As many of you are aware, there were a number of changes in the law adopted by the Florida Legislature in the 2014 session, some of which we have addressed in previous monthly columns. This column will address some of the more important changes in the law that relate to official records as well as those changes relating to both board and membership meetings for condominium and homeowners associations. First, with regard to the inspection of official records, both the Homeowners Association Act and the Condominium Act were amended to clarify that the Association may publish a directory containing “all” telephone numbers of each unit owner, and also specifically providing that a unit owner may consent in writing to the disclosure of other contact information. The reason for this clarification is that the previous statute stated that the association directory could contain each unit owner's telephone number. However, there was some confusion as to whether or not the association could publish multiple phone numbers, and the legislature has clarified this to allow an association to publish all known phone numbers in its directory. Additionally, both the Condominium Act and the Homeowners Association Act were amended to specifically require that an outgoing board member or committee member must relinquish all association official records or association property within five (5) days after the election. Any board or committee member who willfully or knowingly fails to relinquish such records and property can be subject to a civil penalty. As it relates to board meetings, Section 718.112, Fla. Stat., was amended to clarify that board members may meet via telephone, real time video conferencing or similar real time electronic or video communication and that such board members may be counted towards a quorum and may also vote as if physically present. Section 718.112, Fla. Stat., was also amended to provide that the members of the board may use email as a means of communication but may not cast a vote on an association matter via email. It is important to note that these changes were not also made in Chapter 720, Fla. Stat., the Homeowners...

A new case out of Florida’s Second District Court of Appeal could have very significant consequences for Florida’s condominiums and homeowner’s associations, and the way they process payments from owners. The case deals with restrictive endorsements—messages on a check, or sent with a check, that purport to create a settlement of all debt owed to the Association. For example, placing the words “for deposit only” on the back of a check is a form of restrictive endorsement, because it limits the further negotiation of the instrument. Section 673.2061, Fla. Stat., limits the power of restrictive endorsements when on negotiable instruments, such as checks; but the case involved an entirely separate letter that was sent with a payment, and conditioned the acceptance of the payment on a full settlement of all amounts due to the association. In St. Croix Lane Trust & M.L. Shaprio, Trustee v. St. Croix at Pelican Marsh Condominium Association, Inc., Case No. 2D13-3636 (Fla. 2nd DCA, Aug. 8, 2014), the association made a demand against a new unit owner, a third-party purchaser at a foreclosure sale, for payment of delinquent assessments dating to before the foreclosure. The attorney for the unit owner sent the association a check for a small amount of the debt, along with a letter notifying the association that the check was provided in full satisfaction of all disputed amounts, and that, if the check was cashed, it would be deemed a full settlement. Despite this limitation, the association cashed the check, and then threatened to foreclose against the unit owner. The unit owner sued the association, and the lower court ruled in favor of the association, citing Section 718.116(3), which provides that an association must apply any payment first to interest accrued by the association, then to administrative late fees, then to attorney’s fees, and then to the delinquency, “notwithstanding any restrictive endorsement, designation, or instruction placed on or accompanying a payment.” This language has long been thought to prohibit restrictive endorsements in the context of payments to a condominium association (note that identical language also appears in the HOA Act, at Section 720.3085(3)(b),...

