[RPPTL LandTen] FW: HB 329 - Condo Assessments
FYI - Please see our comments to HB 329, as well as Michael Gelfand's
response and my reply to Michael. Read from bottom up. I will forward
on any new substantive responses we receive.
I have also attached a copy of the proposed bill for your reference.
We will discuss further at next week's meeting (unless no one wants to
discuss it, in which case we will mention it and quickly move on).
Scott A Frank
Attorney at Law
ARNSTEIN & LEHR LLP
www.arnstein.com http://www.arnstein.com/
515 North Flagler Drive
Sixth Floor
West Palm Beach, Florida 33401-4323
Phone: 561.833.9800
Fax: 561.655.5551
433 Plaza Real
Suite 275
Boca Raton, Florida 33401-4323
Phone: 561.962.4145
Fax: 561.962.4245
SAFrank@arnstein.com mailto:SAFrank@arnstein.com
Offices in Illinois, Florida, and Wisconsin
From: Frank, Scott A.
Sent: Thursday, January 07, 2010 8:46 AM
To: 'Michael J. Gelfand'
Cc: gmeyer@carltonfields.com; Neil B. Shoter;
RFreedman@CarltonFields.com; smezer@bushross.com
Subject: RE: HB 329 - Condo Assessments
Michael:
I understand the bind that associations are finding themselves in these
days. And I also have no sympathy for landlords who are accepting rent
and then not paying their dues. However, I still have issues with the
bill in that (i) while it does offer the innocent tenant some
protection, it is still geared toward the association (I would feel
better from the tenant side if the notice provision were clearer and the
tenant had the right to "reject" the lease and stop paying assessments
once he or she vacates); and (ii) it allows the association to take
private property - the rent money is the landlord's property until a
court says otherwise - without any form of due process or even (for
current owners as of the date the bill is enacted) any prior notice of
the possibility. Again, I would feel more comfortable if the bill were
drafted as an "opt-in" clause, allowing existing associations to adopt
the provisions by an affirmative vote of membership. That way, no owner
could argue lack of notice.
Just my $0.02.
Scott A Frank
Attorney at Law
ARNSTEIN & LEHR LLP
www.arnstein.com http://www.arnstein.com/
515 North Flagler Drive
Sixth Floor
West Palm Beach, Florida 33401-4323
Phone: 561.833.9800
Fax: 561.655.5551
433 Plaza Real
Suite 275
Boca Raton, Florida 33401-4323
Phone: 561.962.4145
Fax: 561.962.4245
SAFrank@arnstein.com mailto:SAFrank@arnstein.com
Offices in Illinois, Florida, and Wisconsin
From: Michael J. Gelfand [mailto:mjgelfand@gelfandarpe.com]
Sent: Thursday, January 07, 2010 1:23 AM
To: Frank, Scott A.
Cc: gmeyer@carltonfields.com; Neil B. Shoter;
RFreedman@CarltonFields.com; smezer@bushross.com
Subject: RE: HB 329 - Condo Assessments
Dear Scott
Thanks for the detailed review. I am forwarding to Rob Freedman and
Steven Mezer of the Condominium Committee to consider the issues raised
in the context of a number of bills with similar provisions.
There are a number of points that bear consideration. I note in passing
that an increasing number of community associations are not waiting for
the legislature to act and associations members are overwhelmingly
approving similar provisions as covenants. To place this in context for
your committee members on a policy level, understanding the need to
address procedure, there appears to be little sympathy for landlords
that are not paying assessments while the landlord still pockets
assessments.
Michael J. Gelfand
Florida Bar Board Certified Real Estate Attorney
Florida Supreme Court Certified Mediator:
Civil Circuit Court & Civil County Court
Gelfand & Arpe, P.A. http://www.gelfandarpe.com/
"Assisting Communities to Efficiently Reach Goals"
Regions Financial Tower, Suite 1220
1555 Palm Beach Lakes Blvd.
West Palm Beach Florida 33401
(561) 655-6224
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From: Frank, Scott A. [mailto:SAFrank@arnstein.com]
Sent: Wednesday, January 06, 2010 2:39 PM
To: Michael J. Gelfand
Cc: gmeyer@carltonfields.com; Neil B. Shoter
Subject: HB 329 - Condo Assessments
You have asked the members of the Landlord-Tenant Committee to review
and comment on this bill. After soliciting the input of the members of
the Committee, I have attempted to put together below an amalgamation of
the comments I received, as well as my own thoughts:
The first issue is the question of whether 83.46 (Duration of Tenancies)
is the right place to put this new language. Could it not possibly fit
better in 83.49 or 83.51? Or possibly even its own new section?
Also, with respect to condo law (I know, not our purview, but anyway),
doesn't this law allow associations to take property without due
process, without such right being explicit in the declaration? In
essence, the rent payment is the property of the unit owner, which
property cannot typically be taken away by an association without either
(i) a judicial determination, or (ii) an explicit right spelled out in
the declaration (or even in a statute in effect as of the date of
conveyance to the specific unit owner). Can associations tow and sell a
delinquent unit owner's car when it is parked in the common area? At
the very least, this statute should not apply to any declarations in
effect unless the specific association votes to adopt it.
Another preliminary thought is the question of whether the remedy
provided here is the appropriate one. By making tenants jointly and
severally liable, the tenant is forced to take on an obligation that
(s)he may not want. What if the tenant, not wanting to stay in a bad
situation that may turn worse, simply decides to move out? As the
tenant is liable under the statute for all sums due under the lease from
the date of the association's notice, the tenant would be required to
pay the remainder of the rent, even post-vacating. (While the landlord
may then have a claim against the tenant for unpaid rent for the
remainder of the term, good luck to him on collecting.) A more
appropriate remedy may be to make the tenant liable for all sums due
under the lease from the date of notice until the date of tenant's
surrender. The right to evict and to deny services are appropriate to
enforce this obligation.
In fact, as a related matter, one may wish to consider amending 83.51 to
require landlord to maintain the payment of association dues. This
would allow the tenant the right to vacate, without fear of suit, if
landlord does not in fact pay the fees.
The proposed statute states that the tenant is responsible to pay the
association from the date of the association's "notice", but does not
specify what constitutes valid notice. Perhaps it would be helpful to
include a statutory notice form that spells out (i) from what date the
tenant is to pay the association (must be at least 14-30 days after the
date of the notice), (ii) the statutory limits of tenant's liability (in
layman's language), (iii) what the associations' remedies are for
tenant's failure, and (iv) what rights tenant has against the landlord
or in defense of an action initiated by the landlord. This notice
should be sent via certified mail or other receipted delivery, and the
tenant should not be liable without proof of delivery or refusal.
Perhaps even a requirement of physical delivery to the unit itself.
Also, the notice should be delivered to the unit owner, again via
certified mail, to the address for the owner that the association has on
record. In addition, with respect to notice, if the tenant fails to
make a payment, the association's remedies should be subject to a notice
and cure period longer than the statutory 3-day notice.
How is the tenant notified that the owner is delinquent? Is the tenant
given proof that the owner has been notified of the delinquency? And
will the association indemnify the tenant - to the extent of payments
made to the association - if the owner/landlord sues for nonpayment
under the lease? At the very least, the statute should amend Ch. 83 to
provide that it is an absolute defense to an eviction for nonpayment
that the payments were made to the association in accordance with this
statute.
The statute in a number of places keeps stating that the tenant is
responsible for "all" or "any" monies owed by the landlord. This seems
overbroad, and should be limited to an itemized list (assessments,
fines, late fees, attorneys' fees) or specify sums payable under the
declaration.
With respect to the remedies stated in (4)(b)(1), what "other remedies"
are available to the Association? As there is no privity between the
parties, they cannot collect contract damages under the lease - the only
remedies that should be available to the association are those that are
granted explicitly by this statute (or the declaration). If the intent
is to allow for a suit for monetary damages, then the statute (or
declaration) should spell this out explicitly. And I am not sure how
the association can sue for eviction under its own name (83.56 and 83.59
give the right to pursue a claim for possession to the "landlord" -
these would need to be amended as well). The statute (or declaration)
should contain an explicit assignment of the owner's rights to sue,
provided the assignment is limited to those amounts due from tenant
under this statute.
The limitation of tenant's liability (amount to be paid under rental
agreement) is specified in 83.46(4)(a) and 83.46(4)(b)(1) but missing in
83.46(4)(b) and 83.46(4)(b)(1). This needs to be rectified, as the
language is very difficult to follow. In addition, the language here
and in (4)(b)(2) is very unclear as to what exactly are the limits of
tenant's liability. A suggestion on how to spell out tenant's
liability may be to simply say that tenant is only liable to pay in any
given month the sums that tenant is scheduled to pay under the lease in
that given month.
The language concerning prepaid rent/security deposits in (4)(a)(2) is
again highly confusing, and somewhat punishing to tenants. To the
extent the written lease acknowledges receipt of any prepaid rent or
security deposit, the tenant's liability should be decreased by such
amount. The cancelled check requirement is excessive, especially
considering that many lower income tenants pay rent in cash or by money
order.
As to 718.106, the first question is whether the term "foreclosure"
refers to mortgage foreclosure or foreclosure of the association's lien.
In addition, the ability to restrict common area access is, at best,
vague, and at worst completely overreaching. Also, who is to be the
arbiter of "fair market rent" in order to determine if the tenant is
legitimate? A better option may be to just require that the lease be an
arms-length transaction between unrelated parties, which does not allow
for the unit owner or any member of his/her family to reside in the
unit. If there is still concern about fraud, there could be a provision
allowing the lease to be vitiated by the association if it is determined
that the unit owner is living in the unit.
We will not address the proposed changes to 718.116(b), as these do not
come within the purview of this committee.
Finally, is there a reason why this provision applies to residential
units only, and not commercial units?
Please note that our comments do not reflect any collective judgment as
to whether the substance and intent of the proposed bill is for the
better or worse, as our committee includes members who represent varying
interests in residential and commercial leasing. Rather it is our intent
to assist the legislature by pointing out what we believe to be
significant issues with the bill as drafted.
Please advise if you wish for any clarification of the above or if we
can be of any further assistance. Thank you.
Scott A Frank
Attorney at Law
ARNSTEIN & LEHR LLP
www.arnstein.com http://www.arnstein.com/
515 North Flagler Drive
Sixth Floor
West Palm Beach, Florida 33401-4323
Phone: 561.833.9800
Fax: 561.655.5551
433 Plaza Real
Suite 275
Boca Raton, Florida 33401-4323
Phone: 561.962.4145
Fax: 561.962.4245
SAFrank@arnstein.com mailto:SAFrank@arnstein.com
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Thanks Scott, that was a very detailed analysis.
My own personal opinion (I'm not sure what official position the Florida
Realtors will take on this matter, if any), is that the tenants should
not be made liable to the association for unpaid unit assessments, etc.
My view is that this bill as drafted is overkill and many of the
provisions will just add further confusion. The associations currently
have a simple (albeit time consuming and costly) remedy - foreclose
their assessment lien and then they can rent the unit to whoever they
want and collect all the rent (although I suppose the new Protecting
Tenants at Foreclosure Act would come into play). Another remedy
apparently used with some success is to go to court and get a blanket
receivership. So the associations already have remedies, and I don't
think the association should be allowed to shift to the T the legal
obligation of paying a unit owner's assessment simply because the
association doesn't want to go through the time/trouble of foreclosing
their assessment lien.
I would scuttle the entire bill and simply propose the following. Amend
Chapter 83 to say that if a Tenant receives notice from an association
asking the T to pay rent directly to the association, the tenant MAY
(not must) choose to abide by that request and doing so would be an
absolute defense to an eviction action filed by the LL under Chapter 83.
I would stick this in 83.60. The Tenants incentive to VOUNTARILY
agree to pay rent to the association would be the hope that by doing so,
the association will sit back and choose not to file a foreclosure
action against the unit for its unpaid assessments thereby allowing the
T to stay put. This would also keep the liability for unpaid
assessments squarely on the unit owner/LL and would NOT purport to
somehow make the T personally liable for condo unit assessments. The
onus would then be on the deadbeat unit owner/LL to go to court and get
a court order directing the T to pay rent to the LL or alternatively get
the association to turn over the rent money to the LL. I predict most
LL's would just disappear at that point and not bother, leaving the
battle between the lender and the association over rent moneys and
assessments. The association would be sort of a surrogate LL until
either the association or lender chose to foreclose. But in the
meantime the association will have cash flow from the T to offset the
unpaid assessments which will make all the other unit owners happy. I
suppose 718 would also need to be amended to say that if a unit owner is
more than X days delinquent on assessments, it would trigger the ability
of the association to send the request to T and that any rents collected
by the association would be credited to the amounts owed by the unit
owner.
To further aid my solution above, I would recommend amending 83.51 to
include an obligation of the LL to keep current on condo unit
assessments. That way, if they failed to do so, the T could presumably
use section 83.56 (1) to thereby terminate the lease if the LL doesn't
come into compliance after the T's 7 day notice to LL. This would give
the T some flexibility - they could either use 83.56 (1) to terminate
the lease and get out of a problematic situation where the real LL has
disappeared, or the T could sit back and, if requested by the
association to pay rent to them, voluntarily pay rent to the association
with the hope that it will help stave off foreclosure by the
association. If the T were to terminate the lease under this provision,
the lack of cash flow would presumably serve to help accelerate the
decision to file foreclosure by either the association or lender, and
the property could be quickly put back on the market for a new buyer who
can begin paying assessments.
Regards,
Greg
Greg Hass, Senior Counsel
Office of Law & Policy
Florida REALTORS(r)
7025 Augusta National Drive
Orlando, FL 32872-5025
Ph: (407) 438-1400
GregH@FAR.org mailto:GregH@FAR.org
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From: landten-bounces@lists.flabarrpptl.org
[mailto:landten-bounces@lists.flabarrpptl.org] On Behalf Of Frank, Scott
A.
Sent: Thursday, January 07, 2010 10:09 AM
To: RPPTL Landlord Tenant Committee
Subject: [RPPTL LandTen] FW: HB 329 - Condo Assessments
FYI - Please see our comments to HB 329, as well as Michael Gelfand's
response and my reply to Michael. Read from bottom up. I will forward
on any new substantive responses we receive.
I have also attached a copy of the proposed bill for your reference.
We will discuss further at next week's meeting (unless no one wants to
discuss it, in which case we will mention it and quickly move on).
Scott A Frank
Attorney at Law
ARNSTEIN & LEHR LLP
www.arnstein.com http://www.arnstein.com/
515 North Flagler Drive
Sixth Floor
West Palm Beach, Florida 33401-4323
Phone: 561.833.9800
Fax: 561.655.5551
433 Plaza Real
Suite 275
Boca Raton, Florida 33401-4323
Phone: 561.962.4145
Fax: 561.962.4245
SAFrank@arnstein.com mailto:SAFrank@arnstein.com
Offices in Illinois, Florida, and Wisconsin
From: Frank, Scott A.
