Senate Bill sb2530
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Florida Senate - 2006 SB 2530
By Senator Posey
24-1191A-06 See CS/HB 391
1 A bill to be entitled
2 An act relating to community associations;
3 creating s. 712.11, F.S.; providing for the
4 revival of certain declarations that have been
5 extinguished; amending s. 718.110, F.S.;
6 revising provisions relating to the amendment
7 of declarations; providing legislative findings
8 and a finding of compelling state interest;
9 requiring a holder of a recorded mortgage on a
10 condominium unit that requires the consent or
11 joinder of a mortgagee to an amendment to
12 provide certain information to a condominium
13 association; providing definitions; providing
14 criteria for consent to an amendment; requiring
15 notice regarding proposed amendments to
16 mortgagees; providing criteria for
17 notification; requiring the association to
18 conduct a diligent search to identify
19 mortgagees; requiring the association's
20 representative to execute an affidavit
21 confirming that a diligent search was
22 conducted; prohibiting the declaration of
23 condominium, articles of incorporation, or
24 bylaws from requiring the consent or joinder of
25 more than a specified percent of the eligible
26 mortgagees in connection with proposed
27 amendments under certain conditions; providing
28 criteria for enforcement; requiring mortgagees
29 seeking to disapprove a proposed amendment to
30 provide certain information to the association;
31 providing for the recovery of certain costs and
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Florida Senate - 2006 SB 2530
24-1191A-06 See CS/HB 391
1 attorney's fees; amending s. 718.404, F.S.;
2 providing retroactive application of provisions
3 relating to mixed-use condominiums; amending s.
4 720.302, F.S.; revising governing provisions
5 relating to corporations that operate
6 residential homeowners' associations; amending
7 s. 720.303, F.S.; providing that special
8 assessments may not be levied at a board
9 meeting except under certain circumstances;
10 revising provisions relating to the
11 closed-circuit cable broadcast notice
12 requirement; authorizing the association to
13 charge a reasonable fee for providing good
14 faith responses to certain requests for
15 information by or on behalf of a prospective
16 purchaser or lienholder; providing conditions
17 for exemption from liability for providing such
18 information; revising what must be included in
19 an association's annual budget; providing for
20 reserve accounts for capital expenditures and
21 deferred maintenance; revising when the
22 association must have its financial report
23 completed and provided to members; repealing s.
24 720.303(2), F.S., as amended, relating to board
25 meetings, to remove conflicting versions of
26 that subsection; amending s. 720.305, F.S.;
27 providing that, where a member is entitled to
28 collect attorney's fees against the
29 association, the member may also recover
30 additional amounts as determined by the court;
31 prohibiting an association from filing a
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Florida Senate - 2006 SB 2530
24-1191A-06 See CS/HB 391
1 foreclosure action against homestead property;
2 providing exceptions; tolling applicable
3 limitation periods; amending s. 720.306, F.S.;
4 providing that certain mergers or
5 consolidations of an association shall not be
6 considered a material or adverse alteration of
7 the proportionate voting interest appurtenant
8 to a parcel; revising provisions relating to
9 items that members and parcel owners may
10 address at membership meetings; amending s.
11 720.307, F.S.; providing additional documents
12 that the developer must deliver at the time the
13 association members elect the board of
14 directors; amending s. 720.308, F.S.; providing
15 for the establishment of guarantees of common
16 expenses shared by association members;
17 amending s. 720.311, F.S.; revising provisions
18 relating to dispute resolution; providing that
19 the filing of any petition for arbitration or
20 the serving of an offer for presuit mediation
21 shall toll the applicable statute of
22 limitations; providing that certain disputes
23 between an association and a parcel owner shall
24 be subject to presuit mediation; revising
25 provisions to conform; providing that temporary
26 injunctive relief may be sought in certain
27 disputes subject to presuit mediation;
28 authorizing the court to refer the parties to
29 mediation under certain circumstances;
30 requiring the aggrieved party to serve on the
31 responding party a written offer to participate
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Florida Senate - 2006 SB 2530
24-1191A-06 See CS/HB 391
1 in presuit mediation; providing a form for such
2 offer; providing that service of the offer is
3 effected by the sending of such an offer in a
4 certain manner; providing that the prevailing
5 party in any subsequent arbitration or
6 litigation proceedings is entitled to seek
7 recovery of all costs and attorney's fees
8 incurred in the presuit mediation process;
9 requiring the mediator or arbitrator to meet
10 certain certification requirements; removing a
11 requirement relating to development of an
12 education program to increase awareness of the
13 operation of homeowners' associations and the
14 use of alternative dispute resolution
15 techniques; providing effective dates.
16
17 Be It Enacted by the Legislature of the State of Florida:
18
19 Section 1. Section 712.11, Florida Statutes, is
20 created to read:
21 712.11 Covenant revitalization.--A homeowners'
22 association not otherwise subject to chapter 720 may use the
23 procedures set forth in ss. 720.403-720.407 to revive
24 covenants that have lapsed under the terms of this chapter.
25 Section 2. Effective October 1, 2006, subsection (11)
26 of section 718.110, Florida Statutes, is amended to read:
27 718.110 Amendment of declaration; correction of error
28 or omission in declaration by circuit court.--
29 (11)(a) Notwithstanding any provision to the contrary
30 contained in this section, any provision in the declaration of
31 condominium, articles of incorporation, or bylaws that
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Florida Senate - 2006 SB 2530
24-1191A-06 See CS/HB 391
1 requires declaration recorded after April 1, 1992, may not
2 require the consent or joinder of some or all mortgagees of
3 units or any other portion of the condominium property to or
4 in amendments to the declaration of condominium, articles of
5 incorporation, or bylaws shall be void to the extent not,
6 unless the requirement is limited to amendments materially
7 affecting the rights or interests of the mortgagees, or as
8 otherwise required by the Federal National Mortgage
9 Association or the Federal Home Loan Mortgage Corporation, and
10 any consent or joinder shall unless the requirement provides
11 that such consent may not be unreasonably withheld. It shall
12 be presumed that, except as to those matters described in
13 subsections (4) and (8) or other issues materially affecting
14 the mortgagee's security interest in the property, amendments
15 to the declaration of condominium, articles of incorporation,
16 or bylaws do not materially affect the rights or interests of
17 mortgagees. In the event mortgagee consent is provided other
18 than by properly recorded joinder, such consent shall be
19 evidenced by affidavit of the association recorded in the
20 public records of the county where the declaration of
21 condominium, articles of incorporation, or bylaws are is
22 recorded.
