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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.
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      • 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.

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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.

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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).

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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.

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Board Member Certification

Board Member Certification: Should It Be Just The Beginning?

The Florida legislature requires board members to be “certified” in order to be properly qualified to serve on the board of a residential community association. By now you might think that the requirements are exactly the same for condominium boards as compared against homeowner associations’ boards, but they differ with regard to how long the association is obligated to keep the proof of director certification.

The Florida Condominium Act, more specifically §718.112(2)(d)4.b., Florida Statutes, and the Florida Homeowners’ Association Act, more specifically §720.3033(1)(a), Florida Statutes, require the following:

  • Within 90 days after being elected or appointed to the board of an association of a residential condominium, each newly elected or appointed director shall certify in writing to the secretary of the association that he or she has read the association’s declaration of condominium, articles of incorporation, bylaws, and current written policies; that he or she will work to uphold such documents and policies to the best of his or her ability; and that he or she will faithfully discharge his or her fiduciary responsibility to the association’s members.
  • In lieu of this written certification, within 90 days after being elected or appointed to the board, the newly elected or appointed director may submit a certificate of having satisfactorily completed the educational curriculum administered by a division-approved condominium education provider within one year before, or 90 days after the date of election or appointment.
  • The written certification or educational certificate is valid and does not have to be resubmitted as long as the director serves on the board without interruption.
  • A director of an association who fails to timely file the written certification or educational certificate is suspended from service on the board until he or she complies with this sub-subparagraph. The board may temporarily fill the vacancy during the period of suspension.
  • Failure to have such written certification or educational certificate on file does not affect the validity of any board action.
  • The Condominium Act requires that the secretary shall cause the association to retain a director’s written certification or educational certificate for inspection by the members for five years after a director’s election or the duration of the director’s uninterrupted tenure, whichever is longer, while the Homeowners’ Association Act requires that the association retain each director’s written certification or educational certificate for inspection by the members for five years after the director’s election.

While requiring certification is a good start in regard to providing board members the necessary tools to do their job, there are issues which need to be addressed, such as the following:

  • The ability of a board member to be certified simply by signing an 8 ½ x 11 piece of paper that they read the governing documents, will uphold the governing documents, and will faithfully discharge their duty should be eliminated. How many board members actually read their respective governing documents; and even if they do, what did they learn about corporate governance and the ever-growing body of statutory law, judicial decisions, and intricacies of ensuring that their fiduciary responsibility is being met?
  • The ability to be certified simply by watching a pre-recorded webinar should also be modified or, better still, fully eliminated. Not only do attendees benefit from the one-on-one instruction in a live classroom or webinar setting, but when viewers have the ability to watch from home, well, did they really do so? At present the Department of Business and Professional Regulation (DBPR) does not regulate or police the pre-recorded board certification webinar. These pre-recorded certification courses allow the viewer to cheat the system by simply fast forwarding to the end to make it appear as though the viewer watched the entire presentation, but in reality, they did not! Most importantly, the laws governing community associations are in a constant state of flux. The legislature is continually revising and adding new laws, and appellate courts continually author new opinions affecting community associations. Only by attending a live class, be it in person or by webinar, will a board member have the best opportunity to be fully updated.
  • The information covered in the certification class is primarily of a legal nature emanating from the Florida Statutes and relevant case law. Therefore, only lawyers who are board-certified specialists in this body of law and other lawyers with a sufficient number of years of daily experience in community association law matters should be permitted to teach the initial board certification classes.
  • Continuing education for those board members serving multiple years should be strongly considered, even if it is only one or two hours per year. The continuing education component courses could be led by board-certified specialists in this body of law, or by other lawyers with a sufficient number of years of daily experience in community association law matters, or perhaps even experienced, licensed managers demonstrating sufficient knowledge in the field, regarding a variety of subjects. Also, during the typical initial board member certification course, the variety of subjects needing discussion can only be summarized. Therefore, in-depth analysis of the myriad of issues and subjects discussed is practically impossible given the time constraints, which could be addressed by requiring continuing education. Potential subjects include the following: 
      • Contract pitfalls
      • Budgets and reserves
      • Internal controls
      • Elections
      • Conflicts of interest
      • Approval and screening requirements
      • Fair housing laws
      • Covenant enforcement
      • How to run a board meeting
      • Conflict resolution and de-escalation techniques for angry homeowners.