Sent: Thursday, January 07, 2010 8:46 AM
To: 'Michael J. Gelfand'
Cc: gmeyer@carltonfields.com; Neil B. Shoter;
RFreedman@CarltonFields.com; smezer@bushross.com
Subject: RE: HB 329 - Condo Assessments
Michael:
I understand the bind that associations are finding themselves in these
days. And I also have no sympathy for landlords who are accepting rent
and then not paying their dues. However, I still have issues with the
bill in that (i) while it does offer the innocent tenant some
protection, it is still geared toward the association (I would feel
better from the tenant side if the notice provision were clearer and the
tenant had the right to "reject" the lease and stop paying assessments
once he or she vacates); and (ii) it allows the association to take
private property - the rent money is the landlord's property until a
court says otherwise - without any form of due process or even (for
current owners as of the date the bill is enacted) any prior notice of
the possibility. Again, I would feel more comfortable if the bill were
drafted as an "opt-in" clause, allowing existing associations to adopt
the provisions by an affirmative vote of membership. That way, no owner
could argue lack of notice.
Just my $0.02.
Scott A Frank
Attorney at Law
ARNSTEIN & LEHR LLP
www.arnstein.com http://www.arnstein.com/
515 North Flagler Drive
Sixth Floor
West Palm Beach, Florida 33401-4323
Phone: 561.833.9800
Fax: 561.655.5551
433 Plaza Real
Suite 275
Boca Raton, Florida 33401-4323
Phone: 561.962.4145
Fax: 561.962.4245
SAFrank@arnstein.com mailto:SAFrank@arnstein.com
Offices in Illinois, Florida, and Wisconsin
From: Michael J. Gelfand [mailto:mjgelfand@gelfandarpe.com]
Sent: Thursday, January 07, 2010 1:23 AM
To: Frank, Scott A.
Cc: gmeyer@carltonfields.com; Neil B. Shoter;
RFreedman@CarltonFields.com; smezer@bushross.com
Subject: RE: HB 329 - Condo Assessments
Dear Scott
Thanks for the detailed review. I am forwarding to Rob Freedman and
Steven Mezer of the Condominium Committee to consider the issues raised
in the context of a number of bills with similar provisions.
There are a number of points that bear consideration. I note in passing
that an increasing number of community associations are not waiting for
the legislature to act and associations members are overwhelmingly
approving similar provisions as covenants. To place this in context for
your committee members on a policy level, understanding the need to
address procedure, there appears to be little sympathy for landlords
that are not paying assessments while the landlord still pockets
assessments.
Michael J. Gelfand
Florida Bar Board Certified Real Estate Attorney
Florida Supreme Court Certified Mediator:
Civil Circuit Court & Civil County Court
Gelfand & Arpe, P.A. http://www.gelfandarpe.com/
"Assisting Communities to Efficiently Reach Goals"
Regions Financial Tower, Suite 1220
1555 Palm Beach Lakes Blvd.
West Palm Beach Florida 33401
(561) 655-6224
This communication/transmission is intended only for the use of the
addressee(s) named above and may contain information that is privileged
and confidential. Access to this e-mail by anyone else is unauthorized.
If you are not the intended recipient, you are hereby notified that any
dissemination, distribution, use or copying of this communication is
strictly prohibited. If you received this transmission in error, please
immediately alert the sender by reply e-mail and permanently delete and
destroy this message and any attachments. To reply to our e-mail
administrator directly, please send an e-mail to ga@gelfandarpe.com.
Nothing contained in this message (including any attachments) shall
constitute a contract or electronic signature under the Electronic
Signatures in Global and National Commerce Act, any version of the
Uniform Electronic Transactions Act or any other statute governing
electronic transactions. This e-mail does not provide an opinion, nor
without a fee agreement signed by the firm does this confirm
representation or counsel.
IRS Circular 230 Notice: To ensure compliance with the requirements
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this communication (including any attachments) is not intended or
written to be used, and may not be used, for the purpose of (i) avoiding
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or recommending to another party any transaction or matter addressed
herein.
P Please consider the environment before printing this e-mail
From: Frank, Scott A. [mailto:SAFrank@arnstein.com]
Sent: Wednesday, January 06, 2010 2:39 PM
To: Michael J. Gelfand
Cc: gmeyer@carltonfields.com; Neil B. Shoter
Subject: HB 329 - Condo Assessments
You have asked the members of the Landlord-Tenant Committee to review
and comment on this bill. After soliciting the input of the members of
the Committee, I have attempted to put together below an amalgamation of
the comments I received, as well as my own thoughts:
The first issue is the question of whether 83.46 (Duration of Tenancies)
is the right place to put this new language. Could it not possibly fit
better in 83.49 or 83.51? Or possibly even its own new section?
Also, with respect to condo law (I know, not our purview, but anyway),
doesn't this law allow associations to take property without due
process, without such right being explicit in the declaration? In
essence, the rent payment is the property of the unit owner, which
property cannot typically be taken away by an association without either
(i) a judicial determination, or (ii) an explicit right spelled out in
the declaration (or even in a statute in effect as of the date of
conveyance to the specific unit owner). Can associations tow and sell a
delinquent unit owner's car when it is parked in the common area? At
the very least, this statute should not apply to any declarations in
effect unless the specific association votes to adopt it.
Another preliminary thought is the question of whether the remedy
provided here is the appropriate one. By making tenants jointly and
severally liable, the tenant is forced to take on an obligation that
(s)he may not want. What if the tenant, not wanting to stay in a bad
situation that may turn worse, simply decides to move out? As the
tenant is liable under the statute for all sums due under the lease from
the date of the association's notice, the tenant would be required to
pay the remainder of the rent, even post-vacating. (While the landlord
may then have a claim against the tenant for unpaid rent for the
remainder of the term, good luck to him on collecting.) A more
appropriate remedy may be to make the tenant liable for all sums due
under the lease from the date of notice until the date of tenant's
surrender. The right to evict and to deny services are appropriate to
enforce this obligation.
In fact, as a related matter, one may wish to consider amending 83.51 to
require landlord to maintain the payment of association dues. This
would allow the tenant the right to vacate, without fear of suit, if
landlord does not in fact pay the fees.
The proposed statute states that the tenant is responsible to pay the
association from the date of the association's "notice", but does not
specify what constitutes valid notice. Perhaps it would be helpful to
include a statutory notice form that spells out (i) from what date the
tenant is to pay the association (must be at least 14-30 days after the
date of the notice), (ii) the statutory limits of tenant's liability (in
layman's language), (iii) what the associations' remedies are for
tenant's failure, and (iv) what rights tenant has against the landlord
or in defense of an action initiated by the landlord. This notice
should be sent via certified mail or other receipted delivery, and the
tenant should not be liable without proof of delivery or refusal.
Perhaps even a requirement of physical delivery to the unit itself.
Also, the notice should be delivered to the unit owner, again via
certified mail, to the address for the owner that the association has on
record. In addition, with respect to notice, if the tenant fails to
make a payment, the association's remedies should be subject to a notice
and cure period longer than the statutory 3-day notice.
How is the tenant notified that the owner is delinquent? Is the tenant
given proof that the owner has been notified of the delinquency? And
will the association indemnify the tenant - to the extent of payments
made to the association - if the owner/landlord sues for nonpayment
under the lease? At the very least, the statute should amend Ch. 83 to
provide that it is an absolute defense to an eviction for nonpayment
that the payments were made to the association in accordance with this
statute.
The statute in a number of places keeps stating that the tenant is
responsible for "all" or "any" monies owed by the landlord. This seems
overbroad, and should be limited to an itemized list (assessments,
fines, late fees, attorneys' fees) or specify sums payable under the
declaration.
With respect to the remedies stated in (4)(b)(1), what "other remedies"
are available to the Association? As there is no privity between the
parties, they cannot collect contract damages under the lease - the only
remedies that should be available to the association are those that are
granted explicitly by this statute (or the declaration). If the intent
is to allow for a suit for monetary damages, then the statute (or
declaration) should spell this out explicitly. And I am not sure how
the association can sue for eviction under its own name (83.56 and 83.59
give the right to pursue a claim for possession to the "landlord" -
these would need to be amended as well). The statute (or declaration)
should contain an explicit assignment of the owner's rights to sue,
provided the assignment is limited to those amounts due from tenant
under this statute.
The limitation of tenant's liability (amount to be paid under rental
agreement) is specified in 83.46(4)(a) and 83.46(4)(b)(1) but missing in
83.46(4)(b) and 83.46(4)(b)(1). This needs to be rectified, as the
language is very difficult to follow. In addition, the language here
and in (4)(b)(2) is very unclear as to what exactly are the limits of
tenant's liability. A suggestion on how to spell out tenant's
liability may be to simply say that tenant is only liable to pay in any
given month the sums that tenant is scheduled to pay under the lease in
that given month.
The language concerning prepaid rent/security deposits in (4)(a)(2) is
again highly confusing, and somewhat punishing to tenants. To the
extent the written lease acknowledges receipt of any prepaid rent or
security deposit, the tenant's liability should be decreased by such
amount. The cancelled check requirement is excessive, especially
considering that many lower income tenants pay rent in cash or by money
order.
As to 718.106, the first question is whether the term "foreclosure"
refers to mortgage foreclosure or foreclosure of the association's lien.
In addition, the ability to restrict common area access is, at best,
vague, and at worst completely overreaching. Also, who is to be the
arbiter of "fair market rent" in order to determine if the tenant is
legitimate? A better option may be to just require that the lease be an
arms-length transaction between unrelated parties, which does not allow
for the unit owner or any member of his/her family to reside in the
unit. If there is still concern about fraud, there could be a provision
allowing the lease to be vitiated by the association if it is determined
that the unit owner is living in the unit.
We will not address the proposed changes to 718.116(b), as these do not
come within the purview of this committee.
Finally, is there a reason why this provision applies to residential
units only, and not commercial units?
Please note that our comments do not reflect any collective judgment as
to whether the substance and intent of the proposed bill is for the
better or worse, as our committee includes members who represent varying
interests in residential and commercial leasing. Rather it is our intent
to assist the legislature by pointing out what we believe to be
significant issues with the bill as drafted.
Please advise if you wish for any clarification of the above or if we
can be of any further assistance. Thank you.
Scott A Frank
Attorney at Law
ARNSTEIN & LEHR LLP
www.arnstein.com http://www.arnstein.com/
515 North Flagler Drive
Sixth Floor
West Palm Beach, Florida 33401-4323
Phone: 561.833.9800
Fax: 561.655.5551
433 Plaza Real
Suite 275
Boca Raton, Florida 33401-4323
Phone: 561.962.4145
Fax: 561.962.4245
SAFrank@arnstein.com mailto:SAFrank@arnstein.com
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Dear Greg,
I have to respectfully oppose any attempt to open the door wider for a
tenant to withhold rent, break a lease or voluntarily pay an association.
This will not work on a practical basis and will cause major problems with
evictions. Suppose they pay partial? You know the association is going to
accept the money and how do I evict?
The whole thing needs to be scuttled.
It is a mess. It is another example of a kneejerk reaction to a temporary
economic crisis or a possible problem that the landlord may eventually cure.
The laws have been in place for years, they have worked fine for years, the
associations just need to deal with it. It is bad enough that tenants think
they can stop paying rent when the owner is in foreclosure.
The restrictions and powers that associations already have are causing a
price drop in condo and homeowners associations as they are making it
nearly impossible for unit owners to rent out their units i.e. investment
buyers will not want to buy. This bill will give them more power and in the
end hurt all unit owners.
I would hope that FAR strongly comes out and takes a stand against what the
associations are doing now, legally and illegally and also fight new onerous
laws.
I can put you in touch with many of your FAR property manager members who
will tell you the horror stories. If anything, we need laws limiting the
powers of these associations to essentially discriminate against renters and
protected classes. Watch how they approve a white doctor in 5 days but an
African American with children, the approval process takes so long the
applicant gives up. We discussed this last August at the FAR Property
Management Council meeting and the crowd was up in arms over it. That is the
tip of the iceberg. If I had time on my hands I would have testers go out,
apply and I would be filing Fair Housing actions all day long. Condos and
HOAs do not want renters period. In one way you can't blame them because
they have to deal with the California buyers who put the unit on Craig's
List and rents it to anyone who calls them up and can breathe.
Harry Heist
LAW OFFICES OF
HEIST, WEISSE & DAVIS, P.A.
PH: 1 800 253 8428
FAX: 1 800 367 9038
"Serving the Property Management Professional"
Website: www.evict.com http://www.evict.com/
Email: harry@evict.com
THIS E-MAIL MESSAGE IS CONFIDENTIAL, ATTORNEY-CLIENT PRIVILEGED, AND
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From: landten-bounces@lists.flabarrpptl.org
[mailto:landten-bounces@lists.flabarrpptl.org] On Behalf Of Greg Hass
Sent: Thursday, January 07, 2010 12:25 PM
To: RPPTL Landlord Tenant Committee
Subject: Re: [RPPTL LandTen] FW: HB 329 - Condo Assessments
Thanks Scott, that was a very detailed analysis.
My own personal opinion (I'm not sure what official position the Florida
Realtors will take on this matter, if any), is that the tenants should not
be made liable to the association for unpaid unit assessments, etc. My
view is that this bill as drafted is overkill and many of the provisions
will just add further confusion. The associations currently have a simple
(albeit time consuming and costly) remedy - foreclose their assessment lien
and then they can rent the unit to whoever they want and collect all the
rent (although I suppose the new Protecting Tenants at Foreclosure Act would
come into play). Another remedy apparently used with some success is to go
to court and get a blanket receivership. So the associations already have
remedies, and I don't think the association should be allowed to shift to
the T the legal obligation of paying a unit owner's assessment simply
because the association doesn't want to go through the time/trouble of
foreclosing their assessment lien.
I would scuttle the entire bill and simply propose the following. Amend
Chapter 83 to say that if a Tenant receives notice from an association
asking the T to pay rent directly to the association, the tenant MAY (not
must) choose to abide by that request and doing so would be an absolute
defense to an eviction action filed by the LL under Chapter 83. I would
stick this in 83.60. The Tenants incentive to VOUNTARILY agree to pay
rent to the association would be the hope that by doing so, the association
will sit back and choose not to file a foreclosure action against the unit
for its unpaid assessments thereby allowing the T to stay put. This would
also keep the liability for unpaid assessments squarely on the unit owner/LL
and would NOT purport to somehow make the T personally liable for condo unit
assessments. The onus would then be on the deadbeat unit owner/LL to go to
court and get a court order directing the T to pay rent to the LL or
alternatively get the association to turn over the rent money to the LL. I
predict most LL's would just disappear at that point and not bother, leaving
the battle between the lender and the association over rent moneys and
assessments. The association would be sort of a surrogate LL until either
the association or lender chose to foreclose. But in the meantime the
association will have cash flow from the T to offset the unpaid assessments
which will make all the other unit owners happy. I suppose 718 would also
need to be amended to say that if a unit owner is more than X days
delinquent on assessments, it would trigger the ability of the association
to send the request to T and that any rents collected by the association
would be credited to the amounts owed by the unit owner.
