REMBAUM'S ASSOCIATION ROUNDUP | The Community Association Legal News You Can Use

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The Interim Status of House Bill 319

Around this time every year, association boards everywhere want to know how this year’s proposed legislation will affect their association.  Me too! The truth is, it is impossible to guess which parts of a proposed bill will actually survive the legislative process.

As far as 2012 is concerned, this year’s legislative bill that most affects community associations is House Bill 319.  Since this bill was originally proposed a few short weeks ago, it has undergone five amendments and is now officially labeled “HB 319c2.”  The “C2” means that the bill is going through the committee hearing process and may have numerous amendments, or the amendments change the original concept of the bill.  In some instances, the bill can be rewritten and a “committee substitute” takes the place of the original.  The next committee may again rewrite the bill, and sometimes more than one bill may be combined.  The committee’s substitute bill continues to carry the identifying number(s) of the original bill(s) filed.  The “c2” designation is a committee substitute for the initial committee substitute.  As to HB319, there are too many committee amendments to list them all.  Three such amendments that might be of interest follow.

In this latest version of the bill, the author makes what is referred to as a “clarification” (remember, that is the author’s term, not mine) to the amount of assessments a first mortgagee lender owes an association for back assessments after the conclusion of its foreclosure lawsuit.  Lawyers have debated this issue for far too long, and clarification is needed.  Some say this clarification is too one sided in favor of the lenders…see what you think.

The revised text of this bill provides that, in determining the assessment liability of the first mortgagee who successfully completed their foreclosure, the assessment calculation excludes interest, administrative late fees, attorneys’ fees, or any other fee, cost or expense the came due prior to the lenders’ acquisition of title.  The underlined text below is the new language that is being proposed to Section 718.116, Florida Statutes.

“The liability of a first mortgagee or its successors or assignees who acquire title to a unit by foreclosure or by deed in lieu of foreclosure for the unpaid assessments, interest, administrative late fees, reasonable costs and attorney fees, and any other fee, cost, or expense incurred in the collection process that became due before the mortgagee’s acquisition of title is limited to the lesser of: Only the unit’s unpaid common expenses and regular periodic assessments that which accrued or came due during the 12 months immediately preceding the acquisition of title and for which payment in full has not been received by the association; or b. One percent of the original mortgage debt…the first mortgagee or its successors or assignees who acquire title to a unit by foreclosure or by deed in lieu of foreclosure are NOT liable for any interest, administrative late fee, reasonable cost or attorney fee, or any other fee, cost, or expense that came due prior to its acquisition of title. This subparagraph is intended to clarify existing law.”

Two other proposed changes include election challenges and hurricane preparedness. As to the former, any challenge to the election process must be commenced within 60 days after the election results are announced.  As to the latter, the Condominium Act would include code compliant windows, doors, or other types of code-compliant hurricane protection in addition to shutters and impact glass.