23 (b) The Legislature finds that the procurement of
24 mortgagee consent or joinder to amendments that do not
25 materially affect the rights or interests of mortgagees is an
26 unreasonable and substantial logistical and financial burden
27 on the unit owners and condominium associations and that there
28 is a compelling state interest in enabling the members of a
29 condominium association to approve amendments. Accordingly,
30 any holder of a recorded mortgage on a condominium unit or any
31 other portion of a condominium, which mortgage is first
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Florida Senate - 2006 SB 2530
24-1191A-06 See CS/HB 391
1 recorded after October 1, 2006, and for which the declaration
2 of condominium, articles of incorporation, or bylaws require
3 the consent or joinder of a mortgagee to an amendment, must
4 provide written notice by certified mail to the association of
5 the address at which the mortgagee may be contacted in regard
6 to any proposed amendments. The association shall maintain the
7 names and addresses of such mortgagees in a registry of
8 mortgagees, which the association shall utilize when sending a
9 request for such consent or joinder. A request for consent or
10 joinder must be mailed to a mortgagee by certified mail,
11 return receipt requested, to the address provided by the
12 mortgagee and retained in the registry of mortgagees. As used
13 in this subsection, "certified mail" means either certified or
14 registered mail, return receipt requested. Consent to an
15 amendment shall be deemed to have been given by any holder of
16 a mortgage that is first recorded after October 1, 2006, and
17 who fails to provide the required written notice and contact
18 information. Also, any mortgagee who fails to respond by
19 certified mail within 30 days after the date the association
20 mails a request for consent or joinder shall be deemed to have
21 consented to the proposed amendment.
22 (c) As to mortgages in existence as of October 1,
23 2006, in those condominiums where the consent or joinder of
24 such mortgagees is required in connection with amendments to
25 the governing documents, and where such mortgagees are not
26 otherwise required by the existing declaration of condominium,
27 articles of incorporation, or bylaws to provide notice to the
28 association of their contact information in order to be
29 eligible to receive notices regarding proposed amendments,
30 those condominium associations that wish to modify provisions
31 in the declaration of condominium, articles of incorporation,
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Florida Senate - 2006 SB 2530
24-1191A-06 See CS/HB 391
1 or bylaws that require the consent or joinder of mortgagees
2 must notify all mortgagees who hold mortgages on units within
3 the condominium or other portions of the condominium property
4 of the need to provide the same contact information as
5 required in paragraph (b). Any mortgagee who does not provide
6 contact information as required will be deemed to have
7 consented to all future proposed amendments. Further, once the
8 proper address for notifying existing mortgagees has been
9 obtained in the manner provided for in this subsection,
10 failure of any mortgagee to respond to a request for the
11 consent or joinder to a proposed amendment within 30 days
12 after the date that such request is sent to the mortgagee by
13 certified mail shall be deemed to have consented to such
14 amendment. In order to properly notify holders of existing
15 mortgages:
16 1. The condominium association must first conduct a
17 diligent search to identify all existing mortgagees and an
18 address for the required notice to be sent to each mortgagee.
19 Service of the notice shall be on the mortgagee's registered
20 agent based upon the information available from the Secretary
21 of State. Where there is no registered agent, the notice shall
22 be sent to the address in the original recorded mortgage
23 unless there is a different address in a more recently
24 recorded assignment or modification instrument or in the
25 records maintained by the condominium association. All notices
26 must be sent by certified mail and must advise the mortgagee
27 that if he or she fails to provide the contact information
28 requested within 30 days after the date of mailing of the
29 certified letter from the association, such mortgagee shall be
30 deemed to have consented to the proposed amendment.
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Florida Senate - 2006 SB 2530
24-1191A-06 See CS/HB 391
1 2. An affidavit must be executed by a representative
2 of the condominium association confirming that a diligent
3 search has been conducted to identify all outstanding
4 mortgages on the condominium in the manner provided for in
5 subparagraph 1. and summarizing the steps that were taken in
6 connection with such diligent search and the notification of
7 all mortgagees, and such affidavit shall be placed in the
8 association's minute book as an attachment to the minutes of
9 the meeting in which the board of directors considers such
10 affidavit.
11 (d) After October 1, 2006, no new declaration of
12 condominium, articles of incorporation, or bylaws may require
13 the consent or joinder of more than 51 percent of the eligible
14 mortgagees in connection with any proposed amendment unless a
15 higher percentage is required in order to comply with the
16 requirements of the Federal National Mortgage Association or
17 Federal Home Loan Mortgage Corporation. Any new declaration of
18 condominium, articles of incorporation, or bylaws must also
19 require mortgagees to provide to the condominium association
20 the address to which notices may be sent, as provided for in
21 paragraph (b), in order for such mortgagees to have the right
22 to be contacted in connection with any proposed amendment.
23 (e) A provision requiring the consent or joinder of
24 some or all holders of mortgages on units or other portions of
25 the condominium property to any proposed amendment shall be
26 enforceable only by mortgagees of record as of the date an
27 amendment is recorded in the public records and only by those
28 mortgagees who have complied with the requirements of
29 paragraph (b) or paragraph (c). Any amendment adopted without
30 the required consent of a mortgagee shall be deemed voidable
31 by any mortgagee who was entitled to notice and the
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Florida Senate - 2006 SB 2530
24-1191A-06 See CS/HB 391
1 opportunity to consent, and actions to void such amendments
2 shall be subject to the statute of limitations applicable to
3 actions founded upon written instruments, which statute shall
4 commence to run as of the date such amendment is recorded in
5 the public records and, for amendments recorded prior to
6 October 1, 2006, shall commence on October 1, 2006.
7 (f) In order to establish that he or she is not
8 unreasonably withholding consent, any mortgagee who seeks to
9 disapprove of a proposed amendment by withholding his or her
10 consent or joinder must include in his or her reply to the
11 condominium association's request for consent or joinder a
12 statement of the specific reasons the proposed amendment is
13 claimed to materially and adversely affect the rights and
14 interests of such mortgagee.
15 (g) In connection with any litigation between a
16 condominium association and a lender with regard to whether
17 consent has been improperly or unreasonably withheld, the
18 prevailing party shall be entitled to recover his or her costs
19 and reasonable attorney's fees.
20 Section 3. Subsections (1) and (2) of section 718.404,
21 Florida Statutes, are amended to read:
22 718.404 Mixed-use condominiums.--When a condominium
23 consists of both residential and commercial units, the
24 following provisions shall apply:
25 (1) The condominium documents shall not provide that
26 the owner of any commercial unit shall have the authority to
27 veto amendments to the declaration, articles of incorporation,
28 bylaws, or rules or regulations of the association. This
29 subsection shall apply retroactively as a remedial measure.
30 (2) Subject to s. 718.301, where the number of
31 residential units in the condominium equals or exceeds 50
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Florida Senate - 2006 SB 2530
24-1191A-06 See CS/HB 391
1 percent of the total units operated by the association, owners
2 of the residential units shall be entitled to vote for a
3 majority of the seats on the board of administration. This
4 subsection shall apply retroactively as a remedial measure.
5 Section 4. Subsections (4) and (5) of section 720.302,
6 Florida Statutes, are amended to read:
7 720.302 Purposes, scope, and application.--
8 (4) This chapter does not apply to any association
9 that is subject to regulation under chapter 718, chapter 719,
10 or chapter 721; or to any nonmandatory association formed
11 under chapter 723, except to the extent that a provision of
12 chapter 718, chapter 719, or chapter 721 is expressly
13 incorporated into this chapter for the purpose of regulating
14 homeowners' associations.
15 (5) Unless expressly stated to the contrary,
16 corporations not for profit that operate residential
17 homeowners' associations in this state shall be governed by
18 and subject to chapter 607, if the association was
19 incorporated thereunder, or to chapter 617, if the association
20 was incorporated thereunder, and this chapter. This subsection
21 is intended to clarify existing law.