To further aid my solution above, I would recommend amending 83.51 to
include an obligation of the LL to keep current on condo unit assessments.
That way, if they failed to do so, the T could presumably use section 83.56
(1) to thereby terminate the lease if the LL doesn't come into compliance
after the T's 7 day notice to LL. This would give the T some flexibility -
they could either use 83.56 (1) to terminate the lease and get out of a
problematic situation where the real LL has disappeared, or the T could sit
back and, if requested by the association to pay rent to them, voluntarily
pay rent to the association with the hope that it will help stave off
foreclosure by the association. If the T were to terminate the lease under
this provision, the lack of cash flow would presumably serve to help
accelerate the decision to file foreclosure by either the association or
lender, and the property could be quickly put back on the market for a new
buyer who can begin paying assessments.
Regards,
Greg
Greg Hass, Senior Counsel
Office of Law & Policy
Florida REALTORSR
7025 Augusta National Drive
Orlando, FL 32872-5025
Ph: (407) 438-1400
mailto:GregH@FAR.org GregH@FAR.org
cid:image001.jpg@01C8B0EE.0B556530
LEGAL DISCLAIMER: The information transmitted is intended solely for the
individual or entity to which it is addressed and may contain confidential
and/or privileged material. Any review, retransmission, dissemination or
other use of or taking action in reliance upon this information by persons
or entities other than the intended recipient is prohibited. If you have
received this email in error please contact the sender and delete the
material from any computer.
Florida RealtorsR
A brand new real estate organization with 93 years of experience!
http://www.floridarealtors.org http://www.floridarealtors.org
From: landten-bounces@lists.flabarrpptl.org
[mailto:landten-bounces@lists.flabarrpptl.org] On Behalf Of Frank, Scott A.
Sent: Thursday, January 07, 2010 10:09 AM
To: RPPTL Landlord Tenant Committee
Subject: [RPPTL LandTen] FW: HB 329 - Condo Assessments
FYI - Please see our comments to HB 329, as well as Michael Gelfand's
response and my reply to Michael. Read from bottom up. I will forward on
any new substantive responses we receive.
I have also attached a copy of the proposed bill for your reference.
We will discuss further at next week's meeting (unless no one wants to
discuss it, in which case we will mention it and quickly move on).
Scott A Frank
Attorney at Law
ARNSTEIN & LEHR LLP
http://www.arnstein.com/ www.arnstein.com
515 North Flagler Drive
Sixth Floor
West Palm Beach, Florida 33401-4323
Phone: 561.833.9800
Fax: 561.655.5551
433 Plaza Real
Suite 275
Boca Raton, Florida 33401-4323
Phone: 561.962.4145
Fax: 561.962.4245
mailto:SAFrank@arnstein.com SAFrank@arnstein.com
Offices in Illinois, Florida, and Wisconsin
From: Frank, Scott A.
Sent: Thursday, January 07, 2010 8:46 AM
To: 'Michael J. Gelfand'
Cc: gmeyer@carltonfields.com; Neil B. Shoter; RFreedman@CarltonFields.com;
smezer@bushross.com
Subject: RE: HB 329 - Condo Assessments
Michael:
I understand the bind that associations are finding themselves in these
days. And I also have no sympathy for landlords who are accepting rent and
then not paying their dues. However, I still have issues with the bill in
that (i) while it does offer the innocent tenant some protection, it is
still geared toward the association (I would feel better from the tenant
side if the notice provision were clearer and the tenant had the right to
"reject" the lease and stop paying assessments once he or she vacates); and
(ii) it allows the association to take private property - the rent money is
the landlord's property until a court says otherwise - without any form of
due process or even (for current owners as of the date the bill is enacted)
any prior notice of the possibility. Again, I would feel more comfortable
if the bill were drafted as an "opt-in" clause, allowing existing
associations to adopt the provisions by an affirmative vote of membership.
That way, no owner could argue lack of notice.
Just my $0.02.
Scott A Frank
Attorney at Law
ARNSTEIN & LEHR LLP
http://www.arnstein.com/ www.arnstein.com
515 North Flagler Drive
Sixth Floor
West Palm Beach, Florida 33401-4323
Phone: 561.833.9800
Fax: 561.655.5551
433 Plaza Real
Suite 275
Boca Raton, Florida 33401-4323
Phone: 561.962.4145
Fax: 561.962.4245
mailto:SAFrank@arnstein.com SAFrank@arnstein.com
Offices in Illinois, Florida, and Wisconsin
From: Michael J. Gelfand [mailto:mjgelfand@gelfandarpe.com]
Sent: Thursday, January 07, 2010 1:23 AM
To: Frank, Scott A.
Cc: gmeyer@carltonfields.com; Neil B. Shoter; RFreedman@CarltonFields.com;
smezer@bushross.com
Subject: RE: HB 329 - Condo Assessments
Dear Scott
Thanks for the detailed review. I am forwarding to Rob Freedman and Steven
Mezer of the Condominium Committee to consider the issues raised in the
context of a number of bills with similar provisions.
There are a number of points that bear consideration. I note in passing
that an increasing number of community associations are not waiting for the
legislature to act and associations members are overwhelmingly approving
similar provisions as covenants. To place this in context for your
committee members on a policy level, understanding the need to address
procedure, there appears to be little sympathy for landlords that are not
paying assessments while the landlord still pockets assessments.
Michael J. Gelfand
Florida Bar Board Certified Real Estate Attorney
Florida Supreme Court Certified Mediator:
Civil Circuit Court & Civil County Court
Gelfand http://www.gelfandarpe.com/ & Arpe, P.A.
"Assisting Communities to Efficiently Reach Goals"
Regions Financial Tower, Suite 1220
1555 Palm Beach Lakes Blvd.
West Palm Beach Florida 33401
(561) 655-6224
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From: Frank, Scott A. [mailto:SAFrank@arnstein.com]
Sent: Wednesday, January 06, 2010 2:39 PM
To: Michael J. Gelfand
Cc: gmeyer@carltonfields.com; Neil B. Shoter
Subject: HB 329 - Condo Assessments
You have asked the members of the Landlord-Tenant Committee to review and
comment on this bill. After soliciting the input of the members of the
Committee, I have attempted to put together below an amalgamation of the
comments I received, as well as my own thoughts:
The first issue is the question of whether 83.46 (Duration of Tenancies) is
the right place to put this new language. Could it not possibly fit better
in 83.49 or 83.51? Or possibly even its own new section?
Also, with respect to condo law (I know, not our purview, but anyway),
doesn't this law allow associations to take property without due process,
without such right being explicit in the declaration? In essence, the rent
payment is the property of the unit owner, which property cannot typically
be taken away by an association without either (i) a judicial determination,
or (ii) an explicit right spelled out in the declaration (or even in a
statute in effect as of the date of conveyance to the specific unit owner).
Can associations tow and sell a delinquent unit owner's car when it is
parked in the common area? At the very least, this statute should not apply
to any declarations in effect unless the specific association votes to adopt
it.
Another preliminary thought is the question of whether the remedy provided
here is the appropriate one. By making tenants jointly and severally
liable, the tenant is forced to take on an obligation that (s)he may not
want. What if the tenant, not wanting to stay in a bad situation that may
turn worse, simply decides to move out? As the tenant is liable under the
statute for all sums due under the lease from the date of the association's
notice, the tenant would be required to pay the remainder of the rent, even
post-vacating. (While the landlord may then have a claim against the tenant
for unpaid rent for the remainder of the term, good luck to him on
collecting.) A more appropriate remedy may be to make the tenant liable for
all sums due under the lease from the date of notice until the date of
tenant's surrender. The right to evict and to deny services are appropriate
to enforce this obligation.
In fact, as a related matter, one may wish to consider amending 83.51 to
require landlord to maintain the payment of association dues. This would
allow the tenant the right to vacate, without fear of suit, if landlord does
not in fact pay the fees.
The proposed statute states that the tenant is responsible to pay the
association from the date of the association's "notice", but does not
specify what constitutes valid notice. Perhaps it would be helpful to
include a statutory notice form that spells out (i) from what date the
tenant is to pay the association (must be at least 14-30 days after the date
of the notice), (ii) the statutory limits of tenant's liability (in layman's
language), (iii) what the associations' remedies are for tenant's failure,
and (iv) what rights tenant has against the landlord or in defense of an
action initiated by the landlord. This notice should be sent via certified
mail or other receipted delivery, and the tenant should not be liable
without proof of delivery or refusal. Perhaps even a requirement of
physical delivery to the unit itself. Also, the notice should be delivered
to the unit owner, again via certified mail, to the address for the owner
that the association has on record. In addition, with respect to notice, if
the tenant fails to make a payment, the association's remedies should be
subject to a notice and cure period longer than the statutory 3-day notice.
How is the tenant notified that the owner is delinquent? Is the tenant
given proof that the owner has been notified of the delinquency? And will
the association indemnify the tenant - to the extent of payments made to the
association - if the owner/landlord sues for nonpayment under the lease? At
the very least, the statute should amend Ch. 83 to provide that it is an
absolute defense to an eviction for nonpayment that the payments were made
to the association in accordance with this statute.
The statute in a number of places keeps stating that the tenant is
responsible for "all" or "any" monies owed by the landlord. This seems
overbroad, and should be limited to an itemized list (assessments, fines,
late fees, attorneys' fees) or specify sums payable under the declaration.
With respect to the remedies stated in (4)(b)(1), what "other remedies" are
available to the Association? As there is no privity between the parties,
they cannot collect contract damages under the lease - the only remedies
that should be available to the association are those that are granted
explicitly by this statute (or the declaration). If the intent is to allow
for a suit for monetary damages, then the statute (or declaration) should
spell this out explicitly. And I am not sure how the association can sue
for eviction under its own name (83.56 and 83.59 give the right to pursue a
claim for possession to the "landlord" - these would need to be amended as
well). The statute (or declaration) should contain an explicit assignment
of the owner's rights to sue, provided the assignment is limited to those
amounts due from tenant under this statute.
The limitation of tenant's liability (amount to be paid under rental
agreement) is specified in 83.46(4)(a) and 83.46(4)(b)(1) but missing in
83.46(4)(b) and 83.46(4)(b)(1). This needs to be rectified, as the
language is very difficult to follow. In addition, the language here and in
(4)(b)(2) is very unclear as to what exactly are the limits of tenant's
liability. A suggestion on how to spell out tenant's liability may be to
simply say that tenant is only liable to pay in any given month the sums
that tenant is scheduled to pay under the lease in that given month.
The language concerning prepaid rent/security deposits in (4)(a)(2) is again
highly confusing, and somewhat punishing to tenants. To the extent the
written lease acknowledges receipt of any prepaid rent or security deposit,
the tenant's liability should be decreased by such amount. The cancelled
check requirement is excessive, especially considering that many lower
income tenants pay rent in cash or by money order.
As to 718.106, the first question is whether the term "foreclosure" refers
to mortgage foreclosure or foreclosure of the association's lien. In
addition, the ability to restrict common area access is, at best, vague, and
at worst completely overreaching. Also, who is to be the arbiter of "fair
market rent" in order to determine if the tenant is legitimate? A better
option may be to just require that the lease be an arms-length transaction
between unrelated parties, which does not allow for the unit owner or any
member of his/her family to reside in the unit. If there is still concern
about fraud, there could be a provision allowing the lease to be vitiated by
the association if it is determined that the unit owner is living in the
unit.
We will not address the proposed changes to 718.116(b), as these do not come
within the purview of this committee.
Finally, is there a reason why this provision applies to residential units
only, and not commercial units?
Please note that our comments do not reflect any collective judgment as to
whether the substance and intent of the proposed bill is for the better or
worse, as our committee includes members who represent varying interests in
residential and commercial leasing. Rather it is our intent to assist the
legislature by pointing out what we believe to be significant issues with
the bill as drafted.
Please advise if you wish for any clarification of the above or if we can be
of any further assistance. Thank you.
Scott A Frank
Attorney at Law
ARNSTEIN & LEHR LLP
http://www.arnstein.com/ www.arnstein.com
515 North Flagler Drive
Sixth Floor
West Palm Beach, Florida 33401-4323
Phone: 561.833.9800
Fax: 561.655.5551
433 Plaza Real
Suite 275
Boca Raton, Florida 33401-4323
Phone: 561.962.4145
Fax: 561.962.4245
mailto:SAFrank@arnstein.com SAFrank@arnstein.com
Offices in Illinois, Florida, and Wisconsin
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information.
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cannot
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to another party any transaction or matter addressed herein.
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to another party any transaction or matter addressed herein.
Harry, your points are very well taken - I agree the situation is a
total mess and I'm not sure what can be done legislatively to cure what
is essentially an economic problem. My brother (a law professor in NY)
was visiting over the holidays and he mentioned that he was thinking of
buying a Florida condo as an investment - suffice it to say he changed
his mind after I got done talking to him about the potential legal
pitfalls of same. With that said, I believe the proposal I suggested
below is, overall, a fair and balanced approach to a messy situation
that has no perfect solution.
As I stated earlier, I'm not sure what if any position FAR will take on
this bill. I'm forwarding all these comments to our legislative
attorney in Tallahassee, Trey Goldman, for his consideration.
Regards,
Greg
Greg Hass, Senior Counsel
Office of Law & Policy
Florida REALTORS(r)
7025 Augusta National Drive
Orlando, FL 32872-5025
Ph: (407) 438-1400
LEGAL DISCLAIMER: The information transmitted is intended solely for
the individual or entity to which it is addressed and may contain
confidential and/or privileged material. Any review, retransmission,
dissemination or other use of or taking action in reliance upon this
information by persons or entities other than the intended recipient is
prohibited. If you have received this email in error please contact the
sender and delete the material from any computer.
Florida Realtors(r)
A brand new real estate organization with 93 years of experience!
http://www.floridarealtors.org
From: landten-bounces@lists.flabarrpptl.org
[mailto:landten-bounces@lists.flabarrpptl.org] On Behalf Of
harry@evict.com
Sent: Thursday, January 07, 2010 2:21 PM
To: 'RPPTL Landlord Tenant Committee'
Subject: Re: [RPPTL LandTen] FW: HB 329 - Condo Assessments
Dear Greg,
I have to respectfully oppose any attempt to open the door wider for a
tenant to withhold rent, break a lease or voluntarily pay an
association. This will not work on a practical basis and will cause
major problems with evictions. Suppose they pay partial? You know the
association is going to accept the money and how do I evict?
