BLG's Monthly Newsletter - June 2014

Amended Florida Statutes - Overview

by Candice Gundel, Esq.

On July 1, 2014 several amendments to the Condominium, Co-Operative, and Homeowner Association Statutes will take effect. Below is a brief overview of the changes as they relate to the collection of assessments. 

 In the spring of 2012 an appellate decision, Aventura Management v. Spiaggia, held that if an Association acquires title to a unit through lien foreclosure or deed in lieu of foreclosure that the Association extinguishes the debt due and owing to the Association.  This ruling further frustrated many Associations in pursuing delinquent assessments and served as a significant deterrent to lien foreclosures.   In 2013 the Legislature amended Florida Statute 720.3085 to exempt a Homeowners Association acquiring title to a unit from extinguishing the debt.    Beginning July 1, 2014 this same exemption has now been extended to Condominium Associations.  The practical effect of this amendment is that the risks associated with filing a lien foreclosure are decreased.  Under the new statute a Condominium Association that takes title to a unit through lien foreclosure or deed in lieu of foreclosure retains the right to collect the debt that was incurred prior to the Association taking title.  It is important to note that the Association taking title will not be able to collect any amounts that accrue while the Association is the unit owner from a subsequent owner.

As of July 1, 2014 all Associations in Florida will have an additional remedy in pursuing delinquent owners.  Many Associations have seen success in collecting rent from tenants residing in delinquent units, however there are a significant number of units that are not occupied by an owner or a tenant and appear to be abandoned.  The Legislature has now enacted provisions to help an Association determine if a unit has been abandoned.  If the unit is abandoned then the Association may initiate a process to enter the unit, make necessary repairs, and have the Court appoint a receiver so that the Association can place a tenant in the abandoned unit and collect rent to help pay down the delinquency.  The charges associated with this process may then be charged to the unit owner as an assessment and subject to collection. This is an exciting evolution in the law, which, with careful representation of counsel, can provide relief to many communities faced with large numbers of empty and delinquent units. 

There are other more administrative changes which will streamline the collections process.  Florida Statutes now provide uniform language for the Pre-Lien, Notice of Intent to Foreclose, and Release of Lien.  In addition, the Legislature has provided guidance to Licensed Community Association Managers and expanded the role they may play in managing the community, interpreting and drafting documents, and collecting assessments. 

The Legislature continues to provide Associations with tools to improve the function and maintenance of the communities, especially as it relates to collections.   Although these tools will not solve all community Association problems they are another step in the right direction and we look forward to working with our Clients to implement the new processes and procedures.