Condominium Statute Changes

by / Thursday, 02 July 2015 / Published in Uncategorized

CONDOMINIUMS

Florida Statute 718.111 – Revises the Insurance and Official Records Provisions

(11)(j) – Previously the association or unit owners would have been responsible for the
reconstruction, repair or replacement of an insured loss as determined by the declaration or bylaws but now it is limited to only the maintenance provisions. It also eliminates uninsured losses in excess of property insurance coverage as a common expense of the condominium.
Added/Stricken language – In the absence of an insurable event, the association
or the unit owners shall be responsible for the reconstruction, repair, or
replacement, as determined by the maintenance provisions of the declaration or
bylaws. All property insurance deductibles, uninsured losses, and other damages
in excess of property insurance coverage under the property insurance policies
maintained by the association are a common expense of the condominium.
(12)(a)(15) – Previously, the Association would have been required to turn over any
records relating to the operation of the association. Now this is clarified to expressly
mean written records.
Added language – All other written records of the association not specifically
included in the foregoing which are related to the operation of the association.

Florida Statute 718.112 – Bylaws

(2)(d)(6) – The revision now authorizes the electronic transmission of notices of certain
meetings of a condominium association irrespective of whether authorized by the
association’s bylaws.

Strikes out – If authorized by the bylaws. . .

(2)(f)(1) – Clarifies the language of what must be included in the proposed annual
budget.
Added/Stricken language – The proposed annual budget of estimated revenues
and expenses must be detailed and must show the amounts budgeted by accounts and expense classifications, including, at a minimum, any if applicable, but not limited to, those expenses listed in s. 718.504(21).
(2)(f)(2)(a) – Added subsection

(2)(f)(2)(b) – Added subsection to allow the developer, before turnover of control of an
association, to vote the voting interests allocated to its unit to waive the reserves or reduce the funding of reserves.

Added / Stricken language – Before However, prior to turnover of control of an
association by a developer to unit owners other than a developer pursuant to s.
718.301, the developer may vote the voting interests allocated to its units to waive the reserves or reduce the funding of reserves through the period expiring at the end of the fiscal year after the fiscal year in which the certificate of surveyor and mapper is recorded pursuant to s. 718.104(4)(e) or an instrument that transfers title to a unit in the condominium which is not accompanied by a recorded assignment of developer rights in favor of the grantee of such unit is recorded, whichever occurs first, after which time reserves may be waived or reduced only upon the vote of a majority of all non-developer voting interests voting in person or by limited proxy at a duly called meeting of the association.

(2)(f)(3) – Clarifies the language regarding when the developer may vote to use reserves.

Added/Stricken language –Before Prior to turnover of control of an association by
a developer to unit owners other than the developer pursuant to s. 718.301, the
developer-controlled association may shall not vote to use reserves for purposes other than those that for which they were intended without the approval of a majority of all non-developer voting interests, voting in person or by limited proxy at a duly called meeting of the association.

(2)(f)(4) – Clarifies the language.

Added/Stricken language – Proxy questions relating to waiving or reducing the funding of reserves or using existing reserve funds for purposes other than purposes for which the reserves were intended must shall contain the following statement in capitalized, bold letters in a font size larger than any other used on the face of the proxy ballet: . . .
Florida Statute 718.116 – Assessments; liability; lien and priority; interest; collection

(3) – Clarifies language and adds that the provision regarding unpaid rents and assessments, interests, and order of payment applies regardless of any accord and satisfaction.

Added/Stricken language – Any payment received by an association must be
applied first to any interest accrued by the association, then to any administrative
late fee, then to any costs and reasonable attorney attorney’s fees incurred in
collection, and then to the delinquent assessment. The foregoing is applicable
notwithstanding s. 673.3111, any purported accord and satisfaction, or any restrictive endorsement, designation, or instruction placed on or accompanying payment. The preceding sentence is intended to clarify existing law.

(5)(b) – Adds administrative late fees to fees that are secured by the claim of lien and
clarifies language.

Added/Stricken language – The claim of lien secures all unpaid assessments that are due and that may accrue after the claim of lien is recorded and through the entry of a final judgment, as well as interest, administrative late fees, and all reasonable costs and attorney attorney’s fees incurred by the association incident to the collection process.

Reenacted – Reviser’s note stated intended to amend subsection (6) but did not publish paragraphs (c) and (d).

(c) If the unit owner remains in possession after foreclosure, the court in its discretion may require the unit owner to pay a reasonable rent for the unit. If the unit is being rented or leased during the foreclosure action, the association is entitled to appoint a receiver for the collection of rent and receiver will be paid by the party that does not prevail.

(d) The association has the power the purchase the condominium parcel at the
foreclosure sale and to hold, lease, mortgage, or convey it.

