Category: Important Posts

In an attempt to clear overcrowding courts and to alleviate frivolous and nuisance suits, the Florida act requires the use of “alternative dispute resolution” prior to any court action.

Just a few years ago, Homeowner disputes were preceded directly to court. That has been changed; now all Florida Associations must use arbitration as a means of resolving selective disputes.

General disputes subject to mandatory non-binding arbitration:

• Elections
• Notice of meeting or mailing
• Proper conduct of Board Meetings
• Not allowing for inspection of books or records
• Disagreement involving members and directors
• Failure to maintain common elements
• Material change or alteration by the board

The following are not eligible for alternative dispute resolution (arbitration):

• The charging of assessments and special assessments.
• The cost of collecting an assessment and attorney fees.
• Common elements and limited common property.
• Title to property and any deeds such as a warranty deed.
• Alleged breaches of fiduciary duty by one or more directors.

Prior to the institution of court litigation, the party to a dispute, petitions the division for non-binding arbitration. An initial filing fee of $50.00 are collected from the Department of Business & Professional Regulation (DBPR). Those who wish to dispute through arbitration, the costs are split between both parties. The last arbitration we experienced, cost the association $2,200.00 and $2,200.00 to the disgruntle unit owner. The one before that cost over $10,000.00 and the issue remains unresolved.

Arbitration is a formal process. All arbitration decisions are final. If both parties agree, the arbitrator may refer a dispute to mediation.

Mediation is voluntary and encouraged. All parties must agree and must select a mutually acceptable mediator.

There are special provisions for both condominium and homeowner associations regarding arbitration and mediation procedures, for more information see Florida State Statute 718.1255: (more…)

The parcel of land outside of privately owned Units and within the community is known as common property.

All members own condominium common property equally and Homeowner’s association hold property that is owned by the association.

Common areas are designated for owner’s and guest use. Although portions of the common area are for members and guests, member use must not infringe the lawful rights of others.

Annexes and its appurtenants, which are exclusive use to a Unit, are described as a limited common property or limited common elements.

Condominium limited common elements are usually a restricted use to a particular unit, such as a porch area or balcony. A balcony with appurtenances would be considered a limited common element. A walkway to the beach or pool area could be considered an appurtenant to the balcony.

Homeowner limited common elements are also reserved for the use of a particular Unit or Units. A storage locker, parking spaces and walkways from individual Units are other examples of limited common elements.

Here is how the Florida Statute interprets limited common elements in both Homeowners and Condominiums:

Limited common elements,” means those common elements, which are reserved for the use of a certain unit or units to the exclusion of all other units, as specified in the declaration.

For most condominiums, air conditioning and heating equipment are considered limited common elements. Here is an example of a condominium declaration:

All equipment, fixtures and installations located inside or outside of a Unit which furnish air conditioning or heating exclusively to that Unit, shall be Limited Common Elements, and shall be maintained, repaired and replaced by, and solely at the expense of, the Owner of the Unit.

The benefiting Unit owner maintains the maintenance and upkeep of limited common elements or property.

In most condominium documents, air conditioners and all associating equipment are a limited common element. Which really means, owners’  personal use and responsibility. Associations are limited to limited common usage. Therefore, solely the exclusive Unit owners use and maintain limited common elements.

Standard democratic principles should be conducted at all Board of Directors Meetings.

With every Board meeting, parliamentary procedures shall be practice by all members. Without them, two things would most likely happen. The Board will make up and manipulate procedures as they go, which would cause confusion and lost of members. Or, the board doesn’t know or use parliamentary procedures at all. Without written procedures, the Board could lose members’ rights altogether.

This is why most community documents include Parliamentary Rules. See example condominium bylaws:

Robert’s Rules Of Order (latest edition) shall govern the conduct of the Association’s meetings when not in conflict with the Act, the Declaration, the Articles, or these Bylaws.

And see example homeowner bylaws:

The then latest edition of Robert’s Rules of Order shall govern the conduct of meetings of all Members of the Association and the Board; provided, however, if such rules of order are in conflict with any of the Documents, Robert’s Rules of Order shall yield to the provision of the documents.

Decisions to be made shall be conducted in an orderly manner. Therefore, parliamentary procedures must govern the conduct and practices of association meetings. This will ensure that all interested individual members are allowed to participate and be heard. If the procedures conducted properly, the result would be a fair and balanced meeting. The rights of members would be protected and everyone would have the right to present, speak to and vote on agenda items.

Every association should have the latest addition of Roberts Rule of Order. All Board members should read the book and understand procedures. The Roberts Rule of Order should only be use as a guide and not as a final decision. Furthermore, only rules, which do not conflict with the bylaws, shall be used. The bylaws will take precedence over Roberts Rule of Order. Since there are no parliamentary procedures written in the Florida Statute, the association’s documents will take priority. Always check applicable documents for reference to the Roberts Rule of Order and the latest addition.