22 Section 5. Subsections (2), (6), and (7) of section
23 720.303, Florida Statutes, as amended by section 18 of chapter
24 2004-345 and section 135 of chapter 2005-2, Laws of Florida,
25 are amended, and paragraphs (d) and (e) are added to
26 subsection (5) of that section, to read:
27 720.303 Association powers and duties; meetings of
28 board; official records; budgets; financial reporting;
29 association funds; recalls.--
30 (2) BOARD MEETINGS.--
31
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Florida Senate - 2006 SB 2530
24-1191A-06 See CS/HB 391
1 (a) A meeting of the board of directors of an
2 association occurs whenever a quorum of the board gathers to
3 conduct association business. All meetings of the board must
4 be open to all members except for meetings between the board
5 and its attorney with respect to proposed or pending
6 litigation where the contents of the discussion would
7 otherwise be governed by the attorney-client privilege. The
8 provisions of this subsection shall also apply to the meetings
9 of any committee or other similar body when a final decision
10 will be made regarding the expenditure of association funds
11 and to meetings of any body vested with the power to approve
12 or disapprove architectural decisions with respect to a
13 specific parcel of residential property owned by a member of
14 the community.
15 (b) Members have the right to attend all meetings of
16 the board and to speak on any matter placed on the agenda by
17 petition of the voting interests for at least 3 minutes. The
18 association may adopt written reasonable rules expanding the
19 right of members to speak and governing the frequency,
20 duration, and other manner of member statements, which rules
21 must be consistent with this paragraph and may include a
22 sign-up sheet for members wishing to speak. Notwithstanding
23 any other law, the requirement that board meetings and
24 committee meetings be open to the members is inapplicable to
25 meetings between the board or a committee and the
26 association's attorney, with respect to meetings of the board
27 held for the purpose of discussing personnel matters.
28 (c) The bylaws shall provide for giving notice to
29 parcel owners and members of all board meetings and, if they
30 do not do so, shall be deemed to provide the following:
31
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Florida Senate - 2006 SB 2530
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1 1. Notices of all board meetings must be posted in a
2 conspicuous place in the community at least 48 hours in
3 advance of a meeting, except in an emergency. In the
4 alternative, if notice is not posted in a conspicuous place in
5 the community, notice of each board meeting must be mailed or
6 delivered to each member at least 7 days before the meeting,
7 except in an emergency. Notwithstanding this general notice
8 requirement, for communities with more than 100 parcels
9 members, the bylaws may provide for a reasonable alternative
10 to posting or mailing of notice for each board meeting,
11 including publication of notice, provision of a schedule of
12 board meetings, or the conspicuous posting and repeated
13 broadcasting of the notice on a closed-circuit cable
14 television system serving the homeowners' association.
15 However, if broadcast notice is used in lieu of a notice
16 posted physically in the community, the notice must be
17 broadcast at least four times every broadcast hour of each day
18 that a posted notice is otherwise required. When broadcast
19 notice is provided, the notice and agenda must be broadcast in
20 a manner and for a sufficient continuous length of time so as
21 to allow an average reader to observe the notice and read and
22 comprehend the entire content of the notice and the agenda.
23 The bylaws or amended bylaws may provide for giving notice by
24 electronic transmission in a manner authorized by law for
25 meetings of the board of directors, committee meetings
26 requiring notice under this section, and annual and special
27 meetings of the members; however, a member must consent in
28 writing to receiving notice by electronic transmission.
29 2. A special An assessment may not be levied at a
30 board meeting unless the notice of the meeting includes a
31 statement that special assessments will be considered and the
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Florida Senate - 2006 SB 2530
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1 nature of the special assessments. Written notice of any
2 meeting at which special assessments will be considered or at
3 which amendments to rules regarding parcel use will be
4 considered must be mailed, delivered, or electronically
5 transmitted to the members and parcel owners and posted
6 conspicuously on the property or broadcast on closed-circuit
7 cable television not less than 14 days before the meeting.
8 3. Directors may not vote by proxy or by secret ballot
9 at board meetings, except that secret ballots may be used in
10 the election of officers. This subsection also applies to the
11 meetings of any committee or other similar body, when a final
12 decision will be made regarding the expenditure of association
13 funds, and to any body vested with the power to approve or
14 disapprove architectural decisions with respect to a specific
15 parcel of residential property owned by a member of the
16 community.
17 (d) If 20 percent of the total voting interests
18 petition the board to address an item of business, the board
19 shall at its next regular board meeting or at a special
20 meeting of the board, but not later than 60 days after the
21 receipt of the petition, take the petitioned item up on an
22 agenda. The board shall give all members notice of the meeting
23 at which the petitioned item shall be addressed in accordance
24 with the 14-day notice requirement pursuant to subparagraph
25 (c)2. Each member shall have the right to speak for at least 3
26 minutes on each matter placed on the agenda by petition,
27 provided that the member signs the sign-up sheet, if one is
28 provided, or submits a written request to speak prior to the
29 meeting. Other than addressing the petitioned item at the
30 meeting, the board is not obligated to take any other action
31 requested by the petition.
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Florida Senate - 2006 SB 2530
24-1191A-06 See CS/HB 391
1 (5) INSPECTION AND COPYING OF RECORDS.--The official
2 records shall be maintained within the state and must be open
3 to inspection and available for photocopying by members or
4 their authorized agents at reasonable times and places within
5 10 business days after receipt of a written request for
6 access. This subsection may be complied with by having a copy
7 of the official records available for inspection or copying in
8 the community. If the association has a photocopy machine
9 available where the records are maintained, it must provide
10 parcel owners with copies on request during the inspection if
11 the entire request is limited to no more than 25 pages.
12 (d) The association or its authorized agent is not
13 required to provide a prospective purchaser or lienholder with
14 information about the residential subdivision or the
15 association other than information or documents required by
16 this chapter to be made available or disclosed. The
17 association or its authorized agent may charge a reasonable
18 fee to the prospective purchaser or lienholder or the current
19 parcel owner or member for providing good faith responses to
20 requests for information by or on behalf of a prospective
21 purchaser or lienholder, other than that required by law, if
22 the fee does not exceed $150 plus the reasonable cost of
23 photocopying and any attorney's fees incurred by the
24 association in connection with the response.
25 (e) An association and its authorized agent are not
26 liable for providing such information in good faith pursuant
27 to a written request if the person providing the information
28 includes a written statement in substantially the following
29 form: "The responses herein are made in good faith and to the
30 best of my ability as to their accuracy."
31 (6) BUDGETS.--
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Florida Senate - 2006 SB 2530
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1 (a) The association shall prepare an annual budget
2 that sets out the annual operating expenses. The budget must
3 reflect the estimated revenues and expenses for that year and
4 the estimated surplus or deficit as of the end of the current
5 year. The budget must set out separately all fees or charges
6 for recreational amenities, whether owned by the association,
7 the developer, or another person. The association shall
8 provide each member with a copy of the annual budget or a
9 written notice that a copy of the budget is available upon
10 request at no charge to the member. The copy must be provided
11 to the member within the time limits set forth in subsection
12 (5).