The whole thing needs to be scuttled.
It is a mess. It is another example of a kneejerk reaction to a
temporary economic crisis or a possible problem that the landlord may
eventually cure. The laws have been in place for years, they have
worked fine for years, the associations just need to deal with it. It
is bad enough that tenants think they can stop paying rent when the
owner is in foreclosure.
The restrictions and powers that associations already have are causing a
price drop in condo and homeowners associations as they are making it
nearly impossible for unit owners to rent out their units i.e.
investment buyers will not want to buy. This bill will give them more
power and in the end hurt all unit owners.
I would hope that FAR strongly comes out and takes a stand against what
the associations are doing now, legally and illegally and also fight new
onerous laws.
I can put you in touch with many of your FAR property manager members
who will tell you the horror stories. If anything, we need laws limiting
the powers of these associations to essentially discriminate against
renters and protected classes. Watch how they approve a white doctor in
5 days but an African American with children, the approval process takes
so long the applicant gives up. We discussed this last August at the FAR
Property Management Council meeting and the crowd was up in arms over
it. That is the tip of the iceberg. If I had time on my hands I would
have testers go out, apply and I would be filing Fair Housing actions
all day long. Condos and HOAs do not want renters period. In one way you
can't blame them because they have to deal with the California buyers
who put the unit on Craig's List and rents it to anyone who calls them
up and can breathe.
Harry Heist
LAW OFFICES OF
HEIST, WEISSE & DAVIS, P.A.
PH: 1 800 253 8428
FAX: 1 800 367 9038
"Serving the Property Management Professional"
Website: www.evict.com http://www.evict.com/
Email: harry@evict.com
THIS E-MAIL MESSAGE IS CONFIDENTIAL, ATTORNEY-CLIENT PRIVILEGED, AND
INTENDED FOR THE PERSONS NAMED ABOVE ONLY. ALL OTHER USE, COPYING, OR
DISTRIBUTION IS STRICTLY PROHIBITED.
From: landten-bounces@lists.flabarrpptl.org
[mailto:landten-bounces@lists.flabarrpptl.org] On Behalf Of Greg Hass
Sent: Thursday, January 07, 2010 12:25 PM
To: RPPTL Landlord Tenant Committee
Subject: Re: [RPPTL LandTen] FW: HB 329 - Condo Assessments
Thanks Scott, that was a very detailed analysis.
My own personal opinion (I'm not sure what official position the Florida
Realtors will take on this matter, if any), is that the tenants should
not be made liable to the association for unpaid unit assessments, etc.
My view is that this bill as drafted is overkill and many of the
provisions will just add further confusion. The associations currently
have a simple (albeit time consuming and costly) remedy - foreclose
their assessment lien and then they can rent the unit to whoever they
want and collect all the rent (although I suppose the new Protecting
Tenants at Foreclosure Act would come into play). Another remedy
apparently used with some success is to go to court and get a blanket
receivership. So the associations already have remedies, and I don't
think the association should be allowed to shift to the T the legal
obligation of paying a unit owner's assessment simply because the
association doesn't want to go through the time/trouble of foreclosing
their assessment lien.
I would scuttle the entire bill and simply propose the following. Amend
Chapter 83 to say that if a Tenant receives notice from an association
asking the T to pay rent directly to the association, the tenant MAY
(not must) choose to abide by that request and doing so would be an
absolute defense to an eviction action filed by the LL under Chapter 83.
I would stick this in 83.60. The Tenants incentive to VOUNTARILY
agree to pay rent to the association would be the hope that by doing so,
the association will sit back and choose not to file a foreclosure
action against the unit for its unpaid assessments thereby allowing the
T to stay put. This would also keep the liability for unpaid
assessments squarely on the unit owner/LL and would NOT purport to
somehow make the T personally liable for condo unit assessments. The
onus would then be on the deadbeat unit owner/LL to go to court and get
a court order directing the T to pay rent to the LL or alternatively get
the association to turn over the rent money to the LL. I predict most
LL's would just disappear at that point and not bother, leaving the
battle between the lender and the association over rent moneys and
assessments. The association would be sort of a surrogate LL until
either the association or lender chose to foreclose. But in the
meantime the association will have cash flow from the T to offset the
unpaid assessments which will make all the other unit owners happy. I
suppose 718 would also need to be amended to say that if a unit owner is
more than X days delinquent on assessments, it would trigger the ability
of the association to send the request to T and that any rents collected
by the association would be credited to the amounts owed by the unit
owner.
To further aid my solution above, I would recommend amending 83.51 to
include an obligation of the LL to keep current on condo unit
assessments. That way, if they failed to do so, the T could presumably
use section 83.56 (1) to thereby terminate the lease if the LL doesn't
come into compliance after the T's 7 day notice to LL. This would give
the T some flexibility - they could either use 83.56 (1) to terminate
the lease and get out of a problematic situation where the real LL has
disappeared, or the T could sit back and, if requested by the
association to pay rent to them, voluntarily pay rent to the association
with the hope that it will help stave off foreclosure by the
association. If the T were to terminate the lease under this provision,
the lack of cash flow would presumably serve to help accelerate the
decision to file foreclosure by either the association or lender, and
the property could be quickly put back on the market for a new buyer who
can begin paying assessments.
Regards,
Greg
Greg Hass, Senior Counsel
Office of Law & Policy
Florida REALTORS(r)
7025 Augusta National Drive
Orlando, FL 32872-5025
Ph: (407) 438-1400
GregH@FAR.org mailto:GregH@FAR.org
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From: landten-bounces@lists.flabarrpptl.org
[mailto:landten-bounces@lists.flabarrpptl.org] On Behalf Of Frank, Scott
A.
Sent: Thursday, January 07, 2010 10:09 AM
To: RPPTL Landlord Tenant Committee
Subject: [RPPTL LandTen] FW: HB 329 - Condo Assessments
FYI - Please see our comments to HB 329, as well as Michael Gelfand's
response and my reply to Michael. Read from bottom up. I will forward
on any new substantive responses we receive.
I have also attached a copy of the proposed bill for your reference.
We will discuss further at next week's meeting (unless no one wants to
discuss it, in which case we will mention it and quickly move on).
Scott A Frank
Attorney at Law
ARNSTEIN & LEHR LLP
www.arnstein.com http://www.arnstein.com/
515 North Flagler Drive
Sixth Floor
West Palm Beach, Florida 33401-4323
Phone: 561.833.9800
Fax: 561.655.5551
433 Plaza Real
Suite 275
Boca Raton, Florida 33401-4323
Phone: 561.962.4145
Fax: 561.962.4245
SAFrank@arnstein.com mailto:SAFrank@arnstein.com
Offices in Illinois, Florida, and Wisconsin
From: Frank, Scott A.
Sent: Thursday, January 07, 2010 8:46 AM
To: 'Michael J. Gelfand'
Cc: gmeyer@carltonfields.com; Neil B. Shoter;
RFreedman@CarltonFields.com; smezer@bushross.com
Subject: RE: HB 329 - Condo Assessments
Michael:
I understand the bind that associations are finding themselves in these
days. And I also have no sympathy for landlords who are accepting rent
and then not paying their dues. However, I still have issues with the
bill in that (i) while it does offer the innocent tenant some
protection, it is still geared toward the association (I would feel
better from the tenant side if the notice provision were clearer and the
tenant had the right to "reject" the lease and stop paying assessments
once he or she vacates); and (ii) it allows the association to take
private property - the rent money is the landlord's property until a
court says otherwise - without any form of due process or even (for
current owners as of the date the bill is enacted) any prior notice of
the possibility. Again, I would feel more comfortable if the bill were
drafted as an "opt-in" clause, allowing existing associations to adopt
the provisions by an affirmative vote of membership. That way, no owner
could argue lack of notice.
Just my $0.02.
Scott A Frank
Attorney at Law
ARNSTEIN & LEHR LLP
www.arnstein.com http://www.arnstein.com/
515 North Flagler Drive
Sixth Floor
West Palm Beach, Florida 33401-4323
Phone: 561.833.9800
Fax: 561.655.5551
433 Plaza Real
Suite 275
Boca Raton, Florida 33401-4323
Phone: 561.962.4145
Fax: 561.962.4245
SAFrank@arnstein.com mailto:SAFrank@arnstein.com
Offices in Illinois, Florida, and Wisconsin
From: Michael J. Gelfand [mailto:mjgelfand@gelfandarpe.com]
Sent: Thursday, January 07, 2010 1:23 AM
To: Frank, Scott A.
Cc: gmeyer@carltonfields.com; Neil B. Shoter;
RFreedman@CarltonFields.com; smezer@bushross.com
Subject: RE: HB 329 - Condo Assessments
Dear Scott
Thanks for the detailed review. I am forwarding to Rob Freedman and
Steven Mezer of the Condominium Committee to consider the issues raised
in the context of a number of bills with similar provisions.
There are a number of points that bear consideration. I note in passing
that an increasing number of community associations are not waiting for
the legislature to act and associations members are overwhelmingly
approving similar provisions as covenants. To place this in context for
your committee members on a policy level, understanding the need to
address procedure, there appears to be little sympathy for landlords
that are not paying assessments while the landlord still pockets
assessments.
Michael J. Gelfand
Florida Bar Board Certified Real Estate Attorney
Florida Supreme Court Certified Mediator:
Civil Circuit Court & Civil County Court
Gelfand & Arpe, P.A. http://www.gelfandarpe.com/
"Assisting Communities to Efficiently Reach Goals"
Regions Financial Tower, Suite 1220
1555 Palm Beach Lakes Blvd.
West Palm Beach Florida 33401
(561) 655-6224
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From: Frank, Scott A. [mailto:SAFrank@arnstein.com]
Sent: Wednesday, January 06, 2010 2:39 PM
To: Michael J. Gelfand
Cc: gmeyer@carltonfields.com; Neil B. Shoter
Subject: HB 329 - Condo Assessments
You have asked the members of the Landlord-Tenant Committee to review
and comment on this bill. After soliciting the input of the members of
the Committee, I have attempted to put together below an amalgamation of
the comments I received, as well as my own thoughts:
The first issue is the question of whether 83.46 (Duration of Tenancies)
is the right place to put this new language. Could it not possibly fit
better in 83.49 or 83.51? Or possibly even its own new section?
Also, with respect to condo law (I know, not our purview, but anyway),
doesn't this law allow associations to take property without due
process, without such right being explicit in the declaration? In
essence, the rent payment is the property of the unit owner, which
property cannot typically be taken away by an association without either
(i) a judicial determination, or (ii) an explicit right spelled out in
the declaration (or even in a statute in effect as of the date of
conveyance to the specific unit owner). Can associations tow and sell a
delinquent unit owner's car when it is parked in the common area? At
the very least, this statute should not apply to any declarations in
effect unless the specific association votes to adopt it.
Another preliminary thought is the question of whether the remedy
provided here is the appropriate one. By making tenants jointly and
severally liable, the tenant is forced to take on an obligation that
(s)he may not want. What if the tenant, not wanting to stay in a bad
situation that may turn worse, simply decides to move out? As the
tenant is liable under the statute for all sums due under the lease from
the date of the association's notice, the tenant would be required to
pay the remainder of the rent, even post-vacating. (While the landlord
may then have a claim against the tenant for unpaid rent for the
remainder of the term, good luck to him on collecting.) A more
appropriate remedy may be to make the tenant liable for all sums due
under the lease from the date of notice until the date of tenant's
surrender. The right to evict and to deny services are appropriate to
enforce this obligation.
In fact, as a related matter, one may wish to consider amending 83.51 to
require landlord to maintain the payment of association dues. This
would allow the tenant the right to vacate, without fear of suit, if
landlord does not in fact pay the fees.
The proposed statute states that the tenant is responsible to pay the
association from the date of the association's "notice", but does not
specify what constitutes valid notice. Perhaps it would be helpful to
include a statutory notice form that spells out (i) from what date the
tenant is to pay the association (must be at least 14-30 days after the
date of the notice), (ii) the statutory limits of tenant's liability (in
layman's language), (iii) what the associations' remedies are for
tenant's failure, and (iv) what rights tenant has against the landlord
or in defense of an action initiated by the landlord. This notice
should be sent via certified mail or other receipted delivery, and the
tenant should not be liable without proof of delivery or refusal.
Perhaps even a requirement of physical delivery to the unit itself.
Also, the notice should be delivered to the unit owner, again via
certified mail, to the address for the owner that the association has on
record. In addition, with respect to notice, if the tenant fails to
make a payment, the association's remedies should be subject to a notice
and cure period longer than the statutory 3-day notice.
How is the tenant notified that the owner is delinquent? Is the tenant
given proof that the owner has been notified of the delinquency? And
will the association indemnify the tenant - to the extent of payments
made to the association - if the owner/landlord sues for nonpayment
under the lease? At the very least, the statute should amend Ch. 83 to
provide that it is an absolute defense to an eviction for nonpayment
that the payments were made to the association in accordance with this
statute.
The statute in a number of places keeps stating that the tenant is
responsible for "all" or "any" monies owed by the landlord. This seems
overbroad, and should be limited to an itemized list (assessments,
fines, late fees, attorneys' fees) or specify sums payable under the
declaration.
With respect to the remedies stated in (4)(b)(1), what "other remedies"
are available to the Association? As there is no privity between the
parties, they cannot collect contract damages under the lease - the only
remedies that should be available to the association are those that are
granted explicitly by this statute (or the declaration). If the intent
is to allow for a suit for monetary damages, then the statute (or
declaration) should spell this out explicitly. And I am not sure how
the association can sue for eviction under its own name (83.56 and 83.59
give the right to pursue a claim for possession to the "landlord" -
these would need to be amended as well). The statute (or declaration)
should contain an explicit assignment of the owner's rights to sue,
provided the assignment is limited to those amounts due from tenant
under this statute.
The limitation of tenant's liability (amount to be paid under rental
agreement) is specified in 83.46(4)(a) and 83.46(4)(b)(1) but missing in
83.46(4)(b) and 83.46(4)(b)(1). This needs to be rectified, as the
language is very difficult to follow. In addition, the language here
and in (4)(b)(2) is very unclear as to what exactly are the limits of
tenant's liability. A suggestion on how to spell out tenant's
liability may be to simply say that tenant is only liable to pay in any
given month the sums that tenant is scheduled to pay under the lease in
that given month.
The language concerning prepaid rent/security deposits in (4)(a)(2) is
again highly confusing, and somewhat punishing to tenants. To the
extent the written lease acknowledges receipt of any prepaid rent or
security deposit, the tenant's liability should be decreased by such
amount. The cancelled check requirement is excessive, especially
considering that many lower income tenants pay rent in cash or by money
order.
As to 718.106, the first question is whether the term "foreclosure"
refers to mortgage foreclosure or foreclosure of the association's lien.
