Q: Recently I needed to have my minor grandchild come live with me. Shortly after, I received a letter from the Association informing me I was in violation of its 55 and Over guidelines. I investigated this and learned that while the community advertises as 55 and Over the amendment that sought to impose the restriction was not approved by sufficient vote, but the Association has been following the amendment anyway. They are now taking another vote to impose the 55 and Over restriction. What can I do?
-P.W., Bonita Springs
A: This is a very complex set of facts and you should definitely seek legal counsel. As you seem to know, a community that is properly established as 55 and Over can prevent other persons who are less than 55 years of age including children from living in the community. If the imposition of the 55 and Over restriction was not adopted properly then the community is not lawfully allowed to prevent children from residing in the community. Doing so would violate the Federal and State Fair Housing laws as it would be considered illegal discrimination in the providing of housing based on familial status which is a protected class. However, the Association may be able to defend by arguing that if the amendment has been recorded for at least 5 years and the Association has properly administered the other 55 and Over program then the amendment cannot be challenged based on the Statute of Limitations. Under these circumstances, I would think that that defense would still not hold up against a Fair Housing discrimination claim.
Q: Do rules adopted by the Board of Directors have to be recorded in the public record?
A: It depends. If you live in a condominium governed by Chapter 718 Florida Statutes or a Cooperative governed by Chapter 719 Florida Statutes the answer is no they do not have to be recorded unless the association’s governing documents require Board adopted rules to be recorded. This is because Chapters 718 and 719 do not require it so it depends on the requirements of the association’s governing documents. Most of the time in my experience the governing documents do not require Board adopted rules to be recorded.
However, if you live in a homeowners association governed by Chapter 720, Florida Statutes, as of July 1, 2018 a new law found in Section 720.306(1), Florida Statutes requires that all “amendments to the governing documents” must be recorded in the public record to be legally enforceable. The definition of “governing documents” under Chapter 720 includes Board adopted rules. So, if your Board adopted rules existing before July 1, 2018 have not been recorded that is fine, (assuming of course the Association’s other governing documents did not already require it).
However, as of July 1 any amendments to the existing rules must be recorded in the public records.
Recording just the amendments, the Board adopted rules, and not the existing rules could be chaotic. So, it is our recommendation that if your current complete set of Board adopted rules have never been recorded in the public record you should do so now and then as you amend the Board adopted rules you must also record the amendments.
Q: Hello, we have a Use Restrictions clause in our Declaration of Condominium that prohibits any business or commercial activity, including the use of a unit as a public lodging establishment. We’ve had several unit owners advertise on sites such as Home Away, which seems to be a violation of the Use Restrictions. Our Property manager has sent letters outlining our lease restrictions, but our board also feels that this type of activity is a violation of the Use Restriction and has Florida county ramifications as well. Any guidance you can lend?
A: Attempting to circumvent the association’s leasing restriction by renting through the various on-line services such as VRBO, Airbnb and Home Away is becoming an increasing problem. As for the first part of the question due to a ruling against a municipality that tried to prohibit short term leasing based on it being a commercial activity that argument does not stand. The court found that leasing one’s home is consistent with a residential home activity and not considered commercial activity. The other argument being made to avoid the association’s leasing restrictions is that the occupancy of the home is not pursuant to a “lease” but rather a “license” which are legally different. Therefore, association restrictions against short term “leasing” are not applicable because the home is not being leased, its use is being licensed. The various short-term rental websites actually coach people on how to assert this argument. While the effect on the community is no different whether the occupancy is pursuant to a lease or license the legal argument is a sound one based on the governing documents wording. So, in the short term I advise associations to continue to enforce their leasing restrictions and if necessary let a Court decide if this is a “difference without a difference.” In the long term the best thing to do is amend your governing documents to provide that all leasing restrictions apply to any type of non-ownership occupancy for which consideration has been paid including but not limited to occupancy pursuant to a license. Also, note there has been a strong effort in the Florida Legislature to pass laws that will prevent municipalities and private community associations from restricting short term occupancy. Therefore, I would recommend pursuing the amendment route as soon as you can as it may not be available in the future.
Q: One of the new laws for condominiums stops board members from purchasing a unit at a foreclosure sale, how about a Tax Deed Sale?
A: No. As of July 1, 2017, Section 718.111(9), of the Condominium Act provides that “a board member, manager, or management company may not purchase a unit at a foreclosure sale resulting from the association’s foreclosure of its lien for unpaid assessments or take title by deed in lieu of foreclosure.” The law does not mention tax deed sales, so a board member, manager or management company can purchase in the association at a tax deed sale. Note there is no similar law for Cooperatives of Homeowner Associations.
Q: My husband and I attended your recent workshop. Great information, very informative. I do have a question for you…. we are an HOA still under builder control. Can a group of volunteer residents hold informal meetings to explore what to expect at turnover from the builder? To read and research what to expect and what the expectations from the builder should be.
-A.B., North Naples
A: Yes, and they should do so. Preparing for turnover of control is an important thing the members should do. The owners will be taking over a business and most know how it operates. This is done by familiarizing yourself with the day to day operations, the vendors performing service and everything else that goes into running the business. The second important aspect is to get ready and do due diligence about the construction of the community infrastructure and amenities. After turnover, the association has a limited amount of time to bring claims against the developer and other persons and entities involved in the construction of the community and its past financial operation. Educating yourself as much as you can before the date of transition will put you “ahead of the curve” in addressing the issues after the transition of control. This is usually done by creating an “ad hoc” transition committee. The developer has no ability to stop this but keep in mind it is not an official committee of the association and the developer-controlled board has no obligation to fund the committee either.