HB 1507

1	A bill to be entitled
2	An act relating to condominiums; creating s. 718.3027,
3	F.S.; requiring prelitigation disclosure to and approval
4	by owners; requiring a disclosure; providing that a
5	prelitigation disclosure is not admissible in evidence;
6	amending s. 718.301, F.S.; providing for the effect of
7	actions taken by members of the board of administration of
8	an association; amending s. 718.503, F.S.; providing
9	requirements for developer disclosure in certain contracts
10	for the sale or lease of a residential unit; amending s.
11	718.506, F.S.; abrogating the right to a cause of action
12	against a developer for an oral representation or
13	information that is not in certain required developer's
14	promotional materials; providing an effective date.
15
16	Be It Enacted by the Legislature of the State of Florida:
17
18	Section 1.  Section 718.3027, Florida Statutes, is created
19	to read:
20	718.3027  Prelitigation disclosure to and approval by
21	owners.--
22	(1)  Before commencing litigation against any party in the
23	name of the association involving amounts in controversy in
24	excess of $100,000 and not involving a dispute that relates to
25	title to a unit or common element or the levy or collection of a
26	fee or assessment or that is governed by s. 718.1255, the
27	association must furnish to each owner, other than the
28	developer, a separate document entitled "Litigation Disclosure
29	Notice." The division shall, by rule, establish a standard
30	format for the Litigation Disclosure Notice.
31	(2)  A Litigation Disclosure Notice must inform each owner
32	other than the developer of the basis for the association's
33	contemplated litigation or adversarial proceeding; the
34	professional qualifications of the person making the allegations
35	supporting the association's claim; the response of the adverse
36	party to the allegations and whether the adverse party has
37	refused or offered to perform remedial work; the efforts made to
38	mediate or resolve the claim; the projected attorney's fees,
39	expert fees, and other costs to the association of the proposed
40	litigation; the association's probability of success in the
41	litigation; the association's probability of collecting a
42	judgment resulting from the litigation; and the probability of
43	association liability for attorney's fees and costs associated
44	with the litigation.
45	(3)  Litigation based upon the matter described in the
46	Litigation Disclosure Notice may not be commenced unless
47	approved in advance by a majority of the owners other than the
48	developer, or by the greater number of the owners other than the
49	developer which is required by the declaration of the
50	condominium operated by the association. At any meeting of unit
51	owners regarding the proposed litigation, the adverse party may
52	be excluded from the meeting and the adverse party's units do
53	not count against the quorum requirement. At any meeting of the
54	board of administration, a director nominated or appointed by
55	the developer, if the developer is an adverse party, may be
56	excluded from the meeting and the seat does not count against
57	the quorum requirement.
58	(4)  The Litigation Disclosure Notice must carry the
59	following legend, in conspicuous type on the top of the first
60	page: THIS DOCUMENT HAS BEEN PREPARED BY THE ASSOCIATION AND ITS
61	ATTORNEYS IN ANTICIPATION OF LITIGATION, AND IS A PROTECTED
62	LAWYER-CLIENT COMMUNICATION.
63	(5)  A Litigation Disclosure Notice is confidential, exempt
64	from discovery by a developer, and inadmissible in any trial or
65	hearing. A unit owner may not waive the confidentiality of a
66	Litigation Disclosure Notice. The confidentiality of a
67	Litigation Disclosure Notice may be waived only by the board of
68	administration of the association.
69	Section 2.  Subsection (6) of section 718.301, Florida
70	Statutes, is redesignated as subsection (7), and a new
71	subsection (6) is added to said section, to read:
72	718.301  Transfer of association control.--
73	(6)  Actions taken by members of the board of
74	administration designated by the developer are considered
75	actions taken by the developer, and the developer is responsible
76	to the association and its members for all such actions.
77	Section 3.  Paragraph (a) of subsection (1) of section
78	718.503, Florida Statutes, is amended to read:
79	718.503  Developer disclosure prior to sale; nondeveloper
80	unit owner disclosure prior to sale; voidability.--
81	(1)  DEVELOPER DISCLOSURE.--
82	(a)  Contents of contracts.--Any contract for the sale of a
83	residential unit or a lease thereof for an unexpired term of
84	more than 5 years shall:
