REMBAUM’S ASSOCIATION ROUNDUP: YOU GET WHAT YOU PAY FOR – ASSISTANCE ANIMAL APPLICATION PACKAGES

The complaint heard often from condominium and HOA board members is in regard to the influx of assistance animals in their “no pet” or pet restricted communities. Few other topics within the body of community association law cause more consternation then the application of the Federal, State and local Fair Housing laws. In fact, one relatively minor misstep from a board member or manager can cost an association tens of thousands of dollars in damages, as well as attorney’s fees and costs. Not only that, but this is one of the very few areas where board members could potentially face individual liability for their actions. Under most circumstances, board members will have protection from liability under the “business judgment rule,” but this is not necessarily the case in the Fair Housing arena.

I have read applications for assistance animal requests, believed to be prepared by lawyers with knowledge in this field, which are used as a method to obtain new community association clients by selling the applications for a very low cost, even below several hundred dollars. Unfortunately, these application packages, while seemingly inexpensive, can expose the association to significant monetary penalties.

One such application package is a nightmare waiting to happen to an unsuspecting board because it requires the application to be completed in order for the board to review the matter. While Fair Housing laws encourage a uniform policy be implemented, an association’s assistance animal application package cannot be made a prerequisite. It can be suggested that providing a completed application will assist in expediting the review process, but it cannot be mandated to be considered for approval. Also, without good cause, an association cannot demand regularly updated medical information concerning a claimed disability, regardless of the use of an application created by an association demanding otherwise.

Recent decisions point out the legal exposure to an association when board members or other agents of the association attempt to curtail the rights of assistance animal owners in an apparent effort to placate the rest of the community.

In a recent Fair Housing consent order entered September 28, 2018 by and between an applicant for an assistance animal and Hudson Harbor Condominium Association, Inc., located in New Jersey, the association was ordered to pay $30,000 to the assistance animal applicant for failing to grant a reasonable accommodation to its policy of requiring the animal be carried in a crate or carrier in the common elements and that the owner of the animal only use a service door when accompanied by the animal.

In another case, Pekiun v. Tierra Del Mar Condominium Association, Inc., 2015 WL 8029840, the association’s motion for summary judgment was denied where the plaintiff’s estate sued the association due to its failure to allow an assistance animal and argued that the association caused the intentional infliction of emotional distress and violations of both Florida and Federal Fair Housing Acts. In this case, the association demanded an assistance animal be removed from the premises due to another individual’s allergies and required, not only that a specific application be completed by a particular time. After the assistance animal was approved, the association’s management company changed and the new management company required the owner to “recertify” his assistance animal. Later, the owner committed suicide. Had the Association not given the owner such a hard time, would the owner still have committed suicide? We will never know. The damage award could easily exceed six figures given these occurrences and resulting suicide.

Remember, when considering an assistance animal request, all that is necessary is that the applicant has a disability recognized by the Fair Housing laws and that the animal helps ameliorate the symptoms or effects of the disability. This information can come to the association from a doctor, psychiatrist, social worker, mental health worker or any other qualified individual.

If the association desires a uniform application for assistance animals to assist in trying to streamline request procedures, the board should be looking to work with an attorney/law firm familiar in this area of law, and not simply go for the low cost option.

Unless and until the Federal, State, and local laws are modified to address this ever-growing situation, when considering assistance animal applications, the association would be wise to seek legal counsel before taking any action. This is particularly true if the association is going to request additional information, implement limitations or restrictions on the owner or assistance animal within the community, or perhaps deny the request.

FIRST DISTRICT COURT OF APPEAL CLARIFIES UNIT OWNER OBLIGATIONS ON PAST DUE ASSESSMENTS AND IDENTIFIES CONFLICT WITH THIRD DISTRICT CASE

In 2013, the world of Florida condominiums was thrown by what many considered to be the controversial decision of Aventura Management, LLC v. Spiaggia Ocean Condominium Association, Inc., which, in effect, limited the obligation of an owner for unpaid assessments of prior owners. (See prior Legal Morsel articles discussing the Spiaggia cases here; and, for the follow-up case, here).