Florida Statute 718.117 – Termination of condominium

(3) New language that if 10 percent or more of the total voting interests reject the plan of
termination, the plan may not proceed.
a) The termination of the condominium form of ownership is subject to the listed conditions
1. All voting interests must be considered and none can be suspended.
2. If the plan is rejected, a subsequent plan may not be considered for 18 months after the date of the rejection.
b) Subsection does not apply to any condominium created pursuant to part VI
(conversions to condominium) of this chapter until 5 years after the recording of
the declaration, unless there is no objection to the termination.
c) Defines bulk owner and if at least 80 percent is owned by a bulk owner then the
plan is subject to the following conditions
1. If the units are offered for lease to the public, each unit owner in occupancy
before the date of recording of termination may lease his former unit and remain in possession for 12 months. In order to do so, the unit owner must make a written request to the termination trustee within 90 days after the date the plan of termination is recorded. Any unit owner who fails to make such timely written request and sign the lease within 15 days is deemed to have waived his right to retain possession and is required to vacate.

2. Any unit owner who was granted homestead exemption shall be paid a relocation payment in an amount equal to 1 percent of the termination proceeds allocated to the owner’s former unit. This is in addition to the termination proceeds and shall be paid no later than 10 days after the unit owner vacates.
3. All unit owners except the bulk owner must be compensated at least 100 percent of the fair market value of their units. This value is to be determined no earlier than 90 days before the date the plan of termination is recorded.
i. For an original purchaser from the developer who rejects the plan of termination and who was granted homestead exemption, or was an owner-occupied operating business as of the date of the plan was recorded and who is current in payment of both assessments and other monetary obligations to the association and any mortgage encumbering the unit, the fair market value shall be at least the original price paid for the unit.
4. Termination plan must provide for payment of a first mortgage encumbering a unit to satisfy the lien, but the payment may not exceed the unit’s share of the proceeds under the plan. If the unit owner is current in both assessments and monetary obligations and any mortgages, the receipt by the holder of the unit’s share of the proceeds or the outstanding balance of the mortgage, whichever is less, shall be deemed to have satisfied the first mortgage in full.
5. Provides certain written disclosures that must be contained in the plan of termination before being presented to the unit owners for consideration
d) If the members of the board are elected by the bulk owner, the unit others may
elect at least one-third of the members of the board of administration before
approval of the plan.
(9) Changes the time required to wait before a new plan of termination is proposed to 18
months. Previously it was 180 days.
a) If the plan is voted on at a meeting, a unit owner desiring to reject the plan must do so either voting to reject the plan in person or by proxy, or by delivering a written rejection to the association before or at the meeting.
b) If the plan is approved, any unit owner desiring to object must deliver a written
objection to the association within 20 days after the date the association notifies the non-consenting owners that the plan was approved.
(11) Plan of termination; optional provisions; conditional termination; withdrawal; errors
a) Unless the plan expressly authorizes a unit owner to remain in possession or use the common elements after termination, all rights automatically terminate on the effective date of termination, as well as, leases, occupancy agreements, subleases, licenses, or other agreements for the use or occupancy of any unit or common element.
c) Unless otherwise provided in the plan, at any time before the sale of the property,
a plan may be withdrawn or modified by the affirmative vote or written agreement
of at least the same percentage of voting interests in the condominium as was
required for the initial approval.
d) Upon discovery of a scrivener’s error in the plan, the trustee may record an
amended plan or an amendment to the plan and it must be executed in the same
manner as required for the execution of a deed.
(12) Allocation of proceeds of sale of condominium
a) Unless the declaration expressly provides for the allocation of the proceeds, the plan may require separate valuations for the common elements. In the absence of such provision, it is presumed that the common elements have no independent value but rather that their value is incorporated into the valuation of the units.
b) Stricken language – The apportionment is deemed fair and reasonable if it is
so determined by the unit owners, who may approve the plan of termination
c) The holder of a lien that encumbers a unit at the time of recording a plan must, within 30 days after the written request from the termination trustee, deliver a statement to the termination trustee confirming the outstanding amount of any obligations to the unit owner secured by the lien.
d) Provides a list of permitted setoffs against each share of the proceeds, including attorney fees and costs.
(16) A unit owner is entitled to content a plan of termination by initiating a petition for
mandatory nonbinding arbitration within 90 days of the plan being recorded. However,
there are limitations as to what a unit owner may contest. If the arbitrator determines the
plan was not properly approved, he may void the plan or grant other relief it deems just and proper. If any of the disclosures required were omitted then it is automatically void. Any challenge to the plan, other than a challenge that the required vote was not obtained, does not affect title but is only a claim against the proceeds of the claim.

