HB 921

1	A bill to be entitled
2	An act relating to lien claims by homeowners'
3	associations; amending s. 720.3085, F.S.; providing that
4	when authorized by the governing documents, a homeowners'
5	association has a lien on each parcel to secure the
6	payment of assessments and other amounts; providing an
7	exception to first mortgages of record; providing
8	construction with respect to lien priority; providing for
9	the elements of a valid claim of lien; providing for the
10	content of a recording notice; requiring a parcel owner or
11	the parcel owner's agent or attorney to require the
12	homeowners' association to enforce a recorded claim of
13	lien against his or her parcel; providing procedures for
14	notifying the homeowners' association; requiring that
15	service be made by certified mail, return receipt
16	requested; authorizing the homeowners' association to
17	bring a civil action to foreclose a lien for assessments
18	in the same manner in which a mortgage of real property is
19	foreclosed; providing that the homeowners' association may
20	also bring an action to recover a money judgment for the
21	unpaid assessments without waiving any claim of lien;
22	providing that if a parcel owner remains in possession of
23	the parcel after a foreclosure judgment has been entered,
24	the court may require the parcel owner to pay a reasonable
25	rent for the parcel; providing that the homeowners'
26	association may purchase the parcel at the foreclosure
27	sale and hold, lease, mortgage, or convey the parcel;
28	limiting the liability of a first mortgagee or its
29	successor or assignee as a subsequent holder of the first
30	mortgage who acquires title to a parcel by foreclosure or
31	by deed in lieu of foreclosure for the unpaid assessments
32	that became due before the mortgagee's acquisition of
33	title; providing that the time limitations in the act do
34	not apply if the parcel is subject to a foreclosure action
35	or forced sale of another party; providing for a
36	qualifying offer during the pendency of a foreclosure
37	action; providing procedures for offering and accepting a
38	qualifying offer; requiring that the qualifying offer be
39	in a particular format; providing an effective date.
40
41	Be It Enacted by the Legislature of the State of Florida:
42
43	Section 1.  Section 720.3085, Florida Statutes, is amended
44	to read:
45	720.3085  Payment for assessments; lien claims.--
46	(1)  When authorized by the governing documents, the
47	association has a lien on each parcel to secure the payment of
48	assessments and other amounts provided for by this section.
49	Except as otherwise set forth in this section, the lien is
50	effective from and shall relate back to the date on which the
51	original declaration of the community was recorded. However, as
52	to first mortgages of record, the lien is effective from and
53	after recording of a claim of lien in the public records of the
54	county in which the parcel is located. Nothing in this
55	subsection shall be construed to bestow upon any lien, mortgage,
56	or certified judgment of record on July 1, 2008, including liens
57	for unpaid assessments created pursuant to this subsection, a
58	priority which, by law, the lien, mortgage, or judgment did not
59	have before that date.
60	(a)  To be valid, a claim of lien must state the
61	description of the parcel, the name of the record owner, the
62	name and address of the association, the assessment amount due,
63	and the due date. The claim of lien shall secure all unpaid
64	assessments that are due and that may accrue subsequent to the
65	recording of the claim of lien and before entry of a certificate
66	of title, as well as interest, late charges, and reasonable
67	costs and attorney's fees incurred by the association incident
68	to the collection process. The person making the payment is
69	entitled to a satisfaction of the lien upon payment in full.
70	(b)  By recording a notice in substantially the following
71	form, a parcel owner or the parcel owner's agent or attorney may
72	require the association to enforce a recorded claim of lien
73	against his or her parcel:
74
75	NOTICE OF CONTEST OF LIEN
76
77	TO: (Name and address of association)
78
79	You are notified that the undersigned contests the claim of lien
80	filed by you on _____, (year) , and recorded in Official Records
81	Book _____ at page _____, of the public records of _____ County,
82	Florida, and that the time within which you may file suit to
83	enforce your lien is limited to 90 days following the date of
84	service of this notice. Executed this _____ day of _____,
85	(year).
86
87	Signed: (Owner or Attorney)
88
89	After the notice of a contest-of-lien has been recorded, the
90	clerk of the circuit court shall mail a copy of the recorded
91	notice to the association by certified mail, return receipt
92	requested, at the address shown in the claim of lien or the most
93	recent amendment to it and shall certify to the service on the
94	face of the notice. Service is complete upon mailing. After
95	service, the association has 90 days in which to file an action
96	to enforce the lien and, if the action is not filed within the
97	90-day period, the lien is void. However, the 90-day period
98	shall be extended for any length of time that the association is
99	prevented from filing its action because of an automatic stay
100	resulting from the filing of a bankruptcy petition by the parcel
101	owner or by any other person claiming an interest in the parcel.
102	(c)  The association may bring an action in its name to
103	foreclose a lien for assessments in the same manner in which a
104	mortgage of real property is foreclosed and may also bring an
105	action to recover a money judgment for the unpaid assessments
106	without waiving any claim of lien. The association is entitled
107	to recover its reasonable attorney's fees incurred in an action
108	to foreclose a lien or an action to recover a money judgment for
109	unpaid assessments.