In addition, the ability to restrict common area access is, at best,
vague, and at worst completely overreaching. Also, who is to be the
arbiter of "fair market rent" in order to determine if the tenant is
legitimate? A better option may be to just require that the lease be an
arms-length transaction between unrelated parties, which does not allow
for the unit owner or any member of his/her family to reside in the
unit. If there is still concern about fraud, there could be a provision
allowing the lease to be vitiated by the association if it is determined
that the unit owner is living in the unit.
We will not address the proposed changes to 718.116(b), as these do not
come within the purview of this committee.
Finally, is there a reason why this provision applies to residential
units only, and not commercial units?
Please note that our comments do not reflect any collective judgment as
to whether the substance and intent of the proposed bill is for the
better or worse, as our committee includes members who represent varying
interests in residential and commercial leasing. Rather it is our intent
to assist the legislature by pointing out what we believe to be
significant issues with the bill as drafted.
Please advise if you wish for any clarification of the above or if we
can be of any further assistance. Thank you.
Scott A Frank
Attorney at Law
ARNSTEIN & LEHR LLP
www.arnstein.com http://www.arnstein.com/
515 North Flagler Drive
Sixth Floor
West Palm Beach, Florida 33401-4323
Phone: 561.833.9800
Fax: 561.655.5551
433 Plaza Real
Suite 275
Boca Raton, Florida 33401-4323
Phone: 561.962.4145
Fax: 561.962.4245
SAFrank@arnstein.com mailto:SAFrank@arnstein.com
Offices in Illinois, Florida, and Wisconsin
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I agree 100% with Harry's analysis here. This is another "kneejerk reaction to a temporary economic crisis" and as usual, unfairly places the burden. At least some of the other recent legislation has sunset provisions, but I didn't see that in this one. This Bill should be nixed altogether.
What is the Bar/RPPTL's position?
Cary
Cary P. Sabol, Esq.
P.O. Box 15981
West Palm Beach, Florida 33416
Phone: (561) 281-2744
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--- On Thu, 1/7/10, harry@evict.com harry@evict.com wrote:
From: harry@evict.com harry@evict.com
Subject: Re: [RPPTL LandTen] FW: HB 329 - Condo Assessments
To: "'RPPTL Landlord Tenant Committee'" landten@lists.flabarrpptl.org
Date: Thursday, January 7, 2010, 2:21 PM
Dear Greg,
I have to respectfully oppose any attempt to open the door wider for a tenant to withhold rent, break a lease or voluntarily pay an association. This will not work on a practical basis and will cause major problems with evictions. Suppose they pay partial? You know the association is going to accept the money and how do I evict?
The whole thing needs to be scuttled.
It is a mess. It is another example of a kneejerk reaction to a temporary economic crisis or a possible problem that the landlord may eventually cure. The laws have been in place for years, they have worked fine for years, the associations just need to deal with it. It is bad enough that tenants think they can stop paying rent when the owner is in foreclosure.
The restrictions and powers that associations already have are causing a price drop in condo and homeowners associations as they are making it nearly impossible for unit owners to rent out their units i.e. investment buyers will not want to buy. This bill will give them more power and in the end hurt all unit owners.
I would hope that FAR strongly comes out and takes a stand against what the associations are doing now, legally and illegally and also fight new onerous laws.
I can put you in touch with many of your FAR property manager members who will tell you the horror stories. If anything, we need laws limiting the powers of these associations to essentially discriminate against renters and protected classes. Watch how they approve a white doctor in 5 days but an African American with children, the approval process takes so long the applicant gives up. We discussed this last August at the FAR Property Management Council meeting and the crowd was up in arms over it. That is the tip of the iceberg. If I had time on my hands I would have testers go out, apply and I would be filing Fair Housing actions all day long. Condos and HOAs do not want renters period. In one way you can’t blame them because they have to deal with the California buyers who put the unit on Craig's List and rents it to anyone who calls them up and can breathe.
Harry Heist
LAW OFFICES OF
HEIST, WEISSE & DAVIS, P.A.
PH: 1 800 253 8428
FAX: 1 800 367 9038
"Serving the Property Management Professional"
Website: www.evict.com
Email: harry@evict.com
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From: landten-bounces@lists.flabarrpptl.org [mailto:landten-bounces@lists.flabarrpptl.org] On Behalf Of Greg Hass
Sent: Thursday, January 07, 2010 12:25 PM
To: RPPTL Landlord Tenant Committee
Subject: Re: [RPPTL LandTen] FW: HB 329 - Condo Assessments
Thanks Scott, that was a very detailed analysis.
My own personal opinion (I’m not sure what official position the Florida Realtors will take on this matter, if any), is that the tenants should not be made liable to the association for unpaid unit assessments, etc. My view is that this bill as drafted is overkill and many of the provisions will just add further confusion. The associations currently have a simple (albeit time consuming and costly) remedy – foreclose their assessment lien and then they can rent the unit to whoever they want and collect all the rent (although I suppose the new Protecting Tenants at Foreclosure Act would come into play). Another remedy apparently used with some success is to go to court and get a blanket receivership. So the associations already have remedies, and I don’t think the association should be allowed to shift to the T the legal obligation of paying a unit owner’s assessment simply because the association doesn’t want to go through the
time/trouble of foreclosing their assessment lien.
I would scuttle the entire bill and simply propose the following. Amend Chapter 83 to say that if a Tenant receives notice from an association asking the T to pay rent directly to the association, the tenant MAY (not must) choose to abide by that request and doing so would be an absolute defense to an eviction action filed by the LL under Chapter 83. I would stick this in 83.60. The Tenants incentive to VOUNTARILY agree to pay rent to the association would be the hope that by doing so, the association will sit back and choose not to file a foreclosure action against the unit for its unpaid assessments thereby allowing the T to stay put. This would also keep the liability for unpaid assessments squarely on the unit owner/LL and would NOT purport to somehow make the T personally liable for condo unit assessments. The onus would then be on the deadbeat unit owner/LL to go to court and get a court order directing the T to pay rent to the LL
or alternatively get the association to turn over the rent money to the LL. I predict most LL’s would just disappear at that point and not bother, leaving the battle between the lender and the association over rent moneys and assessments. The association would be sort of a surrogate LL until either the association or lender chose to foreclose. But in the meantime the association will have cash flow from the T to offset the unpaid assessments which will make all the other unit owners happy. I suppose 718 would also need to be amended to say that if a unit owner is more than X days delinquent on assessments, it would trigger the ability of the association to send the request to T and that any rents collected by the association would be credited to the amounts owed by the unit owner.
To further aid my solution above, I would recommend amending 83.51 to include an obligation of the LL to keep current on condo unit assessments. That way, if they failed to do so, the T could presumably use section 83.56 (1) to thereby terminate the lease if the LL doesn’t come into compliance after the T’s 7 day notice to LL. This would give the T some flexibility – they could either use 83.56 (1) to terminate the lease and get out of a problematic situation where the real LL has disappeared, or the T could sit back and, if requested by the association to pay rent to them, voluntarily pay rent to the association with the hope that it will help stave off foreclosure by the association. If the T were to terminate the lease under this provision, the lack of cash flow would presumably serve to help accelerate the decision to file foreclosure by either the association or lender, and the property could be quickly put back on the market for a
new buyer who can begin paying assessments.
Regards,
Greg
Greg Hass, Senior Counsel
Office of Law & Policy
Florida REALTORS®
7025 Augusta National Drive
Orlando, FL 32872-5025
Ph: (407) 438-1400
GregH@FAR.org
LEGAL DISCLAIMER: The information transmitted is intended solely for the individual or entity to which it is addressed and may contain confidential and/or privileged material. Any review, retransmission, dissemination or other use of or taking action in reliance upon this information by persons or entities other than the intended recipient is prohibited. If you have received this email in error please contact the sender and delete the material from any computer.
Florida Realtors®
A brand new real estate organization with 93 years of experience!
http://www.floridarealtors.org
From: landten-bounces@lists.flabarrpptl.org [mailto:landten-bounces@lists.flabarrpptl.org] On Behalf Of Frank, Scott A.
Sent: Thursday, January 07, 2010 10:09 AM
To: RPPTL Landlord Tenant Committee
Subject: [RPPTL LandTen] FW: HB 329 - Condo Assessments
FYI - Please see our comments to HB 329, as well as Michael Gelfand's response and my reply to Michael. Read from bottom up. I will forward on any new substantive responses we receive.
I have also attached a copy of the proposed bill for your reference.
We will discuss further at next week's meeting (unless no one wants to discuss it, in which case we will mention it and quickly move on).
Scott A Frank
Attorney at Law
ARNSTEIN & LEHR LLP
515 North Flagler Drive
Sixth Floor
West Palm Beach, Florida 33401-4323
Phone: 561.833.9800
Fax: 561.655.5551
433 Plaza Real
Suite 275
Boca Raton, Florida 33401-4323
Phone: 561.962.4145
Fax: 561.962.4245
SAFrank@arnstein.com
Offices in Illinois, Florida, and Wisconsin
From: Frank, Scott A.
Sent: Thursday, January 07, 2010 8:46 AM
To: 'Michael J. Gelfand'
Cc: gmeyer@carltonfields.com; Neil B. Shoter; RFreedman@CarltonFields.com; smezer@bushross.com
Subject: RE: HB 329 - Condo Assessments
Michael:
I understand the bind that associations are finding themselves in these days. And I also have no sympathy for landlords who are accepting rent and then not paying their dues. However, I still have issues with the bill in that (i) while it does offer the innocent tenant some protection, it is still geared toward the association (I would feel better from the tenant side if the notice provision were clearer and the tenant had the right to "reject" the lease and stop paying assessments once he or she vacates); and (ii) it allows the association to take private property - the rent money is the landlord's property until a court says otherwise - without any form of due process or even (for current owners as of the date the bill is enacted) any prior notice of the possibility. Again, I would feel more comfortable if the bill were drafted as an "opt-in" clause, allowing existing associations to adopt the provisions by an affirmative vote of membership.
That way, no owner could argue lack of notice.
Just my $0.02.
Scott A Frank
Attorney at Law
ARNSTEIN & LEHR LLP
515 North Flagler Drive
Sixth Floor
West Palm Beach, Florida 33401-4323
Phone: 561.833.9800
Fax: 561.655.5551
433 Plaza Real
Suite 275
Boca Raton, Florida 33401-4323
Phone: 561.962.4145
Fax: 561.962.4245
SAFrank@arnstein.com
Offices in Illinois, Florida, and Wisconsin
From: Michael J. Gelfand [mailto:mjgelfand@gelfandarpe.com]
Sent: Thursday, January 07, 2010 1:23 AM
To: Frank, Scott A.
Cc: gmeyer@carltonfields.com; Neil B. Shoter; RFreedman@CarltonFields.com; smezer@bushross.com
Subject: RE: HB 329 - Condo Assessments
Dear Scott
Thanks for the detailed review. I am forwarding to Rob Freedman and Steven Mezer of the Condominium Committee to consider the issues raised in the context of a number of bills with similar provisions.
There are a number of points that bear consideration. I note in passing that an increasing number of community associations are not waiting for the legislature to act and associations members are overwhelmingly approving similar provisions as covenants. To place this in context for your committee members on a policy level, understanding the need to address procedure, there appears to be little sympathy for landlords that are not paying assessments while the landlord still pockets assessments.
Michael J. Gelfand
Florida Bar Board Certified Real Estate Attorney
Florida Supreme Court Certified Mediator:
Civil Circuit Court & Civil County Court
Gelfand & Arpe, P.A.
"Assisting Communities to Efficiently Reach Goals"
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From: Frank, Scott A. [mailto:SAFrank@arnstein.com]
Sent: Wednesday, January 06, 2010 2:39 PM
To: Michael J. Gelfand
Cc: gmeyer@carltonfields.com; Neil B. Shoter
Subject: HB 329 - Condo Assessments
You have asked the members of the Landlord-Tenant Committee to review and comment on this bill. After soliciting the input of the members of the Committee, I have attempted to put together below an amalgamation of the comments I received, as well as my own thoughts:
The first issue is the question of whether 83.46 (Duration of Tenancies) is the right place to put this new language. Could it not possibly fit better in 83.49 or 83.51? Or possibly even its own new section?
Also, with respect to condo law (I know, not our purview, but anyway), doesn’t this law allow associations to take property without due process, without such right being explicit in the declaration? In essence, the rent payment is the property of the unit owner, which property cannot typically be taken away by an association without either (i) a judicial determination, or (ii) an explicit right spelled out in the declaration (or even in a statute in effect as of the date of conveyance to the specific unit owner). Can associations tow and sell a delinquent unit owner’s car when it is parked in the common area? At the very least, this statute should not apply to any declarations in effect unless the specific association votes to adopt it.
Another preliminary thought is the question of whether the remedy provided here is the appropriate one. By making tenants jointly and severally liable, the tenant is forced to take on an obligation that (s)he may not want. What if the tenant, not wanting to stay in a bad situation that may turn worse, simply decides to move out? As the tenant is liable under the statute for all sums due under the lease from the date of the association’s notice, the tenant would be required to pay the remainder of the rent, even post-vacating. (While the landlord may then have a claim against the tenant for unpaid rent for the remainder of the term, good luck to him on collecting.) A more appropriate remedy may be to make the tenant liable for all sums due under the lease from the date of notice until the date of tenant’s surrender. The right to evict and to deny services are appropriate to enforce this obligation.
In fact, as a related matter, one may wish to consider amending 83.51 to require landlord to maintain the payment of association dues. This would allow the tenant the right to vacate, without fear of suit, if landlord does not in fact pay the fees.
The proposed statute states that the tenant is responsible to pay the association from the date of the association’s “notice”, but does not specify what constitutes valid notice. Perhaps it would be helpful to include a statutory notice form that spells out (i) from what date the tenant is to pay the association (must be at least 14-30 days after the date of the notice), (ii) the statutory limits of tenant’s liability (in layman’s language), (iii) what the associations’ remedies are for tenant’s failure, and (iv) what rights tenant has against the landlord or in defense of an action initiated by the landlord. This notice should be sent via certified mail or other receipted delivery, and the tenant should not be liable without proof of delivery or refusal. Perhaps even a requirement of physical delivery to the unit itself. Also, the notice should be delivered to the unit owner, again via certified mail, to the address for the owner
that the association has on record. In addition, with respect to notice, if the tenant fails to make a payment, the association’s remedies should be subject to a notice and cure period longer than the statutory 3-day notice.
How is the tenant notified that the owner is delinquent? Is the tenant given proof that the owner has been notified of the delinquency? And will the association indemnify the tenant – to the extent of payments made to the association – if the owner/landlord sues for nonpayment under the lease? At the very least, the statute should amend Ch. 83 to provide that it is an absolute defense to an eviction for nonpayment that the payments were made to the association in accordance with this statute.