Requiring an initial board certification was a really good start. However, the process of education must continue. In our opinion, a one-time board certification course is simply not sufficient! Since the law already contemplates that board members will serve multiple years, the law should also contemplate continuing education requirements.

(Written by Jeffrey Rembaum (Kaye Bender Rebaum) and reprinted with permission from the October 2023 edition of the “Florida Community Association Journal“.)

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Fiduciary Duty: What It Means to Your Association

FIDUCIARY DUTY: What it Means to Your Community Association

What duty does a community association board member owe to their association? What happens if that duty is breached? During the 2023 legislative session, legislation was proposed that would have made directors criminally liable for failure to timely respond to official record requests, among other provisions. The legislation in House Bill 919 was proposed by Representative Porras in response to the alleged $3.4 million dollar embezzlement scheme that took place at the Hammocks Community Association, located in Miami-Dade County. Parts of this proposed bill were well-intentioned; however, several provisions were commonly viewed as too broad and expansive.

On November 15, 2022, the Miami-Dade State Attorney’s Office announced charges related to the Hammocks’ criminal case, including racketeering, organized scheme to defraud, money laundering, grand theft, and fabricating physical evidence against five board members. These board members have been accused of the following:

i) running a scheme in which they used HOA checks and HOA credit cards from 55 bank accounts to pay for “no-show” work by shell companies or vendors, who would funnel money back to the directors for their personal use;

ii) withholding official records from members; and,

iii) failure to hold valid elections, among other bad acts.

If found guilty these board members overtly breached their fiduciary duty to their association.

During the 2023 legislative session, House Bill 919 initially contained significant criminal penalties to punish board members who failed to provide official records when they otherwise should have, criminal penalties for kickbacks, and criminal penalties for improper election interference, among other provisions. Such laws, while well intended, went overboard as evidenced by the creation of criminal penalties for failure to provide official records, as such severe criminal penalties for operational matters would likely only deter good people from running for the board. Recognizing this potential issue, parts of HB 919 were tempered a bit prior to it becoming law. That said, in the opinion of this author, new laws with new criminal penalties are not the answer. Bad people do bad things, and no amount of laws will likely significantly change that. So, what is the answer?

One answer is to shore up the educational and certification requirements for board members. At present, there are two ways to be certified as a board member. One method is to take a State-approved class, which provides an overview of the voluminous information board members need to know in order to perform their duties. The other method is to sign a piece of paper that the board member has read the governing documents, will abide by them, and will faithfully discharge their duties. This second method should be eliminated as there is no method to confirm compliance, and this method does not have any educational component. In addition, continuing education requirements should be required for any board member serving consecutive years.

During a board certification class, time should be spent discussing the term “fiduciary duty.” While the term is repeatedly used in Chapters 718 and 720 of the Florida Statutes, it is not expressly defined in these statutes. Section 718.111, Florida Statutes, makes reference to Section 617.0830, Florida Statutes, which provides for general standards for directors of not-for-profit corporations, such as community associations.

Section 617.0830, Florida Statutes, provides the following:

      1. A director shall discharge his or her duties as a director, including his or her duties as a member of a committee i) in good faith; ii) with the care an ordinarily prudent person in a like position would exercise under similar circumstances; and iii) in a manner he or she reasonably believes to be in the best interests of the corporation.
      2. In discharging his or her duties, a director may rely on information, opinions, reports, or statements, including financial statements and other financial data, if prepared or presented by: i) One or more officers or employees of the corporation whom the director reasonably believes to be reliable and competent in the matters presented; ii) legal counsel, public accountants, or other persons as to matters the director reasonably believes are within the persons’ professional or expert competence; or iii) 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.
      3. 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 subsection (2) unwarranted.
      4. 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 this section.

