TC Palm Q&A Column, November 26, 2017

By November 26, 2017News, Questions & Answers

Editor’s note: Attorneys at Goede, Adamczyk, DeBoest & Cross, PLLC respond to questions about Florida community association law. The firm represents community associations throughout Florida and focuses on condominium and homeowner association law, real estate law, litigation, estate planning and business law.

Q: Our community is reviewing its current bulk cable agreement and there is a rumor that the Board will be adding internet to the contract.  Some of us are very happy with our internet service and do not want the bulk provider.  We are also skeptical of rumors that the provider is compensating the Association to enter into this transaction.  Do we have to go along with this?

-T.R., Stuart

A: Florida Statutes section 720.309 provides that a homeowners association may enter into a bulk agreement for information and internet services.  Often, there is a significant savings enjoyed through such a bulk agreement for both cable television and internet.  Because the statute specifically authorizes the Board to enter into a bulk internet agreement, any contract executed by the Board and providing bulk internet will be binding on all owners.  If you want to keep your current internet provider, you may do so, but that will not allow you to avoid paying for your share of the bulk contract authorized by the homeowners association.  

Concerning compensation, it is very common for cable providers to compensate an association for entering into a long term cable agreement.  That compensation should be payable to the homeowners association, and not to any individual director, and the association should also exercise care in determining whether any such compensation is taxable income or whether it has other financial ramifications.  Generally, these funds are not restricted and can be used by the Board in any lawful manner.

It is rare, but I have seen governing documents specifically limit the Board’s authority for these bulk agreements and therefore I would also recommend a review of your governing documents by a licensed Florida attorney to determine their interaction with the above referenced statute.

Q: One of our condominium unit owners passed away recently and was not paying assessments for some time prior to death.  The children are saying they don’t have to pay the assessments and want to sell the unit.  Who is correct?

-B.D., Treasure Coast

A: Generally speaking, when a unit owner dies, there is a question of whether the pre-death assessments were paid.  Because the condominium is probably a reasonably ascertainable creditor, the estate’s personal representative is required to serve a notice to each ascertainable creditor, including the condominium association, and provide that potential creditor with a window of time to file claim to preserve its pre-death claim.  If the association files such a document, the claim is prioritized based on a statutory hierarchy and must be addressed in some way prior to closing the estate.

If the decedent was current on association dues at death, the association may not need to take the same steps to preserve its claim, but it does need to stay on top of the situation because heirs rarely want to pay assessments until there is a purchaser for the property.

Ultimately, there are many factors determining how the condominium can pursue and collect both pre-death and post-death amounts, but the children are not correct if they believe the condominium association can be ignored, or that it is absolved from having to pay.  Whether it is the decedent, the estate, the children, or the beneficiaries, the unit is subject to the Declaration of Condominium which provides that the owner, any owner, of the unit must pay assessments and that same document provides lien rights for nonpayment.  I would recommend consulting with a licensed Florida attorney versed in both probate and condominium matters.

John C. Goede Esq. is Co-Founder and Shareholder of the Law firm Goede, Adamczyk, DeBoest & Cross, PLLC.  Ask questions about your issues for future columns send your inquiry to: question@gadclaw.com.  The information provided herein is for informational purposes only and should not be construed as legal advice.  The publication of this article does not create an attorney-client relationship between the reader and Goede, Adamczyk, DeBoest & Cross, PLLC or any of our attorneys.  Readers should not act or refrain from acting based upon the information contained in this article without first contacting an attorney, if you have questions about any of the issues raised herein.  The hiring of an attorney is a decision that should not be based solely on advertisements or this column.