If not stated in the governing documents, adoption of the latest addition of the Roberts Rule of Order are highly recommended. Establishing parliamentary procedures can ensure peace and harmony within the community. (more…)

 

Renters have the same rights as unit owners do, even while living in their community.

So many times Board of Directors deny and restrict renter rights of using the Clubhouse for special events. Or use stricter rules & regulations for renters, as opposed to the owners, by limiting the use and time of weight room and amenities.

If their were a known survey, we’re sure it would show ownership has a higher sense of ownership pride as would a renter. Members will say, “Renters’ do not have the same respect as a unit owner and after pool or clubhouse use, too often they refuse to clean after themselves”.

Although many Boards are in favor of amenity use restrictions for renters, the Florida Statute 718.106 adversely states, “When a unit is leased, a tenant shall have all use rights in the association property and those common elements otherwise readily available for use generally by unit owners and the unit owner shall not have such rights except as a guest, unless such rights are waived in writing by the tenant.”

The law also allows for association right to adopt rules to prohibit dual usage by a unit owner and a tenant of association property and common elements otherwise readily available for use generally by unit owners.

If dual usage becomes a problem in a community, then the Board can prohibit use by adding to the Rules & Regulations. Since the Florida Statute clearly states the ability for the Directors to eliminate dual usage, adding to the association Rules & Regulations would be considered a reasonable rule.

How to prohibit dual use of common elements without a membership vote?

• Post an agenda with the date, time and place of a Board of Directors Meeting.
• Make sure the agenda item states, “Vote to prohibit dual usage.”
• Vote to approve or disapprove dual usage.
• If approved by the Board, add the language to the governing Rule & Regulations.
• Send all record owners a copy of the new Rules & Regulations.
• An Affidavit of mailing is recommended.

For more information or supporting documents, see Florida Statute 718.106 below: (more…)

 

The Community Association Board of Director’s are Solely Responsible for Their Actions: 

First make sure the Board of Directors have their policies in place. The Board of Directors is responsible for the operation of the Association by maintaining, repairing and replacing the necessary common elements. Preserving the property valve should be one of the main objectives of the “master plan”.

The property manager and property management company’s implement the policies supplied by the Board. If the Board does not have a management policy, the manager can supply an initial master plan and the association could then prioritize the plan as necessary. The manager would then assist the Board by delegating maintenance, repairs, replacement and other functions directed by the Board.

The Board can assign tasks and allow for the manager to run the day-to-day association business on behalf of the Board. Although the manager makes the daily decisions, the Board is still ultimately responsible to the association. The Board could never reverse their responsibility by assigning manager duties.

The Board of Directors by State Statute is obligated to use prudent business judgments and has fiduciary duties to act in the best interest of their community. Also, to make good faith decisions, as would an ordinary person would under the same circumstances.

To help make sound decisions, the Board can seek professional opinion. Experts like Community Association Attorney, industrial engineer, state contractor, public accountant and property manager, are all necessary in making responsible board decisions. The Directors’, who apply these high standards of community management, will never be liable for actions or the failure to take action by any of the association members.
If the community contains less than fifty (50) units or has an annual budget (or budgets) of less than $100,000.00, a hired Community Association Manager would not be required by state statute. For seasons stated above, not having a Community Association Manager is not recommended. For more information regarding management duties and how to choose a community association management company, see, “How to Choose the Right Property Management Company“.

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Today is a special day to spend with family and friends and enjoy the festivities.

Were celebrating this Thanksgiving Day with a roast turkey, gravy made from the turkey drippings, roasted spaghetti & acorn squash, sweet potatoes casserole with mini marshmallows on top and homemade pumpkin pie.  We are certainly grateful for being able to enjoy this peaceful day.

We also hope Charlie Crist is enjoying his Thanksgiving Day. Here’s a little insight of our newly elected Florida Governor, it’s been just over a year. “Charlie Crist now serves as Florida’s 44th Governor in the State of Florida. He vows to work as “The People’s Governor” because he is working for the people of Florida—the people he calls his boss. Today, he is ready to lead Florida onward, to new opportunities and to Florida’s brightest future.”

Here is a another blurb regarding the State of Florida Citizens Property Insurance Company:

Property Insurance – Governor Crist praised the Legislature for continuing the work of lowering property insurance rates by ensuring affordability and consumer choice within Florida’s insurance market. Rates for homeowners insured by Citizens Property Insurance Corporation will not be increased until January 1, 2009, and consumers can qualify to purchase insurance from Citizens when comparable coverage from private insurers is more than 15 percent higher than Citizens rates. Private insurers will also be required to report their national profits when filing for rate increases, and no new Florida-only subsidiaries companies, will be permitted to insure property in Florida.

