rembaumlaw | Rembaum's Association Roundup

November 3, 2025November 3, 2025

Adopting Electronic Voting in Florida

The Statutory Similarities and Differences Applicable to Condominium, Cooperative, and Homeowners’ Associations

Electronic voting continues to become an increasingly attractive option for community associations. The benefits of electronic voting are many and include the following: (i) allowing members to cast their votes from an electronic device anywhere with an internet connection; (ii) helping associations achieve quorum requirements because an electronic vote counts as the member being in attendance at the meeting; (iii) automating the counting and collection of votes thereby reducing the potential for errors associated with manual counting ballots; and (iv) saving associations money by reducing costs associated with the cost of printing and mailing of paper ballots and associated paperwork.

Despite the many benefits of electronic voting, many associations still insist on voting the old-fashioned way and are reluctant to adopt electronic voting. However, as further discussed below, adopting electronic voting is not a complicated endeavor.

So, how can an association adopt electronic voting? In short, at a properly noticed board meeting, the board of directors (the board) of the association must adopt a resolution approving electronic voting.

§§718.128, 719.129, and 720.317, Florida Statutes, applicable to condominium, cooperative, and homeowners’ associations respectively (collectively, the “electronic voting statutes”), require that, for such associations that desire to adopt electronic voting, a resolution of the board is required. Additionally, the electronic voting statutes provide, in pertinent part, that the resolution adopted by the board must provide members the option to receive notice of the opportunity to vote through an online voting system, establish reasonable procedures and deadlines for members to consent electronically or in writing to online voting, and must establish reasonable procedures and deadlines for members to opt out of online voting after giving consent. Therefore, the board will want to utilize the association’s attorney to assist with drafting of the electronic voting resolution to be sure that all statutory requirements are followed.

There are many significant similarities and differences within the electronic voting statutes, too. As to similarities, the electronic voting statutes allow associations to conduct electronic voting through an internet-based online voting system only if electronic voting is properly approved by the board. To vote electronically, a unit owner and/or member must opt in to do so. A member who votes electronically is considered in attendance for quorum purposes. As both a similarity and a safeguard, the online voting system must be able to permanently separate authentication/identifying information from the ballot for elections where secret ballots are provided for in the governing documents.

Additionally, when considering adopting electronic voting, associations should select an electronic voting service provider and platform that meets the statutory specifications as set out in the electronic voting statues. For example, the electronic voting statutes require the following:

- a voting system that is able to authenticate the owner’s identity
- the ability to authenticate the validity of each electronic vote to ensure that the vote is not altered in transit
- the ability to transmit a receipt from the online voting system to each owner who casts an electronic vote
- the ability to permanently separate any authentication or identifying information from the electronic voting ballot rendering it impossible to tie an election ballot to a specific unit or member (note for homeowners’ associations–the foregoing only applies if the association’s bylaws provide for secret ballots for the election of directors)
- the ability to store and keep electronic votes accessible to election officials for recount, inspection, and review purposes.

Regarding pertinent statutory differences, as to condominium associations, if at least 25 percent of the voting interests of the condominium petition the board to adopt electronic voting for the next scheduled election, the board must hold a meeting within 21 days after receiving the petition to adopt the resolution. The board must receive the petition within 180 days after the date of the last scheduled annual meeting. As such, the foregoing method serves as a statutory mechanism for unit owners to force a board to adopt electronic voting.

Additionally, if electronic voting has not been adopted by a condominium association, effective July 1, 2025, §718.128, Florida Statutes, for the first time requires condominium associations to designate an email address to receive electronically transmitted ballots. It also provides for the inclusion of specific language for those electronically transmitted ballots such as the inclusion of a unit number, a printed name acting as a signature, and a prominent capitalized statement explaining that by emailing the ballot the voting unit owner waives anonymity.

Regarding pertinent statutory differences for both homeowners’ and cooperative associations, the relevant electronic voting legislation does not include a provision for a member-triggered petition that would obligate the board to adopt electronic voting as there is with condominium associations. Additionally, if electronic voting has not been adopted by a homeowners’ or cooperative association, there is no requirement that either association designate an email address to receive electronically transmitted ballots. Further, both the Homeowners’ and Cooperative Association Acts provide for specific notice mechanisms for the board meeting at which the electronic voting resolution will be considered, including that written notice of such meeting being mailed, delivered, electronically transmitted (for those homeowners who have opted into receiving electronic notice), and posted conspicuously on the property at least 14 days prior to the meeting whereas, effective July 1, 2025, a condominium association only requires a 48-hour posted notice to adopt the board resolution approving electronic voting. Also, as to homeowners’ and cooperative associations, evidence of compliance with the 14–day notice requirement must be made by an affidavit executed by the person providing the notice and kept as part of the official records.

Overall, for those associations who adopt electronic voting, it presents an opportunity to modernize the voting process, increase member participation at meetings, reduce human error, and save money. By understanding the process associated with adopting electronic voting, coupled with an understating of the pertinent statutory similarities and differences, community associations are well on their way to successfully adopting electronic voting. Of course, best business practice dictates that if your association has questions regarding adopting electronic voting, to assist with drafting an appropriate board resolution, and to ensure compliance with other specific statutory requirements, your association should seek the assistance and guidance of its legal counsel.

October 12, 2025October 28, 2025

The Pre-Suit Mediation Process | Friend or Foe?

Overall, the often statutorily required pre-suit mediation process governed by §720.311, Fla. Stat., can potentially save a community association tens of thousands of dollars by providing an opportunity to resolve the dispute prior to litigation. In fact, a great many disputes resolve themselves at this stage, but not all disputes are subject to the pre-suit mediation requirements. Sometimes opting to use the process is voluntary, and sometimes it is mandatory. Condominium, homeowners’, and arguably cooperative associations can all take advantage of the pre-suit mediation process described in §720.311, Fla. Stat., though there are a few noticeable differences.

As per §720.311, Fla. Stat., election and recall disputes are not eligible for pre-suit mediation. This is because those disputes must be resolved via arbitration by the DBPR Division of Florida Condominium, Timeshares, and Mobile Homes—Arbitration Section or filed in a local court of competent jurisdiction. Other HOA disputes for which the pre-suit mediation process is not required include collection of any assessment, fine, or other financial obligation, including attorneys’ fees and costs, claimed to be due or any action to enforce a prior mediation settlement agreement between the parties.

Regarding HOA disputes that must follow the pre-suit mediation process before the dispute is filed in court, the aggrieved party must follow the pre-suit mediation when the dispute meets one of the following criteria:

1. 1. Between an association and a parcel owner regarding use of or changes to the parcel or the common areas
  2. Other covenant enforcement disputes
  3. Disputes regarding amendments to the association documents
  4. Disputes regarding meetings of the board and committees appointed by the board
  5. Membership meetings not including election meetings
  6. Access to the official records of the association.