85	1.  Contain the following legend in conspicuous type: THIS
86	AGREEMENT IS VOIDABLE BY BUYER BY DELIVERING WRITTEN NOTICE OF
87	THE BUYER'S INTENTION TO CANCEL WITHIN 15 DAYS AFTER THE DATE OF
88	EXECUTION OF THIS AGREEMENT BY THE BUYER, AND RECEIPT BY BUYER
89	OF ALL OF THE ITEMS REQUIRED TO BE DELIVERED TO HIM OR HER BY
90	THE DEVELOPER UNDER SECTION 718.503, FLORIDA STATUTES.  THIS
91	AGREEMENT IS ALSO VOIDABLE BY BUYER BY DELIVERING WRITTEN NOTICE
92	OF THE BUYER'S INTENTION TO CANCEL WITHIN 15 DAYS AFTER THE DATE
93	OF RECEIPT FROM THE DEVELOPER OF ANY AMENDMENT WHICH MATERIALLY
94	ALTERS OR MODIFIES THE OFFERING IN A MANNER THAT IS ADVERSE TO
95	THE BUYER.  ANY PURPORTED WAIVER OF THESE VOIDABILITY RIGHTS
96	SHALL BE OF NO EFFECT. BUYER MAY EXTEND THE TIME FOR CLOSING FOR
97	A PERIOD OF NOT MORE THAN 15 DAYS AFTER THE BUYER HAS RECEIVED
98	ALL OF THE ITEMS REQUIRED.  BUYER'S RIGHT TO VOID THIS AGREEMENT
99	SHALL TERMINATE AT CLOSING.
100	2.  Contain the following caveat in conspicuous type on the
101	first page of the contract:  ORAL REPRESENTATIONS CANNOT BE
102	RELIED UPON AS CORRECTLY STATING THE REPRESENTATIONS OF THE
103	DEVELOPER.  FOR CORRECT REPRESENTATIONS, REFERENCE SHOULD BE
104	MADE TO THIS CONTRACT AND THE DOCUMENTS REQUIRED BY SECTION
105	718.503, FLORIDA STATUTES, TO BE FURNISHED BY A DEVELOPER TO A
106	BUYER OR LESSEE. A PURCHASER HAS NO CLAIM OR CAUSE OF ACTION
107	AGAINST THE DEVELOPER FOR THE PURCHASER'S RELIANCE ON ORAL
108	REPRESENTATIONS OR INFORMATION NOT CONTAINED IN THIS CONTRACT OR
109	IN THE PROSPECTUS. A PURCHASER MAY MAKE A CLAIM OR INSTITUTE A
110	CAUSE OF ACTION AGAINST THE DEVELOPER ONLY FOR THE PURCHASER'S
111	RELIANCE ON THE TERMS OF THIS CONTRACT OR ON MATTERS SET FORTH
112	IN THE PROSPECTUS.
113	3.  If the unit has been occupied by someone other than the
114	buyer, contain a statement that the unit has been occupied.
115	4.  If the contract is for the sale or transfer of a unit
116	subject to a lease, include as an exhibit a copy of the executed
117	lease and shall contain within the text in conspicuous type:
118	THE UNIT IS SUBJECT TO A LEASE (OR SUBLEASE).
119	5.  If the contract is for the lease of a unit for a term
120	of 5 years or more, include as an exhibit a copy of the proposed
121	lease.
122	6.  If the contract is for the sale or lease of a unit that
123	is subject to a lien for rent payable under a lease of a
124	recreational facility or other commonly used facility, contain
125	within the text the following statement in conspicuous type:
126	THIS CONTRACT IS FOR THE TRANSFER OF A UNIT THAT IS SUBJECT TO A
127	LIEN FOR RENT PAYABLE UNDER A LEASE OF COMMONLY USED FACILITIES.
128	FAILURE TO PAY RENT MAY RESULT IN FORECLOSURE OF THE LIEN.
129	7.  State the name and address of the escrow agent required
130	by s. 718.202 and state that the purchaser may obtain a receipt
131	for his or her deposit from the escrow agent upon request.
132	8.  If the contract is for the sale or transfer of a unit
133	in a condominium in which timeshare estates have been or may be
134	created, contain within the text in conspicuous type:  UNITS IN
135	THIS CONDOMINIUM ARE SUBJECT TO TIMESHARE ESTATES.  The contract
136	for the sale of a fee interest in a timeshare estate shall also
137	contain, in conspicuous type, the following:  FOR THE PURPOSE OF
138	AD VALOREM TAXES OR SPECIAL ASSESSMENTS LEVIED BY TAXING
139	AUTHORITIES AGAINST A FEE INTEREST IN A TIMESHARE ESTATE, THE
140	MANAGING ENTITY IS GENERALLY CONSIDERED THE TAXPAYER UNDER
141	FLORIDA LAW.  YOU HAVE THE RIGHT TO CHALLENGE AN ASSESSMENT BY A
142	TAXING AUTHORITY RELATING TO YOUR TIMESHARE ESTATE PURSUANT TO
143	THE PROVISIONS OF CHAPTER 194, FLORIDA STATUTES.
144	Section 4.  Subsection (3) is added to section 718.506,
145	Florida Statutes, to read:
146	718.506  Publication of false and misleading information.--
147	(3)  A person has no cause of action against a developer
148	for any oral representation or information that is not contained
149	in the developer's advertising and promotional materials,
150	including, but not limited to, a prospectus, the items required
151	as exhibits to a prospectus, brochures, or newspaper
152	advertising.
153	Section 5.  This act shall take effect July 1, 2004.

CODING: Words stricken are deletions; words underlined are additions.