Senate Bill sb2300
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Florida Senate - 2003 SB 2300
By Senator Clary
4-1403-03
1 A bill to be entitled
2 An act relating to condominiums; creating s.
3 718.3027, F.S.; requiring prelitigation
4 disclosure to and approval by owners; requiring
5 a disclosure; providing that a prelitigation
6 disclosure is not admissible in evidence;
7 amending s. 718.301, F.S.; providing for the
8 effect of actions taken by members of the board
9 of administration of an association; amending
10 s. 718.503, F.S.; providing requirements for
11 developer disclosure in certain contracts for
12 the sale or lease of a residential unit;
13 amending s. 718.506, F.S.; abrogating the right
14 to a cause of action against a developer for an
15 oral representation or information that is not
16 in certain required developer's promotional
17 materials; providing an effective date.
18
19 Be It Enacted by the Legislature of the State of Florida:
20
21 Section 1. Section 718.3027, Florida Statutes, is
22 created to read:
23 718.3027 Prelitigation disclosure to and approval by
24 owners.--
25 (1) Before commencing litigation against any party in
26 the name of the association involving amounts in controversy
27 in excess of $100,000 and not involving a dispute that relates
28 to title to a unit or common element or the levy or collection
29 of a fee or assessment or that is governed by s. 718.1255, the
30 association must furnish to each owner, other than the
31 developer, a separate document entitled "Litigation Disclosure
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Florida Senate - 2003 SB 2300
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1 Notice." The division shall, by rule, establish a standard
2 format for the Litigation Disclosure Notice.
3 (2) A Litigation Disclosure Notice must inform each
4 owner other than the developer of the basis for the
5 association's contemplated litigation or adversarial
6 proceeding; the professional qualifications of the person
7 making the allegations supporting the association's claim; the
8 response of the adverse party to the allegations and whether
9 the adverse party has refused or offered to perform remedial
10 work; the efforts made to mediate or resolve the claim; the
11 projected attorney's fees, expert fees, and other costs to the
12 association of the proposed litigation; the association's
13 probability of success in the litigation; the association's
14 probability of collecting a judgment resulting from the
15 litigation; and the probability of association liability for
16 attorney's fees and costs associated with the litigation.
17 (3) Litigation based upon the matter described in the
18 Litigation Disclosure Notice may not be commenced unless
19 approved in advance by a majority of the owners other than the
20 developer, or by such greater number of the owners other than
21 the developer as is required by the declaration of the
22 condominium operated by the association. At any meeting of
23 unit owners regarding the proposed litigation, the adverse
24 party may be excluded from the meeting, and the adverse
25 party's units do not count against the quorum requirement. At
26 any meeting of the board of administration, a director
27 nominated or appointed by the developer, if the developer is
28 an adverse party, may be excluded from the meeting, and the
29 seat does not count against the quorum requirement.
30 (4) The Litigation Disclosure Notice must carry the
31 following legend, in conspicuous type on the top of the first
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Florida Senate - 2003 SB 2300
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1 page: THIS DOCUMENT HAS BEEN PREPARED BY THE ASSOCIATION AND
2 ITS ATTORNEYS IN ANTICIPATION OF LITIGATION, AND IS A
3 PROTECTED LAWYER-CLIENT COMMUNICATION.
4 (5) A Litigation Disclosure Notice is confidential,
5 exempt from discovery by a developer, and inadmissible in any
6 trial or hearing. A unit owner may not waive the
7 confidentiality of a Litigation Disclosure Notice; only the
8 board of administration of the association may authorize a
9 waiver of confidentiality of a Litigation Disclosure Notice.
10 Section 2. Present subsection (6) of section 718.301,
11 Florida Statutes, is redesignated as subsection (7) of that
12 section, and a new subsection (6) is added to that section, to
13 read:
14 718.301 Transfer of association control.--
15 (6) Actions taken by members of the board of
16 administration designated by the developer are considered
17 actions taken by the developer, and the developer is
18 responsible to the association and its members for all such
19 actions.
20 Section 3. Paragraph (a) of subsection (1) of section
21 718.503, Florida Statutes, is amended to read:
22 718.503 Developer disclosure prior to sale;
23 nondeveloper unit owner disclosure prior to sale;
24 voidability.--
25 (1) DEVELOPER DISCLOSURE.--
26 (a) Contents of contracts.--Any contract for the sale
27 of a residential unit or a lease thereof for an unexpired term
28 of more than 5 years shall:
29 1. Contain the following legend in conspicuous type:
30 THIS AGREEMENT IS VOIDABLE BY BUYER BY DELIVERING WRITTEN
31 NOTICE OF THE BUYER'S INTENTION TO CANCEL WITHIN 15 DAYS AFTER
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1 THE DATE OF EXECUTION OF THIS AGREEMENT BY THE BUYER, AND
2 RECEIPT BY BUYER OF ALL OF THE ITEMS REQUIRED TO BE DELIVERED
3 TO HIM OR HER BY THE DEVELOPER UNDER SECTION 718.503, FLORIDA
4 STATUTES. THIS AGREEMENT IS ALSO VOIDABLE BY BUYER BY
5 DELIVERING WRITTEN NOTICE OF THE BUYER'S INTENTION TO CANCEL
6 WITHIN 15 DAYS AFTER THE DATE OF RECEIPT FROM THE DEVELOPER OF
7 ANY AMENDMENT WHICH MATERIALLY ALTERS OR MODIFIES THE OFFERING
8 IN A MANNER THAT IS ADVERSE TO THE BUYER. ANY PURPORTED
9 WAIVER OF THESE VOIDABILITY RIGHTS SHALL BE OF NO EFFECT.
10 BUYER MAY EXTEND THE TIME FOR CLOSING FOR A PERIOD OF NOT MORE
11 THAN 15 DAYS AFTER THE BUYER HAS RECEIVED ALL OF THE ITEMS
12 REQUIRED. BUYER'S RIGHT TO VOID THIS AGREEMENT SHALL
13 TERMINATE AT CLOSING.
14 2. Contain the following caveat in conspicuous type on
15 the first page of the contract: ORAL REPRESENTATIONS CANNOT
16 BE RELIED UPON AS CORRECTLY STATING THE REPRESENTATIONS OF THE
17 DEVELOPER. FOR CORRECT REPRESENTATIONS, REFERENCE SHOULD BE
18 MADE TO THIS CONTRACT AND THE DOCUMENTS REQUIRED BY SECTION
19 718.503, FLORIDA STATUTES, TO BE FURNISHED BY A DEVELOPER TO A
20 BUYER OR LESSEE. A PURCHASER HAS NO CLAIM OR CAUSE OF ACTION
21 AGAINST THE DEVELOPER FOR THE PURCHASER'S RELIANCE ON ORAL
22 REPRESENTATIONS OR INFORMATION NOT CONTAINED IN THIS CONTRACT
23 OR IN THE PROSPECTUS. A PURCHASER MAY MAKE A CLAIM OR
24 INSTITUTE A CAUSE OF ACTION AGAINST THE DEVELOPER ONLY FOR THE
25 PURCHASER'S RELIANCE ON THE TERMS OF THIS CONTRACT OR ON
26 MATTERS SET FORTH IN THE PROSPECTUS.
27 3. If the unit has been occupied by someone other than
28 the buyer, contain a statement that the unit has been
29 occupied.
30 4. If the contract is for the sale or transfer of a
31 unit subject to a lease, include as an exhibit a copy of the
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Florida Senate - 2003 SB 2300
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1 executed lease and shall contain within the text in
2 conspicuous type: THE UNIT IS SUBJECT TO A LEASE (OR
3 SUBLEASE).
4 5. If the contract is for the lease of a unit for a
5 term of 5 years or more, include as an exhibit a copy of the
6 proposed lease.
7 6. If the contract is for the sale or lease of a unit
8 that is subject to a lien for rent payable under a lease of a
9 recreational facility or other commonly used facility, contain
10 within the text the following statement in conspicuous type:
11 THIS CONTRACT IS FOR THE TRANSFER OF A UNIT THAT IS SUBJECT TO
12 A LIEN FOR RENT PAYABLE UNDER A LEASE OF COMMONLY USED
13 FACILITIES. FAILURE TO PAY RENT MAY RESULT IN FORECLOSURE OF
14 THE LIEN.
15 7. State the name and address of the escrow agent
16 required by s. 718.202 and state that the purchaser may obtain
17 a receipt for his or her deposit from the escrow agent upon
18 request.
19 8. If the contract is for the sale or transfer of a
20 unit in a condominium in which timeshare estates have been or
21 may be created, contain within the text in conspicuous type:
22 UNITS IN THIS CONDOMINIUM ARE SUBJECT TO TIMESHARE ESTATES.
23 The contract for the sale of a fee interest in a timeshare
24 estate shall also contain, in conspicuous type, the following:
25 FOR THE PURPOSE OF AD VALOREM TAXES OR SPECIAL ASSESSMENTS
26 LEVIED BY TAXING AUTHORITIES AGAINST A FEE INTEREST IN A
27 TIMESHARE ESTATE, THE MANAGING ENTITY IS GENERALLY CONSIDERED
28 THE TAXPAYER UNDER FLORIDA LAW. YOU HAVE THE RIGHT TO
29 CHALLENGE AN ASSESSMENT BY A TAXING AUTHORITY RELATING TO YOUR
30 TIMESHARE ESTATE PURSUANT TO THE PROVISIONS OF CHAPTER 194,
31 FLORIDA STATUTES.
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Florida Senate - 2003 SB 2300
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1 Section 4. Subsection (3) is added to section 718.506,
2 Florida Statutes, to read:
3 718.506 Publication of false and misleading
4 information.--
5 (3) A person has no cause of action against a
6 developer for any oral representation or information that is
7 not contained in the developer's advertising and promotional
8 materials, including, but not limited to, a prospectus, the
9 items required as exhibits to a prospectus, brochures, and
10 newspaper advertising.
11 Section 5. This act shall take effect July 1, 2003.
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14 SENATE SUMMARY
15 Requires prelitigation disclosure to and approval by
condominium owners. Requires a disclosure. Provides that
16 a prelitigation disclosure is not admissible in evidence.
Provides for the effect of actions taken by members of
17 the board of administration of an association. Provides
requirements for developer disclosure in certain
18 contracts for the sale or lease of a residential unit.
Abrogates the right to a cause of action against a
19 developer for an oral representation or information that
is not in certain required developer's promotional
20 materials.
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