As to condominium association disputes, §718.1255, Fla. Stat., provides that in lieu of the initiation of manditory nonbinding arbitration, a party may submit their dispute to pre-suit mediation in accordance with the homeowners’ association pre-suit meditation process set out in §720.311, Fla. Stat. The condominium association disputes eligible for the pre-suit mediation process include the authority of the board of directors, under Chapter 718, Fla. Stat., or association’s documents, involving any of the following:

1. 1. Requirement for any owner to take any action, or not to take any action, involving that owner’s unit or the appurtenances thereto
  2. Alteration or addition to a common area or element
  3. The failure to properly conduct elections
  4. The failure to give adequate notice of meetings or other actions
  5. The failure to properly conduct meetings
  6. The failure to allow inspection of books and records
  7. Challenges to a plan of termination of the condominium pursuant to §718.117, Fla. Stat.

As to condominium association disputes, mandatory, non-binding arbitration or, alternatively; the presuit mediation process, is not required for:

1. 1. Title to any unit or common element
  2. The interpretation or enforcement of any warranty
  3. The levy of a fee or assessment, or the collection of an assessment levied against a party
  4. The eviction or other removal of a tenant from a unit
  5. Alleged breaches of fiduciary duty by one or more directors, or
  6. Claims for damages to a unit based upon the alleged failure of the association to maintain the common elements or condominium property.

It is also good to know that in any dispute subject to the statutory required pre-suit mediation where emergency relief is required, a motion for temporary injunctive relief may be filed with the court without first complying with the otherwise required pre-suit mediation process.

As to cooperative association disputes, §719.1255, Fla Stat., provides that disputes can be subject to the alternative dispute resolution process set out in §718.1255, Fla. Stat. This statute then refers to §720.311, Fla. Stat., which describes the pre-suit mediation process in detail. Therefore, parties involved with cooperative association disputes follow the same guidelines as condominium association disputes.

Regarding the mediation process itself, pre-suit mediation proceedings must be conducted in accordance with the applicable Florida Rules of Civil Procedure, and that these proceedings are privileged and confidential to the same extent as court-ordered mediation. This means what happens at mediation, stays at mediation (like Vegas)!

The pre-suit mediation process is fully described in §720.311, Fla. Stat. Simply put, the aggrieved party must serve on the other party(ies) (by certified mail, return receipt requested, and regular U.S. mail) written demand for participation in mandatory pre-suit mediation, which must provide a list of five mediators from which the recipient must choose one. The recipient will have 20 days from the date of mailing to serve (by certified mail, return receipt requested, and regular U.S. mail) a written response to the aggrieved party. The pre-suit mediation must then be held within 90 days unless the parties jointly agree to an extension. The parties split the costs of the mediator, and each party is responsible for their own respective attorneys’ fees and costs (unless otherwise agreed to at the mediation as part of any settlement).

The failure of any party to respond to a pre-suit mediation demand, to agree upon a mediator, to make payment of fees and costs within the time established by the mediator, or to appear for a scheduled mediation session without the approval of the mediator constitutes an “impasse” in the pre-suit mediation by such party, entitling the other party to proceed in court and to seek an award of the costs and fees associated with the mediation. Additionally, and most importantly, the party who fails or refuses to participate in the entire mediation process may not recover prevailing party attorneys’ fees and costs in subsequent litigation relating to the dispute should they actually prevail.

If pre-suit mediation is not successful in resolving all issues between the parties, the aggrieved party may file the unresolved dispute in a court of competent jurisdiction. As to any issue or dispute that is not resolved at pre-suit mediation, and as to any issue that is settled at pre-suit mediation but is thereafter subject to an action seeking enforcement of the mediation settlement, the prevailing party in any subsequent litigation proceeding is entitled to seek recovery of all costs and attorneys’ fees incurred in the pre-suit mediation process.

Again, if the receiving party does not timely and properly respond to the aggrieved party’s pre-suit mediation demand, then should the aggrieved party proceed with the litigation and lose, since the receiving party did not comply with the pre-suit mediation demand, they would not be entitled to their otherwise awardable prevailing party attorneys’ fees and costs due to their failure to comply. As those legal procedures and their surrounding strategy have a signficant impact on association legal counsel familar with the intracacies of community association law should be involved.

September 12, 2025September 25, 2025

Construction Defects | From the Frying Pan into the Fire

At times the law can be quite cruel. A recent appellate case from Florida’s Fourth District Court of Appeal, Vuletic Group LLC d/b/a Concept Construction v. Malkin, Case No. 4D2024-1589 (Fla. 4th DCA July 16, 2025), reminds us all of this salient fact.

In Vuletic Group, the parties contracted with one another in 2018 for a house remodeling project. Around November 2019, the homeowners terminated the contract and stopped paying the contractor. As a result, the contractor sued the homeowners for nonpayment. The homeowners then made a counterclaim against the contractor for breach of contract and construction defects. In the counterclaim the homeowners alleged that the contractor breached its contract by failing to supervise, coordinate, schedule, and/or manage a significant number of subcontractors and vendors working on the renovation project which ultimately led to multiple construction defects and deficiencies.

In January 2023 a bench trial (a non-jury trial) was held during which the homeowners presented expert testimony regarding the anticipated costs to repair and remedy all the issues allegedly caused by the contractor’s breach of contract, amounting to $414,372 in damages. Ultimately, the trial court ruled in favor of the homeowners and awarded them damages in the amount of $499,250, which also included pre-judgment interest. After the trial court’s ruling, the contractor appealed the case to the Fourth District Court of Appeal.

The contractor argued to the Court that the trial court had incorrectly awarded damages to the homeowners because the damages should have been calculated using cost figures as of the date of the breach, not cost figures as of a date after the date of the alleged breach. More particularly, the homeowners’ expert testified at trial that the cost to remedy all the issues would be $414,372 using cost figures as of September 2, 2022—a date nearly three years after the date of the breach of contract. As you will read, this turned out to be a fatal flaw in homeowners’ case against the contractor. The Court’s role was to determine whether or not the trial court applied the correct measure of damages to the homeowners’ breach of contract claim.

Early in the Court’s opinion, the Court points out that “[d]amages for a breach of contract should be measured as of the date of the breach;” “[f]luctuations in value after the breach do not affect the nonbreaching party’s recovery [of damages];” and “[d]amages are not supported by competent, substantial evidence when damages are assessed for a time other than that of the time of breach.”

The Court went on to cite a Florida Supreme Court case which directly speaks to the issue and provided that damages for a breach of contract case are measured as of the date of the breach in Grossman Holdings Ltd. V. Hourihan, 414 So.2d 1037 (Fla. 1982).