Florida Statute 718.1255 – Alternative dispute resolution; voluntary mediation; mandatory nonbinding arbitration; legislative findings

(1)(c) – Adds a plan of termination pursuant to s. 718.117 to the definition of dispute.

Florida Statute 718.128 – Electronic voting

New statute that allows the association to conduct elections through an internet-based online voting system as long as the unit owner consents in writing and certain requirements are met.
(1) The association has to prove each unit owner with:
a) A method to authenticate the unit owner’s identity.
b) For elections of the board, a method to transmit the electronic ballot that ensures
the secrecy and integrity of each ballot.
c) A method to confirm, at least 14 days before the voting deadline that the unit
owner’s electronic device can successfully communicate with the online voting
system.
(2) The association uses a voting system that is:
a) Able to communicate the unit owner’s identity.
b) Able to authenticate the validity of each electronic vote to ensure it is not altered in
transit
c) Able to transmit a receipt to each unit owner who votes.
d) For elections of the board, able to permanently separate any authentication or
identifying information from the electronic election ballot so it is impossible to tie
an election ballot to a specific unit owner.
e) Able to restore and keep electronic votes accessible for recount, inspection, and
review purposes.

(3) A member voting electronically is counted toward the determination of a quorum. The association may not take a substantive vote on any other issue than the issues specifically identified in the electronic vote, when a quorum is established based on unit owners voting electronically pursuant to the section.

(4) The section applies to an association that provides and authorizes an online voting
system by a board resolution. The board resolution must provide that unit owners receive notice of the opportunity to vote through an online voting system, establish procedures and deadlines for unit owners to consent, in writing and for unit owners to opt out of online voting after giving consent. Statute also provides how written noticed must be made to the unit owners.

(5) Provides a unit owners consent is valid until the unit owner opts out of online voting.

(6) The section applies to matters that require a vote of the unit owners who are not
members of a timeshare condominium association.
Florida 718.203 Warranties

(3) Revises the definition of “completion of a building or improvement” to conform with s.
558.02.
Added/Stricken language – “Completion of a building or improvement” means
issuance of a certificate of occupancy, whether temporary or otherwise, that allows for occupancy or use of for the entire building or improvement, or an the equivalent authorization to occupy or use the improvement, issued by the occupancy or the equivalent authorization is issued, the term it means substantial completion of construction, finishing, and equipping of the building or improvement according to the plans and specifications.
Florida Statute 718.303 – Obligations of owners and occupants; remedies
(3) – Clarifies that a fine may be levied by the board under certain conditions.

Added language – A fine may be levied by the board on the basis of each day of a continuing violation, with a single notice and opportunity for hearing before a committee as provided in paragraph (b).

(b) – Revises requirements for levying fine or suspension.
Added/Stricken language – A fine or suspension levied by the board of administration may not be imposed unless the board association first provides at least 14 days’ written notice and an opportunity for a hearing to the unit owner and, if applicable, its occupant, licensee or invitee. [. . .] The role of the committee is limited to determining whether to confirm or reject the fine or suspension levied by the board.

(4) – Adds fee or fine to obligations a unit owner may be delinquent on
Added language – If a unit owner is more than 90 days delinquent in paying a fee, fine, or other monetary obligation due to the association, the association may suspend the right of the owner or the unit’s occupant, licensee, or invitee to use common elements, common facilities, or any other association property until the fee, fine, or other monetary obligation is paid in full.

(5) – Provides the method for determining the voting interests allocated to a unit who has been suspended.

Added/Stricken language – An association may suspend the voting rights of a unit or member due to nonpayment of any fee, fine, or other monetary obligation due to the association which is more than 90 days delinquent. A voting interest or consent right allocated to a unit or member which has been suspended by the association shall be subtracted from may not be counted towards the total number of voting interests in the association, which shall be reduced by the number of suspended voting interests when calculating the total percentage of number of all voting interests available to take or approve any action, and suspended voting interests shall not be considered for any purpose, including, but not limited to, the percentage or number of voting interests
necessary to constitute a quorum, the percentage or number of voting interests required to conduct an election, or the percentage or number of voting interests required to approve an action under this chapter or pursuant to the declaration, articles of incorporation, or bylaws.

(7) – Adds who the suspensions apply to.
Added language – The suspensions permitted by paragraph (3)(a) and subsections
(4) and (5) apply to a member and, when appropriate, that member’s tenants,
guests, or invitees, even if the delinquency or failure that resulted in the
suspension arose from less than all of the multiple units owned by a member.

Florida Statute 718.707 – Time limitation for classification as bulk assignee or bulk buyer

Extends the period for classification as bulk assignee or bulk buyer until 2018.

Added/Stricken language – A person acquiring condominium parcels may not be
classified as a bulk assignee or bulk buyer unless the condominium parcels were
acquired on or after July 1, 2010, but before July 1, 2018 2016.

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