110	(d)  If the parcel owner remains in possession of the
111	parcel after a foreclosure judgment has been entered, the court
112	may require the parcel owner to pay a reasonable rent for the
113	parcel. If the parcel is rented or leased during the pendency of
114	the foreclosure action, the association is entitled to the
115	appointment of a receiver to collect the rent. The expenses of
116	the receiver must be paid by the party who does not prevail in
117	the foreclosure action.
118	(e)  The association may purchase the parcel at the
119	foreclosure sale and hold, lease, mortgage, or convey the
120	parcel.
121	(2)(a)(1)  A parcel owner, regardless of how his or her
122	title to property has been acquired, including by purchase at a
123	foreclosure sale or by deed in lieu of foreclosure, is liable
124	for all assessments that come due while he or she is the parcel
125	owner. The parcel owner's liability for assessments may not be
126	avoided by waiver or suspension of the use or enjoyment of any
127	common area or by abandonment of the parcel upon which the
128	assessments are made.
129	(b)(2)  A parcel owner is jointly and severally liable with
130	the previous parcel owner for all unpaid assessments that came
131	due up to the time of transfer of title. This liability is
132	without prejudice to any right the present parcel owner may have
133	to recover any amounts paid by the present owner from the
134	previous owner.
135	(c)  Notwithstanding anything to the contrary contained in
136	this section, the liability of a first mortgagee, or its
137	successor or assignee as a subsequent holder of the first
138	mortgage who acquires title to a parcel by foreclosure or by
139	deed in lieu of foreclosure for the unpaid assessments that
140	became due before the mortgagee's acquisition of title, shall be
141	the lesser of:
142	1.  The parcel's unpaid common expenses and regular
143	periodic or special assessments that accrued or came due during
144	the 6 months immediately preceding the acquisition of title and
145	for which payment in full has not been received by the
146	association; or
147	2.  One percent of the original mortgage debt.
148
149	The limitations on first mortgagee liability provided by this
150	paragraph apply only if the first mortgagee filed suit against
151	the parcel owner and initially joined the association as a
152	defendant in the mortgagee foreclosure action. Joinder of the
153	association is not required if, on the date the complaint is
154	filed, the association was dissolved or did not maintain an
155	office or agent for service of process at a location that was
156	known to or reasonably discoverable by the mortgagee.
157	(3)  Assessments and installments on assessments that are
158	not paid when due bear interest from the due date until paid at
159	the rate provided in the declaration of covenants or the bylaws
160	of the association, which rate may not exceed the rate allowed
161	by law. If no rate is provided in the declaration or bylaws,
162	interest accrues at the rate of 18 percent per year.
163	(a)  If the declaration or bylaws so provide, the
164	association may also charge an administrative late fee in an
165	amount not to exceed the greater of $25 or 5 percent of the
166	amount of each installment that is paid past the due date.
167	(b)  Any payment received by an association and accepted
168	shall be applied first to any interest accrued, then to any
169	administrative late fee, then to any costs and reasonable
170	attorney's fees incurred in collection, and then to the
171	delinquent assessment. This paragraph applies notwithstanding
172	any restrictive endorsement, designation, or instruction placed
173	on or accompanying a payment. A late fee is not subject to the
174	provisions of chapter 687 and is not a fine.
175	(4)  A homeowners' association may not file a record claim
176	of lien against a parcel for unpaid assessments unless a written
177	notice or demand for past due assessments as well as any other
178	amounts owed to the association pursuant to its governing
179	documents has been made by the association. The written notice
180	or demand must:
181	(a)  Provide the owner with 45 days following the date the
182	notice is deposited in the mail to make payment for all amounts
183	due, including, but not limited to, any attorney's fees and
184	actual costs associated with the preparation and delivery of the
185	written demand.
186	(b)  Be sent by registered or certified mail, return
187	receipt requested, and by first-class United States mail to the
188	parcel owner at his or her last address as reflected in the
189	records of the association, if the address is within the United
190	States, and to the parcel owner subject to the demand at the
191	address of the parcel if the owner's address as reflected in the
192	records of the association is not the parcel address. If the
193	address reflected in the records is outside the United States,
194	then sending the notice to that address and to the parcel
195	address by first-class United States mail is sufficient.
196	(5)  The association may bring an action in its name to
197	foreclose a lien for unpaid assessments secured by a lien in the
198	same manner that a mortgage of real property is foreclosed and
199	may also bring an action to recover a money judgment for the
200	unpaid assessments without waiving any claim of lien. The Such
201	action to foreclose the lien may not be brought until 45 days
202	after the parcel owner has been provided notice of the
203	association's intent to foreclose and collect the unpaid amount.
204	The notice must be given in the manner provided in paragraph
205	(4)(b) and the notice may not be provided until the passage of
206	the 45 days required in paragraph (4)(a).
207	(a)  The association may recover any interest, late
208	charges, costs, and reasonable attorney's fees incurred in a
209	lien foreclosure action or in an action to recover a money
210	judgment for the unpaid assessments.