The Court went on, citing yet another case where a trial court found that damages for replacing a defective roof were based on the cost of damages calculated five years after the occurrence of the breach of contract. On appeal in that case, the Second District Court of Appeal reversed the trial court’s ruling because the cost of damages should have been determined as of the date of the breach in Peach State Roofing, Inc. v. 2224 South Trail Corp., 3 So.3d 442 (Fla. 2d DCA 2009). Clearly then there is a substantial caselaw on this particular subject that makes it patently clear that the construction damages proven at trial must be based upon the actual date of the breach of the contract.

In accordance with the aforementioned, the Court pointed out that the homeowners presented no evidence to establish the amount of damages as of the date of the contract breach itself but rather presented evidence of damages which were nearly three years after the date of the alleged contract breach. Because the damages must be measured as of the date of the breach, the damage award from the trial court was not supported by competent, substantial evidence and was therefore fully reversed. It gets worse…much, much worse.

Rather than remanding the case for further proceedings and allowing the homeowners to establish the damages as of the time of the breach, the Court held that the homeowners were not entitled to remedy their own failure to present competent, substantial evidence of damages as of the date of the breach of contract to support their claim. Thus, the homeowners were not entitled to “a second bite of the apple” to prove their damages since they already had the opportunity to prove their case and failed. Therefore, since the homeowners were required to prove their damages as of the date of the breach and did not do so, they failed to meet their burden of proof. Therefore, the Court reversed the trial court’s judgment and instructed the trial court to enter judgment in favor of the contractor. Now, here comes the really bad part.

While not addressed in Vuletic Group, the effect of the Court’s ruling will also allow the contractor to seek its prevailing party attorney’s fees and costs against the homeowners at both the trial court and appellate court levels. So at the end of the day, not only did the homeowners lose their damage claim, which really should have gone their way had they proven their damages as of the date of the breach rather than a later date, but also the homeowners will likely be faced with having to pay prevailing party fee awards in favor of the contractor that allegedly caused the homeowners’ damages in the first place. Talk about a double whammy, wow!

Choosing the right attorney is no small undertaking. It is so very important that the attorney has a thorough understanding of the body of law at issue. When you hire board-certified attorneys, the Florida Bar is affirming the attorney’s expertise in a particular field. Is your association using a law firm with board-certified attorneys?

August 6, 2025September 10, 2025

What Managers and Board Members Need to Know About House Bill 913

On June 23, 2025, Florida Governor DeSantis signed House Bill 913 (HB 913) into law. Its provisions took effect on July 1st. In last month’s Roundup we discussed how HB 913 amends the Florida Condominium Act, Chapter 718, Fla. Stat. In today’s article the Roundup considers how HB 913 affects Chapter 468, Fla. Stat., which addresses the statutory requirements for both management companies and individual licensed community association managers (LCAMs). The following information is presented generally in the order in which it is presented in HB 913.

If an LCAM’s license is revoked, then such individual cannot own any interest in a management company during the 10-year period after the effective date of the license revocation and cannot reapply for ownership in a management company until such 10-year period is completed.

LCAMs must create and maintain an online licensure account with the Florida Department of Business & Professional Regulation (DBPR). In addition, all LCAMs must both identify the community(ies) for which he or she is designated as an on-site manager, and such records must be updated within 30 days of any changes.

A community association management company must identify for the DBPR all managers that it employs to provide community association management services.

If an LCAM has his or her license suspended or revoked, then the DBPR is obligated to provide notice to the LCAM’s management company in which they are employed and must also notice all community associations to which the LCAM is assigned.

An LCAM must not knowingly perform any act directed by a community association if such act violates any state or federal law.

If the community association is subject to the statutory requirements of the structural integrity reserve study and/or milestone report, then such LCAM must comply with all relevant sections of law as directed by the community’s board of directors.

All management contracts must have, in at least 12-point type, the following language: “The community association manager shall abide by all professional standards and recordkeeping requirements imposed by part VIII of chapter 468, Fla. Stat.

An LCAM must attend at least one board meeting or member meeting per year (while this is not a new requirement in HB 913, it is important to note).

All LCAMs must post their hours of availability and summary of duties in a conspicuous place in the community, which must also be posted on a website (or app) if the association is required to have one (while this is not a new requirement in HB 913, it is important to note).

LCAMs and management companies must provide a copy of the management contract if requested by a member. (This obligation is separate and distinct from an official record request, and while not a new requirement in HB 913, it is important to note.)

A rebuttable presumption of conflict of interest exists if the LCAM, or their relative, proposes to enter into a contract or other transaction with the association or actually enters into such contract for services or goods other than community association management services. Such a proposed conflict must be disclosed on the board meeting notice and agenda along with a copy of the proposed contract attached to the meeting notice (and such contract must be approved by two-thirds of all directors present at the meeting). However, if the community association manager or firm previously disclosed a conflict of interest in an existing management contract with the association, such conflict of interest does not need to be additionally noticed and voted on during the term of the management contract but, upon renewal, must be noticed and voted on as described above.

If a violation of the conflict-of-interest requirements occurs, then the contract itself is voidable by the board; and the association only owes the vendor for monies due up to the date of cancellation and is not liable for any other damages including liquidated damages, etc. which may otherwise be due under the contract.

If the association receives and considers a bid for a good or service that exceeds $2,500, and the good or service is unrelated to community association management services, and such good or service would be reasonably construed as a conflict of interest under § 468.4335 F.S., the association must receive multiple bids from other providers; however, this requirement of multiple bids does not apply to any goods or services that are disclosed in the management services contract as a conflict of interest.

If you have any questions regarding anything discussed herein, please be sure to discuss them with your association’s legal counsel.

July 1, 2025July 9, 2025

House Bill 913: A Summary of What You Need to Know

As initially written for the Florida Community Association Journal, by the time you read this article we will know whether Florida House Bill 913, as approved by both houses of the Florida Congress, is the law of the state. In fact HB 913 was approved by the Governor and will be effective July, 1 2025.

This bill primarily pertains to condominium and cooperative associations. There are also new requirements for licensed community association managers and management companies that will be addressed in detail in our 2025 Legal Update Guide and a future Roundup article, too. Homeowners’ associations governed by Chapter 720 F.S.are not addressed in this bill.

With that in mind, let’s take a look at a few of the more notable changes as related to condominium associations.