As we are now in the midst of hurricane season, it is important to consider how an association may conduct business in the event that a state of emergency is declared. Several years ago, the Condominium Act was amended to give condominium boards certain emergency powers that could be used in the event that the Governor declared a state of emergency. However, at that time, neither the Cooperative Act or the Homeowners Association Act provided the same powers. As of July 1, 2014, that has changed, and now both Chapters 719 and 720 contain emergency powers for an association board when a state of emergency has been declared by the Governor. Pursuant to both Sections 720.316 and 719.128, Fla. Stats., and as previously provided in Section 718.1265, Fla. Stat., associations now have the following emergency powers when the Governor has declared a state of emergency: The board may conduct board or membership meetings after notice of the meetings has been provided in as practicable a manner as possible.Boards may cancel and reschedule association meetings.Boards may designate assistant officers who are not directors. If an executive officer is incapacitated or unavailable, the assistant officer will have the same authority during the state of emergency as the executive officer he or she assists.Boards may relocate the association's principal office or designate an alternate principal office.Boards may enter into agreements with counties and municipalities to assist with debris removal.Boards may implement a disaster plan before or immediately following the event for which the state of emergency is declared, which may include turning on or shutting off elevators, electricity, water, sewer or security systems or air conditioners for association buildings.Boards may determine, with the advice of emergency management officials or licensed professionals, that a portion of the association property is unavailable for entry or occupancy.Boards may determine whether or not to require evacuation of association property in the event of a mandatory evacuation order, provided that the association shall be immune from liability for any injury to persons or property arising from the failure of a unit owner or other occupant to evacuate the property.Boards...

The 2014 Florida legislative session concluded last month with a number of new laws affecting community associations, including community association managers. One of the most highly discussed changes relates to Chapter 468, Fla. Stat., governing the types of activities that a community association manager or community association management firm may perform as part of its normal duties. Previous to the 2014 session, Section 468.431(2), Fla. Stat., provided that community association managers and management firms were empowered to control or disburse funds of a community association, prepare budgets or other financial documents for a community association, assist in the noticing of conduct of community association meetings, and coordinate maintenance for a residential development. As of July 1, 2014, in addition to the above items, community association managers and management firms will also be empowered to perform the following tasks: Determining the number of days required for statutory noticesDetermining amounts due to the associationCollecting amounts due to the Association before the filing of a civil actionCalculating the votes required for a quorum or to approve a proposition or amendmentCompleting forms relating to the management of a community association that has been created by statute or by a state agencyDrafting meeting notices and agendasCalculating and preparing certificates of assessment and estoppel certificatesResponding to requests for certificates of assessment and estoppel certificatesNegotiating monetary or performance terms of a contract subject to approval by the associationDrafting pre-arbitration demandsCoordinating or performing maintenance for real or personal property and other related routine services involved in the operation of a community association The new law also provides specific statutory forms that a manager or an association may use in order to record a claim of lien, release of lien, and a form demand letter for the payment of delinquent assessments. The statutory forms have been incorporated into the statutes governing condominiums, cooperatives and homeowners associations (Chapters 718, 719 and 720, Fla. Stat., respectively). However, it remains important for associations, managers and management firms to consult with legal counsel in determining what functions may properly be performed by a manager or management firm, and to determine whether or not and...

In the course of business, every corporation, including community associations, must enter into dozens of contracts for services and materials, some of which relate only to a single project, and some of which may continue for many years (bulk cable contracts being the most typical example). And, with so many contracts and providers, it’s inevitable that one or more of those relationships will sour. At that point, many associations will contact their attorneys, to determine what can be done to get them out of the agreement, or to recover funds already paid to a non-performing party. Unfortunately, trying to resolve a contract dispute at the time of a breach is far less efficient than paying the necessary funds to have an attorney draft and negotiate an agreement with appropriate protections for the association from the outset. In legal parlance, a contract is an agreement between two parties, where each party has certain obligations to the other, and where some “consideration,” or value, is exchanged. Typically, an association will offer to pay money to a vendor or contractor, in exchange for goods or services. The terms of the contract, which are usually in writing (in Florida, any contract for the sale of goods over $500, or where the services provided are not to be performed within the space of one year, must be in writing), govern the relationship between the parties. This is critical, because contracts are evaluated on their face, according to the plain language used, and external evidence of the parties intent may only be considered if the language is ambiguous or has multiple meanings. Otherwise, whatever a contract says is legally binding. So, for example, as attorneys we are often asked whether a client may terminate a contract because a vendor is performing poorly. The only way to determine the client’s rights to terminate is to look for a written termination provision, and to see, under what conditions, the contract may be voided. Often, contracts are silent as to termination rights, or provide that they may only be terminated “for cause,” and then only after providing notice of a...