13 (b) In addition to annual operating expenses, the
14 budget shall include reserve accounts for capital expenditures
15 and deferred maintenance. These accounts shall include, but
16 are not limited to, accounts for roof replacement, building
17 painting, and pavement resurfacing, regardless of the amount
18 of deferred maintenance expense or replacement cost, and for
19 any other item for which the deferred maintenance expense or
20 replacement cost exceeds $10,000. The amount to be reserved
21 shall be computed by means of a formula that is based upon the
22 estimated remaining useful life and estimated replacement cost
23 or deferred maintenance expense of each reserve item. The
24 association may adjust replacement reserve assessments
25 annually to take into account any changes in estimates or
26 extension of the useful life of a reserve item caused by
27 deferred maintenance. This subsection does not apply to an
28 adopted budget in which the members of an association have
29 determined, by a majority vote at a duly called meeting of the
30 association, to provide no reserves or fewer reserves than
31 required by this subsection. However, prior to turnover of
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Florida Senate - 2006 SB 2530
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1 control of an association by a developer to unit owners, the
2 developer may vote to waive the reserves or reduce the funding
3 of reserves for the first 2 fiscal years of the association's
4 operation, beginning with the fiscal year in which the initial
5 declaration is recorded, after which time reserves may be
6 waived or reduced only upon the vote of a majority of all
7 nondeveloper voting interests voting in person or by limited
8 proxy at a duly called meeting of the association. If a
9 meeting of the unit owners has been called to determine
10 whether to waive or reduce the funding of reserves and no such
11 result is achieved or a quorum is not attained, the reserves
12 as included in the budget shall go into effect. After the
13 turnover, the developer may vote its voting interest to waive
14 or reduce the funding of reserves.
15 (c) Funding formulas for reserves required by this
16 subsection shall be based on either a separate analysis of
17 each of the required assets or a pooled analysis of two or
18 more of the required assets.
19 1. If the association maintains separate reserve
20 accounts for each of the required assets, the amount of the
21 contribution to each reserve account shall be the sum of the
22 following two calculations:
23 a. The total amount necessary, if any, to bring a
24 negative component balance to zero.
25 b. The total estimated deferred maintenance expense or
26 estimated replacement cost of the reserve component less the
27 estimated balance of the reserve component as of the beginning
28 of the period for which the budget will be in effect. The
29 remainder, if greater than zero, shall be divided by the
30 estimated remaining useful life of the component.
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Florida Senate - 2006 SB 2530
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1 The formula may be adjusted each year for changes in estimates
2 and deferred maintenance performed during the year and may
3 consider factors such as inflation and earnings on invested
4 funds.
5 2. If the association maintains a pooled account of
6 two or more of the required reserve assets, the amount of the
7 contribution to the pooled reserve account as disclosed in the
8 proposed budget shall be not less than that required to ensure
9 that the balance on hand at the beginning of the period for
10 which the budget will go into effect plus the projected annual
11 cash inflows over the remaining estimated useful lives of all
12 of the assets that make up the reserve pool are equal to or
13 greater than the projected annual cash outflows over the
14 remaining estimated useful lives of all of the assets that
15 make up the reserve pool, based on the current reserve
16 analysis. The projected annual cash inflows may include
17 estimated earnings from investment of principal. The reserve
18 funding formula shall not include any type of balloon
19 payments.
20 (d) Reserve funds and any interest accruing thereon
21 shall remain in the reserve account or accounts and shall be
22 used only for authorized reserve expenditures unless their use
23 for other purposes is approved in advance by a majority vote
24 at a duly called meeting of the association. Prior to turnover
25 of control of an association by a developer to unit owners,
26 the developer-controlled association shall not vote to use
27 reserves for purposes other than that for which they were
28 intended without the approval of a majority of all
29 nondeveloper voting interests voting in person or by limited
30 proxy at a duly called meeting of the association.
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Florida Senate - 2006 SB 2530
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1 (7) FINANCIAL REPORTING.--Within 90 days after the end
2 of the fiscal year, or annually on a date provided in the
3 bylaws, the association shall prepare and complete, or
4 contract for the preparation and completion of, a financial
5 report for the preceding fiscal year. Within 21 days after the
6 final financial report is completed by the association or
7 received from the third party, but not later than 120 days
8 after the end of the fiscal year or other date as provided in
9 the bylaws, the association shall prepare an annual financial
10 report within 60 days after the close of the fiscal year. The
11 association shall, within the time limits set forth in
12 subsection (5), provide each member with a copy of the annual
13 financial report or a written notice that a copy of the
14 financial report is available upon request at no charge to the
15 member. Financial reports shall be prepared as follows:
16 (a) An association that meets the criteria of this
17 paragraph shall prepare or cause to be prepared a complete set
18 of financial statements in accordance with generally accepted
19 accounting principles as adopted by the Florida Board of
20 Accountancy. The financial statements shall be based upon the
21 association's total annual revenues, as follows:
22 1. An association with total annual revenues of
23 $100,000 or more, but less than $200,000, shall prepare
24 compiled financial statements.
25 2. An association with total annual revenues of at
26 least $200,000, but less than $400,000, shall prepare reviewed
27 financial statements.
28 3. An association with total annual revenues of
29 $400,000 or more shall prepare audited financial statements.
30
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Florida Senate - 2006 SB 2530
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1 (b)1. An association with total annual revenues of
2 less than $100,000 shall prepare a report of cash receipts and
3 expenditures.
4 2. An association in a community of fewer than 50
5 parcels, regardless of the association's annual revenues, may
6 prepare a report of cash receipts and expenditures in lieu of
7 financial statements required by paragraph (a) unless the
8 governing documents provide otherwise.
9 3. A report of cash receipts and disbursement must
10 disclose the amount of receipts by accounts and receipt
11 classifications and the amount of expenses by accounts and
12 expense classifications, including, but not limited to, the
13 following, as applicable: costs for security, professional,
14 and management fees and expenses; taxes; costs for recreation
15 facilities; expenses for refuse collection and utility
16 services; expenses for lawn care; costs for building
17 maintenance and repair; insurance costs; administration and
18 salary expenses; and reserves if maintained by the
19 association.
20 (c) If 20 percent of the parcel owners petition the
21 board for a level of financial reporting higher than that
22 required by this section, the association shall duly notice
23 and hold a meeting of members within 30 days of receipt of the
24 petition for the purpose of voting on raising the level of
25 reporting for that fiscal year. Upon approval of a majority of
26 the total voting interests of the parcel owners, the
27 association shall prepare or cause to be prepared, shall amend
28 the budget or adopt a special assessment to pay for the
29 financial report regardless of any provision to the contrary
30 in the governing documents, and shall provide within 90 days
31
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1 of the meeting or the end of the fiscal year, whichever occurs
2 later:
3 1. Compiled, reviewed, or audited financial
4 statements, if the association is otherwise required to
5 prepare a report of cash receipts and expenditures;
6 2. Reviewed or audited financial statements, if the
7 association is otherwise required to prepare compiled
8 financial statements; or
9 3. Audited financial statements if the association is
10 otherwise required to prepare reviewed financial statements.