- - The term “video conference” is added to § 718.103, F.S., and requires that if a video conference is used (such as Zoom), then a hyperlink and call-in conference telephone number be set out in the meeting notice along with a physical location for unit owners to attend in person. Such a meeting must be recorded, and the recording must be maintained in the official records of the association for at least one year. With the aforementioned in mind, it is now clear that board meetings and membership meetings can be conducted by video conference so long as the foregoing requirements are followed.
  - If a unit owner membership meeting is held electronically and the foregoing requirements are followed, then the unit owners may vote electronically.
  - If the annual membership meeting of the members is held electronically, then a quorum of the board of directors must be physically present at the physical location, the meeting must be recorded, and of course the recording must be maintained as an official record of the association. The Florida Division of Condominiums is charged with adopting additional requirements. (Yes, it is quite strange that this new law requires a majority of the board to be physically present when in fact it is a membership meeting, not a board meeting. Perhaps this will get straightened out in future legislation or not.)
  - If the bylaws are silent as to the required location, unit owner membership meetings must be held within 15 miles of the condominium property or within the same county as the condominium property.
  - Condominium associations will be required to have an insurance replacement cost appraisal performed every three years.
  - Official records now include electronic records, bank statements and ledgers, recordings of all such meetings that are conducted by video conference, and all affidavits as may be required by Chapter 718 F.S.
  - A board of directors may use their best efforts to make prudent investment decisions carefully considering risk and return to manage both operating and reserve funds. This new legislation makes clear that the board can invest in certificates of deposit, savings and loans, banks, and credit unions without a vote of the unit owners.
  - If a board of directors prepares a budget that requires assessments against the unit owners that exceed 115 percent of the prior year assessments, then the board must also simultaneously propose a “substitute” budget that does not include any of the “discretionary” expenditures that are not required to be in the budget. The substitute budget must be proposed before adoption of the other budget that exceeds the 115 percent. Unit owners will have the right to vote on that substitute budget and may adopt it if it meets with the approval of the majority of the total voting interests unless the bylaws require a greater percentage. The 115 percent calculation excludes repair, replacement, and maintenance of the components required for the structural integrity reserve study along with insurance premiums.
  - The prior $10,000 threshold for statutory reserves has been increased to $25,000, meaning that the budget must include reserves for capital expenditures and deferred maintenance for roof replacement, building painting, pavement resurfacing, and any other items that have deferred maintenance or a replacement cost that exceeds $25,000 or such inflation-adjusted amount. The same is true for the structural integrity reserve study (“SIRS”) items, meaning that reserves for the SIRS items must include any other item that has a deferred maintenance or replacement cost that exceeds $25,000 (rather than $10,000), and the failure to maintain such item would negatively affect any of the SIRS items.
  - Structural integrity reserves may be funded by regular assessments, special assessments, lines of credit, and loans; but if it is being funded by special assessment, line of credit, or loan, then an approval of the majority of the total voting interests of the membership is required.
  - Clarification is provided that a unit owner-controlled association subject to a structural integrity reserve study that has forthcoming capital expenses as required by a milestone inspection may obtain a line of credit or loan to fund the cumulative amount of the previously waived or underfunded reserves.
  - Clarity is provided that requirement for a structural integrity reserve study, which must be prepared at least once every 10 years, only applies to condominiums that are three or more “habitable” stories.
  - For a budget adopted on or before December 31, 2028, if the milestone inspection was completed within the previous two years, then the board of directors (with the approval of a majority of the total voting membership interests) may temporarily “pause” for a period of not more than two consecutive annual budgets the reserve fund contributions or reduce the amount of such funding. If a condominium association does properly “pause” such funding, then they must have a new structural integrity reserve study performed to determine the new needs and to recommend a revised reserve funding plan. This “pausing” option excludes developer-controlled associations, unit owner-controlled associations where the owners have been in control for less than one year, and condominium associations controlled by a bulk buyer or bulk assignee.
  - Reserve funding for the structural integrity items can only be pooled with other structural integrity reserve items (and pooling can be used for nonstructural reserve items as well).
  - In order for a condominium association to go from straight-line funding to pooling or from pooling to straight-line funding, a vote of the membership is no longer required. Such decisions will be vested to the board of directors.
  - The Division of Condominium is to adjust the minimum $25,000 reserve threshold annually to account for inflation.
  - The structural integrity reserve study must, at a minimum, include a recommendation for a funding schedule based on a baseline funding plan that provides a funding goal for each year that is sufficient to ensure the cash balance is always above zero. Additionally, the structural integrity reserve study must take into account the funding method used by the association, whether via regular assessments, special assessments, lines of credit, or a loan. If the structural integrity study is completed before the association knows how it will be funded, then after the decisions are made regarding the funding of the structural integrity reserve study, the actual study must be updated to take into account the selected funding method.
  - Clarity is provided that the structural integrity reserve study must be completed by December 31, 2025, instead of December 31, 2024. But, if the condominium association is required to have a milestone inspection by December 31, 2026, then such association can do the structural integrity reserve study simultaneously with the milestone inspection.
  - If a condominium association completed a milestone or similar inspection as required by local government, then the association may delay its structural integrity reserve study for no more than two budget years to focus on the financial resources now required for repair and maintenance as required by the milestone inspection.
  - An officer or director (not manager) must sign an affidavit acknowledging receipt of the completed structural integrity reserve study.
  - If 25 percent of the unit owners petition the board to adopt electronic voting within 180 days of the last annual meeting, then the board must hold a meeting within 21 days after receipt of the petition to adopt electronic voting. Additionally, if electronic voting is not provided for, then there are new provisions requiring unit owners to have the opportunity to electronically transmit a ballot to an email address designated by the association (which would obviously waive anonymity if the vote is for the election). The electronic ballot must comply with the statutory form.
  - The 14-day requirement for a board meeting notice where electronic voting will be considered is deleted.
  - Regarding hurricane protection, unless provided otherwise in the declaration of condominium, a unit owner is not responsible for removal or reinstallation of hurricane protection, window, or other aperture if removal is necessary for maintenance, repair, or replacement of the condominium or association property for which the association is responsible.

The aforementioned is intended as a summary review only. Do not make the mistake of relying on summary reviews, but rather only on the text of the legislation itself. Stay tuned for future Rembaum’s Association Roundup articles regarding this new legislation. If you’re not receiving our electronic versions, then you are not receiving all of our publications. Remember to check in with your association’s lawyer regarding any questions you may have concerning this new legislation.

June 12, 2025June 12, 2025

Accusations Of Racial Discrimination by the HOA

Admittedly there are always two sides to every story. This is why we have the American judicial system to get to the resolution of a matter as decided by the “trier of fact,” be it the judge or jury, after hearing from both the accuser and the accused (or in civil terms, hearing from the plaintiff and defendant). In most civil cases a plaintiff only needs to prove that a particular event was more likely than not to have occurred. This is referred to as a “preponderance of the evidence” standard of proof, meaning that a majority of the evidence favors the plaintiff’s position. But, before the parties can get to that stage, the plaintiff first must sufficiently allege a cause of action against the defendant. If not, then the plaintiff’s lawsuit is subject to being dismissed. Well, that is exactly what happened in the recent federal appellate case of Watts v. Joggers Run Property Owners Association, Inc., 133 F.4th 1032 (11th Cir. 2025), in which the plaintiff, Watts, appealed the dismissal of her case in its entirety by the lower court, the U.S. District Court for the Southern District of Florida.