The main issue in Spiaggia addressed the limit of how far back into prior owners’ unpaid assessments a current owner will be held accountable.  Section 718.116 of Florida Statutes provides that an owner is jointly and severally liable for sums due from the prior owner.  Spiaggia limited that to one prior owner and for only sums unpaid during that ownership. Florida practitioners in this area of the law, including Kaye Bender Rembaum, overwhelmingly agree that the Spiaggia decision was not correct.  The Florida Legislature also apparently thought so and amended Section 718.116 F. S. the following year in an effort to correct the misconception.  On July 16, 2019, the Florida First District Court of Appeal issued its decision in Coastal Creek Condominium Association, Inc., v. Fla. Trust Services LLC, Case No. 1D18-1457, which expressly conflicts with the conclusions of Spiaggia as to what is owed by a current owner.

Coastal Creek Condominium Association, Inc. filed a foreclosure action to collect on unpaid maintenance assessments.  The Appellate Court discusses the history of the ownership of the unit and indicates that Fla Trust Services, the defendant/current unit owner in this foreclosure, had taken title to the unit on July 26, 2016, from Homes HQ, which had purchased the property at a mortgage foreclosure sale, with title conveyed to it on June 13, 2016.  The original owners in all of this, who were foreclosed upon by the lender in 2016, were Tracy Langley and Todd Levraea (called “Original Owners” by the Court).  The foreclosure by Coastal Creek sought sums due from August 15, 2015, which pre-dated Homes HQ ownership and the mortgage foreclosure, when the unit was owned by the Original Owners.  The lower court decided that Fla Trust owed assessments only from Home HQ’s ownership and not from the time of the Original Owners, relying upon the holding of Spiaggia.  The Appellate Court disagreed with that conclusion, deciding that sums claimed by the Association from the Original Owner were owed by Fla Trust as well.

In reaching its decision, the Appellate Court reviewed the relevant portion of Section 718.116 F.S., and concluded that Spiaggia had not fully grasped the intent of the Statute, which was that a current owner is jointly and severally liable for all unpaid assessments from all prior owners, not just from the time the unit was owned by the immediately prior owner, as the Spiaggia court concluded.  Home HQ was jointly and severally liable for all of the sums due from the owner prior to it, the Original Owners.  As such, Fla Trust was likewise liable for these sums.  As a result, the Court concluded that Fla Trust is required to pay for the assessments that were not paid by Home HQ and the Original Owners.  (Fla Trust still has the ability to bring legal claims against Home HQ and/or the Original Owners for their portion of the unpaid assessments.)

As a result of this conflict between District Courts of Appeal, the First District Court has certified the conflict to the Florida Supreme Court to consider whether to resolve it.  We will be monitoring the progress of that certification and report any news as it develops.  However, until such time as the conflict is resolved, the effect of this conflicting decision in the First District Court of Appeal from the prior decision in the Third District depends upon where the property is located that is the subject of a condominium foreclosure.  For property within the jurisdiction of the 3rd DCA (Miami-Dade and Monroe Counties), the Spiaggia decision remains the law that should be followed, and for properties located within the 1st DCA (the most northern and northwestern part of Florida, including Tallahassee and surrounding areas), the Coastal Creek decision is to be followed.  For all other jurisdictions in Florida, lower level judges will choose between the two in reaching their decisions.  This can result in inconsistent rulings on the same issue, even in the same courthouse, until the Supreme Court resolves the conflict.

Additionally, and equally important here, from the way this Appellate Court phrased its opinion, it may have clarified that the 2015 holding of the Fourth District Court of Appeal in Pudlit 2 Joint Venture, LLP v. Westwood Gardens Homeowners Association, Inc., only applies to homeowners associations and not to condominiums. (See Legal Morsel on the Pudlit decision published by Kaye Bender Rembaum, P.L. here.)  The Pudlit decision limited the obligation of certain third party purchasers at a lender foreclosure sale in a homeowner association based upon provisions contained in the documents of that community rather than what is set forth in the Statute.  Since Pudlit was published, there have been inconsistent rulings in the lower courts regarding whether or not that same limitation applies to condominiums.  In Coast Creek, the Appellate Court expressly includes sums which came due prior to the lender foreclosure.  Since the unit was purchased by a third party at the lender foreclosure sale, the Court holding here did not provide the third party an exemption from the obligation to pay for sums due prior to foreclosure, as many have argued in recent years.  This may prove to be very helpful to condominium associations in Florida in the future.