11 (d) If approved by a majority of the voting interests
12 present at a properly called meeting of the association, an
13 association may prepare or cause to be prepared:
14 1. A report of cash receipts and expenditures in lieu
15 of a compiled, reviewed, or audited financial statement;
16 2. A report of cash receipts and expenditures or a
17 compiled financial statement in lieu of a reviewed or audited
18 financial statement; or
19 3. A report of cash receipts and expenditures, a
20 compiled financial statement, or a reviewed financial
21 statement in lieu of an audited financial statement.
22 Section 6. Subsection (2) of section 720.303, Florida
23 Statutes, as amended by section 2 of chapter 2004-345 and
24 section 15 of chapter 2004-353, Laws of Florida, is repealed.
25 Section 7. Section 720.305, Florida Statutes, is
26 amended to read:
27 720.305 Obligations of members; remedies at law or in
28 equity; levy of fines and suspension of use rights; failure to
29 fill sufficient number of vacancies on board of directors to
30 constitute a quorum; appointment of receiver upon petition of
31 any member; liens against real property.--
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1 (1) Each member and the member's tenants, guests, and
2 invitees, and each association, are governed by, and must
3 comply with, this chapter, the governing documents of the
4 community, and the rules of the association. Actions at law or
5 in equity, or both, to redress alleged failure or refusal to
6 comply with these provisions may be brought by the association
7 or by any member against:
8 (a) The association;
9 (b) A member;
10 (c) Any director or officer of an association who
11 willfully and knowingly fails to comply with these provisions;
12 and
13 (d) Any tenants, guests, or invitees occupying a
14 parcel or using the common areas.
15
16 The prevailing party in any such litigation is entitled to
17 recover reasonable attorney's fees and costs. A member
18 prevailing in an action between the association and the member
19 under this section, in addition to recovering his or her
20 reasonable attorney's fees, may recover additional amounts as
21 determined by the court to be necessary to reimburse the
22 member for his or her share of assessments levied by the
23 association to fund its expenses of the litigation. This
24 relief does not exclude other remedies provided by law. This
25 section does not deprive any person of any other available
26 right or remedy.
27 (2) If the governing documents so provide, an
28 association may suspend, for a reasonable period of time, the
29 rights of a member or a member's tenants, guests, or invitees,
30 or both, to use common areas and facilities and may levy
31 reasonable fines, not to exceed $100 per violation, against
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1 any member or any tenant, guest, or invitee. A fine may be
2 levied on the basis of each day of a continuing violation,
3 with a single notice and opportunity for hearing, except that
4 no such fine shall exceed $1,000 in the aggregate unless
5 otherwise provided in the governing documents. A fine shall
6 not become a lien against a parcel. In any action to recover a
7 fine, the prevailing party is entitled to collect its
8 reasonable attorney's fees and costs from the nonprevailing
9 party as determined by the court.
10 (a) A fine or suspension may not be imposed without
11 notice of at least 14 days to the person sought to be fined or
12 suspended and an opportunity for a hearing before a committee
13 of at least three members appointed by the board who are not
14 officers, directors, or employees of the association, or the
15 spouse, parent, child, brother, or sister of an officer,
16 director, or employee. If the committee, by majority vote,
17 does not approve a proposed fine or suspension, it may not be
18 imposed.
19 (b) The requirements of this subsection do not apply
20 to the imposition of suspensions or fines upon any member
21 because of the failure of the member to pay assessments or
22 other charges when due if such action is authorized by the
23 governing documents.
24 (c) Suspension of common-area-use rights shall not
25 impair the right of an owner or tenant of a parcel to have
26 vehicular and pedestrian ingress to and egress from the
27 parcel, including, but not limited to, the right to park.
28 (3) If the governing documents so provide, an
29 association may suspend the voting rights of a member for the
30 nonpayment of regular annual assessments that are delinquent
31 in excess of 90 days.
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1 (4) If an association fails to fill vacancies on the
2 board of directors sufficient to constitute a quorum in
3 accordance with the bylaws, any member may apply to the
4 circuit court that has jurisdiction over the community served
5 by the association for the appointment of a receiver to manage
6 the affairs of the association. At least 30 days before
7 applying to the circuit court, the member shall mail to the
8 association, by certified or registered mail, and post, in a
9 conspicuous place on the property of the community served by
10 the association, a notice describing the intended action,
11 giving the association 30 days to fill the vacancies. If
12 during such time the association fails to fill a sufficient
13 number of vacancies so that a quorum can be assembled, the
14 member may proceed with the petition. If a receiver is
15 appointed, the homeowners' association shall be responsible
16 for the salary of the receiver, court costs, attorney's fees,
17 and all other expenses of the receivership. The receiver has
18 all the powers and duties of a duly constituted board of
19 directors and shall serve until the association fills a
20 sufficient number of vacancies on the board so that a quorum
21 can be assembled.
22 (5) No association may sue to foreclose a lien against
23 real property during any period of time that the member of the
24 association who owes the money giving rise to the lien is also
25 entitled to the homestead protection described in s. 4(a)(1),
26 Art. X of the State Constitution as to that parcel of real
27 property. This subsection does not prevent the filing of a
28 lien against the real property, nor does this subsection bar
29 the filing of an action against a subsequent purchaser of the
30 real property regardless of whether the definition of
31 homestead may be applicable to such subsequent purchaser. Any
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1 applicable statute of limitations, whether applicable to an in
2 rem foreclosure action or applicable to an in personam action
3 against the member, shall be tolled during any period of time
4 that the association is barred from filing or prosecuting a
5 foreclosure action by this subsection.
6 Section 8. Paragraph (c) of subsection (1) and
7 subsection (6) of section 720.306, Florida Statutes, are
8 amended to read:
9 720.306 Meetings of members; voting and election
10 procedures; amendments.--
11 (1) QUORUM; AMENDMENTS.--
12 (c) Unless otherwise provided in the governing
13 documents as originally recorded or permitted by this chapter
14 or chapter 617, an amendment may not materially and adversely
15 alter the proportionate voting interest appurtenant to a
16 parcel or increase the proportion or percentage by which a
17 parcel shares in the common expenses of the association unless
18 the record parcel owner and all record owners of liens on the
19 parcels join in the execution of the amendment. For purposes
20 of this section, a change in quorum requirements is not an
21 alteration of voting interests. The merger or consolidation of
22 one or more associations under a plan of merger or
23 consolidation under chapter 607 or chapter 617 shall not be
24 considered a material or adverse alteration of the
25 proportionate voting interest appurtenant to a parcel.
26 (6) RIGHT TO SPEAK.--Members and parcel owners have
27 the right to attend all membership meetings and to speak at
28 any meeting with reference to all items opened for discussion
29 or included on the agenda. Notwithstanding any provision to
30 the contrary in the governing documents or any rules adopted
31 by the board or by the membership, a member and a parcel owner
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1 have the right to speak for at least 3 minutes on any agenda
2 item, provided that the member or parcel owner submits a
3 written request to speak prior to the meeting. The association
4 may adopt written reasonable rules governing the frequency,
5 duration, and other manner of member and parcel owner
6 statements, which rules must be consistent with this
7 subsection.
8 Section 9. Paragraph (t) is added to subsection (3) of
9 section 720.307, Florida Statutes, to read:
10 720.307 Transition of association control in a
11 community.--With respect to homeowners' associations:
12 (3) At the time the members are entitled to elect at
13 least a majority of the board of directors of the homeowners'
14 association, the developer shall, at the developer's expense,
15 within no more than 90 days deliver the following documents to
16 the board:
17 (t) The financial records, including financial
18 statements of the association, and source documents from the
19 incorporation of the association through the date of turnover.
