Changes to Leasing Restrictions May Not Apply to All Owners

Q: Recently there was a discussion in my condominium association about amending our declaration to increase the minimum lease term from 30 days to 6 months. Many of our owners are in favor of this change, but we have been told it would not apply to current unit owners and would only apply to future owners. Shouldn’t the association be able to require 6-month leases? (N.A., via e-mail)

A: Generally, properly adopted amendments to the condominium documents apply to all unit owners, regardless of when they acquired title to their units. However, amendments which change rental rights are different.

The Florida Condominium Act, in Section 718.110(13), Florida Statutes, limits the ability of a condominium association to amend its documents to impose new rental restrictions. The statute states that “an amendment prohibiting unit owners from renting their units or altering the duration of the rental term or specifying or limiting the number of times unit owners are entitled to rent their units during a specified period applies only to unit owners who consent to the amendment and unit owners who acquire title to their units after the effective date of that amendment.”

Accordingly, if your association wished to adopt an amendment which increased the minimum lease term from 30 days to 6 months, it could do so pursuant to the amendatory procedures contained in the declaration of condominium. However, such an amendment would only apply to those unit owners who voted for the amendment or to unit owners who take title to their unit after the effective date of the amendment. Therefore, any unit owners who do not vote for the amendment would be entitled to lease their units pursuant to the current 30-day lease minimum. While this is the rule for condominium associations, Chapter 720, Florida Statues, the Florida Homeowners’ Association Act, does not contain a similar provision.

Q: Recently, my condominium association adopted its budget and at that meeting there was a membership vote to waive the funding of reserves. My condominium association waives reserve funding every year. However, isn’t there a legal requirement to have some minimum amount of money in reserves? (B.C., via e-mail)

A: Not if the association properly waives reserve funding on an annual basis.

Pursuant to the Florida Condominium Act, Chapter 718, Florida Statutes, a condominium association is generally required to adopt a budget with fully funded reserves. Pursuant to Section 718.112(2)(f)2.a., Florida Statutes, the association must have reserve funds for roof replacement, building painting and pavement resurfacing and reserve accounts for any other item that has deferred maintenance or a replacement cost that exceeds $10,000. Further, the statute states that the reserve funding must be computed using a formula based on the estimated remaining useful life of the subject asset and the estimated replacement cost or deferred maintenance expense for each reserve item.

As such, the default under the statute is that condominium associations must, on an annual basis, adopt a budget with fully funded reserves, based on the statutory requirements discussed above. However, the statute also provides that the association may waive or reduce reserve funding on an annual basis by a membership vote.

Therefore, if the association has properly voted to waive reserve funding, the association is not obligated to have any specific minimum reserve balance. However, if the association does not properly waive reserves, going forward, the association would have to adopt a budget with fully funded reserves as required by the statute.

Originally posted on floridacondohoalawblog.com. Written by Joe Adams is an attorney with Becker & Poliakoff, P.A., Fort Myers. Send questions to Joe Adams by e-mail to jadams@beckerlawyers.com

Trustee Likely Able to Serve on the Board

Q: I am the trustee of a trust that owns a condominium.  I want to run for the board of directors at the next annual meeting. My neighbor said that I will not be able to run because my name is not on the title. As the trustee of the trust that owns the condominium, am I qualified to run for the board? (C.M., via e-mail)

A: Probably. You should first review the association’s bylaws to see if there are any provisions addressing whether a trustee qualifies to be a director. If the bylaws are silent on the issue, Chapters 607 and 617, Florida Statutes (the “Florida Business Corporation Act” and the “Florida Not For Profit Corporation Act,” respectively) do provide some guidance. However, the answer may depend on whether or not you reside in the unit.

The Florida Business Corporation Act states that in the event the eligibility to serve as a member of the board of directors of a condominium association is restricted to membership in such an association, a grantor of a trust or a qualified beneficiary of a trust which owns a unit shall be deemed a “member” of the association and is eligible to serve as a director of the association provided that the beneficiary occupies the unit. The Not For Profit Corporation Act, which applies to all not for profit associations, has a similar provision.

Additionally, the Division of Condominiums, Timeshares, and Mobile Homes, the state agency which regulates condominiums and adjudicates most condominium election issues, has taken the position that where the association’s bylaws provide that a board member must be the owner of a unit, it is reasonable to interpret this language to apply to other current, legal interests, such as trustees. Therefore, unless there is something in your association’s condominium documents stating otherwise, you, as the trustee, would likely be eligible to serve as a director of the association.

Q: I was recently appointed to my homeowners’ association’s board of directors, and there are a number of questions that I and the other board members have. Particularly, is there any Florida law that states how many members of the board there must be? Additionally, how is the board supposed to address vacancies when a member of the board of directors resigns? (K.E., via e-mail)

A: For homeowners’ associations, governed by Chapter 720, Florida Statutes, the “Homeowners’ Association Act,” there is no guidance concerning the number of board members an association must have. Therefore, it would be necessary to review the governing documents for your association to determine if either the articles of incorporation or the bylaws define how many board members your association is supposed to have. Well-written documents will state with specificity the size of the board. Accordingly, in order to determine how many board members your association is supposed to have, it would be necessary to review the governing documents. However, for many associations the default position is five board members.

