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A bill to be entitled

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An act relating to lien claims by homeowners'

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associations; amending s. 720.3085, F.S.; providing that

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when authorized by the governing documents, a homeowners'

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association has a lien on each parcel to secure the

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payment of assessments and other amounts; providing an

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exception to first mortgages of record; providing that the

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act does not bestow upon any lien, mortgage, or certified

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judgment of record on July 1, 2008, a priority that the

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lien, mortgage, or judgment did not have before that date;

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providing for the elements of a valid claim of lien;

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providing for the content of a recording notice; requiring

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a parcel owner or the parcel owner's agent or attorney to

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require the homeowners' association to enforce a recorded

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claim of lien against his or her parcel; providing

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procedures for notifying the homeowners' association;

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requiring that service be made by certified mail, return

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receipt requested; authorizing the homeowners' association

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to bring a civil action to foreclose a lien for

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assessments in the same manner in which a mortgage of real

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property is foreclosed; providing that the homeowners'

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association may also bring an action to recover a money

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judgment for the unpaid assessments without waiving any

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claim of lien; providing that if a parcel owner remains in

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possession of the parcel after a foreclosure judgment has

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been entered, the court may require the parcel owner to

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pay a reasonable rent for the parcel; providing that the

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homeowners' association may purchase the parcel at the

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foreclosure sale and hold, lease, mortgage, or convey the

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parcel; limiting the liability of a first mortgagee or its

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successor or assignee as a subsequent holder of the first

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mortgage who acquires title to a parcel by foreclosure or

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by deed in lieu of foreclosure for the unpaid assessments

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that became due before the mortgagee's acquisition of

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title; providing that the time limitations in the act do

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not apply if the parcel is subject to a foreclosure action

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or forced sale of another party; providing for a qualified

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offer during the pendency of a foreclosure action;

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providing procedures for offering and accepting a

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qualifying offer; requiring that the qualifying offer be

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in a particular format; providing an effective date.

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Be It Enacted by the Legislature of the State of Florida:

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     Section 1.  Section 720.3085, Florida Statutes, is amended

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to read:

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     720.3085  Payment for assessments; lien claims.--

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     (1) When authorized by the governing documents, the

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association has a lien on each parcel to secure the payment of

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assessments and other amounts provided for by this section.

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Except as otherwise set forth in this section, the lien is

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effective from and shall relate back to the date on which the

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original declaration of the community was recorded. However, as

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to first mortgages of record, the lien is effective from and

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after recording of a claim of lien in the public records of the

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county in which the parcel is located. This subsection does not

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bestow upon any lien, mortgage, or certified judgment of record

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on July 1, 2008, including the lien for unpaid assessments

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created in this section, a priority that, by law, the lien,

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mortgage, or judgment did not have before July 1, 2008.

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     (a) To be valid, a claim of lien must state the description

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of the parcel, the name of the record owner, the name and address

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of the association, the assessment amount due, and the due date.

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The claim of lien shall secure all unpaid assessments that are

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due and that may accrue subsequent to the recording of the claim

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of lien and before entry of a certificate of title, as well as

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interest, late charges, and reasonable costs and attorney's fees

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incurred by the association incident to the collection process.

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The person making the payment is entitled to a satisfaction of

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the lien upon payment in full.

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     (b) By recording a notice in substantially the following

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form, a parcel owner or the parcel owner's agent or attorney may

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require the association to enforce a recorded claim of lien

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against his or her parcel:

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NOTICE OF CONTEST OF LIEN

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TO: (Name and address of association)

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You are notified that the undersigned contests the claim of lien

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filed by you on _____, (year) , and recorded in Official Records

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Book _____ at page _____, of the public records of _____ County,

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Florida, and that the time within which you may file suit to

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enforce your lien is limited to 90 days following the date of

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service of this notice. Executed this _____ day of _____, (year).

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Signed: (Owner or Attorney)

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After the notice of a contest of lien has been recorded, the

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clerk of the circuit court shall mail a copy of the recorded

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notice to the association by certified mail, return receipt

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requested, at the address shown in the claim of lien or the most

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recent amendment to it and shall certify to the service on the

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face of the notice. Service is complete upon mailing. After

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service, the association has 90 days in which to file an action

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to enforce the lien and, if the action is not filed within the

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90-day period, the lien is void. However, the 90-day period shall

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be extended for any length of time that the association is

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prevented from filing its action because of an automatic stay

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resulting from the filing of a bankruptcy petition by the parcel

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owner or by any other person claiming an interest in the parcel.

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(c) The association may bring an action in its name to

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foreclose a lien for assessments in the same manner in which a

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mortgage of real property is foreclosed and may also bring an

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action to recover a money judgment for the unpaid assessments

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without waiving any claim of lien. The association is entitled to

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recover its reasonable attorney's fees incurred in an action to

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foreclose a lien or an action to recover a money judgment for

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unpaid assessments.