20 The records shall be audited by an independent certified
21 public accountant for the period from the incorporation of the
22 association or from the period covered by the last audit, if
23 an audit has been performed for each fiscal year since
24 incorporation. All financial statements shall be prepared in
25 accordance with generally accepted accounting principles and
26 shall be audited in accordance with generally accepted
27 auditing standards, as prescribed by the Florida Board of
28 Accountancy, pursuant to chapter 473. The certified public
29 accountant performing the audit shall examine to the extent
30 necessary supporting documents and records, including the cash
31 disbursements and related paid invoices to determine if
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1 expenditures were for association purposes and the billings,
2 cash receipts, and related records to determine that the
3 developer was charged and paid the proper amounts of
4 assessments.
5 Section 10. Section 720.308, Florida Statutes, is
6 amended to read:
7 720.308 Assessments and charges.--
8 (1) ASSESSMENTS.--For any community created after
9 October 1, 1995, the governing documents must describe the
10 manner in which expenses are shared and specify the member's
11 proportional share thereof. Assessments levied pursuant to the
12 annual budget or special assessment must be in the member's
13 proportional share of expenses as described in the governing
14 document, which share may be different among classes of
15 parcels based upon the state of development thereof, levels of
16 services received by the applicable members, or other relevant
17 factors. While the developer is in control of the homeowners'
18 association, it may be excused from payment of its share of
19 the operating expenses and assessments related to its parcels
20 for any period of time for which the developer has, in the
21 declaration, obligated itself to pay any operating expenses
22 incurred that exceed the assessments receivable from other
23 members and other income of the association. This section does
24 not apply to an association, no matter when created, if the
25 association is created in a community that is included in an
26 effective development-of-regional-impact development order as
27 of the effective date of this act, together with any approved
28 modifications thereto.
29 (2) GUARANTEES OF COMMON EXPENSES.--
30 (a) Establishment of guarantee.--If a guarantee is not
31 included in the purchase contracts, declaration, or
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1 prospectus, any agreement establishing a guarantee shall only
2 be effective either upon the vote of a majority of all
3 nondeveloper voting interests voting in person or by limited
4 proxy at a duly called meeting of the association or by
5 agreement in writing without a meeting if provided in the
6 bylaws. Such guarantee shall meet the requirements of this
7 section.
8 (b) Guarantee period.--The period of time for the
9 guarantee shall be indicated by a specific beginning and
10 ending date or event.
11 1. The ending date or event shall be the same for all
12 of the members of a homeowners' association, including members
13 in different phases of homeowners' associations.
14 2. The guarantee may provide for different intervals
15 of time during a guarantee period with different dollar
16 amounts for each such interval.
17 (c) Guarantee extension.--The guarantee may provide
18 that after the initial stated period, the developer has an
19 option to extend the guarantee for one or more additional
20 stated periods. The extension of a guarantee is limited to
21 extending the ending date or event; therefore, the developer
22 does not have the option of changing the level of assessments
23 guaranteed.
24 (3) MAXIMUM LEVEL OF ASSESSMENTS.--The stated dollar
25 amount of the guarantee shall be an exact dollar amount for
26 each parcel identified in the declaration. Regardless of the
27 stated dollar amount of the guarantee, assessments charged to
28 a member shall not exceed the maximum obligation of the member
29 based on the total amount of the adopted budget and the
30 member's proportionate ownership share of the common elements.
31
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1 (4) CASH FUNDING REQUIREMENTS DURING GUARANTEE.--The
2 cash payments required from the guarantor during the guarantee
3 period shall be determined as follows:
4 (a) If at any time during the guarantee period the
5 funds collected from member assessments at the guaranteed
6 level and other revenues collected by the association are not
7 sufficient to provide payment, on a timely basis, of all
8 common expenses, including the full funding of the reserves
9 unless properly waived, the guarantor shall advance sufficient
10 cash to the association at the time such payments are due.
11 (b) Expenses incurred in the production of
12 nonassessment revenues, not in excess of the nonassessment
13 revenues, shall not be included in the common expenses. If the
14 expenses attributable to nonassessment revenues exceed
15 nonassessment revenues, only the excess expenses must be
16 funded by the guarantor. For example, if the association
17 operates a rental program in which rental expenses exceed
18 rental revenues, the guarantor shall fund the rental expenses
19 in excess of the rental revenues. Interest earned on the
20 investment of association funds may be used to pay the income
21 tax expense incurred as a result of the investment, such
22 expense shall not be charged to the guarantor, and the net
23 investment income shall be retained by the association. Each
24 such nonassessment revenue-generating activity shall be
25 considered separately. Capital contributions collected from
26 members are not revenues and shall not be used to pay common
27 expenses.
28 (5) CALCULATION OF GUARANTOR'S FINAL OBLIGATION.--The
29 guarantor's total financial obligation to the association at
30 the end of the guarantee period shall be determined on the
31 accrual basis using the following formula:
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1 (a) The guarantor shall fund the total common expenses
2 incurred during the guarantee period, including the full
3 funding of the reserves unless properly waived; less
4 (b) The total regular periodic assessments earned by
5 the association from the members other than the guarantor
6 during the guarantee period regardless of whether the actual
7 level charged was less than the maximum guaranteed amount.
8 (6) EXPENSES.--Expenses incurred in the production of
9 nonassessment revenues, not in excess of the nonassessment
10 revenues, shall not be included in the common expenses. If the
11 expenses attributable to nonassessment revenues exceed
12 nonassessment revenues, only the excess expenses must be
13 funded by the guarantor. For example, if the association
14 operates a rental program in which rental expenses exceed
15 rental revenues, the guarantor shall fund the rental expenses
16 in excess of the rental revenues. Interest earned on the
17 investment of association funds may be used to pay the income
18 tax expense incurred as a result of the investment, such
19 expense shall not be charged to the guarantor, and the net
20 investment income shall be retained by the association. Each
21 such nonassessment revenue-generating activity shall be
22 considered separately. Capital contributions collected from
23 members are not revenues and shall not be used to pay common
24 expenses.
25 Section 11. Section 720.311, Florida Statutes, is
26 amended to read:
27 720.311 Dispute resolution.--
28 (1) The Legislature finds that alternative dispute
29 resolution has made progress in reducing court dockets and
30 trials and in offering a more efficient, cost-effective option
31 to litigation. The filing of any petition for mediation or
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1 arbitration or the serving of an offer for presuit mediation
2 as provided for in this section shall toll the applicable
3 statute of limitations. Any recall dispute filed with the
4 department pursuant to s. 720.303(10) shall be conducted by
5 the department in accordance with the provisions of ss.