Here’s the problem, the Florida ran Citizen Insurance Company are not affordable. In fact in the South West Florida area, Citizen’s Insurance Company more than doubled in all Associations including our own. Since Hurricane Wilma some Association Insurance costs has almost tripled. All of us here in the State of Florida are spending a huge amount of money on property insurance. The high costs are mostly due to Wind coverage.

The legislation reports the rates will not increase until 2009: Our rate already more than doubled. The pledge of having our insurance not increases for a couple of years are insulting to us who live in South West Florida, not having an increase does not lower our costs. If a private company comes to Florida and offers just fewer than 15% for insurance, you can add another insult to injury. Lastly, private insurers are now required to report their national profits when filing for rate increases. This begs the question of how much did these insurance companies make before they left town and why is the legislation requiring such reporting? This pledge also doesn’t add any kind of significant changes to our insurance costs.

Aside from vacating Florida, here’s one attempt we can make to lower our insurance premiums. Write a letter. Don’t waste your time with emails, we’ve already tried and received no feedback. Below is a sample letter:

 

Your name
Your address
Name of your Association
Phone number or other contact information.
Today’s date

Charlie Crist
The Capitol, 400 S. Monroe St.
Tallahassee, FL 32399-0001
Phone: (850) 488-7176
Fax: (850) 487-0801

Regarding: High Cost of Insurance Premiums

Dear Mr. Crist:

It’s been a while now since you Charlie Crist have taken office with the promise of reducing our insurance rates. As you know Citizen’s, which is a Florida State insurance company is and had been charging enormous insurance premiums for our community. These high rates are causing a hardship for our members of our Association, especially those who are on fixed incomes. It has more than doubled since Hurricane Wilma.

So far the only relief from Citizen’s Insurance, is from having a mitigation inspection to our roofs. These inspections performed by a licensed contractor add additional costs to our association. The reduction is not significant and barely puts a dent in the amount we are charged by Citizen’s.

Speaking on my behalf and our Association, please take the necessary steppes in an expedient way to reduce our insurance premiums.

Sincerely,

Your name
Carbon copy: your association’s name

Happy Thanksgiving!!! (more…)

 

With budget season about coming to a close, here are a few more budget items to consider, if not already added.

Miscellaneous Pool Maintenance Costs:

• Annual operating pool permits expense.
• Artificial lighting. (Under water lighting costs $350 to $500.)
• Replacement of life ring, throw rope and Shepard’s hook.
• Pool signs.

Fire Safety:

• The replacement costs of fire alarms and maintenance.
• Annual fire extinguisher inspections performed by a state license inspector.
• The replacement costs of fire extinguisher and maintenance.

Elevator Service:

• Annual certificate of operation costs, issued by the DBPR, which is usually framed with a transparent cover.
• Quarterly costs of service maintenance contract for routine maintenance. (Special note, any change of maintenance service contract must be reported to the DBPR. Also, any injury or death must be reported within five (5) days of incident.)
• The cost of cleaning the elevator’s bottom well could also prove to be another significance expense.

Pest Control:

• The costs of routine building pest control; these are high costs because of state requirements. A licensed Florida Department of Agriculture and Consumer Services shall only perform fumigation in individual residences.  Also, Community Associations should never have unlicensed or uncertified personnel perform pest control services in individual units or in common areas. Furthermore, pest Control businesses must maintain insurance coverage. 
• Fungicides and chemicals for pest control of shrubs, ornamentals and turf must only be performed by State licensed and insured pest control personnel and must carry an identification card. These services are high costs maintenance due to strict regulations.

Security Guards:

• Bathroom supplies and cleaning materials are usually purchased by a cleaning service and are not included in their service contract. Check the contract for any unknown costs.
• Security guard contracts should never be increased before a new annual budget begins. All costs of maintaining operation should be included in the security guard contract. Here are a few items to consider:
• The security agent must have a “class D” license. The agency must also be licensed. The contract also should state the dates of biannual license renewal.
• License employees should wear uniforms with the patch identifying the employing agency.
• Armed security officers must have both Class D and Class G licenses.
• Security guards must contact the local police for any criminal acts and must not use force or try to make an arrest. Only law enforcement is granted the use of police powers.
• The Department of State, division of Licensing, regulates security officers.

After the proposed budget has been reviewed and accepted by all Board of Directors, it’s time to prepare for mailings.

If not written in the governing documents, Condominium and Cooperative require a minimum of a fourteen (14) day written notice with attached proposed budget prior of budget meeting. Homeowners associations required a minimum of at least seven (7) day before the meeting with proposed budget attachments.

An executed affidavit is required for compliance of State requirement of Condominium and Cooperatives. For proof of evidence, executing an affidavit for homeowner associations are also recommended. The affidavit should be filed in official records of the association. (more…)