On May 1, 2008, Florida Governor Crist signed House Bill 995. House Bill 995, which takes effect on October 1, 2008, amends various provisions of Chapter 718 of the Florida Statutes, the Florida Condominium Act. The following is a brief summary of amendments included in House Bill 995:
- Section 718.111 (The Association):
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- Subsection (1)(d): New standards of conduct for
officers, directors and agents of condominium
associations and personal liability for monetary damages
in the event of a breach or failure to perform per such
standards.
- Subsection (12) (Official Records):
Any person who knowingly or intentionally defaces,
destroys, or fails to create or maintain required
accounting records is personally subject to a civil
penalty. In addition, official records of the association
must be maintained for at least 7 years and be made
available within 45 miles of the Condominium Property,
within the county in which the condominium is located, or
electronically. Access to association records containing
Social Security numbers, driver's license
numbers, credit card numbers, and other personal
identifying information of unit owners, occupants, or
tenants is limited.
- Subsection (13) (Financial
Reporting): The developer is required to pay for
required audits or reviews prior to turnover. The
association may not waive the financial reporting
requirements of the Condominium Act for more than 3
consecutive years.
- Subsection (1)(d): New standards of conduct for
officers, directors and agents of condominium
associations and personal liability for monetary damages
in the event of a breach or failure to perform per such
standards.
- Section 718.112 (Bylaws) subsection (2)
(Required Provisions):
-
- Subsection (2)(b) (Quorum; voting
requirements; proxies): Votes allocated to units
owned by an association may not be exercised or
considered for any purpose including a quorum or
election.
- Subsection (2)(c) (Board of Administration
Meetings): If 20% of voting interests petition
the board to address an item of business, the board must
place such item on the agenda at its next regular or
special meeting but in no event more than 60 days after
receipt of the petition. In addition, notice of any
meeting in which assessments will be considered must
specifically state the nature, estimated cost and
description of the purposes for such assessments.
- Subsection (2)(d) (Unit Owner
Meetings): The annual meeting of unit owners
must be held within 45 miles of the condominium property
if the bylaws are silent as to the location of the annual
meeting. Board members' terms expire at the
annual meeting unless the bylaws provide for staggered
terms of no more than 2 years, and co-owners of a unit
may not serve as board members at the same time. In
addition to convicted felons, a person suspended or
removed by the Division of Florida Land Sales and anyone
who is delinquent in assessments is not eligible for
board membership. Notices of meetings at which an
election will be held must also include a new
certification form, which form must be signed by all
candidates certifying that such person has read and
understands the Condominium Act and the governing
documents of the association. The amendment to this
subsection also eliminates the authority of an
association of 10 or more units to opt out of the
statutory election process and provide for different
voting and election procedures in its bylaws.
- Subsection (2)(f) (Annual Budget):
Annual budgets must include estimated revenues. In
addition, proxies for waiving or reducing funding of
reserves or using existing reserve funds for purposes
other than for which such reserves were intended must
contain the following statement in capitalized, bold
letters in a font size larger than any other used on the
face of the ballot: WAIVING OF RESERVES, IN WHOLE OR IN
PART, OR ALLOWING ALTERNATIVE USES OF EXISTING RESERVES,
MAY RESULT IN UNIT OWNER LIABILITY FOR PAYMENT OF
UNANTICIPATED SPECIAL ASSESSMENTS REGARDING THOSE RESERVE
ITEMS.
- Subsection (2)(n): Any director or officer of an
association that is more than 90 days delinquent in
payment of regular assessments is deemed to have
abandoned the office, and a director or officer charged
with a felony theft or embezzlement offense involving
association funds or property shall be removed from
office and only reinstated if resolved without a finding
of guilt.
- Subsection (2)(b) (Quorum; voting
requirements; proxies): Votes allocated to units
owned by an association may not be exercised or
considered for any purpose including a quorum or
election.
- Section 718.1124: Provides for additional requirements on
a unit owner seeking appointment of a receiver for the
association and notices regarding the same.
- 718.113 (Maintenance; limitation upon
improvement; display of flag; hurricane
shutters):
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- New Subsection (6): Requires an inspection of
condominium buildings greater than 3 stories in height
every 5 years by an engineer or architect unless waived
by a majority of the voting interests present at a duly
noticed meeting. The engineer or architect must provide a
report attesting to required maintenance, useful life and
replacement costs of the common elements. The report must
be maintained as an official record of the association
under amended 718.111(12).
- New Subsection (7): Association must permit a unit
owner to attach to the door frame of a unit religious
objects not exceeding 3" wide, 6" high and
1.5" deep.
- New Subsection (6): Requires an inspection of
condominium buildings greater than 3 stories in height
every 5 years by an engineer or architect unless waived
by a majority of the voting interests present at a duly
noticed meeting. The engineer or architect must provide a
report attesting to required maintenance, useful life and
replacement costs of the common elements. The report must
be maintained as an official record of the association
under amended 718.111(12).
- New Section 718.121(4): Provides that an association may
not file a lien against a condominium unit until 30 days
after a notice of intent to file a lien has been provided to
the unit owner by certified mail, return receipt requested,
and first-class U.S. mail.
-
- New Section 718.1224 (Prohibition against
SLAPP Suits): Prohibits SLAPP (strategic
lawsuits against public participation) suits and
prohibits lawsuits against a unit owner without merit and
arising out of the unit owner's appearance and
presentation before a governmental entity on matters
related to the condominium association. Condominium
associations may not expend association funds in
prosecuting a SLAPP suit against a condominium unit
owner.
- Section 718.1265 (Association Emergency
Powers): Provides emergency powers of the board
that may be exercised in response to damage caused by an
event for which a state of emergency is declared
including the right to require evacuation and to perform
emergency repairs.
- Section 718.301 (Transfer of Association
Control): In addition to the current timeframes
for turnover, the statute now requires turnover when the
developer files a petition in bankruptcy or when a
receiver for the developer is appointed by the circuit
court and is not discharged within 30 days after such
appointment. In addition, at turnover the developer is
required to provide a turnover inspection report prepared
by an engineer or architect attesting to required
maintenance, useful life, and replacement costs of the
following applicable common elements: roof, structure,
fireproofing and fire protection systems, elevators,
heating and cooling systems, plumbing, electrical
systems, swimming pools and related equipment, seawalls,
pavement and parking areas, drainage systems, painting,
and irrigation systems.
- New Section 718.1224 (Prohibition against
SLAPP Suits): Prohibits SLAPP (strategic
lawsuits against public participation) suits and
prohibits lawsuits against a unit owner without merit and
arising out of the unit owner's appearance and
presentation before a governmental entity on matters
related to the condominium association. Condominium
associations may not expend association funds in
prosecuting a SLAPP suit against a condominium unit
owner.
For the full text of House Bill 995, see http://www.myfloridahouse.gov/Sections/Documents/loaddoc.aspx?FileName=_h0995er.xml&DocumentType=Bill&BillNumber=0995&Session=2008
If you have any questions about this Alert or would like more information, please contact Jeffrey R. Margolis, any other Member of the Real Estate Practice Group or the attorney in the firm with whom you are regularly in contact.
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