6 718.112(2)(j) and 718.1255 and the rules adopted by the
7 division. In addition, the department shall conduct mandatory
8 binding arbitration of election disputes between a member and
9 an association pursuant to s. 718.1255 and rules adopted by
10 the division. Neither election disputes nor recall disputes
11 are eligible for presuit mediation; these disputes shall be
12 arbitrated by the department. At the conclusion of the
13 proceeding, the department shall charge the parties a fee in
14 an amount adequate to cover all costs and expenses incurred by
15 the department in conducting the proceeding. Initially, the
16 petitioner shall remit a filing fee of at least $200 to the
17 department. The fees paid to the department shall become a
18 recoverable cost in the arbitration proceeding, and the
19 prevailing party in an arbitration proceeding shall recover
20 its reasonable costs and attorney's fees in an amount found
21 reasonable by the arbitrator. The department shall adopt rules
22 to effectuate the purposes of this section.
23 (2)(a) Disputes between an association and a parcel
24 owner regarding use of or changes to the parcel or the common
25 areas and other covenant enforcement disputes, disputes
26 regarding amendments to the association documents, disputes
27 regarding meetings of the board and committees appointed by
28 the board, membership meetings not including election
29 meetings, and access to the official records of the
30 association shall be the subject of an offer filed with the
31 department for presuit mandatory mediation served by an
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1 aggrieved party before the dispute is filed in court. Presuit
2 mediation proceedings must be conducted in accordance with the
3 applicable Florida Rules of Civil Procedure, and these
4 proceedings are privileged and confidential to the same extent
5 as court-ordered mediation. Disputes subject to presuit
6 mediation under this section shall not include the collection
7 of any assessment, fine, or other financial obligation,
8 including attorney's fees and costs, claimed to be due or any
9 action to enforce a prior mediation settlement agreement
10 between the parties. Also, in any dispute subject to presuit
11 mediation under this section where emergency relief is
12 required, a motion for temporary injunctive relief may be
13 filed with the court without first complying with the presuit
14 mediation requirements of this section. After any issues
15 regarding emergency or temporary relief are resolved, the
16 court may either refer the parties to a mediation program
17 administered by the courts or require mediation under this
18 section. An arbitrator or judge may not consider any
19 information or evidence arising from the presuit mediation
20 proceeding except in a proceeding to impose sanctions for
21 failure to attend a presuit mediation session or with the
22 parties' agreement in a proceeding seeking to enforce the
23 agreement. Persons who are not parties to the dispute may not
24 attend the presuit mediation conference without the consent of
25 all parties, except for counsel for the parties and a
26 corporate representative designated by the association. When
27 mediation is attended by a quorum of the board, such mediation
28 is not a board meeting for purposes of notice and
29 participation set forth in s. 720.303. An aggrieved party
30 shall serve on the responding party a written offer to
31
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1 participate in presuit mediation in substantially the
2 following form:
3
4 STATUTORY OFFER TO PARTICIPATE IN PRESUIT MEDIATION
5
6 The alleged aggrieved party,__________________,
7 hereby offers to _________________, as the
8 responding party, to enter into presuit
9 mediation in connection with the following
10 dispute, which by statute is of a type that is
11 subject to presuit mediation:
12
13 (List specific nature of the dispute or
14 disputes to be mediated and the authority
15 supporting a finding of a violation as to each
16 dispute.)
17
18 Pursuant to section 720.311, Florida Statutes,
19 this offer to resolve the dispute through
20 presuit mediation is required before a lawsuit
21 can be filed concerning the dispute. Pursuant
22 to the statute, the aggrieved party is hereby
23 offering to engage in presuit mediation with a
24 neutral third-party mediator in order to
25 attempt to resolve this dispute without court
26 action, and the aggrieved party demands that
27 you likewise agree to this process. If you fail
28 to agree to presuit mediation, or if you agree
29 and later fail to follow through with your
30 agreement to mediate, suit may be brought
31 against you without further warning.
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1
2 The process of mediation involves a supervised
3 negotiation process in which a trained, neutral
4 third-party mediator meets with both parties
5 and assists them in exploring possible
6 opportunities for resolving part or all of the
7 dispute. The mediation process is a voluntary
8 one. By agreeing to participate in presuit
9 mediation, you are not bound in any way to
10 change your position or to enter into any type
11 of agreement. Furthermore, the mediator has no
12 authority to make any decisions in this matter
13 or to determine who is right or wrong and
14 merely acts as a facilitator to ensure that
15 each party understands the position of the
16 other party and that all reasonable settlement
17 options are fully explored.
18
19 If an agreement is reached, it shall be reduced
20 to writing and becomes a binding and
21 enforceable commitment of the parties. A
22 resolution of one or more disputes in this
23 fashion avoids the need to litigate these
24 issues in court. The failure to reach an
25 agreement, or the failure of a party to
26 participate in the process, results in the
27 mediator's declaring an impasse in the
28 mediation, after which the aggrieved party may
29 proceed to court on all outstanding, unsettled
30 disputes.
31
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1 The aggrieved party has selected and hereby
2 lists three certified mediators who we believe
3 to be neutral and qualified to mediate the
4 dispute. You have the right to select any one
5 of these mediators. The fact that one party may
6 be familiar with one or more of the listed
7 mediators does not mean that the mediator
8 cannot act as a neutral and impartial
9 facilitator. Any mediator who cannot act in
10 this capacity ethically must decline to accept
11 engagement. The mediators that we suggest, and
12 their current hourly rates, are as follows:
13
14 (List the names, addresses, telephone numbers,
15 and hourly rates of the mediators. Other
16 pertinent information about the background of
17 the mediators may be included as an
18 attachment.)
19
20 You may contact the offices of these mediators
21 to confirm that the listed mediators will be
22 neutral and will not show any favoritism toward
23 either party. The names of certified mediators
24 may be found through the office of the clerk of
25 the circuit court for this circuit.
26
27 If you agree to participate in the presuit
28 mediation process, the statute requires that
29 each party is to pay one-half of the costs and
30 fees involved in the presuit mediation process
31 unless otherwise agreed by all parties. An
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1 average mediation may require 3 to 4 hours of
2 the mediator's time, including some preparation
3 time, and each party would need to pay one-half
4 of the mediator's fees as well as his or her
5 own attorney's fees if he or she chooses to
6 employ an attorney in connection with the
7 mediation. However, use of an attorney is not
8 required and is at the option of each party.
9 The mediator may require the advance payment of
10 some or all of the anticipated fees. The
11 aggrieved party hereby agrees to pay or prepay
12 one-half of the mediator's estimated fees and
13 to forward this amount or such other reasonable
14 advance deposits as the mediator may require
15 for this purpose. Any funds deposited will be
16 returned to you if these are in excess of your
17 share of the fees incurred.
18
19 If you agree to participate in presuit
20 mediation in order to attempt to resolve the
21 dispute and thereby avoid further legal action,
22 please sign below and clearly indicate which
23 mediator is acceptable to you. We will then ask
24 the mediator to schedule a mutually convenient
25 time and place for the mediation conference to
26 be held. The mediation conference must be held
27 within 90 days after the date of this letter
28 unless extended by mutual written agreement. In
29 the event that you fail to respond within 20
30 days after the date of this letter, or if you
31 fail to agree to at least one of the mediators
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1 that we have suggested and to pay or prepay to
2 the mediator one-half of the costs involved,
3 the aggrieved party will be authorized to
4 proceed with the filing of a lawsuit against
5 you without further notice and may seek an
6 award of attorney's fees or costs incurred in
7 attempting to obtain mediation.
8
9 Should you wish, you may also elect to waive
10 presuit mediation so that this matter may
11 proceed directly to court.