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     (d) If the parcel owner remains in possession of the parcel

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after a foreclosure judgment has been entered, the court may

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require the parcel owner to pay a reasonable rent for the parcel.

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If the parcel is rented or leased during the pendency of the

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foreclosure action, the association is entitled to the

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appointment of a receiver to collect the rent. The expenses of

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the receiver must be paid by the party who does not prevail in

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the foreclosure action.

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     (e) The association may purchase the parcel at the

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foreclosure sale and hold, lease, mortgage, or convey the parcel.

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     (2)(a)(1) A parcel owner, regardless of how his or her

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title to property has been acquired, including by purchase at a

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foreclosure sale or by deed in lieu of foreclosure, is liable for

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all assessments that come due while he or she is the parcel

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owner. The parcel owner's liability for assessments may not be

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avoided by waiver or suspension of the use or enjoyment of any

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common area or by abandonment of the parcel upon which the

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assessments are made.

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     (b)(2) A parcel owner is jointly and severally liable with

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the previous parcel owner for all unpaid assessments that came

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due up to the time of transfer of title. This liability is

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without prejudice to any right the present parcel owner may have

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to recover any amounts paid by the present owner from the

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previous owner.

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     (c) Notwithstanding anything to the contrary contained in

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this section, the liability of a first mortgagee, or its

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successor or assignee as a subsequent holder of the first

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mortgage who acquires title to a parcel by foreclosure or by deed

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in lieu of foreclosure for the unpaid assessments that became due

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before the mortgagee's acquisition of title, shall be the lesser

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of:

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     1. The parcel's unpaid common expenses and regular periodic

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or special assessments that accrued or came due during the 12

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months immediately preceding the acquisition of title and for

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which payment in full has not been received by the association;

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or

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     2. One percent of the original mortgage debt.

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The limitations on first mortgagee liability provided by this

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paragraph apply only if the first mortgagee filed suit against

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the parcel owner and initially joined the association as a

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defendant in the mortgagee foreclosure action. Joinder of the

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association is not required if, on the date the complaint is

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filed, the association was dissolved or did not maintain an

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office or agent for service of process at a location that was

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known to or reasonably discoverable by the mortgagee.

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     (3)  Assessments and installments on assessments that are

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not paid when due bear interest from the due date until paid at

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the rate provided in the declaration of covenants or the bylaws

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of the association, which rate may not exceed the rate allowed by

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law. If no rate is provided in the declaration or bylaws,

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interest accrues at the rate of 18 percent per year.

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     (a)  If the declaration or bylaws so provide, the

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association may also charge an administrative late fee in an

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amount not to exceed the greater of $25 or 5 percent of the

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amount of each installment that is paid past the due date.

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     (b)  Any payment received by an association and accepted

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shall be applied first to any interest accrued, then to any

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administrative late fee, then to any costs and reasonable

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attorney's fees incurred in collection, and then to the

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delinquent assessment. This paragraph applies notwithstanding any

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restrictive endorsement, designation, or instruction placed on or

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accompanying a payment. A late fee is not subject to the

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provisions of chapter 687 and is not a fine.

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     (4) A homeowners' association may not file a record claim

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of lien against a parcel for unpaid assessments unless a written

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notice or demand for past due assessments as well as any other

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amounts owed to the association pursuant to its governing

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documents has been made by the association. The written notice or

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demand must:

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     (a) Provide the owner with 45 days following the date the

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notice is deposited in the mail to make payment for all amounts

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due, including, but not limited to, any attorney's fees and

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actual costs associated with the preparation and delivery of the

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written demand.

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     (b)  Be sent by registered or certified mail, return receipt

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requested, and by first-class United States mail to the parcel

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owner at his or her last address as reflected in the records of

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the association, if the address is within the United States, and

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to the parcel owner subject to the demand at the address of the

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parcel if the owner's address as reflected in the records of the

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association is not the parcel address. If the address reflected

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in the records is outside the United States, then sending the

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notice to that address and to the parcel address by first-class

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United States mail is sufficient.

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     (5)  The association may bring an action in its name to

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foreclose a lien for unpaid assessments secured by a lien in the

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same manner that a mortgage of real property is foreclosed and

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may also bring an action to recover a money judgment for the

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unpaid assessments without waiving any claim of lien. The Such

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action to foreclose the lien may not be brought until 45 days

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after the parcel owner has been provided notice of the

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association's intent to foreclose and collect the unpaid amount.

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The notice must be given in the manner provided in paragraph

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(4)(b) and the notice may not be provided until the passage of

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the 45 days required in paragraph (4)(a).

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     (a) The association may recover any interest, late charges,

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costs, and reasonable attorney's fees incurred in a lien

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foreclosure action or in an action to recover a money judgment

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for the unpaid assessments.