211	(b)  The time limitations in this subsection do not apply
212	if the parcel is subject to a foreclosure action or forced sale
213	of another party, or if an owner of the parcel is a debtor in a
214	bankruptcy proceeding The association may purchase the parcel at
215	the foreclosure sale and hold, lease, mortgage, or convey the
216	parcel.
217	(6)  If after service of a summons on a complaint to
218	foreclose a lien the parcel is not the subject of a mortgage
219	foreclosure or a notice of tax certificate sale, or the parcel
220	owner is not a debtor in bankruptcy proceedings, or the trial of
221	or trial docket for the lien foreclosure action is not set to
222	begin within 30 days, the parcel owner may serve and file with
223	the court a qualifying offer at any time before the entry of a
224	foreclosure judgment. For purposes of this subsection, the term
225	"qualifying offer" means a written offer to pay all amounts
226	secured by the lien of the association plus amounts interest
227	accruing during the pendency of the offer at the rate of
228	interest provided in this section. The parcel owner may make
229	only one qualifying offer during the pendency of a foreclosure
230	action. If a parcel becomes the subject of a mortgage
231	foreclosure or a notice of tax certificate sale while a
232	qualifying offer is pending, the qualifying offer becomes
233	voidable at the election of the association. If the parcel owner
234	becomes a debtor in bankruptcy proceedings while a qualifying
235	offer is pending, the qualifying offer becomes void.
236	(a)  The parcel owner shall deliver a copy of the filed
237	qualifying offer to the association's attorney by hand delivery,
238	obtaining a written receipt, or by certified mail, return
239	receipt requested.
240	(b)  The parcel owner's filing of the qualifying offer with
241	the court stays the foreclosure action for the period stated in
242	the qualifying offer, which may not exceed 60 days following the
243	date of service of the qualifying offer and no sooner than 30
244	days before the date of trial, arbitration, or the beginning of
245	the trial docket, whichever occurs first, to permit the parcel
246	owner to pay the qualifying offer to the association plus any
247	amounts interest accruing during the pendency of the offer.
248	(c)  The qualifying offer of the parcel owner must be in
249	writing, be signed by all owners the owner of the parcel and the
250	spouse of any the owner if the spouse resides in or otherwise
251	claims holds a homestead interest in the parcel, be acknowledged
252	by a notary public, and be in substantially in the following
253	form: state the total amount due the association, state that the
254	total amount due the association is secured by the lien of the
255	association, state that the association is entitled to foreclose
256	the lien and obtain a foreclosure judgment for the total amount
257	due if the parcel owner breaches the qualifying offer, state
258	that the parcel owner will not endanger the priority of the lien
259	of the association or the amounts secured by the lien, and state
260	the actual date or dates the association will receive the total
261	amount due from the parcel owner.
262
263	QUALIFYING OFFER
264	AUTOMATIC STAY INVOKED PURSUANT TO F.S. 720.3085
265
266	I/We, [Name(s) of Parcel Owner(s)], admit the following:
267	1.  The total amount due the association is secured by the
268	lien of the association.
269	2.  The association is entitled to foreclose its claim of
270	lien and obtain a foreclosure judgment for the total amount due
271	if I/we breach this qualifying offer by failing to pay the
272	amount due by the date specified in this qualifying offer.
273	3.  I/We will not permit the priority of the lien of the
274	association or the amounts secured by the lien to be endangered.
275	4.  I/We hereby affirm that the date(s) by which the
276	association will receive $ [specify amount] as the total amount
277	due is [specify date, no later than 60 days after the date of
278	service of the qualifying offer and at least 30 days before the
279	trial or arbitration date], in the following amounts and dates:
280	5.  I/We hereby confirm that I/we have requested and have
281	received from the homeowners' association a breakdown and total
282	of all sums due the association and that the amount offered
283	above is equal to or greater than the total amount provided by
284	the association.
285	6.  This qualifying offer operates as a stay to all
286	portions of the foreclosure action which seek to collect unpaid
287	assessments as provided in s. 720.3085.
288
289	Signed: (Signatures of all parcel owners and spouses, if any)
290
291	Sworn to and subscribed this (date) day of (month), (year),
292	before the undersigned authority.
293
294	Notary Public: (Signature of notary public)
295
296	If the parcel owner makes a qualifying offer under this
297	subsection, the association may not add the cost of any legal
298	fees incurred by the association within the period of the stay
299	other than costs acquired in defense of a mortgage foreclosure
300	action concerning the parcel, a bankruptcy proceeding in which
301	the parcel owner is a debtor, or in response to filings by a
302	party other than the association in the lien foreclosure action
303	of the association.
304	(7)(d)  If the parcel owner breaches the qualifying offer,
305	the stay shall be vacated and the association may proceed in its
306	action to obtain a foreclosure judgment against the parcel and
307	the parcel owners for the amount in the qualifying offer and any
308	amounts accruing after the date of the qualifying offer.
309	Section 2.  This act shall take effect July 1, 2008.

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