then you have to take steps to obtain the written approval. This is especially important now that the Florida Legislature has put back the statute allowing associations to lien and foreclose on fines. If your association imposes a fine against you for unapproved changes or improvements, you could lose your home. Even without the language, your association could sue you to obtain an injunction forcing you to return your property or unit to its original state. Even more important, once you are labeled a troublemaker by your association they will make your life miserable. Unfortunately they have a lot of power to do just that.

In summary, always submit an application by certified mail, return receipt and, if you do not hear from the association within thirty (30) days, contact them to find out when your application will be reviewed. Make sure to get the approval in writing and do not rely on verbal approvals.

Tired of being bullied by your association? Friday, Mar 29 2013 

All associations, COAs and HOAs, should operate according to the governing documents. There are several problems with this system that allow board members to show favoritism or even be bullies.

Very few people are involved in attending meeting and joining committees. Less people watching the leaders means its easy to run a dictatorship and steal.

Very few people want to be board members so the same people run the associations for years and get used to having their way.

Very few people vote so its easy to stay in power and even rig the voting if necessary.

Very few people care what’s going on unless they have a problem.

There is little regulation of COAs by the state and almost none at all of HOAs (elections only). The only resource owners have to fight is to sue and most people can’t afford to sue.

The associations and their attorneys have well organized lobbying groups who are able to get the laws they want passed.

Notice all but the last two issues are problems originating with the owners. These are problems you and your neighbors have the power to fix.

A good friend of mine once said associations have more power over our citizens then the founding fathers ever envisioned. This was the exact tyranny they tried to prevent. Welcome to Flori-duh!

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