Still, though, there is no express definition of the term “fiduciary duty.” The purpose of studying fiduciary relationships is to identify the areas where it exists and gain an insight into the duties of a fiduciary. After all, every board member is a fiduciary for their community association. Common definitions of the term “fiduciary” include:

      • 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.

In other words, a good community association board member puts the interest of their association above their own personal interests. Thus, while we may not be able to stop bad people from doing bad things, through continuing education we can help good people do better.

To recap, there are three things that can be readily accomplished that would make a positive difference for Florida’s community associations.

      1. Remove the ability of a board member to be “certified” by signature alone.
      2. Require continuing education for board members serving continuous years.
      3. Amend Florida Statutes, Chapters 718 and 720, to include express definitions of fiduciary duty so that it is made patently clear that every board member must put their community association above and ahead of their own personal interests.

(Written by Jeffrey Rembaum (Kaye Bender Rebaum) and reprinted with permission from the September 2023 edition of the “Florida Community Association Journal“.)

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Guns in the Clubhouse: What Can a Community Association Do?

Guns in the Clubhouse: What Can a Community Association Do?

The right of the people to carry and bear arms without governmental infringement is a right which stems from both the United States Constitution and the Constitution of the State of Florida. The State of Florida recently adopted new gun legislation, effective July 1, 2023, which allows the everyday citizen to carry a concealed weapon without first obtaining a concealed weapons permit. This raises interesting questions for community associations such as, is the right to carry a concealed weapon absolute? Can a community association adopt a rule that prohibits the carrying of concealed weapons in the clubhouse or other common area facilities?

Before we get too far in our analysis, it is important to point out that the intent of this article is not to advocate for gun control or the right to carry. Rather, the intent of this article is to examine the rulemaking authority of a board of directors of a community association to prohibit concealed weapons in the clubhouse and other common areas. In short, is it possible for a community association to adopt such a rule? Yes, subject to the cautions and explanations explained below. Is the adoption of such a rule risk free? No!

As the starting point, in order for a board-made rule of this nature to have validity, we must examine whether it violates either the United States Constitution or the Constitution of the State of Florida. As to when constitutional protections apply within a community association, this is an interesting question. In prior cases, courts have found that recorded covenants restricting home ownership based on race will subject the covenants to a constitutional examination, and in the end, such covenants were deemed to violate the equal protection clause of the Fourteenth Amendment to the United States Constitution.

Another method by which courts may find application of constitutional protections to community associations is if there is significant governmental action associated with the community association. For example, an argument would exist that if a community association were built with federal monies, the covenants of such a community association would be subject to all the protections afforded by both the United States Constitution and the Constitution of the State of Florida. Often, multiple community associations that exist within a sprawling master association are built in community development districts (CDD). The CDD is a quasi-governmental entity established to govern and control what would otherwise be the common areas of the master association. The creation of the CDD allows many of the hard costs associated with the community’s build-out, such as the roads and drainage systems, to be immediately passed on to the first-time home buyers. By utilizing a CDD, long-term bonds can be issued, which are paid back through ad valorem tax obligations allowing the costs to spread out over a significantly longer period of time. As quasi-governmental entities, constitutional protections which limit powers of government would likely apply to CDDs. Therefore, should a CDD adopt rules to prohibit concealed weapons in the common areas, such a rule would likely be found to violate constitutional protections. However, the same analysis is not applicable if the community association itself adopted such a rule.

It should be remembered that courts have long held that owners give up certain individual rights and liberties when living in a community controlled by a community association. In 2002 the Florida Supreme Court held, in Woodside Village v. Jahren, 806 So. 2d 452 (Fla. 2002), that certain individual rights must be compromised when one chooses to live in a condominium association (and by analogy, in a homeowners’ association, too). But, on occasion courts have found that certain constitutional protections apply within a community association; however, such application is somewhat rare.