In the underlying action, Watts alleged Joggers Run of taking unlawful actions against her, her family, and her guests due to their race and brought claims against Joggers Run under both the Fair Housing Act and the Civil Rights Act. Watts accused Joggers Run of selectively enforcing its rules pertaining to parking, pets, yard sales, and penalty fees against her and her family but not against non-Black residents. She accused the association’s president of referring to Black people as “monkeys” and another director of using derogatory, race-based comments. She alleged that she was limited to three minutes when addressing the board, but other non-Black owners were not so limited; and when she complained about this, somehow the board stripped her of her board membership without any notice to her. She alleged that the association denied her children use of the basketball courts because a director complained about there being noisy Black kids and “too many people of color” using the basketball courts. She alleged that the association accused her Black guest of trespassing and vandalizing cars. Other discriminatory practices were alleged in the lawsuit as well.

Joggers Run moved to dismiss the entire complaint for failure to raise any cognizable claim under both the Fair Housing Act and the Civil Rights Act. The lower district court granted that motion. While the lower court found that the alleged conduct of Joggers Run was reprehensible, it nevertheless ruled that none of Watts’s allegations could support her statutory claims and dismissed the lawsuit. Watts then appealed the dismissal to the U.S. Court of Appeals of the Eleventh Circuit, which ultimately reversed the lower court’s dismissal and remanded the parties back to the lower court for further
proceedings.

The standard of review employed by the Appellate Court is, in this instance, de novo, meaning the Appellate Court reviews the matter as if it were being considered for the first time, allowing for a new analysis of the facts and law involved. The Appellate Court noted that to withstand a motion to dismiss for failure to state a claim, the plaintiff’s complaint must include enough facts to state a claim for relief that is plausible on its face. The plaintiff must allege more than mere conclusions and formulaic recitations of the elements of a cause of action. But, however, in Fair Housing Act discrimination cases, the Appellate Court recognized that it can be difficult to define the precise formulation of a required prima facie case before the process of discovery has an opportunity to unearth all the relevant facts and evidence. That said, the allegations in the complaint should be judged by the required statutory elements.

The Appellate Court began its discussion with a brief history and the importance of the Fair Housing Act. As found by a bipartisan committee appointed by President Lyndon B. Johnson, national fair housing laws were necessary to end evident and profoundly divisive housing discrimination. In response, Congress passed the Fair Housing Act in 1968 to provide for fair housing within the United States; and in Sections 1981 and 1982 of the Civil Rights Act, Congress provided that all Americans, regardless of race, are entitled to equal contract and property rights.

While the Fair Housing Act makes it unlawful to discriminate against any person in the terms, conditions, or privileges of the sale or rental of a dwelling or in the provision of services or facilities in connection therewith because of race, color, religion, sex, familial status, or national origin, Congress did not provide a list as to what these “terms, conditions, and privileges” actually are. Later, through adoption of regulations by U.S. Department of Housing and Urban Development under the Fair Housing Act, we learn that access to communal spaces is within the scope of “terms, conditions, and privileges” of the sale or rental of a dwelling and that limiting the use of such privileges because of race would be a violation of the Fair Housing Act. In other words, when a person enters into an enforceable agreement for the purchase of property that includes a mandatory obligation to be a member of a homeowners’ association, then discrimination is prohibited as related to any of the privileges, services, and facilities afforded by membership in the homeowners’ association. The Appellate Court found that Watt’s complaint sufficiently alleged that she was denied equal access and treatment because of her race by Joggers Run.

In examining whether Watts had sufficient allegations to withstand the motion to dismiss regarding the Civil Rights Act, the Appellate Court found that it only needed to “initially identify an impaired contractual relationship under which Watts had rights.” The Appellate Court found, “The HOA rules created an enforceable contract that governed the residence rights and responsibilities and benefits of membership.” Because Watts alleged that the HOA violated its own rules and regulations by allowing non-Black residents to violate the rules and regulations while enforcing the rules and regulations against her and her family due to their race, Watts plausibly alleged that the contractual relationship was violated by Joggers Run in contravention of its own rules and regulations, which was sufficient to bring such a lawsuit. In fact, the United States Supreme Court broadly construes the Civil Rights Act to protect not merely the enforceability of property interest acquired by Black citizens but also their right to use property on an equal basis with White citizens.

Watts alleged that the Joggers Run created a dual property system where White owners could fully enjoy the amenities’ common areas and services while Watts, as a Black resident, could not. In conclusion the Appellate Court found that Watts’s complaint presented plausible claims for relief under the Fair Housing Act and under the relevant sections of the Civil Rights Act. Therefore, the case was reinstated and remanded back to the lower court for further proceedings.

Given that the facts of the case have yet to be tried in court, whether racial discrimination occurred against Watts remains to be heard and determined by the trier of fact. All that we know for the time being is that Watts has sufficiently stated her complaint to make a primary showing of discrimination, but whether it actually occurred or not will have to be decided later after all relevant evidence and testimony is reviewed by the trier of fact.

Reviewing the alleged facts in a light most favorable to and as presented by Watts, it certainly seems as though discrimination may have occurred. However, could Joggers Run have accomplished the car towing, the closing of the basketball court, and its other actions in a lawful, non-discriminatory manner? The short answer is, “likely so,” if it had equally enforced its rules and regulations against all owners and followed the required procedures. Had Joggers Run equally enforced its rules and regulations and followed the required procedures, then Watts’s claims could have failed.

Regardless of equal enforcement, making disparaging comments regarding any member’s race, color, religion, sex, familial status, or national origin is not only fundamentally wrong but also sets the stage for all the board members’ acts to be judged with those racially charged comments in mind. To make such comments as a board member could be, if proven true, fatal to the association’s position. Had the Joggers Run board members not made racially motivated comments, if it did as alleged by Watts, and had they engaged the association’s attorney to provide important and necessary guidance, then in all likelihood this entire fiasco could have been avoided.

May 22, 2025May 27, 2025

Board Member Fiduciary Duties Owed to the Association

What is the standard of care that a community association officer and board member owe to their association? The Homeowners’ Association Act (Ch. 720 Fla. Stat.) provides in §720.303, “The officers and directors of an association are subject to §617.0830 and have a fiduciary relationship to the members who are served by the association.” The Condominium Act (Ch. 718 Fla. Stat.) in §718.111 similarly provides, “The officers and directors of the association have a fiduciary relationship to the owners.” Still, though, there is no express definition of the term “fiduciary relationship” set out in either piece of legislation.

