The Legislative Session for 2011 has produced a number of significant changes to the Condominium Act (Chapter 718 F.S.), as well as other Chapters of Florida Statutes that affect condominiums, as found in House Bill (HB) 1195, which become effective July 1, 2011. The following is a summary of changes most relevant to the operation of the association and an identification of the particular affected sections. Please note that this summary is not intended to be an exhaustive explanation of the intricate detail of all of the changes nor is it to be considered complete legal advice on the subject. It is recommended that if there are any questions regarding any of these changes, you contact this office for further discussion. (All Section references below are to Florida Statutes.)
Among the most important revisions, HB 1195 incorporates changes to official record limitations; meetings that are not required to be open to membership attendance; candidate eligibility for elections; candidate certification forms; inclusion of impact glass in hurricane protection options; options for pursuing rent from tenants of delinquent owners; and, expansion and clarification of suspension of use and voting rights options.
As a clarification from confusion created in 2010 when 2 different bills were approved and adopted, changes were made to Sections 633.0215(14) to clearly provide that the particular life safety code issue applies to condominiums, cooperatives or multifamily residential structures of less than four (4) stories.
Section 718.111(12)(a)7, regarding Official Records, has been revised to include facsimile numbers of unit owners who consent to receive notices in this fashion. (However, as noted below, such numbers may not be open to inspection by other owners.)
Section 718.111(12)(c), which contains the exceptions to portions of the Official Records that are open to the inspection by a requesting unit owner has again been adjusted. Subsection 1, regarding attorney-client privileged materials removed the phrases “imminent civil or criminal” and “imminent adversarial administrative” from the items under protection. This effectively expands the items subject to the exception.
Subsection 3 clarifies that the exception of “personnel records” also refers to management company employees, but will not include written employment agreements, or budgetary or financial records that indicate the compensation paid to the employee. By removing these items from the exception to owner access means that they are to be made available for inspection.
Subsection 5 adds facsimile numbers to the exceptions from open access unless the number is provided to fulfill the notice requirement of the association, but further provides that a unit owner may consent in writing to the disclosure of personal information set forth in the subsection. It also provides that an association is not liable for inadvertent disclosure of such items if the information was voluntarily provided by a unit owner without an initial request from the association that it be placed into the official records.
Section 718.112(2)(c) has been broken down into three subparagraphs. Of note is changes in the new subsection 3.b., involving exceptions to meetings of the board and/or committees that are required to be open to the membership. The new subsection now indicates that board meetings held for the purpose of discussing personnel matters may be closed, whether or not the association attorney is present.
Section 718.112(2)(d) has been further divided into subparagraphs, now numbered 1-10. The new subsection 2 defines a “candidate” for the board as an eligible person who has timely submitted the written notice of the intention to become a candidate. The terms of all board members expire at the annual meeting unless the terms are staggered. Further, if all board members terms expire but there are no names timely submitted, there is no automatic “rollover” of the then current board at the annual meeting. If the term of a board member expires at the annual meeting, the members may stand for reelection unless prohibited by the by-laws. (This seems to allow for the possibility of term limits to be added to the by-laws.) The terms of a board that is not staggered expire at the annual meeting. If terms of board members that are expiring equal or exceed the number of candidates, those who have placed themselves into nomination are automatically seated at the adjournment of the annual meeting. Any vacancies at that point are filled by the remaining directors, unless the by-laws provide otherwise. Any owner desiring to be a candidate must be “eligible” to serve on the deadline for submitting a notice of intent to serve to have his or her name placed in the ballot. (This, in particular, refers to delinquencies of greater than 90 days.)
Section 718.112(2)(d)4.b has revised the requirement of the submission of a candidate certification form or educational certificate to provide that either option chosen is not required to be re-submitted in successive years of a board member’s service, so long as such service is continuous, without interruption. It also allows acceptance of an educational certificate obtained up to one (1) year prior to the election or appointment or, alternatively, up to ninety (90) days after the election or appointment.
A new subsection 718.112(2)(d)10 has been added to provide that limitations on election procedures, including proxy use and written ballots, do not apply to timeshares.
Section 718.113(5)(a) has been revised to add “impact glass or other code-compliant windows” to those which are regulated by this section.
Section 718.114 has been revised to provide for a majority vote requirement for the acquisition of certain leaseholds, memberships and other possessory or use interests after 12 months following the recording of the declaration.
Section 718.116(1)(b) has been further subdivided. Subsection 1. is renumbered to include subsections “a” and “b”, and a new Subsection 2. has been added, which provides that an association that acquires title to a unit through its own foreclosure of unpaid assessments is not liable for any unpaid assessments, late fees, interest, or reasonable attorney’s fees and costs that came due prior to the acquisition of title in favor of any other association which holds a superior lien interest on the unit.
Section 718.116(11), regarding seeking rent from the tenant of a delinquent owner, has been divided into additional subparts, which expands the Section to “(a) – (f)”. Subsection (a) has been clarified regarding the obligation of a tenant to pay rent to include all monetary obligations due to the association by the owner. A form has been added for the written demand on a tenant for the payment of the rent.
Section 718.117 regarding procedures to be followed for the termination of condominiums has been revised to include a procedure for timeshares and added provisions regarding partial terminations of the condominium.
Section 718.303(3), (4) and (5), regarding fining, suspending use rights and voting rights, have been revised in several ways. A new Subsection (3)(a) has been added to provide that an association may suspend use rights for covenant violations. Suspensions for covenant violations and fines require advance notice and a hearing before a committee to approve the fine or suspension.
Subsection (4) has been re-written and now more clearly provides for the suspension of use rights for individuals delinquent for more than ninety (90) days on a monetary obligation due to the association without the need for a hearing before a committee.
Subsection (5) has been revised to clarify that a suspended voting interest will not be included toward the total number of votes necessary for a quorum, the number of votes required to conduct an election or the number needed to approve action by the association.
A new Subsection (6) has been included to clearly provide that suspensions under (4) and (5) for delinquent owners, including the suspension of voting rights, do not require a hearing before a committee, but rather at a properly noticed board meeting. Upon approval, written notice of the action is required to all affected parties.
Part 7 of Chapter 718, involving Sections 703-707, for bulk buyers/assignees, has been revised with clarifications of the rights of those parties. It also identifies its application to only such transfers that occur between July 1, 2010 and July 1, 2012.
House Bill 59 was also adopted, which amends Section 48.031, involving access to gated or otherwise secured communities by licensed process servers. The new provisions state that a gated residential community, including a condominium or cooperative, shall grant unannounced entry, including to common areas and common elements, to a person attempting to serve process on a defendant or a witness who resides in or is known to be within the community.
We understand that there are numerous and significant changes made for 2011. The synopsis set forth herein is to simply provide an overview of the changes that most appreciably affect association operations. If you have further questions regarding any of the new provisions, please contact this office.