Thankfully, we do have some limited guidance. In 1989 the Florida Supreme Court held, in Quail Creek POA v. Hunter, 538 So. 2d 1288 (Fla. 2d DCA 1989), that neither a homeowners’ association’s recording of its covenants in the public records, nor the enforcement of its covenants in state court, created a sufficient nexus to evidence “state action” such that the First Amendment and the Fourteenth Amendment of the United States Constitution would apply. By analogy, such logic could be applied to defending the right of a community association to adopt a rule prohibiting concealed weapons in the clubhouse. Thus, there is no reason to believe that such arguments would not also apply to the application of the Second Amendment of the United States Constitution within community associations. That said, it would not at all be surprising for an owner to challenge such a rule; so, any association that adopts such a rule should be prepared to be a possible test case, which could have national implications associated with it.

Let us assume that the board understands and accepts such a risk and is ready to move forward to adopt a rule prohibiting the carry of concealed weapons in the clubhouse. Certainly, we recommend that counsel for the association be consulted prior to adopting these types of rules. For the purposes of our analysis, let us also assume that the community association at issue does not have a sufficient nexus to the federal or state governments that would, in and of itself, render such a rule unconstitutional. Under these circumstances, the analysis can then shift to the ordinary rulemaking criteria necessary to withstand judicial challenge, as follows:

      1. Does the board have the necessary rulemaking authority set out in the governing documents or by statute to adopt such a rule?
      2. Does the rule conflict with any rights afforded by governing documents of higher priority, whether they are considered express or implied rights?
      3. Is the rule reasonable? Reasonableness is difficult to define, but case law provides that the rule must be rationally related to a legitimate association objective. The rule cannot be arbitrary or capricious.
      4. Does the rule contravene existing laws or compelling public policies?
      5. Was the rule adopted in a procedurally correct manner that is provided by both the governing documents and existing law?

Of course, even if the association adopts such a rule, enforceability is an entirely different issue. Assuming the association is not using some type of full body scanner, then so long as the possessor of the concealed weapon does not brandish the weapon, and thus it remains fully concealed, no one will be the wiser. In addition, such a rule would not apply to certain individuals who have an absolute right to carry a concealed weapon, subject to very few limitations, such as an off-duty police officer.

As an aside, just because a person may not need to have a concealed weapon permit to carry a concealed weapon, this does not mean that the still-available concealed weapon permit does not have value. It certainly does when it comes to traveling outside the State of Florida to one of the many states, over 26, that have reciprocity with Florida, meaning that the other states recognize Florida’s concealed weapons permit. With that in mind, obtaining a concealed weapons permit may still make sense.

While a properly drafted rule prohibiting guns in the clubhouse stands a decent chance of validity, remember that even if your association

i) fully analyzes whether it has any type of federal governmental nexus which would provide for clear application of constitutional protections and such analysis is answered in the negative, ii) meets the rule adoption criteria listed above, and iii) consults with the association’s lawyer who helps draft such a rule, the association could still find itself as a defendant in a lawsuit seeking to have such a rule invalidated by the court.

(Written by Jeffrey Rembaum and reprinted with permission from the June 2023 edition of the “Florida Community Association Journal”.)

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Sunshine With a Chance of Screaming Children? Not in My Community

Sunshine with a Chance of Screaming Children? Not in My Community! “55+” Communities Under the Housing for Older Persons Act

Florida’s “55+” communities are no longer required to be registered with the Florida Commission on Human Relations, an agency created by the Florida Legislature in 1969 to enforce the Florida Civil Rights Act, which includes Florida’s Fair Housing Laws. However, a community association qualifying as housing for persons 55 years of age or older must still have and follow procedures to determine the occupancy of the homes within the community every two years to maintain the community’s status as a “55+” community.