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     (b) The time limitations in this subsection do not apply if

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the parcel is subject to a foreclosure action or forced sale of

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another party, or if an owner of the parcel is a debtor in a

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bankruptcy proceeding The association may purchase the parcel at

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the foreclosure sale and hold, lease, mortgage, or convey the

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parcel.

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     (6)  If after service of a summons on a complaint to

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foreclose a lien the parcel is not the subject of a mortgage

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foreclosure or a notice of tax certificate sale, or the parcel

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owner is not a debtor in bankruptcy proceedings, or the trial of

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or trial docket for the lien foreclosure action is not set to

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begin within 30 days, the parcel owner may serve and file with

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the court a qualifying offer at any time before the entry of a

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foreclosure judgment. For purposes of this subsection, the term

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"qualifying offer" means a written offer to pay all amounts

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secured by the lien of the association plus amounts interest

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accruing during the pendency of the offer at the rate of interest

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provided in this section. The parcel owner may make only one

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qualifying offer during the pendency of a foreclosure action. If

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a parcel becomes the subject of a mortgage foreclosure or a

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notice of tax certificate sale while a qualifying offer is

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pending, the qualifying offer becomes voidable at the election of

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the association. If the parcel owner becomes a debtor in

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bankruptcy proceedings while a qualifying offer is pending, the

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qualifying offer becomes void.

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     (a)  The parcel owner shall deliver a copy of the filed

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qualifying offer to the association's attorney by hand delivery,

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obtaining a written receipt, or by certified mail, return receipt

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requested.

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     (b)  The parcel owner's filing of the qualifying offer with

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the court stays the foreclosure action for the period stated in

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the qualifying offer, which may not exceed 60 days following the

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date of service of the qualifying offer and no sooner than 30

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days before the date of trial, arbitration, or the beginning of

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the trial docket, whichever occurs first, to permit the parcel

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owner to pay the qualifying offer to the association plus any

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amounts interest accruing during the pendency of the offer.

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     (c) The qualifying offer of the parcel owner must be in

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writing, be signed by all owners the owner of the parcel and the

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spouse of any the owner if the spouse resides in or otherwise

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claims holds a homestead interest in the parcel, be acknowledged

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by a notary public, and be in substantially the following form:

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state the total amount due the association, state that the total

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amount due the association is secured by the lien of the

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association, state that the association is entitled to foreclose

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the lien and obtain a foreclosure judgment for the total amount

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due if the parcel owner breaches the qualifying offer, state that

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the parcel owner will not endanger the priority of the lien of

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the association or the amounts secured by the lien, and state the

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actual date or dates the association will receive the total

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amount due from the parcel owner.

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QUALIFYING OFFER

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AUTOMATIC STAY INVOKED PURSUANT TO F.S. 720.3085

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I/We, [Name(s) of Parcel Owner(s)], admit the following:

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     1. The total amount due the association is secured by the

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lien of the association.

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     2. The association is entitled to foreclose its claim of

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lien and obtain a foreclosure judgment for the total amount due

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if I/we breach this qualifying offer by failing to pay the amount

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due by the date specified in this qualifying offer.

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     3. I/We will not permit the priority of the lien of the

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association or the amounts secured by the lien to be endangered.

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     4. I/We hereby affirm that the date(s) by which the

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association will receive $ [specify amount] as the total amount

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due is [specify date, no later than 60 days after the date of

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service of the qualifying offer and at least 30 days before the

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trial or arbitration date], in the following amounts and dates:

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     5. I/We hereby confirm that I/we have requested and have

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received from the homeowners' association a breakdown and total

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of all sums due the association and that the amount offered above

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is equal to or greater than the total amount provided by the

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association.

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     6. This qualifying offer operates as a stay to all portions

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of the foreclosure action which seek to collect unpaid

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assessments as provided in s. 720.3085.

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Signed: (Signatures of all parcel owners and spouses, if any)

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Sworn to and subscribed this (date) day of (month), (year),

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before the undersigned authority.

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Notary Public: (Signature of notary public)

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If the parcel owner makes a qualifying offer under this

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subsection, the association may not add the cost of any legal

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fees incurred by the association within the period of the stay

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other than costs acquired in defense of a mortgage foreclosure

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action concerning the parcel, a bankruptcy proceeding in which

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the parcel owner is a debtor, or in response to filings by a

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party other than the association in the lien foreclosure action

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of the association.

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     (7)(d) If the parcel owner breaches the qualifying offer,

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the stay shall be vacated and the association may proceed in its

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action to obtain a foreclosure judgment against the parcel and

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the parcel owners for the amount in the qualifying offer and any

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amounts accruing after the date of the qualifying offer.

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     Section 2.  This act shall take effect July 1, 2008.