With that in mind, let’s take a look at some of the more common definitions of the term “fiduciary,” including the following:

- - A fiduciary relationship is a relation between two parties wherein one party (fiduciary) has the duty to act in the best interest of the other party (beneficiary or principal).
  - A fiduciary is a person who holds a legal or ethical relationship of trust with one or more other parties. Typically, a fiduciary prudently takes care of money or other assets for another person.
  - A fiduciary duty is a relationship in which one party places special trust, confidence, and reliance in and is influenced by another who has a fiduciary duty to act for the benefit of the party.
  - Most importantly, and germane to this discussion, a fiduciary is a person or organization that acts on behalf of another person or persons, putting their clients’ interests ahead of their own, with a duty to preserve good faith and trust.

From all of this we can glean that a good community association board member puts the interest of their association well above their own personal interests. Not only are homeowners’ associations subject to Chapter 720, Florida Statutes, and condominium associations subject to Chapter 718, Florida Statutes, but both are subject to Florida’s Not-For-Profit Corporation Act, Chapter 617, Florida Statutes. Section 617.0830, Fla. Stat., provides a mechanism that will shield a director from breach of fiduciary duty claims so long as they follow the requirements set forth in this ever-important piece of legislation.

Section 617.0830, Fla. Stat., provides,

A director shall discharge his or her duties as a director, including his or her duties as a member of a committee, In good faith;

With the care an ordinarily prudent person in a like position would exercise under similar circumstances; and

In a manner he or she reasonably believes to be in the best interests of the corporation.

In discharging his or her duties, a director may rely on information, opinions, or reports, including financial statements and other financial data, if prepared or presented by the following:

One or more officers or employees of the corporation whom the director reasonably believes to be reliable and competent in the matters presented;

Legal counsel, public accountants, or other persons as to matters the director reasonably believes are within the persons’ professional or expert competence; or

A committee of the board of directors of which he or she is not a member if the director reasonably believes the committee merits confidence.

A director is not acting in good faith if he or she has knowledge concerning the matter in question that makes reliance otherwise permitted by i, ii, and iii immediately above unwarranted. (In plain English and for example, this means if you have reason to know that you should not rely on such professional advice because say the expert was impaired, then relying on his or her advice will not provide the statutory protection.)

A director is not liable for any action taken as a director, or any failure to take any action, if he or she performed the duties of his or her office in compliance with all of the aforementioned.

Therefore, for example, should the association’s legal counsel or other selected expert in a particular field provide advice to the association’s board and then the board member decides to act in a contrary manner, then such board member would not have the aforesaid statutory protection and, in fact, could be accused of acting in bad faith should they act in a manner contrary to the advice or instruction of the expert.

Condominium association directors should be aware that pursuant to §781.112, Fla. Stat., a willful and knowing failure to complete the structural integrity reserve study and/ or the milestone inspection when required to do so is considered to be an automatic breach of such officer’s and director’s fiduciary relationship to the unit owners. Yikes!

Additionally, the “business judgment rule” protects board members from their decision making so long as the board member acted in such a manner as would any other reasonably prudent person under similar circumstances. Generally, the decisions of directors are not subject to successful attack unless there is a showing of fraud, criminal activity, self-dealing, dishonesty, or incompetency. In fact, in the often-cited seminal case Sonny Boy, L.L.C. v. Asnani, 879 So. 2d 25, 28 (Fla. 5th DCA 2004), the court held that the directors of a condominium association were not personally liable for failing to maintain and repair common elements where the accusation was that rental revenue was lost as a result thereof because there was no showing of fraud, self-dealing, or unjust enrichment.

The Sonny Boy court went even further when it wrote in its opinion that “it is well established in Florida that absent fraud, self-dealing and betrayal of trust, directors of condominium associations are not personally liable for the decisions they make in their capacity as directors of condominium associations.” See, e.g., Perlow v. Goldberg, 700 So.2d 148 (Fla. 3d DCA 1997) (finding directors of condominium associations not individually liable for actions and governance of condominium association); Taylor v. Wellington Station Condominium Association, Inc., 633 So.2d 43 (Fla. 5th DCA 1994) (finding that in general, corporate directors and officers cannot be personally liable for corporate acts absent actual wrongdoing in the form of fraud, self-dealing, or unjust enrichment to trigger individual liability); Munder v. Circle One Condominium, Inc., 596 So.2d 144 (Fla. 4th DCA 1992) (reversing lower court’s finding of individual liability by condominium developer). Similarly, §617.0834(1), Florida Statutes (2002), and §607.0831(1), Florida Statutes (2002),[2] provide insulation for condominium association directors from liability in their individual capacities absent fraud, criminal activity, self-dealing, or unjust enrichment. Perlow, 700 So.2d at 149.”

In Grand Harbour Community Association, Inc. v. G.H. Vero Beach Development, LLC., Case No. 4D2023-1191, (Fla. 4th DCA Oct. 2, 2024), the trial court had found that the developer and the developer-appointed directors were entitled to summary judgment on the breach of fiduciary duty claim because no evidence existed that the developer-appointed directors had acted in bad faith in failing to fund the reserves or in undercharging the developer for its deficit funding obligation, and therefore there was no basis to hold the developer vicariously liable for the acts of its appointed directors. Then, on appeal, the 4th District Court of Appeal affirmed the trial court ruling because “the community association declaration provided that the board members shall not be liable for any mistake of judgment, negligent or otherwise, except for their own individual willful misfeasance, malfeasance, misconduct, or bad faith.””

The appealate court continued, “Under Florida law, the ‘business judgment rule’ protects directors of non-profit corporations, from personal liability for any actions undertaken as directors ‘absent a showing of bad faith, self-dealing, or a violation of criminal law,’” citing New Horizons Condo. Master Ass’n. v. Harding, 336 So. 3d 796, 799 (Fla. 3d DCA 2022).

In yet another case, Miller v. Homeland Prop. Owners Association, Inc., 284 So. 3d 534, 537 (Fla. 4th DCA 2019), the court held that deference to community associations’ decisions must be given when i) the association had the contractual or statutory authority to perform the relevant acts; and ii) the board acted reasonably and not in an arbitrary, capricious manner or in bad faith.

So, while Florida Statutes and relevant case law provide a strong level of protection in favor of officer and board member decision making, such decisions should be rendered reasonably, in reliance on expert opinions (when relevant), and not decided in bad faith or in an arbitrary and capricious manner or in a manner that suggests self-dealing or unjust enrichment, etc. in favor of the officer and director(s).

April 15, 2025May 27, 2025

Not all Expenditures Can Be Collected from Delinquent Owners as Part of the Collection/Foreclosure Process – Why Not?