With Florida’s sunshine, sandy beaches, and countless activities, it is easy to understand why the Sunshine State attracts seniors from colder climates and why Florida residents approaching retirement continue to live here. For those who prefer to be surrounded by their generational peers, there are many communities to choose from that prohibit or restrict occupancy of the homes within the community by children, and more and more are being created every day. If you are an avid reader of this publication, you are already familiar with the Fair Housing Act, and may be asking yourself, “How is this possible when the Fair Housing Act prohibits discrimination in housing against families with minor children?” The answer is, there is an exception for that.

Under the Housing for Older Persons Act, housing providers, including community associations, are exempt from liability for familial status discrimination so long as certain requirements are met and maintained. Although there are three types of housing for older persons exemptions, the most prevalent exemption is for housing intended and operated for occupancy by persons 55 years of age or older. As such, “55+” communities are the focus of this article.

In order for a community to qualify as a “55+” community, the community must comply with the following requirements:

    1. At least 80% of the occupied homes must be occupied by at least one person who is 55 years of age or older; and
    2. The community must publish and adhere to policies and procedures which demonstrate the community’s intent to be a provider of housing for persons 55 years of age or older; and
    3. The community must comply with rules established by the U.S. Department of Housing and Urban Development (“HUD”) for age verification of the community’s residents.

As provided above, a housing provider must publish and adhere to policies and procedures that demonstrate its intent to operate as a “55+” community. For community associations, these policies and procedures are best placed in the homeowners’ association’s declaration of covenants or the condominium association’s declaration of condominium. The Housing for Older Persons Act sets out the following nonexclusive factors that demonstrate a housing provider’s intent to operate as an older persons’ community:

The following factors, among others, are considered relevant in determining whether the housing facility or community has complied with this [demonstration of intent to operate as an older persons’ community] requirement:

      1. The manner in which the housing facility or community is described to prospective residents;
      2. Any advertising designed to attract prospective residents;
      3. Lease provisions;
      4. Written rules, regulations, covenants, deed or other restrictions;
      5. The maintenance and consistent application of relevant procedures;
      6. Actual practices of the housing facility or community; and
      7. Public posting in common areas of statements describing the facility or community as housing for persons 55 years of age or older.

The community association must be able to produce, in response to a complaint filed under the Fair Housing Act, verification of compliance with the 80% occupancy requirement, discussed above, through reliable surveys and affidavits. A community association’s failure to survey its list of occupants in accordance with its age verification procedures does not demonstrate intent to be housing for older persons and could jeopardize the community’s status as a “55+” community.

In performing the required occupancy survey, any of the following documents are considered reliable documentation of the age of the occupants of the homes within the community to ensure that at least one occupant of at least 80% of the homes within the community is 55 years of age or older:

      1. Driver’s license;
      2. Birth certificate;
      3. Passport;
      4. Immigration card;
      5. Military identification;
      6. Any other state, local national, or international official documents containing a birth date of comparable reliability; or
      7. A certification in a lease, application, affidavit, or other document signed by any member of the household age 18 or older asserting that at least one person in the unit is 55 years of age or older.

Now that we know the survey must be done every two years to ensure that at least one occupant of at least 80% of the homes within the community is 55 years of age or older, what about the remaining 20% of the homes? The remaining 20% of the homes may be occupied by persons under the age of 55, and the community may still qualify as a “55+” community. Notwithstanding this 20% allowance, a community association may require that 100% of the homes be occupied by at least one person 55 years of age or older, or that 80% of the homes be occupied exclusively by persons 55 years of age or older. Although up to 20% of the homes within a “55+” community may be occupied exclusively by persons under the age of 55, a community association allowing this occupancy needs to plan with care any attempt to permit the entire 20%, or a large portion of the 20%, of the remaining homes to be occupied exclusively by persons under the age of 55 because doing so could endanger the community’s housing discrimination exemption, particularly in the event a qualifying occupant who is over the age of 55 dies when all the remaining occupants of the home are under 55 years of age.