The statute in a number of places keeps stating that the tenant is responsible for "all" or "any" monies owed by the landlord. This seems overbroad, and should be limited to an itemized list (assessments, fines, late fees, attorneys' fees) or specify sums payable under the declaration.
With respect to the remedies stated in (4)(b)(1), what “other remedies” are available to the Association? As there is no privity between the parties, they cannot collect contract damages under the lease – the only remedies that should be available to the association are those that are granted explicitly by this statute (or the declaration). If the intent is to allow for a suit for monetary damages, then the statute (or declaration) should spell this out explicitly. And I am not sure how the association can sue for eviction under its own name (83.56 and 83.59 give the right to pursue a claim for possession to the “landlord” – these would need to be amended as well). The statute (or declaration) should contain an explicit assignment of the owner’s rights to sue, provided the assignment is limited to those amounts due from tenant under this statute.
The limitation of tenant’s liability (amount to be paid under rental agreement) is specified in 83.46(4)(a) and 83.46(4)(b)(1) but missing in 83.46(4)(b) and 83.46(4)(b)(1). This needs to be rectified, as the language is very difficult to follow. In addition, the language here and in (4)(b)(2) is very unclear as to what exactly are the limits of tenant’s liability. A suggestion on how to spell out tenant’s liability may be to simply say that tenant is only liable to pay in any given month the sums that tenant is scheduled to pay under the lease in that given month.
The language concerning prepaid rent/security deposits in (4)(a)(2) is again highly confusing, and somewhat punishing to tenants. To the extent the written lease acknowledges receipt of any prepaid rent or security deposit, the tenant’s liability should be decreased by such amount. The cancelled check requirement is excessive, especially considering that many lower income tenants pay rent in cash or by money order.
As to 718.106, the first question is whether the term “foreclosure” refers to mortgage foreclosure or foreclosure of the association’s lien. In addition, the ability to restrict common area access is, at best, vague, and at worst completely overreaching. Also, who is to be the arbiter of “fair market rent” in order to determine if the tenant is legitimate? A better option may be to just require that the lease be an arms-length transaction between unrelated parties, which does not allow for the unit owner or any member of his/her family to reside in the unit. If there is still concern about fraud, there could be a provision allowing the lease to be vitiated by the association if it is determined that the unit owner is living in the unit.
We will not address the proposed changes to 718.116(b), as these do not come within the purview of this committee.
Finally, is there a reason why this provision applies to residential units only, and not commercial units?
Please note that our comments do not reflect any collective judgment as to whether the substance and intent of the proposed bill is for the better or worse, as our committee includes members who represent varying interests in residential and commercial leasing. Rather it is our intent to assist the legislature by pointing out what we believe to be significant issues with the bill as drafted.
Please advise if you wish for any clarification of the above or if we can be of any further assistance. Thank you.
Scott A Frank
Attorney at Law
ARNSTEIN & LEHR LLP
515 North Flagler Drive
Sixth Floor
West Palm Beach, Florida 33401-4323
Phone: 561.833.9800
Fax: 561.655.5551
433 Plaza Real
Suite 275
Boca Raton, Florida 33401-4323
Phone: 561.962.4145
Fax: 561.962.4245
SAFrank@arnstein.com
Offices in Illinois, Florida, and Wisconsin
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It is my understanding that the RPPTL does not as yet have a position.
But that may or may not change.
Scott A Frank
Attorney at Law
ARNSTEIN & LEHR LLP
www.arnstein.com http://www.arnstein.com/
515 North Flagler Drive
Sixth Floor
West Palm Beach, Florida 33401-4323
Phone: 561.833.9800
Fax: 561.655.5551
433 Plaza Real
Suite 275
Boca Raton, Florida 33401-4323
Phone: 561.962.4145
Fax: 561.962.4245
SAFrank@arnstein.com mailto:SAFrank@arnstein.com
Offices in Illinois, Florida, and Wisconsin
From: landten-bounces@lists.flabarrpptl.org
[mailto:landten-bounces@lists.flabarrpptl.org] On Behalf Of Cary Sabol
Sent: Thursday, January 07, 2010 3:31 PM
To: RPPTL Landlord Tenant Committee
Subject: Re: [RPPTL LandTen] FW: HB 329 - Condo Assessments
I agree 100% with Harry's analysis here. This is another "kneejerk
reaction to a temporary economic crisis" and as usual, unfairly places
the burden. At least some of the other recent legislation has sunset
provisions, but I didn't see that in this one. This Bill should be
nixed altogether.
What is the Bar/RPPTL's position?
Cary
Cary P. Sabol, Esq.
P.O. Box 15981
West Palm Beach, Florida 33416
Phone: (561) 281-2744
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--- On Thu, 1/7/10, harry@evict.com harry@evict.com wrote:
From: harry@evict.com <harry@evict.com>
Subject: Re: [RPPTL LandTen] FW: HB 329 - Condo Assessments
To: "'RPPTL Landlord Tenant Committee'"
landten@lists.flabarrpptl.org
Date: Thursday, January 7, 2010, 2:21 PM
Dear Greg,
I have to respectfully oppose any attempt to open the door wider
for a tenant to withhold rent, break a lease or voluntarily pay an
association. This will not work on a practical basis and will cause
major problems with evictions. Suppose they pay partial? You know the
association is going to accept the money and how do I evict?
The whole thing needs to be scuttled.
It is a mess. It is another example of a kneejerk reaction to a
temporary economic crisis or a possible problem that the landlord may
eventually cure. The laws have been in place for years, they have
worked fine for years, the associations just need to deal with it. It
is bad enough that tenants think they can stop paying rent when the
owner is in foreclosure.
The restrictions and powers that associations already have are
causing a price drop in condo and homeowners associations as they are
making it nearly impossible for unit owners to rent out their units i.e.
investment buyers will not want to buy. This bill will give them more
power and in the end hurt all unit owners.
I would hope that FAR strongly comes out and takes a stand
against what the associations are doing now, legally and illegally and
also fight new onerous laws.
I can put you in touch with many of your FAR property manager
members who will tell you the horror stories. If anything, we need laws
limiting the powers of these associations to essentially discriminate
against renters and protected classes. Watch how they approve a white
doctor in 5 days but an African American with children, the approval
process takes so long the applicant gives up. We discussed this last
August at the FAR Property Management Council meeting and the crowd was
up in arms over it. That is the tip of the iceberg. If I had time on my
hands I would have testers go out, apply and I would be filing Fair
Housing actions all day long. Condos and HOAs do not want renters
period. In one way you can't blame them because they have to deal with
the California buyers who put the unit on Craig's List and rents it to
anyone who calls them up and can breathe.
Harry Heist
LAW OFFICES OF
HEIST, WEISSE & DAVIS, P.A.
PH: 1 800 253 8428
FAX: 1 800 367 9038
"Serving the Property Management Professional"
Website: www.evict.com <http://www.evict.com/>
Email: harry@evict.com
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From: landten-bounces@lists.flabarrpptl.org
[mailto:landten-bounces@lists.flabarrpptl.org] On Behalf Of Greg Hass
Sent: Thursday, January 07, 2010 12:25 PM
To: RPPTL Landlord Tenant Committee
Subject: Re: [RPPTL LandTen] FW: HB 329 - Condo Assessments
Thanks Scott, that was a very detailed analysis.
My own personal opinion (I'm not sure what official position the
Florida Realtors will take on this matter, if any), is that the tenants
should not be made liable to the association for unpaid unit
assessments, etc. My view is that this bill as drafted is overkill and
many of the provisions will just add further confusion. The
associations currently have a simple (albeit time consuming and costly)
remedy - foreclose their assessment lien and then they can rent the unit
to whoever they want and collect all the rent (although I suppose the
new Protecting Tenants at Foreclosure Act would come into play).
Another remedy apparently used with some success is to go to court and
get a blanket receivership. So the associations already have remedies,
and I don't think the association should be allowed to shift to the T
the legal obligation of paying a unit owner's assessment simply because
the association doesn't want to go through the time/trouble of
foreclosing their assessment lien.
I would scuttle the entire bill and simply propose the
following. Amend Chapter 83 to say that if a Tenant receives notice
from an association asking the T to pay rent directly to the
association, the tenant MAY (not must) choose to abide by that request
and doing so would be an absolute defense to an eviction action filed by
the LL under Chapter 83. I would stick this in 83.60. The Tenants
incentive to VOUNTARILY agree to pay rent to the association would be
the hope that by doing so, the association will sit back and choose not
to file a foreclosure action against the unit for its unpaid assessments
thereby allowing the T to stay put. This would also keep the liability
for unpaid assessments squarely on the unit owner/LL and would NOT
purport to somehow make the T personally liable for condo unit
assessments. The onus would then be on the deadbeat unit owner/LL to go
to court and get a court order directing the T to pay rent to the LL or
alternatively get the association to turn over the rent money to the LL.
I predict most LL's would just disappear at that point and not bother,
leaving the battle between the lender and the association over rent
moneys and assessments. The association would be sort of a surrogate LL
until either the association or lender chose to foreclose. But in the
meantime the association will have cash flow from the T to offset the
unpaid assessments which will make all the other unit owners happy. I
suppose 718 would also need to be amended to say that if a unit owner is
more than X days delinquent on assessments, it would trigger the ability
of the association to send the request to T and that any rents collected
by the association would be credited to the amounts owed by the unit
owner.
To further aid my solution above, I would recommend amending
83.51 to include an obligation of the LL to keep current on condo unit
assessments. That way, if they failed to do so, the T could presumably
use section 83.56 (1) to thereby terminate the lease if the LL doesn't
come into compliance after the T's 7 day notice to LL. This would give
the T some flexibility - they could either use 83.56 (1) to terminate
the lease and get out of a problematic situation where the real LL has
disappeared, or the T could sit back and, if requested by the
association to pay rent to them, voluntarily pay rent to the association
with the hope that it will help stave off foreclosure by the
association. If the T were to terminate the lease under this provision,
the lack of cash flow would presumably serve to help accelerate the
decision to file foreclosure by either the association or lender, and
the property could be quickly put back on the market for a new buyer who
can begin paying assessments.
Regards,
Greg
Greg Hass, Senior Counsel
Office of Law & Policy
Florida REALTORS(r)
7025 Augusta National Drive
Orlando, FL 32872-5025
Ph: (407) 438-1400
GregH@FAR.org
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From: landten-bounces@lists.flabarrpptl.org
[mailto:landten-bounces@lists.flabarrpptl.org] On Behalf Of Frank, Scott
A.
Sent: Thursday, January 07, 2010 10:09 AM
To: RPPTL Landlord Tenant Committee
Subject: [RPPTL LandTen] FW: HB 329 - Condo Assessments
FYI - Please see our comments to HB 329, as well as Michael
Gelfand's response and my reply to Michael. Read from bottom up. I
will forward on any new substantive responses we receive.
I have also attached a copy of the proposed bill for your
reference.
We will discuss further at next week's meeting (unless no one
wants to discuss it, in which case we will mention it and quickly move
on).
Scott A Frank
Attorney at Law
ARNSTEIN & LEHR LLP
www.arnstein.com <http://www.arnstein.com/>
515 North Flagler Drive
Sixth Floor
West Palm Beach, Florida 33401-4323
Phone: 561.833.9800
Fax: 561.655.5551
433 Plaza Real
Suite 275
Boca Raton, Florida 33401-4323
Phone: 561.962.4145
Fax: 561.962.4245
SAFrank@arnstein.com
http://us.mc332.mail.yahoo.com/mc/compose?to=SAFrank@arnstein.com
Offices in Illinois, Florida, and Wisconsin
From: Frank, Scott A.
Sent: Thursday, January 07, 2010 8:46 AM
To: 'Michael J. Gelfand'
Cc: gmeyer@carltonfields.com; Neil B. Shoter;
RFreedman@CarltonFields.com; smezer@bushross.com
Subject: RE: HB 329 - Condo Assessments
Michael:
I understand the bind that associations are finding themselves
in these days. And I also have no sympathy for landlords who are
accepting rent and then not paying their dues. However, I still have
issues with the bill in that (i) while it does offer the innocent tenant
some protection, it is still geared toward the association (I would feel
better from the tenant side if the notice provision were clearer and the
tenant had the right to "reject" the lease and stop paying assessments
once he or she vacates); and (ii) it allows the association to take
private property - the rent money is the landlord's property until a
court says otherwise - without any form of due process or even (for
current owners as of the date the bill is enacted) any prior notice of
the possibility. Again, I would feel more comfortable if the bill were
drafted as an "opt-in" clause, allowing existing associations to adopt
the provisions by an affirmative vote of membership. That way, no owner
could argue lack of notice.
Just my $0.02.
Scott A Frank
Attorney at Law
ARNSTEIN & LEHR LLP
www.arnstein.com <http://www.arnstein.com/>
515 North Flagler Drive
Sixth Floor
West Palm Beach, Florida 33401-4323
Phone: 561.833.9800
Fax: 561.655.5551
433 Plaza Real
Suite 275
Boca Raton, Florida 33401-4323
Phone: 561.962.4145
Fax: 561.962.4245
SAFrank@arnstein.com
http://us.mc332.mail.yahoo.com/mc/compose?to=SAFrank@arnstein.com
Offices in Illinois, Florida, and Wisconsin
From: Michael J. Gelfand [mailto:mjgelfand@gelfandarpe.com]
Sent: Thursday, January 07, 2010 1:23 AM
To: Frank, Scott A.
Cc: gmeyer@carltonfields.com; Neil B. Shoter;
RFreedman@CarltonFields.com; smezer@bushross.com
Subject: RE: HB 329 - Condo Assessments
Dear Scott
Thanks for the detailed review. I am forwarding to Rob Freedman
and Steven Mezer of the Condominium Committee to consider the issues
raised in the context of a number of bills with similar provisions.
There are a number of points that bear consideration. I note in
passing that an increasing number of community associations are not
waiting for the legislature to act and associations members are
overwhelmingly approving similar provisions as covenants. To place this
in context for your committee members on a policy level, understanding
the need to address procedure, there appears to be little sympathy for
landlords that are not paying assessments while the landlord still
pockets assessments.
Michael J. Gelfand
Florida Bar Board Certified Real Estate Attorney
Florida Supreme Court Certified Mediator:
Civil Circuit Court & Civil County Court
Gelfand & Arpe, P.A. <http://www.gelfandarpe.com/>
"Assisting Communities to Efficiently Reach Goals"
Regions Financial Tower, Suite 1220
1555 Palm Beach Lakes Blvd.
West Palm Beach Florida 33401
(561) 655-6224
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From: Frank, Scott A. [mailto:SAFrank@arnstein.com]
Sent: Wednesday, January 06, 2010 2:39 PM
To: Michael J. Gelfand
Cc: gmeyer@carltonfields.com; Neil B. Shoter
Subject: HB 329 - Condo Assessments
You have asked the members of the Landlord-Tenant Committee to
review and comment on this bill. After soliciting the input of the
members of the Committee, I have attempted to put together below an
amalgamation of the comments I received, as well as my own thoughts:
The first issue is the question of whether 83.46 (Duration of
Tenancies) is the right place to put this new language. Could it not
possibly fit better in 83.49 or 83.51? Or possibly even its own new
section?