It is clear that Florida’s community association collection/foreclosure legislation allows associations to foreclose an owner’s home for nonpayment of assessments. However, not all of the monies expended by an association fit into the definition of an assessment. For example, let’s say that an association has a right to correct a deficiency on an owner’s lot, but the declaration of covenants at issue does not support converting the money spent into an assessment. In that event, the monies expended by the association would have to be recovered as part of a breach of contract action rather than as part of an assessment/foreclosure action. Sometimes, however, the declaration will provide that the monies expended can be treated as an assessment. If that is the case, then before those expenditures can be included as a part of the collection/foreclosure process, the board would need to convert the expenditure into an assessment against the noncomplying owner. (As to how that is done, you can discuss it with your community association’s attorney.) Florida’s collection/foreclosure legislation also provides for recovery of certain costs incidental to the collection/foreclosure process, but recovery of such cost must be rooted in a statute or by contract (i.e., the declaration of covenants).

Let’s look at the fee charged by a management company for sending the notice of late assessment letter, often referred as a NOLA letter, as required by Florida Statute, and determine whether it is a recoverable cost in an association’s collection/foreclosure action and whether including the NOLA fee as a part of the association’s collection/foreclosure proceedings violates the Federal Fair Debt Collection Practices Act (the Act).

The Act was passed into law because of abundant evidence of the use of abusive, deceptive, and unfair debt collection practices. It does not matter whether a debt collector used their best efforts to comply with the Act. Only strict compliance matters when it comes to the enforceability of the Act against a debt collector. Clearly, the association is not considered a “debt collector” pursuant to the Act and, for the most part, neither are management companies, with this caveat: the pendulum may swing in the future to the notion that management companies are, in fact, debt collectors. It seems that at least for the time being they are shielded from the Act. However, what is patently clear is that an attorney who provides collection/foreclosure services to assist their association clients with delinquent assessments is certainly considered a “debt collector.” Therefore, the attorney must be vigilant when reviewing the delinquent owner’s account ledger to ensure that the items set out in the ledger can lawfully be included in the association’s collection/foreclosure action. A recent case reminds us of this fact.

On February 4, 2025, in Glover v. Ocwen Loan Servicing, Case no. 23-12578 & 12579 (11th Cir. Fla. 2025), the 11th Circuit of the Federal Court of Appeals found that Ocwen as a debt collector violated the Fair Debt Collection Practices Act when it charged consumers an optional fee when making expedited mortgage payments because the loan servicer charged an amount that was not expressly authorized by the agreement creating the debt or permitted by law. The takeaway from this case is that a debt collector can only collect debts that are authorized by law or by contract with the debtor.

It was only several years ago that the Florida legislature enacted into law the requirement that an association assessment debtor must be provided the NOLA correspondence from the association providing the debtor a final opportunity to pay their delinquent assessment debt prior to turning the matter over to the association’s legal counsel to commence collection/foreclosure proceedings where fees and costs accrue against the debtor. See S. 718.121 and S. 720.3085, Fla. Stat.

Management companies are typically tasked with preparing and sending the NOLA letter on behalf of the associations they manage before turning the file over for collections to the association’s attorney. In this regard, a management company that is charging such a fee but has not amended its contract with the association to provide for charging the fee for the notice of late assessment would be wise to consider amending its contract with the association they represent to provide for this charge. Doing so would ensure that the management company, even though it may not be considered a “debt collector,” would have a solid basis for charging the fee because it would be based on a contractual obligation charged to the association. This is important because the NOLA, as mandated by Florida Statutes, does not at all provide for the recovery of a fee in regard to sending such a letter. So, while management companies may not be considered a “debt collector” today, this could change in any new case at any time. Why take the chance?

Now, let’s analyze whether the attorney who is collecting the past due assessment debts for the association can include the management company’s NOLA fee paid by the association to the management company in the collection/foreclosure action against a delinquent owner. Keep in mind, as we go through the analysis, that the “debt collector” (in this case, the attorney) can only collect debts authorized by contract or by law, and also remember that the relevant laws governing the NOLA letter do not provide for a specific cost recovery for the management company sending of the notice of late assessment letter. Thus, at a minimum, there should at least be a contractual obligation that the association pay the management company for sending the NOLA letter. But that may not always be the case even though it is the better practice.

Part and parcel with the collection/foreclosure process is the recording of an association assessment lien. To be valid, such a claim of lien must state the description of the parcel, the name of the record owner, the name and address of the association, the assessment amount due, and the due date. The claim of lien secures all unpaid assessments that are due and that may accrue subsequent to the recording of the claim of lien and before entry of a certificate of title, as well as interest, late charges, and reasonable costs and attorneys’ fees incurred by the association incident to the collection process.

So, while the relevant statutes do not provide for the association to be able to recover a fee for the sending of the NOLA letter, it certainly should be considered a “reasonable cost incurred by the association incident to the collection process,” most especially when the fee charged for sending the NOLA letter is a contractual obligation between the association and the management company.

There even exists an argument that, even if the management contract between the association and the management company does not provide that the association is responsible to pay the management company for the preparation and sending of the notice of late assessment, it is still considered a “reasonable cost”; but when you plug in the holding of the aforementioned case, the collection of the cost associated with the NOLA letter by the debt collector (i.e., the attorney representing the association), the better practice is to ensure that the contract between the management company and the association contains a provision that the association is responsible to pay the management company a reasonable fee for each such notice of late assessment letter sent.

Perhaps now you have a better understanding of why, at times, the association’s collection/foreclosure attorney cannot include a particular line item on the delinquent owner’s account ledger in the collection/foreclosure action. If you have any questions regarding the collection/foreclosure process, most especially which charges can and cannot be included, please be sure to discuss them with your association’s attorney.

March 19, 2025March 19, 2025

Are Changes to Association Landscaping a Material Alteration That Requires a Vote of the Owners?

If you live in a community association, especially if you serve on the board, you may already be familiar with the term “material alteration.” In Sterling Village Condominium Association, Inc., v. Breitenbach, 261 So. 2d 685, 687 (Fla. 4th DCA 1971), the Court defined the term material alteration as follows:

[T]o palpably or perceptively vary or change the form, shape, elements, or specifications of a building from its original design or plan, or existing condition, in such a manner as to appreciably affect or influence its function, use, or appearance.

Generally, an association’s declaration provides the manner in which material alterations to the common elements and common areas are to be accomplished and the necessary percentage of the unit owners required to approve material alterations, if any. In a homeowners’ association such decisions are left to the discretion of the board of directors unless the governing documents provide otherwise. As to condominium associations, absent a provision in the association’s declaration providing otherwise, section 718.113(2)(a), Florida Statutes, provides in relevant part that 75 percent of the total voting interests of the association must approve the alterations or additions before the material alterations or substantial additions are commenced.