Community associations should also be aware that local laws may provide for additional protected classes against which housing discrimination is prohibited, including, for example, discrimination based upon age, sexual orientation, marital status, and gender identity or expression. Therefore, a community association should contact its attorney before establishing policies and procedures restricting occupancy based on age or affecting survivors’ rights to property.

Similarly, although the Housing for Older Persons Act provides an exemption from liability for familial status discrimination for those communities that comply with its requirements, the Housing from Older Persons Act does not protect housing providers from liability for housing discrimination because of race, color, religion, sex, disability, or national origin under the Fair Housing Act.

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Requiring Workers’ Compensation | Why it is So Very Important to Consider Its Inclusion in Every Contract and More

Requiring Workers' Compensation

Why it is so very Important To Consider Its Inclusion In Every Contract and More

It is surprising to hear from so many community association board members and managers looking to protect their community association that, when asked if they require all vendors to have workers’ compensation insurance as a required term in all of their contracts, it can be like looking at a deer in the headlights. In addition, for reasons explained below, if your community association provides services on a regular basis, such as valet, concierge, fitness programs, etc., then you may also want to consider amending the declaration of covenants or declaration of condominium to include a requirement that the association is contractually obligated to provide such services to its owners because this can help provide liability protection in favor of the association. However, this approach can lead to other problems if the association does not actually provide the required services.

According to the Florida Office of Insurance Regulation, workers’ compensation insurance is coverage purchased by the employer/business that provides benefits for job-related employee injuries, with a few exceptions. Florida law requires most employers to purchase workers’ compensation coverage. Under a workers’ compensation policy, employees are compensated for occupationally incurred injuries regardless of fault. This coverage makes employers immune from some injury lawsuits by employees, as the workers’ compensation policy will limit the type of recovery available to the employee.

However, there are many exceptions afforded to employers in which the employer is not required by statute to have workers’ compensation coverage. For example, a construction-related company is allowed up to three exemptions, and a non-construction-related company is allowed up to ten exemptions. If the employer is exempt from having to provide workers’ compensation coverage, then should an employee be injured on the association’s property, the association could bear the financial brunt of the liability for the injury.

Why is requiring workers’ compensation so very important? Because it helps protect the association from liability claims when an employee of a vendor is hurt on the association’s property. While Florida’s workers’ compensation laws do not guarantee protection, they sure go a very long way in helping to protect the association from claims by employees of vendors when they get hurt in your community.

Why is it a good idea to consider including regularly provided services as a requirement within the declaration of condominium or declaration of covenants? Because, under certain circumstances, the association can be considered a “statutory employer” under the workers’ compensation rules, meaning that the association is entitled to the same immunity protection that the injured employee’s employer is afforded.

In a recent case, Bal Harbor Towers Condominium Association, Inc. v. Martin Bellorin, 351 So.3d 96 (Fla. 3d DCA Oct. 19, 2022), the employee, Martin Bellorin, was injured while delivering luggage when a plastic panel fell from the ceiling of the elevator and hit his head. Subsequently, he filed a lawsuit against the association, alleging negligence based on a premises liability theory, and sought damages for his injury. During the trial court proceedings, the association sought to defend the case by arguing during its motion for summary judgment that it was entitled to workers’ compensation immunity because it was a “statutory employer.” The trial court disagreed and held that the workers’ compensation immunity did not apply to the association because, in this case, the declaration of condominium and bylaws were not a contract and, therefore, did not impose a contractual obligation upon the association to provide the valet services. However, the association appealed the trial court decision and prevailed.