Also, with respect to condo law (I know, not our purview, but
anyway), doesn't this law allow associations to take property without
due process, without such right being explicit in the declaration? In
essence, the rent payment is the property of the unit owner, which
property cannot typically be taken away by an association without either
(i) a judicial determination, or (ii) an explicit right spelled out in
the declaration (or even in a statute in effect as of the date of
conveyance to the specific unit owner). Can associations tow and sell a
delinquent unit owner's car when it is parked in the common area? At
the very least, this statute should not apply to any declarations in
effect unless the specific association votes to adopt it.
Another preliminary thought is the question of whether the
remedy provided here is the appropriate one. By making tenants jointly
and severally liable, the tenant is forced to take on an obligation that
(s)he may not want. What if the tenant, not wanting to stay in a bad
situation that may turn worse, simply decides to move out? As the
tenant is liable under the statute for all sums due under the lease from
the date of the association's notice, the tenant would be required to
pay the remainder of the rent, even post-vacating. (While the landlord
may then have a claim against the tenant for unpaid rent for the
remainder of the term, good luck to him on collecting.) A more
appropriate remedy may be to make the tenant liable for all sums due
under the lease from the date of notice until the date of tenant's
surrender. The right to evict and to deny services are appropriate to
enforce this obligation.
In fact, as a related matter, one may wish to consider amending
83.51 to require landlord to maintain the payment of association dues.
This would allow the tenant the right to vacate, without fear of suit,
if landlord does not in fact pay the fees.
The proposed statute states that the tenant is responsible to
pay the association from the date of the association's "notice", but
does not specify what constitutes valid notice. Perhaps it would be
helpful to include a statutory notice form that spells out (i) from what
date the tenant is to pay the association (must be at least 14-30 days
after the date of the notice), (ii) the statutory limits of tenant's
liability (in layman's language), (iii) what the associations' remedies
are for tenant's failure, and (iv) what rights tenant has against the
landlord or in defense of an action initiated by the landlord. This
notice should be sent via certified mail or other receipted delivery,
and the tenant should not be liable without proof of delivery or
refusal. Perhaps even a requirement of physical delivery to the unit
itself. Also, the notice should be delivered to the unit owner, again
via certified mail, to the address for the owner that the association
has on record. In addition, with respect to notice, if the tenant fails
to make a payment, the association's remedies should be subject to a
notice and cure period longer than the statutory 3-day notice.
How is the tenant notified that the owner is delinquent? Is the
tenant given proof that the owner has been notified of the delinquency?
And will the association indemnify the tenant - to the extent of
payments made to the association - if the owner/landlord sues for
nonpayment under the lease? At the very least, the statute should amend
Ch. 83 to provide that it is an absolute defense to an eviction for
nonpayment that the payments were made to the association in accordance
with this statute.
The statute in a number of places keeps stating that the tenant
is responsible for "all" or "any" monies owed by the landlord. This
seems overbroad, and should be limited to an itemized list (assessments,
fines, late fees, attorneys' fees) or specify sums payable under the
declaration.
With respect to the remedies stated in (4)(b)(1), what "other
remedies" are available to the Association? As there is no privity
between the parties, they cannot collect contract damages under the
lease - the only remedies that should be available to the association
are those that are granted explicitly by this statute (or the
declaration). If the intent is to allow for a suit for monetary
damages, then the statute (or declaration) should spell this out
explicitly. And I am not sure how the association can sue for eviction
under its own name (83.56 and 83.59 give the right to pursue a claim for
possession to the "landlord" - these would need to be amended as well).
The statute (or declaration) should contain an explicit assignment of
the owner's rights to sue, provided the assignment is limited to those
amounts due from tenant under this statute.
The limitation of tenant's liability (amount to be paid under
rental agreement) is specified in 83.46(4)(a) and 83.46(4)(b)(1) but
missing in 83.46(4)(b) and 83.46(4)(b)(1). This needs to be rectified,
as the language is very difficult to follow. In addition, the language
here and in (4)(b)(2) is very unclear as to what exactly are the limits
of tenant's liability. A suggestion on how to spell out tenant's
liability may be to simply say that tenant is only liable to pay in any
given month the sums that tenant is scheduled to pay under the lease in
that given month.
The language concerning prepaid rent/security deposits in
(4)(a)(2) is again highly confusing, and somewhat punishing to tenants.
To the extent the written lease acknowledges receipt of any prepaid rent
or security deposit, the tenant's liability should be decreased by such
amount. The cancelled check requirement is excessive, especially
considering that many lower income tenants pay rent in cash or by money
order.
As to 718.106, the first question is whether the term
"foreclosure" refers to mortgage foreclosure or foreclosure of the
association's lien. In addition, the ability to restrict common area
access is, at best, vague, and at worst completely overreaching. Also,
who is to be the arbiter of "fair market rent" in order to determine if
the tenant is legitimate? A better option may be to just require that
the lease be an arms-length transaction between unrelated parties, which
does not allow for the unit owner or any member of his/her family to
reside in the unit. If there is still concern about fraud, there could
be a provision allowing the lease to be vitiated by the association if
it is determined that the unit owner is living in the unit.
We will not address the proposed changes to 718.116(b), as these
do not come within the purview of this committee.
Finally, is there a reason why this provision applies to
residential units only, and not commercial units?
Please note that our comments do not reflect any collective
judgment as to whether the substance and intent of the proposed bill is
for the better or worse, as our committee includes members who represent
varying interests in residential and commercial leasing. Rather it is
our intent to assist the legislature by pointing out what we believe to
be significant issues with the bill as drafted.
Please advise if you wish for any clarification of the above or
if we can be of any further assistance. Thank you.
Scott A Frank
Attorney at Law
ARNSTEIN & LEHR LLP
www.arnstein.com <http://www.arnstein.com/>
515 North Flagler Drive
Sixth Floor
West Palm Beach, Florida 33401-4323
Phone: 561.833.9800
Fax: 561.655.5551
433 Plaza Real
Suite 275
Boca Raton, Florida 33401-4323
Phone: 561.962.4145
Fax: 561.962.4245
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to another party any transaction or matter addressed herein.
I agree with the committee members opposed to the bill in its entirety.
In my opinion, having limitations on rentals in condominiums is a good
idea since it tends to promote peaceful and quiet enjoyment, civility
and less absentee landlords. Some of these places that have no
limitations on rentals have turned into 24-hour circuses and property
values have suffered as a result. That being said, we don't need this
over-reaching bill to accomplish that goal. The associations already
have too much power-which is often abused-and should comply with the law
in its current state.
Regards,
Anthony J. Horky, Esq.
Mombach, Boyle & Hardin, P.A.
500 East Broward Boulevard
Suite 1950 Broward Financial Centre
Ft. Lauderdale, Florida 33394
Telephone: 954.467.2200 ext. 225
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From: landten-bounces@lists.flabarrpptl.org
[mailto:landten-bounces@lists.flabarrpptl.org] On Behalf Of Cary Sabol
Sent: Thursday, January 07, 2010 3:31 PM
To: RPPTL Landlord Tenant Committee
Subject: Re: [RPPTL LandTen] FW: HB 329 - Condo Assessments
I agree 100% with Harry's analysis here. This is another "kneejerk
reaction to a temporary economic crisis" and as usual, unfairly places
the burden. At least some of the other recent legislation has sunset
provisions, but I didn't see that in this one. This Bill should be
nixed altogether.
What is the Bar/RPPTL's position?
Cary
Cary P. Sabol, Esq.
P.O. Box 15981
West Palm Beach, Florida 33416
Phone: (561) 281-2744
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--- On Thu, 1/7/10, harry@evict.com harry@evict.com wrote:
From: harry@evict.com harry@evict.com
Subject: Re: [RPPTL LandTen] FW: HB 329 - Condo Assessments
To: "'RPPTL Landlord Tenant Committee'" landten@lists.flabarrpptl.org
Date: Thursday, January 7, 2010, 2:21 PM
Dear Greg,
I have to respectfully oppose any attempt to open the door wider for a
tenant to withhold rent, break a lease or voluntarily pay an
association. This will not work on a practical basis and will cause
major problems with evictions. Suppose they pay partial? You know the
association is going to accept the money and how do I evict?
The whole thing needs to be scuttled.
It is a mess. It is another example of a kneejerk reaction to a
temporary economic crisis or a possible problem that the landlord may
eventually cure. The laws have been in place for years, they have
worked fine for years, the associations just need to deal with it. It
is bad enough that tenants think they can stop paying rent when the
owner is in foreclosure.
The restrictions and powers that associations already have are causing a
price drop in condo and homeowners associations as they are making it
nearly impossible for unit owners to rent out their units i.e.
investment buyers will not want to buy. This bill will give them more
power and in the end hurt all unit owners.
I would hope that FAR strongly comes out and takes a stand against what
the associations are doing now, legally and illegally and also fight new
onerous laws.
I can put you in touch with many of your FAR property manager members
who will tell you the horror stories. If anything, we need laws limiting
the powers of these associations to essentially discriminate against
renters and protected classes. Watch how they approve a white doctor in
5 days but an African American with children, the approval process takes
so long the applicant gives up. We discussed this last August at the FAR
Property Management Council meeting and the crowd was up in arms over
it. That is the tip of the iceberg. If I had time on my hands I would
have testers go out, apply and I would be filing Fair Housing actions
all day long. Condos and HOAs do not want renters period. In one way you
can't blame them because they have to deal with the California buyers
who put the unit on Craig's List and rents it to anyone who calls them
up and can breathe.
Harry Heist
LAW OFFICES OF
HEIST, WEISSE & DAVIS, P.A.
PH: 1 800 253 8428
FAX: 1 800 367 9038
"Serving the Property Management Professional"
Website: www.evict.com http://www.evict.com/
Email: harry@evict.com
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From: landten-bounces@lists.flabarrpptl.org
[mailto:landten-bounces@lists.flabarrpptl.org] On Behalf Of Greg Hass
Sent: Thursday, January 07, 2010 12:25 PM
To: RPPTL Landlord Tenant Committee
Subject: Re: [RPPTL LandTen] FW: HB 329 - Condo Assessments
Thanks Scott, that was a very detailed analysis.
My own personal opinion (I'm not sure what official position the Florida
Realtors will take on this matter, if any), is that the tenants should
not be made liable to the association for unpaid unit assessments, etc.
My view is that this bill as drafted is overkill and many of the
provisions will just add further confusion. The associations currently
have a simple (albeit time consuming and costly) remedy - foreclose
their assessment lien and then they can rent the unit to whoever they
want and collect all the rent (although I suppose the new Protecting
Tenants at Foreclosure Act would come into play). Another remedy
apparently used with some success is to go to court and get a blanket
receivership. So the associations already have remedies, and I don't
think the association should be allowed to shift to the T the legal
obligation of paying a unit owner's assessment simply because the
association doesn't want to go through the time/trouble of foreclosing
their assessment lien.
I would scuttle the entire bill and simply propose the following. Amend
Chapter 83 to say that if a Tenant receives notice from an association
asking the T to pay rent directly to the association, the tenant MAY
(not must) choose to abide by that request and doing so would be an
absolute defense to an eviction action filed by the LL under Chapter 83.
I would stick this in 83.60. The Tenants incentive to VOUNTARILY
agree to pay rent to the association would be the hope that by doing so,
the association will sit back and choose not to file a foreclosure
action against the unit for its unpaid assessments thereby allowing the
T to stay put. This would also keep the liability for unpaid
assessments squarely on the unit owner/LL and would NOT purport to
somehow make the T personally liable for condo unit assessments. The
onus would then be on the deadbeat unit owner/LL to go to court and get
a court order directing the T to pay rent to the LL or alternatively get
the association to turn over the rent money to the LL. I predict most
LL's would just disappear at that point and not bother, leaving the
battle between the lender and the association over rent moneys and
assessments. The association would be sort of a surrogate LL until
either the association or lender chose to foreclose. But in the
meantime the association will have cash flow from the T to offset the
unpaid assessments which will make all the other unit owners happy. I
suppose 718 would also need to be amended to say that if a unit owner is
more than X days delinquent on assessments, it would trigger the ability
of the association to send the request to T and that any rents collected
by the association would be credited to the amounts owed by the unit
owner.
To further aid my solution above, I would recommend amending 83.51 to
include an obligation of the LL to keep current on condo unit
assessments. That way, if they failed to do so, the T could presumably
use section 83.56 (1) to thereby terminate the lease if the LL doesn't
come into compliance after the T's 7 day notice to LL. This would give
the T some flexibility - they could either use 83.56 (1) to terminate
the lease and get out of a problematic situation where the real LL has
disappeared, or the T could sit back and, if requested by the
association to pay rent to them, voluntarily pay rent to the association
with the hope that it will help stave off foreclosure by the
association. If the T were to terminate the lease under this provision,
the lack of cash flow would presumably serve to help accelerate the
decision to file foreclosure by either the association or lender, and
the property could be quickly put back on the market for a new buyer who
can begin paying assessments.
Regards,
Greg
Greg Hass, Senior Counsel
Office of Law & Policy
Florida REALTORS(r)
7025 Augusta National Drive
Orlando, FL 32872-5025
Ph: (407) 438-1400
GregH@FAR.org
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From: landten-bounces@lists.flabarrpptl.org
[mailto:landten-bounces@lists.flabarrpptl.org] On Behalf Of Frank, Scott
A.
Sent: Thursday, January 07, 2010 10:09 AM
To: RPPTL Landlord Tenant Committee
Subject: [RPPTL LandTen] FW: HB 329 - Condo Assessments
FYI - Please see our comments to HB 329, as well as Michael Gelfand's
response and my reply to Michael. Read from bottom up. I will forward
on any new substantive responses we receive.
I have also attached a copy of the proposed bill for your reference.
We will discuss further at next week's meeting (unless no one wants to
discuss it, in which case we will mention it and quickly move on).
Scott A Frank
Attorney at Law
ARNSTEIN & LEHR LLP
www.arnstein.com http://www.arnstein.com/
515 North Flagler Drive
Sixth Floor
West Palm Beach, Florida 33401-4323
Phone: 561.833.9800
Fax: 561.655.5551
433 Plaza Real
Suite 275
Boca Raton, Florida 33401-4323
Phone: 561.962.4145
Fax: 561.962.4245
SAFrank@arnstein.com
http://us.mc332.mail.yahoo.com/mc/compose?to=SAFrank@arnstein.com
Offices in Illinois, Florida, and Wisconsin
From: Frank, Scott A.