12
13 Therefore, please give this matter your
14 immediate attention. By law, your response must
15 be mailed by certified mail, return receipt
16 requested, with an additional copy being sent
17 by regular first-class mail to the address
18 shown on this offer.
19
20 _____________________
21 _____________________
22
23 RESPONDING PARTY: CHOOSE ONLY ONE OF THE TWO
24 OPTIONS BELOW. YOUR SIGNATURE INDICATES YOUR
25 AGREEMENT TO THAT CHOICE.
26
27 AGREEMENT TO MEDIATE
28
29 The undersigned hereby agrees to participate in
30 presuit mediation and agrees to the following
31
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1 mediator or mediators as acceptable to mediate
2 this dispute:
3
4 (List acceptable mediator or mediators.)
5
6 I/we further agree to pay or prepay one-half of
7 the mediator's fees and to forward such advance
8 deposits as the mediator may require for this
9 purpose.
10
11 _______________________
12 Signature of responding party #1
13
14 _______________________
15 Signature of responding party #2 (if
16 applicable)(if property is owned by more than
17 one person, all owners must sign)
18
19 WAIVER OF MEDIATION
20
21 The undersigned hereby waives the right to
22 participate in presuit mediation of the dispute
23 listed above and agrees to allow the aggrieved
24 party to proceed in court on such matters.
25
26 __________________________
27 Signature of responding party #1
28
29 ___________________________
30
31
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1 Signature of responding party #2 (if
2 applicable)(if property is owned by more than
3 one person, all owners must sign)
4
5 (b) Service of the statutory offer to participate in
6 presuit mediation shall be effected by sending a letter in
7 substantial conformity with the above form by certified mail,
8 return receipt requested, with an additional copy being sent
9 by regular first-class mail, to the address of the responding
10 party as it last appears on the books and records of the
11 association. The responding party shall have 20 days from the
12 date of the mailing of the statutory offer to serve a response
13 to the aggrieved party in writing. The response shall be
14 served by certified mail, return receipt requested, with an
15 additional copy being sent by regular first-class mail, to the
16 address shown on the statutory offer. In the alternative, the
17 responding party may waive mediation in writing.
18 Notwithstanding the foregoing, once the parties have agreed on
19 a mediator, the mediator may reschedule the mediation for a
20 date and time mutually convenient to the parties. The
21 department shall conduct the proceedings through the use of
22 department mediators or refer the disputes to private
23 mediators who have been duly certified by the department as
24 provided in paragraph (c). The parties shall share the costs
25 of presuit mediation equally, including the fee charged by the
26 mediator, if any, unless the parties agree otherwise, and the
27 mediator may require advance payment of its reasonable fees
28 and costs. The failure of any party to respond to a demand or
29 response, to agree upon a mediator, to make payment of fees
30 and costs within the time established by the mediator, or to
31 appear for a scheduled mediation session shall operate as an
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1 impasse in the presuit mediation by such party, entitling the
2 other party to proceed in court and to seek an award of the
3 costs and fees associated with the mediation. Additionally, if
4 any presuit mediation session cannot be scheduled and
5 conducted within 90 days after the offer to participate in
6 mediation was filed, an impasse shall be deemed to have
7 occurred unless both parties agree to extend this deadline. If
8 a department mediator is used, the department may charge such
9 fee as is necessary to pay expenses of the mediation,
10 including, but not limited to, the salary and benefits of the
11 mediator and any travel expenses incurred. The petitioner
12 shall initially file with the department upon filing the
13 disputes, a filing fee of $200, which shall be used to defray
14 the costs of the mediation. At the conclusion of the
15 mediation, the department shall charge to the parties, to be
16 shared equally unless otherwise agreed by the parties, such
17 further fees as are necessary to fully reimburse the
18 department for all expenses incurred in the mediation.
19 (c)(b) If presuit mediation as described in paragraph
20 (a) is not successful in resolving all issues between the
21 parties, the parties may file the unresolved dispute in a
22 court of competent jurisdiction or elect to enter into binding
23 or nonbinding arbitration pursuant to the procedures set forth
24 in s. 718.1255 and rules adopted by the division, with the
25 arbitration proceeding to be conducted by a department
26 arbitrator or by a private arbitrator certified by the
27 department. If all parties do not agree to arbitration
28 proceedings following an unsuccessful mediation, any party may
29 file the dispute in court. A final order resulting from
30 nonbinding arbitration is final and enforceable in the courts
31 if a complaint for trial de novo is not filed in a court of
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1 competent jurisdiction within 30 days after entry of the
2 order. As to any issue or dispute that is not resolved at
3 presuit mediation, and as to any issue that is settled at
4 presuit mediation but is thereafter subject to an action
5 seeking enforcement of the mediation settlement, the
6 prevailing party in any subsequent arbitration or litigation
7 proceeding shall be entitled to seek recovery of all costs and
8 attorney's fees incurred in the presuit mediation process.
9 (d)(c) The department shall develop a certification
10 and training program for private mediators and private
11 arbitrators which shall emphasize experience and expertise in
12 the area of the operation of community associations. A
13 mediator or arbitrator shall be certified to conduct mediation
14 or arbitration under this section by the department only if he
15 or she has been certified as a circuit court civil mediator or
16 arbitrator, respectively, pursuant to the requirements
17 established attended at least 20 hours of training in
18 mediation or arbitration, as appropriate, and only if the
19 applicant has mediated or arbitrated at least 10 disputes
20 involving community associations within 5 years prior to the
21 date of the application, or has mediated or arbitrated 10
22 disputes in any area within 5 years prior to the date of
23 application and has completed 20 hours of training in
24 community association disputes. In order to be certified by
25 the department, any mediator must also be certified by the
26 Florida Supreme Court. The department may conduct the training
27 and certification program within the department or may
28 contract with an outside vendor to perform the training or
29 certification. The expenses of operating the training and
30 certification and training program shall be paid by the moneys
31 and filing fees generated by the arbitration of recall and
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1 election disputes and by the mediation of those disputes
2 referred to in this subsection and by the training fees.
3 (e)(d) The presuit mediation procedures provided by
4 this subsection may be used by a Florida corporation
5 responsible for the operation of a community in which the
6 voting members are parcel owners or their representatives, in
7 which membership in the corporation is not a mandatory
8 condition of parcel ownership, or which is not authorized to
9 impose an assessment that may become a lien on the parcel.
10 (3) The department shall develop an education program
11 to assist homeowners, associations, board members, and
12 managers in understanding and increasing awareness of the
13 operation of homeowners' associations pursuant to this chapter
14 and in understanding the use of alternative dispute resolution
15 techniques in resolving disputes between parcel owners and
16 associations or between owners. Such education program may
17 include the development of pamphlets and other written
18 instructional guides, the holding of classes and meetings by
19 department employees or outside vendors, as the department
20 determines, and the creation and maintenance of a website
21 containing instructional materials. The expenses of operating
22 the education program shall be initially paid by the moneys
23 and filing fees generated by the arbitration of recall and
24 election disputes and by the mediation of those disputes
25 referred to in this subsection.
26 Section 12. Except as otherwise expressly provided in
27 this act, this act shall take effect July 1, 2006.
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