On appeal, the association argued that its declaration of condominium was a contract and, in fact, provided a contractual obligation to provide the valet services to the unit owners at the condominium, and therefore it was entitled to the workers’ compensation immunity as a “statutory employer.” Pursuant to §440.10(1)(b), Florida Statutes,

in cases where a contractor sublets any part or parts of his or her contract work to a subcontractor or subcontractors, all of the employees of such contractor and subcontractor or subcontractors engaged on such contract work shall be deemed to be employed in one and the same business or establishment, and the contractor shall be liable for, and shall secure, the payment of compensation to all such employees, except to employees of a subcontractor who has secured such payment.

Stated differently, a “statutory employer” is entitled to vertical immunity. A vertical relationship exists when a contractor (in this case, the association) sublets any part(s) of its contracted work to a subcontractor (in this case, the valet company). Thus, in the Bal Harbor Towers Condominium Association case, the association argued it should be deemed the “statutory employer” of the employees of the valet company.

As pointed out by the Appellate Court, for the Association to be a contractor under §440.10, it must show that it has a contractual obligation to provide the services to the unit owners, and that it sublet any part of the contract work to a subcontractor… to be considered a contractor under §440.10 the association’s primary obligation in performing a job or providing a service, must arise out of a contract… well-established Florida law provides that a declaration of condominium operates as a contract, thus the trial court erred  in finding that the Association did not have a contractual obligation to provide valet services to unit owners under its declaration of condominium, thereby determining that the Association was not entitled to worker’s compensation immunity as a statutory employer.

Therefore, the Appellate Court reversed the trial court’s non-final order denying the association’s motion for final sum-mary judgment and remanded the case back to the trial court for further proceedings.

The takeaway from the Bal Harbor Towers Condominium Association case is if the association is going to provide serv-ices on a regular basis to its members, then  amending the declaration to require providing such services will further help shield the association from liability claims from the association’s vendor’s employees. In addition, the association should consider requiring all vendors servicing the association and its members to have workers’ compensation insurance and provide proof of coverage prior to commencing work. Remember, the fact that a vendor may tell you they are exempt from workers’ compensation only means that if they or their employees are hurt on the association’s property, then the association is exposed to liability for damages. Be sure to talk about these important issues with the association’s legal counsel, and always, no matter the value of the contract, strongly consider asking association counsel to prepare the appropriate addendum to help better protect the interests of the association.

(Written by Jeffrey Rembaum and reprinted with permission from the May 2023 edition of the “Florida Community Association Journal”.)

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Is There Liability for Dangerous Wild Animals in Your Community?

Is There Liability for Dangerous Wild Animals in Your Community?

With the ever-increasing development in Florida, especially in South Florida, we are once again reminded that we live in close proximity to a number of native, exotic, invasive, and at times dangerous wild animals. Tragically, and all too recently, in St. Lucie County an 85-year-old woman died while trying to rescue her dog from an alligator. Whether her community association will be held liable will largely depend upon what the association knew and when they knew it regarding the existence of alligators within the association’s property.

Simply put, if there is a foreseeable zone of risk, then the association’s members should be made aware of it. Phrased differently, where the association, acting by and through its board of directors, is aware or should reasonably be aware of a dangerous animal within association property, then there is a duty to act. Such action should minimally include notice to the entire community, and for those situations where reoccurrence is a likely possibility, then posting signs could be warranted, too.

What can and should happen when your community association is confronted with that unexpected wild animal that causes a disturbance or, even worse, the wild animal has become a source of imminent danger to the members of the association or their guests? Guidance is presented from Hanrahan v. Hometown America, LLC, 90 S.3d 915 (Fla. 4th DCA 2012), decided on June 20, 2012, by Florida’s Fourth District Court of Appeal. In this case, the personal representative of a deceased resident, Ms. Hanrahan (Hanrahan), sought damages for the negligent death of Mr. Hanrahan, who died from fire-ant bites sustained on the common areas of Pinelake Gardens and Estates, a mobile home park (Pinelake Gardens).