With regard to condominium associations, governed by Chapter 718, Florida Statutes, the “Condominium Act,” Section 718.112(2)1, states that in the absence of a provision in the bylaws specifying the number of board members, the board should be composed of five members unless the condominium has five or fewer units. This same section also provides that where the condominium has five or fewer units the board must consist of at least three members, unless the bylaws provide otherwise. Therefore, a condominium association with five or more units would have a five member board and one with five or fewer units would have at least a three member board, unless the bylaws provide otherwise.

With regard to filling vacancies, both Chapter 718 and 720, Florida Statutes, state that a vacancy on the board of directors may be filled by a vote of a majority of the remaining board members, unless the governing documents state otherwise.

Originally posted on floridacondohoalawblog.com. Written by Joe Adams is an attorney with Becker & Poliakoff, P.A., Fort Myers. Send questions to Joe Adams by e-mail to jadams@beckerlawyers.com

Beach Access Restricted?

Although summer is gone and fall is nearing its end, the truth is that even in the heart of winter we never truly have to wait long to enjoy the beach in Florida. The problem this year however is who can access the beach.

During the 2018 Legislative Session, the Legislature passed House Bill (HB) 631, relating to “Possession of Real Property.” The bill dealt with the causes of action known as ejectment, forcible entry, and unlawful detainer. The bill also included what turned out to be controversial change in the law related to “customary use,” which may impact the public’s right to access beach property. If your home or condominium is on the beach, you will be interested in this change in the law.

It is first important to understand that private property owners who live on the beach in some cases own lots that are platted to include the beach area between the dunes and the high-water mark. This could include condominium associations if the common elements or association property includes the beach.

Before the Legislature passed HB 631, counties were adopting “Customary Use Ordinances” which essentially allowed beach access on private property. It was then up to the property owner (this would include condominium associations) to challenge the customary use of their property by non-owners.

HB 631 requires counties to go through a new process in order to adopt a Customary Use Ordinance and places the burden on the county to establish the customary use over each privately owned parcel included in the ordinance. The bill essentially makes it more difficult for counties to adopt Customary Use Ordinances as it shifts the burden from the property owner who previously had to challenge the ordinance in court to the county which now has to establish the customary use truly does exist for that parcel.

If you or your condominium association own beachside property, there is still some dispute regarding how much power a property owner has to “kick out” someone using the beach. The opponents of the new law (primarily the county governments) have stated that the new law lets beachfront property owners “wall off” portions of the beach from the public. However, Representative Paul Renner, a proponent of the bill, wrote an article stating that through the courts, Florida law has recognized the public’s right to the “customary use” of that private property, and that the public can still have beach access if it is an area that has been customarily used by the public. Nevertheless, the new law has caused disputes between beachgoers and property owners and in some cases, law enforcement has been called to mediate disputes.

 

Originally posted on www.floridacondohoalawblog.com. Written by Yeline Goin.

Legal Tools at Your Disposal to Make Your Responsibilities as a Board Member Easier

I often find that there is an over-complication that some people believe goes hand-in-hand with their responsibilities in operating a condominium. Most forget that the statute and administrative code provide boards with some basic tools to assist in day to day operations.  This article will review some of these tools.

Unit owner participation at meetings.   The Condominium Act gives unit owners the right to attend board meetings and the right to speak on any topic on the agenda.  But what do you do about the disruptive owner?  The association may adopt written reasonable rules governing the frequency, duration, and manner of unit owner statements.  For example, if you want to allow a unit owner to speak for no longer than three minutes on any topic on the agenda, the board could create such a rule as well as others.

Unit owner audio and videotaping meetings. The Florida Administrative Code provides that any unit owner may tape record or videotape meetings of the board of administration, committee meetings, or unit owner meetings, subject to the following restrictions: The only audio and video equipment and devices which unit owners are authorized to utilize at any such meeting is equipment which does not produce distracting sound or light emissions.  The Administrative Code also permits associations to adopt the following as written rules in advance of the meeting: audio and video equipment shall be assembled and placed in position in advance of the commencement of the meeting;  anyone videotaping or recording a meeting shall not be permitted to move about the meeting room in order to facilitate the recording; advance notice shall be given to the board by any unit owner desiring to utilize any audio or video equipment.

Requests for official records. The association may adopt reasonable rules regarding the frequency, time, location, notice, and manner of record inspections and copying.  The key to this type of rule is to ensure that the rule is reasonable and permits access. There are a number of arbitration decisions dealing with condominium associations attempting to create rules that were too strict and unenforceable. Therefore, I recommend that you consult with your attorney before finalizing such a rule. You can also charge a reasonable amount for photocopies. That amount should be in the rule as well.

Written inquiries by unit owners.  On occasion you will have a unit owner send a list of questions to the board. The association can also control these inquiries. The board may adopt reasonable rules and regulations regarding the frequency and manner of responding to unit owner inquiries, one of which may be that the association is only obligated to respond to one written inquiry per unit in any given 30-day period. In such a case, any additional inquiry or inquiries must be responded to in the subsequent 30-day period, or periods, as applicable.  You may also limit the number of questions.

Originally posted on floridacondohoalawblog.com and written by Mark D. Friedman