Appellate courts have even carved out exceptions to situations where a material alteration requires a vote of the membership when the material alteration and resulting special assessment are necessary for life safety reasons. In fact, courts often provide boards of directors great deference due to the operation of the business judgment rule. For example, in Tiffany Plaza Condominium Association, Inc. v. Spencer 455 So. 2d 454 (Fla. 2nd DCA 1982), without the required vote of the owners, when it was otherwise required, the board of directors opted to construct a rock revetment wall in the sand between the condominium’s seawall and the mean high tide line. The area in question was part of the association’s common elements since it owned the land from west to east all the way to the mean high tide line. Owners who were unhappy with the association’s unauthorized assessment sued the association. The association defended itself on the basis that the rock revetment was not an alteration or improvement of a common element but rather was part of the maintenance, repair, and replacement of a common element that the association had responsibility for under several provisions of the declaration, its bylaws, and statutes. While the trial court agreed with the plaintiff owners, the Second District Court of Appeal reversed the trial court decisions and held that:

If in the good business judgment of the association, alteration or improvement of the beachfront by addition of a rock revetment would protect the beach from damage and the necessity of subsequent repair or replacement then that cost should also be borne equally by all unit owners.

With the foregoing in mind, let’s examine landscaping alterations and whether making landscaping changes to a condominium’s common elements constitutes a material alteration requiring a vote of the unit owners. The Florida Division of Condominiums, Timeshares & Mobile Homes (the “Division”) has published arbitration decisions from which we can glean an answer. (It is important to note that these arbitration decisions only provide limited guidance. Such decisions do not create precedent in any way, not even for the Division and certainly not for any appellate court. But, they do provide guidance. It is also important to note that when examining issues of community association law, when there is not a developed law on a particular issue, both condominium associations and homeowners’ associations tend to rely on each other’s body of law.)

In Girsch v. Whisper Walk Section E Association, Inc. (Arb. Case No. 97-0305), an owner challenged the board’s decision to replace a hibiscus hedge with a ficus hedge on the basis that a material alteration resulted. The arbitrator ruled that the foregoing was not a material alteration and stated, in pertinent part, that:

Board decisions regarding what shrubbery to plant or how to replace existing shrubs particularly implicate the business judgment decision of the board and rarely grow to the dimensions necessary to implicate the provisions of the documents or statute regarding material alterations to the common element… Moreover, changes apparent in a garden setting are not interchangeable with the types of decisions typically regarded as requiring compliance with section 718.113(2), Florida Statutes…Changes to foliage may appear dramatic to the observer, but rarely would the function and use of that portion of the common elements be appreciably altered to an extent deemed material. These considerations, combined with the realization that there is less of a legitimate expectation of the status quo in the area of landscaping, which may be transient in a given case, suggests that this area is one particularly ill-suited for material alteration analysis.

As another example, in Katchen V. Braemer Isle Condominium Association, Inc. (Arb. Case No. 98-5485), an owner challenged the board’s decision to make certain landscaping changes which affected the owner’s patio and view. The arbitrator stated, in pertinent part, that:

[I]t is not shown that the contemplated landscaping changes constitute an alteration or betterment within the meaning of the documents…The area in question will not change in function or essential nature; it will still be a landscaped garden area with flowers, bushes, and trees, similar in function to the parcel when petitioners first purchased their unit.

In yet another example, Tilney v. Association of the Fountains, Inc. (ARB. Case No. 02-5651), the owner alleged that the board materially altered the common elements without a vote of the owners as required by the documents and statute due to the addition of trees, landscaping rocks, an irrigation system, and parking spaces upon a previously undeveloped parcel of the property. Again the arbitrator ruled that the foregoing were not material alterations and stated, in pertinent part, that:

The essential character of the property has not changed in a material sense. Some change in appearance is inevitable where landscaping details are altered…but does not compel the conclusion that all changes are material…Even if a material change existed, the degree of maintenance chosen by the board is entitled to a presumption of correctness through operation of the business judgment rule.

Based upon the foregoing arbitration decisions, landscaping decisions such as what shrubbery to plant or how to replace existing shrubs are left to the reasonable business judgment of the board and do not rise to the level of being a material alteration subject to a vote of the unit owners. However, does that mean that all changes to landscaping do not rise to the level of being a material alteration? That answer, like many legal answers: it depends. Sometimes landscaping may be so dramatically changed, or there may be landscaping that is so significant, that changing such landscaping may rise to the level of being considered a material alteration to the common elements (or common areas as to homeowners’ associations).

Such was the situation in Trio Englewood, Inc. v. Fantasy Island Condominium Association, Inc. (ARB. Case No. 98-4670). Here, an owner challenged the board’s decision to remove two trees. However, the two trees in controversy were Norfolk Island pine trees, and the arbitrator was unwilling to rule without the benefit of additional fact finding that removal of such trees could not be considered a material alteration. The arbitrator concluded, in pertinent part, that:

[T]wo very tall, conical trees, [that] are, in setting and type, distinct from the other landscaping, and thus may be sufficiently significant features of the landscape that their removal would constitute a material alteration of the common elements.

However, because the arbitrator requested additional fact-finding, we do not know how the situation fully resolved itself. But, this decision indicates that not all landscape changes are exempt from being considered a material alteration.

Accordingly, the next time your association is contemplating changes to its landscaping, and although many changes to landscaping are left to the reasonable business judgment of the board and do not rise to the level of a material alteration requiring a vote of the unit owners, the board would be wise to consult with the association’s legal counsel to weigh in prior to making such changes.

March 4, 2025March 4, 2025

U.S. Treasury Department Announces Suspension of Enforcement of the CTA

U.S. Treasury Department Announces the Suspension of Enforcement of the Corporate Transparency Act Against U.S. Citizens and Domestic Reporting Companies

Keeping up with the “on again, off again” requirements of the Corporate Transparency Act is like watching a basketball bounce up and down. Finally, however, it appears as though the point guard took the shot and the basket is made.

On March 2, 2025, The Treasury Department announced that, with respect to the Corporate Transparency Act, not only will it NOT enforce any penalties or fines associated with the beneficial ownership information reporting rule under the existing regulatory deadlines, but it will further NOT enforce any penalties or fines against U.S. citizens or domestic reporting companies or their beneficial owners after the forthcoming rule changes take effect either.

The Treasury Department will further be issuing a proposed rulemaking that will narrow the scope of the rule to foreign reporting companies only. Treasury takes this step in the interest of supporting hard-working American taxpayers and small businesses and ensuring that the rule is appropriately tailored to advance the public interest.

“This is a victory for common sense,” said U.S. Secretary of the Treasury Scott Bessent. “Today’s action is part of President Trump’s bold agenda to unleash American prosperity by reining in burdensome regulations, in particular for small businesses that are the backbone of the American economy.”

You can view the official Press Release HERE.

It was also rumored that the Executive branch made an announcement that the United States Treasury will be suspending all future enforcement of the Corporate Transparency Act on American businesses and is working towards an emergency rule for codification of the new enforcement policy in furtherance of its goals toward less governmental regulation.

As new information is obtained we will share it with you, our readers.