By way of background, Mr. Hanrahan was walking his dog in the common area of Pinelake Gardens known as the “Preserve.” Mr. Hanrahan claimed that he brushed up against a bush, at which point the fire ants gained access to his body. Mr. Hanrahan attempted to wash the fire ants off of his body but collapsed on the shower floor. He died two days later. During the trial, the Pinelake Gardens community manager testified that she was not aware of any resident in Pinelake Gardens being exposed to or attacked by fire ants on the premises, nor was she aware of any fire ants in the area of Pinelake Gardens where the incident allegedly occurred. She testified that Pinelake Gardens regularly contracted with an exterminator to spray insecticide, which included killing ants (not specifically fire ants). She further testified that maintenance employees would treat observed ant mounds with granules and would contact the exterminator if there was anything out of the ordinary observed.

The trial court ruled in favor of Pinelake Gardens. The trial court determined that Pinelake Gardens was not on sufficient notice of a fire-ant infestation at the area of the alleged incident, and therefore did not have a duty to Mr. Hanrahan to guard against the fire ants or otherwise take action in this situation. As a result, Hanrahan appealed. On appeal, Hanrahan claimed that the trial court improperly determined whether Pinelake Gardens could foresee the specific injury that actually occurred, instead of, as Hanrahan claimed, whether Pinelake Gardens’ conduct created a “foreseeable zone of risk.”

The general rule in regard to wild animals in Florida, as explained by the appellate court citing another case, Wamser v. City of St. Petersburg, 339 So.2d 244 (Fla. 2d DCA 1976), is that

…the law does not require the owner or possessor of land to anticipate the presence of, or guard an invitee against harm from, animals “ferare naturae” (which is a common law doctrine where wild animals are considered owned by no one specifically but by the people generally) unless such owner or possessor harbors such animals or has introduced wild animals to the premises which are not indigenous to the locality.

The Wamser case involved a shark attack, in which the city did not have any knowledge of prior shark attacks and therefore did not have any foreseeability of the possibility of shark attacks nor a duty to guard against shark attacks. As in Wamser, the appellate court in Hanrahan v. Hometown America, LLC, ruled that there was no evidence in the record to show Pinelake Gardens had any knowledge of a “ferae naturae” attack in the alleged area. The appellate court held that the presence of the fire ants was not caused by any act of Pinelake Gardens and that Pinelake Gardens did not harbor or introduce them. Furthermore, Pinelake Gardens regularly attempted, by maintenance staff and exterminators, to treat the ant mounds and other manifestations of fire ants. To add a further caveat to its ruling, the appellate court quoted from another fire-ant case, State of Texas, Nicholson v. Smith, 986 S.W,2d 54 (Tex. App. 1999), in which it was stated:

…we do not say a landowner can never be negligent with regard to the indigenous wild animals found on its property. A premises owner could be negligent with regard to wild animals found in artificial structures or places where they are not normally found; that is, stores, hotels, apartment houses, or billboards, if the landowner knows or should know of the unreasonable risk of harm posed by an animal on its premises and cannot expect patrons to realize the danger or guard against it. [emphasis added]

Thus, in the end, the appellate court ruled that there was no evidence that Pinelake Gardens knew or should have known of the unreasonable risk of harm posed by the fire ants. Even though the Hanrahan case concerned fire ants, the case could be applied by analogy to any number of wild animals that you could encounter in your community association, including, without limitation, alligators. 

When it comes to injuries caused by wild animals, the board of directors should examine whether there is a foreseeable zone of danger. The question is not whether an injury occurred (as strict liability does not exist), but rather was it foreseeable that an injury could occur? If so, then the board has a duty to act. Remember, the basic rule is that if the association is aware of a dangerous animal or if it is foreseeable that a dangerous wild animal could be within the lands governed by the association, then the association has a duty to act. Importantly, please be certain to discuss the situation with the association’s legal counsel for proper guidance.

(Written by Jeffrey Rembaum and reprinted with permission from the April 2023 edition of the “Florida Community Association Journal”.)

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Kaye Bender Rembaum, P.L.