Sent: Thursday, January 07, 2010 8:46 AM
To: 'Michael J. Gelfand'
Cc: gmeyer@carltonfields.com; Neil B. Shoter;
RFreedman@CarltonFields.com; smezer@bushross.com
Subject: RE: HB 329 - Condo Assessments
Michael:
I understand the bind that associations are finding themselves in these
days. And I also have no sympathy for landlords who are accepting rent
and then not paying their dues. However, I still have issues with the
bill in that (i) while it does offer the innocent tenant some
protection, it is still geared toward the association (I would feel
better from the tenant side if the notice provision were clearer and the
tenant had the right to "reject" the lease and stop paying assessments
once he or she vacates); and (ii) it allows the association to take
private property - the rent money is the landlord's property until a
court says otherwise - without any form of due process or even (for
current owners as of the date the bill is enacted) any prior notice of
the possibility. Again, I would feel more comfortable if the bill were
drafted as an "opt-in" clause, allowing existing associations to adopt
the provisions by an affirmative vote of membership. That way, no owner
could argue lack of notice.
Just my $0.02.
Scott A Frank
Attorney at Law
ARNSTEIN & LEHR LLP
www.arnstein.com http://www.arnstein.com/
515 North Flagler Drive
Sixth Floor
West Palm Beach, Florida 33401-4323
Phone: 561.833.9800
Fax: 561.655.5551
433 Plaza Real
Suite 275
Boca Raton, Florida 33401-4323
Phone: 561.962.4145
Fax: 561.962.4245
SAFrank@arnstein.com
http://us.mc332.mail.yahoo.com/mc/compose?to=SAFrank@arnstein.com
Offices in Illinois, Florida, and Wisconsin
From: Michael J. Gelfand [mailto:mjgelfand@gelfandarpe.com]
Sent: Thursday, January 07, 2010 1:23 AM
To: Frank, Scott A.
Cc: gmeyer@carltonfields.com; Neil B. Shoter;
RFreedman@CarltonFields.com; smezer@bushross.com
Subject: RE: HB 329 - Condo Assessments
Dear Scott
Thanks for the detailed review. I am forwarding to Rob Freedman and
Steven Mezer of the Condominium Committee to consider the issues raised
in the context of a number of bills with similar provisions.
There are a number of points that bear consideration. I note in passing
that an increasing number of community associations are not waiting for
the legislature to act and associations members are overwhelmingly
approving similar provisions as covenants. To place this in context for
your committee members on a policy level, understanding the need to
address procedure, there appears to be little sympathy for landlords
that are not paying assessments while the landlord still pockets
assessments.
Michael J. Gelfand
Florida Bar Board Certified Real Estate Attorney
Florida Supreme Court Certified Mediator:
Civil Circuit Court & Civil County Court
Gelfand & Arpe, P.A. http://www.gelfandarpe.com/
"Assisting Communities to Efficiently Reach Goals"
Regions Financial Tower, Suite 1220
1555 Palm Beach Lakes Blvd.
West Palm Beach Florida 33401
(561) 655-6224
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From: Frank, Scott A. [mailto:SAFrank@arnstein.com]
Sent: Wednesday, January 06, 2010 2:39 PM
To: Michael J. Gelfand
Cc: gmeyer@carltonfields.com; Neil B. Shoter
Subject: HB 329 - Condo Assessments
You have asked the members of the Landlord-Tenant Committee to review
and comment on this bill. After soliciting the input of the members of
the Committee, I have attempted to put together below an amalgamation of
the comments I received, as well as my own thoughts:
The first issue is the question of whether 83.46 (Duration of Tenancies)
is the right place to put this new language. Could it not possibly fit
better in 83.49 or 83.51? Or possibly even its own new section?
Also, with respect to condo law (I know, not our purview, but anyway),
doesn't this law allow associations to take property without due
process, without such right being explicit in the declaration? In
essence, the rent payment is the property of the unit owner, which
property cannot typically be taken away by an association without either
(i) a judicial determination, or (ii) an explicit right spelled out in
the declaration (or even in a statute in effect as of the date of
conveyance to the specific unit owner). Can associations tow and sell a
delinquent unit owner's car when it is parked in the common area? At
the very least, this statute should not apply to any declarations in
effect unless the specific association votes to adopt it.
Another preliminary thought is the question of whether the remedy
provided here is the appropriate one. By making tenants jointly and
severally liable, the tenant is forced to take on an obligation that
(s)he may not want. What if the tenant, not wanting to stay in a bad
situation that may turn worse, simply decides to move out? As the
tenant is liable under the statute for all sums due under the lease from
the date of the association's notice, the tenant would be required to
pay the remainder of the rent, even post-vacating. (While the landlord
may then have a claim against the tenant for unpaid rent for the
remainder of the term, good luck to him on collecting.) A more
appropriate remedy may be to make the tenant liable for all sums due
under the lease from the date of notice until the date of tenant's
surrender. The right to evict and to deny services are appropriate to
enforce this obligation.
In fact, as a related matter, one may wish to consider amending 83.51 to
require landlord to maintain the payment of association dues. This
would allow the tenant the right to vacate, without fear of suit, if
landlord does not in fact pay the fees.
The proposed statute states that the tenant is responsible to pay the
association from the date of the association's "notice", but does not
specify what constitutes valid notice. Perhaps it would be helpful to
include a statutory notice form that spells out (i) from what date the
tenant is to pay the association (must be at least 14-30 days after the
date of the notice), (ii) the statutory limits of tenant's liability (in
layman's language), (iii) what the associations' remedies are for
tenant's failure, and (iv) what rights tenant has against the landlord
or in defense of an action initiated by the landlord. This notice
should be sent via certified mail or other receipted delivery, and the
tenant should not be liable without proof of delivery or refusal.
Perhaps even a requirement of physical delivery to the unit itself.
Also, the notice should be delivered to the unit owner, again via
certified mail, to the address for the owner that the association has on
record. In addition, with respect to notice, if the tenant fails to
make a payment, the association's remedies should be subject to a notice
and cure period longer than the statutory 3-day notice.
How is the tenant notified that the owner is delinquent? Is the tenant
given proof that the owner has been notified of the delinquency? And
will the association indemnify the tenant - to the extent of payments
made to the association - if the owner/landlord sues for nonpayment
under the lease? At the very least, the statute should amend Ch. 83 to
provide that it is an absolute defense to an eviction for nonpayment
that the payments were made to the association in accordance with this
statute.
The statute in a number of places keeps stating that the tenant is
responsible for "all" or "any" monies owed by the landlord. This seems
overbroad, and should be limited to an itemized list (assessments,
fines, late fees, attorneys' fees) or specify sums payable under the
declaration.
With respect to the remedies stated in (4)(b)(1), what "other remedies"
are available to the Association? As there is no privity between the
parties, they cannot collect contract damages under the lease - the only
remedies that should be available to the association are those that are
granted explicitly by this statute (or the declaration). If the intent
is to allow for a suit for monetary damages, then the statute (or
declaration) should spell this out explicitly. And I am not sure how
the association can sue for eviction under its own name (83.56 and 83.59
give the right to pursue a claim for possession to the "landlord" -
these would need to be amended as well). The statute (or declaration)
should contain an explicit assignment of the owner's rights to sue,
provided the assignment is limited to those amounts due from tenant
under this statute.
The limitation of tenant's liability (amount to be paid under rental
agreement) is specified in 83.46(4)(a) and 83.46(4)(b)(1) but missing in
83.46(4)(b) and 83.46(4)(b)(1). This needs to be rectified, as the
language is very difficult to follow. In addition, the language here
and in (4)(b)(2) is very unclear as to what exactly are the limits of
tenant's liability. A suggestion on how to spell out tenant's
liability may be to simply say that tenant is only liable to pay in any
given month the sums that tenant is scheduled to pay under the lease in
that given month.
The language concerning prepaid rent/security deposits in (4)(a)(2) is
again highly confusing, and somewhat punishing to tenants. To the
extent the written lease acknowledges receipt of any prepaid rent or
security deposit, the tenant's liability should be decreased by such
amount. The cancelled check requirement is excessive, especially
considering that many lower income tenants pay rent in cash or by money
order.
As to 718.106, the first question is whether the term "foreclosure"
refers to mortgage foreclosure or foreclosure of the association's lien.
In addition, the ability to restrict common area access is, at best,
vague, and at worst completely overreaching. Also, who is to be the
arbiter of "fair market rent" in order to determine if the tenant is
legitimate? A better option may be to just require that the lease be an
arms-length transaction between unrelated parties, which does not allow
for the unit owner or any member of his/her family to reside in the
unit. If there is still concern about fraud, there could be a provision
allowing the lease to be vitiated by the association if it is determined
that the unit owner is living in the unit.
We will not address the proposed changes to 718.116(b), as these do not
come within the purview of this committee.
Finally, is there a reason why this provision applies to residential
units only, and not commercial units?
Please note that our comments do not reflect any collective judgment as
to whether the substance and intent of the proposed bill is for the
better or worse, as our committee includes members who represent varying
interests in residential and commercial leasing. Rather it is our intent
to assist the legislature by pointing out what we believe to be
significant issues with the bill as drafted.
Please advise if you wish for any clarification of the above or if we
can be of any further assistance. Thank you.
Scott A Frank
Attorney at Law
ARNSTEIN & LEHR LLP
www.arnstein.com http://www.arnstein.com/
515 North Flagler Drive
Sixth Floor
West Palm Beach, Florida 33401-4323
Phone: 561.833.9800
Fax: 561.655.5551
433 Plaza Real
Suite 275
Boca Raton, Florida 33401-4323
Phone: 561.962.4145
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Hello All,
Can anyone give their opinion as to the legality of requiring a residential
tenant to purchase renter's insurance.
I believe 3 states specifically allow it by statute but we are silent.
I see it pop up here and there in leases but have been hesitant to give the
green light to the large multi-family clients who are requesting it.
The larger clients are not so much concerned with damages to the tenant's
personal property but they want to require liability insurance from the
tenants to protect the apartment community in the event the tenant causes a
fire or flood.
Thanks,
Harry
LAW OFFICES OF
HEIST, WEISSE & DAVIS, P.A.
PH: 1 800 253 8428
FAX: 1 800 367 9038
"Serving the Property Management Professional"
Website: http://www.evict.com/ www.evict.com
Email: mailto:harry@evict.com harry@evict.com
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I have worked with the Office of Insurance Regulation on this issue for
mobile home park tenancies. My understanding is that you can require
the tenant to have insurance, the landlord cannot be the loss payee.
Which sort of defeats the purpose. I would appreciate hearing from
others who have had some other experience under Chapter 83.
David D. Eastman, Esq.
Lutz, Bobo, Telfair, Eastman, Gabel & Lee
2155 Delta Boulevard, Suite 210-B
Tallahassee, Florida 32303
(850) 521-0890
(850) 521-0891 Facsimile
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From: landten-bounces@lists.flabarrpptl.org
[mailto:landten-bounces@lists.flabarrpptl.org] On Behalf Of
harry@evict.com
Sent: Monday, March 22, 2010 11:40 AM
To: 'RPPTL Landlord Tenant Committee'
Subject: [RPPTL LandTen] Renter's insurance
Hello All,
Can anyone give their opinion as to the legality of requiring a
residential tenant to purchase renter's insurance.
I believe 3 states specifically allow it by statute but we are silent.
I see it pop up here and there in leases but have been hesitant to give
the green light to the large multi-family clients who are requesting it.
The larger clients are not so much concerned with damages to the
tenant's personal property but they want to require liability insurance
from the tenants to protect the apartment community in the event the
tenant causes a fire or flood.
Thanks,
Harry
LAW OFFICES OF
HEIST, WEISSE & DAVIS, P.A.
PH: 1 800 253 8428
FAX: 1 800 367 9038
"Serving the Property Management Professional"
Website: www.evict.com http://www.evict.com/
Email: harry@evict.com mailto:harry@evict.com
THIS E-MAIL MESSAGE IS CONFIDENTIAL, ATTORNEY-CLIENT PRIVILEGED, AND
INTENDED FOR THE PERSONS NAMED ABOVE ONLY. ALL OTHER USE, COPYING, OR
DISTRIBUTION IS STRICTLY PROHIBITED.
Well, in both the current and proposed new versions of the "Residential
Lease for Single Family Home or Duplex", it provides in Section 18 as
follows:
-
RISK OF LOSS/INSURANCE
A. Landlord and Tenant shall each be responsible for
loss, damage, or injury caused by its own negligence or willful conduct.
B. Tenant should carry insurance covering Tenant's
personal property and Tenant's liability insurance.
IMO if the Supreme Court has approved a lease saying the T should carry
insurance, then I don't see why an attorney couldn't draft their own
custom lease requiring it. Presumably it would just be an 83.56 (2)(b)
type violation if T doesn't comply and you would give them a 7 day
notice. Would be interesting to see how Judge Judy would react to an
attempt by a LL to evict on that basis. So yes I think it's legal, but
I'm skeptical on how enforceable it would be in County court.
Regards,
Greg
Greg Hass, Senior Counsel
Office of Law & Policy | FloridaRealtors(r)
7025 Augusta National Drive, Orlando, FL 32822
talk: 407.438.1400, ext. 2421
visit: http://www.floridarealtors.org http://www.floridarealtors.org
Florida Open House Weekend: April 10-11
Be Proud of it. Be Part of it.
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From: landten-bounces@lists.flabarrpptl.org
[mailto:landten-bounces@lists.flabarrpptl.org] On Behalf Of
harry@evict.com
Sent: Monday, March 22, 2010 11:40 AM
To: 'RPPTL Landlord Tenant Committee'
Subject: [RPPTL LandTen] Renter's insurance
Hello All,
Can anyone give their opinion as to the legality of requiring a
residential tenant to purchase renter's insurance.
I believe 3 states specifically allow it by statute but we are silent.
I see it pop up here and there in leases but have been hesitant to give
the green light to the large multi-family clients who are requesting it.
The larger clients are not so much concerned with damages to the
tenant's personal property but they want to require liability insurance
from the tenants to protect the apartment community in the event the
tenant causes a fire or flood.
Thanks,
Harry
LAW OFFICES OF
HEIST, WEISSE & DAVIS, P.A.
PH: 1 800 253 8428
FAX: 1 800 367 9038
"Serving the Property Management Professional"
Website: www.evict.com http://www.evict.com/
Email: harry@evict.com mailto:harry@evict.com
THIS E-MAIL MESSAGE IS CONFIDENTIAL, ATTORNEY-CLIENT PRIVILEGED, AND
INTENDED FOR THE PERSONS NAMED ABOVE ONLY. ALL OTHER USE, COPYING, OR
DISTRIBUTION IS STRICTLY PROHIBITED.
