Category: Important Posts

In the event of a sale in a planned community, the mortgage company is required to collect an approval from the association as part of their escrow process. However, approval of a sale is not required if the community declaration, articles or bylaws do not provide for. Along with the sale approval, a current updated commonly asked question & answer form is required which should be attached to the rules & regulations and documents.

If the authority to do so appears in the declaration or bylaws, the association should also approve leases. Security deposits up to one months rent can be collected to protect against damages to the common property. Again, check the applicable documents.

For processing and administrative fees, the association can charge for sale/lease forms, up to the amount stated in the community documents. However, if the lease is a renewal from the same party, then no charge can be applied. 

If any of these provisions are not stated, then it is time to update those rusty old community documents. See, “How to Amend Community Documents”.  For supporting documents, click here. (more…)

Amending condominium or cooperative bylaws can only be executed after a membership vote. If not provided for in the community documents, the State of Florida requires a minimum 2/3% of the voting interest.

The amendment must contain the full text. Occasionally during minutes taking, we would refer to a title or number of a section for reference. A proposed amendment however, should always consist of the original full text. In this way the text can be added with an underline. And conversely, any words can easily be deleted from the text with a hyphen.

See example of a standard proposed change:

“No unit may be leased for a period of less than two weeks.”

                                       to

“Individual units may be leased for a period of less than one month and no more than four (4) times per fiscal year.”

Individual no units may be leased for a period of less than two weeks one month and no more than four (4) times per fiscal year.

Simple changes can be proposed and should always be approved by the association attorney. If a change by use of underlines and hyphens would hinder rather than assist, then a more substantial change can be written. However, a notation must be inserted immediately preceding the proposed amendment. The association attorney should always make these extensive proposed amendments, or at least give his written approval.

For supporting documents, click here. (more…)

Every association has a chronic complainer. Usually it’s the person out of one hundred (100) that always have to complain about something or another. A common nickname is condo commando, bellyacher or squawker. This person rarely has a resolution to a problem, only complaints. Condo commandos are always the first to attend Board meetings. In public some are quiet, while others are vocal and disruptive.  So what is the Board to do?

Avoid and ignore bellyachers whenever possible is highly recommended.  But if the squawker goes as far as to complain by certify letter, directed to the association, only then, the Board is obligated to respond. The failure to respond in writing could prevent the association from recovering attorney fees and other costs, which could lead to arbitration.

In an attempt to not forfeit recovering attorney’s fees and costs of any future litigation, due to failure to respond, there’re three (3) acceptable responses:

1. Within thirty (30) day, give a substantive response.

2. Notify the queries that advice has been requested from the division.

3. Notify the queries that a legal opinion has been requested.

Basically a substantive response is a response with substance and/or legal fact. Whoever can measure a substantive response is beyond us, so if in doubt, consult with the association attorney.

If the inquirer involves the Department of Business and Professional Regulation (DBPR), then the board shall, within 10 days of its receipt of the advice from the DBPR, provide in writing a substantive response to the inquirer, or simply forward the divisions direction.

For supporting documents, click here. (more…)

Reporting of financial requirements for homeowner association is identically the same as condominium law. The only difference is if the member of the homeowner association wishes to partition the level of financial reporting, only twenty (20%) of the total membership is required. If partitioning becomes successful, then a duly called members meeting would be mandatory to consider a higher level of financial reporting. A majority vote would determine the level of financial reports due for the end of the fiscal year.

See below both condominium and homeowner association requirements for annual revenue reporting:  

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

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

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

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

Without a Members vote, Board of Directors at their discretion may elect to vote for a higher level of financial reporting for any fiscal year.

Click here for supporting documents.

(more…)

The time of year is here to start preparing for all association’s annual revenue reporting. If the condominium is only fifty (50) units or less, or annual revenues are less than $100.000, then cash receipts would be automatic. The end-of-the-year statement, which is better known as the 12/31 (December, 31st.) would most likely already be prepared by the management company.

If the association annual revenues are $400.000 or more, then the State of Florida requires a full blown audit. Paying for a full audit year after year would be costly and may be inconsequential. By approval of a majority vote of members at a duly called members meeting (usually Annual Meeting), the State allows for a waiver of the stringent reporting requirements. Regardless of the number of units or revenues, every seven (7) to eight (8) years all associations should arrange for an audit from a certified public accountant. (CPA).

The State also requires the association to complete and send financial reporting to all members within a precise time frame.  In lieu of sending the statements to all members, which is also a costly task, the State allows for a notice stating, “that a copy of the financial statement will be mailed without extra charge upon written request.” It is local custom to add this statement with the Annual or Budget notices.
 
For supporting documents, click here. (more…)

Homeowner State requirements are looser than condominium associations. At a duly called homeowner meeting, the board can officially adopt a new agenda anytime without being regarded as an emergency. Also, a vote to add or delete agenda items is not required by the State of Florida. Depending on homeowner by-laws, minimum agenda posting requirements are the same as condominium. See, “ Common Overlooked Florida Requirements for Condominiums”.

Special assessments for homeowner are handled the same way as condominium associations. Both entail a fourteen-day (14) notice indicating that a summed assessment is being considered.

Directors for both types of associations do not vote by proxies or by secret ballots at board meetings. However, in the event of a director conflict of interest, or wants and needs, secret ballots can be exploited in-lieu of an open vote.  A majority director vote should determine if a secret ballot vote is necessary.

For supporting documents, click here to view next page. (more…)

A typical Board of Director meeting requires a forty-eight (48) hour agenda notice. The notice should be posted in a conspicuous located on property. One (1) known location is all that is necessary. All agenda items should be incorporated in the agenda, before the meeting. During a duly called board of directors meeting, if a subject comes up without being identified on the agenda, the subject can be voted on, but only on an emergency basis. The vote should be noted in the minutes as an emergency agenda item. The State of Florida requires that an emergency vote shall only pass by a majority plus one (1) vote.

By board meeting practices of the current Florida Statutes along with the governing documents, should keep all the Association’s records official. For supporting documents, see next page. (more…)