DUMBFOUNDING DIFFERENCES

Before you know it, The Florida Legislature will be in session.  In terms of legislation for condominiums and homeowner associations, 2019 was a complete bust.  There wasn’t a single change to Florida Statute 718 or 720.

For reasons beyond my comprehension, there are differences between these two statutes that simply defy common sense that need to be reconciled.  For example:

 

Meetings:  Under the condominium statute, the condominium must post an agenda of what is to be discussed at a board meeting.  In an HOA, no agenda is required to be posted.

The Right to Speak: The condominium statute simply says unit owners have a right to speak at the board meeting.  The HOA statute says: The association may adopt written reasonable rules expanding the right of members to speak and governing the frequency, duration, and other manner of member statements, which rules must be consistent with this paragraph and may include a sign-up sheet for members wishing to speak.

Minutes.—The HOA statute says: Minutes of all meetings of the members of an association and of the board of directors of an association must be maintained in written form or in another form that can be converted into written form within a reasonable time. The condo statute simply requires maintaining a book of minutes.   Neither statute spells out what the minutes should or must contain.

 

Access to Records: In a condo, an owner denied access to records can file an arbitration action.  In an HOA, the owner must first go to pre-suit mediation.  HOA members may be required to pay costs for personnel to retrieve the records.

 

Reserves: In a condo, the statute requires that the budget include fully funded reserves which can be voted down by the owners.  In an HOA the budget may include reserves.

 

Voting for Board Members: The condo statute has a very detailed set of requirements for the annual election that works well.  The first notice to be sent 60 days before the election.  Notices of Intent to Run must be filed by the owners who want to run.  The condo must send out a second mailing with ballots and envelopes.  The statute and administrative code detail how the votes are counted and the procedures at the annual meeting.  The HOA statute simply says: Elections of directors must be conducted in accordance with the procedures set forth in the governing documents of the association.

Proxy Voting:  Allowed in HOA elections – not allowed in condo elections.

Litigation: The HOA statute says: Before commencing litigation against any party in the name of the association involving amounts in controversy in excess of $100,000, the association must obtain the affirmative approval of a majority of the voting interests at a meeting of the membership at which a quorum has been attained.  There is no such requirement in the condo statute.

 

I can keep going, but you get the point.  While there are certainly some differences between living in a condominium and living in an HOA, in general, and typically, owners in a condominium are sharing common elements while they live in a vertical structure, whereas in an HOA owners are sharing common elements while they live horizontally to each other in single family homes.  In both communities it is a bunch of people who are living in the same community sharing expenses and who are owed a fiduciary duty by the members of their board.

If that’s the only difference, then why such differences in the law?  It’s time for the statutes to mirror each other where it is possible and where it makes sense to do so.   I would hope this is the year we accomplish this.

I’ll leave it to Jan to talk about the biggest difference between condos and HOAs — and that’s the fact that condos are regulated by the DBPR while HOAs aren’t.  One group pays the state and the other doesn’t.

Any other differences you would like to see changed?

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