FREQUESTLY ASKED QUESTIONS Q.- I live in a condominium, which is the statute that applies to my situation? A.- If you live in a condominium, Chapter 718 of the Florida Statues applies to your association, along with the Florida Administrative Code. You need to check also Chapter 617 of the Florida Statutes, because your condo association is probably a not-for-profit corporation. http://www.leg.state.fl.us/ If you live in a homeowner's association, Chapter 720 of the Florida Statutes will apply.for those of you that live in a cooperative, Chapter 719 of the Florida Statutes will govern your association. Q.- Who is the entity that regulates the Condo Association Financial Reports? What are the remedies to mistakes or questionable expenses? A.- FINANCIAL REPORTING Florida Statute Section 718.111(13) and Section 61B-22.006 of the Florida Administrative Code govern financial reporting requirements. The type depends on the size of the budget. There are also time requirements as set forth in the association' s documents and Statute. AUDITS An audit provides the highest level of assurance that an association's financial statement complies with the generally accepted accounting principles (GAAP). An unqualified audit opinion (one without caveats), expresses reasonable assurance that the financial statements contain no material misstatements. To reach this opinion, the CPA must examine the association's statements and documents supporting the amounts and disclosures. The accountant must also access the associations accounting systems and the internal controls it uses to report transactions. To issue an audit report, he or she is usually required to be independent of the association. A review is less extensive than an audit, but more involved than a compilation (the third choice). A review doesn't require the accountant to study and evaluate internal controls, verify data with third parties, or physically inspect assets. Rather a review report expresses limited assurance in the form of a statement. To perform a review, a CPA needs to possess a general knowledge of the accounting principals and practices of the associations industry, as well as an understanding of its business. If the financial statements appear inconsistent or questionable, the accountant may perform additional procedures. Q.- How does the Board decide if it is necessary to use bids when buying the materials for pool repair?
A.- BIDS Section 718.3026 Florida Statutes requires competitive bids for materials, equipment or services if over 5% of the budget including reserves. The association does not have to accept the lowest bid. Q.- My Condo Board decided to hire a manager, and I'm concerned about increasing our monthly expenses unnecessarily. Is this hiring of a manager mandatory? A.- COMMUNITY ASSOCIATION MANAGER ( CAM ) There is no requirement in the law that any association has a manager. But, if the association is over 50 units or has a budget of over $100,000 and they do hire a manager the manager must be licensed. See Florida Statutes Chapter 468. How To File A Complaint Against A CAM. Complaints against the regulated professionals or professions may be filed with the Complaints Section in Tallahassee or any regional field office. You may file a complaint over the Internet or download a complaint form from www.myflorida.com. The Division of Florida Land Sales is charged with regulating the professions and protection of the public. To learn more about consumer fraud, please visit the Attorney General's website at www.myflorida.com Q.- We have disputes regarding who is supposed to pay some maintenance fees. Are there any established criteria to decide what is common and what not? A.-Obligations Regarding Maintenance of Common Elements Maintenance of the common elements. Pursuant to Section 718.113(1) of the Florida Statutes, the maintenance of the common elements is the responsibility of the association. The Common elements are defined as the portions of the condominium property not included in the units or as modified by your individual documents. Section 718.103(3) Florida Statute. Limited common elements are those common elements, which are reserved for the use of a certain unit or units to the exclusion of all other units, and as specified in your declaration. Section 718.103(19) Florida Statutes. In determining the responsibility for the maintenance of certain property elements it must first be determined from the Declaration and the Florida Statutes whether it is a common element or a limited common element. If it is determined to be a limited common element, it must then be determined from the Declaration and Florida Statutes whether the responsibility is that of the association or that of the unit owner or both.
Maintenance of limited common elements. Pursuant to Section 718.113(1) Florida Statutes, the declaration may provide that certain limited common elements shall be maintained by those entitled to use the limited common elements or that the association shall provide the maintenance. The declaration may provide that the maintenance be either as a common expense to all unit owners, or by shared cost to those entitled to use those limited common elements. The declaration shall describe in detail the method of apportionment. Common Element Possession And Use. A unit owner is entitled to use the common elements in accordance with the purpose for which they are intended. Section 718.106 Florida Statutes. Q.- What is to be done if the unit suffers any kind of damages? A.- DAMAGES TO YOUR UNIT If you discover damage to your unit from any source known or unknown you must immediately notify your homeowners' policy carrier, the association, and any unit owner who may be involved. Your insurance carrier will give you instructions. If your damage was caused by a common element problem and there was negligence on the part of the association in dealing with the problem it would be their liability. Without negligence the association is only responsible for the common area damage as set forth in your declaration of condominium and bylaws under Maintenance and Repair. Q.- Is there a formal way to notify the Board of something important? DEMAND, NOTICE OR INQUIRY LETTER In order to officially bring an issue to the attention of the board of directors you must make a written inquiry by certified mail to the Board of Directors pursuant to Section 718.112(2)(a)2 Florida Statutes. If they refuse to answer or do not give a substantive response in writing within 30 days you may seek help from the office of the Ombudsman or you may file a complaint with the Division of Condominium (DBPR) at www.myflorida.com. If you meet the requirements you may seek a solution provided by Section 718.1255 Florida Statute. Alternate dispute resolution. Q.- We have a problem with elections, how is the formal procedure? A.- ELECTIONS Florida Statutes Section 718.112(d)3. Florida Administrative Code 61B-23.0021 There is a set procedure for condominium elections in the Florida Administrative Rules 61B- 23.0021 and Florida Statute Section 718.112(d)3.
Election Procedure. Florida Statute Section 718.112(d)3 Elections. The voting procedure for new directors is to be conducted at the annual meeting as stated in your Bylaws. The Florida Administrative Code 61B-23.0021 governs elections. The first notice of the date of the election is to mailed or delivered not later than 60 days before a scheduled election. A candidate for the board shall give written notice to the association not later than 40 days before the election (Certified mail Return Receipt is recommended). Written notice shall be effective when received. The association shall issue a written receipt acknowledging delivery of the written notice. If the candidates have a written receipt of delivery to the association of their intent dated before the 40 days they cannot be rejected as candidates. The association shall mail or deliver the second notice with the ballot no less than 14 days prior to the election. If the second notice was mailed or delivered less than the 14 days before the election you may file a complaint with the Division of Condominiums to invalidate the election now. Check the postmark on the envelope. All papers and documents relating to the voting are official records of the association and must be maintained for one year. Q.- Can we have supervised elections? A.- ELECTION MONITOR The office of the Ombudsman can provide you with an election monitor pursuant to Section 718.5012(9) Florida Statutes. The monitor can conduct the election for your association. Fill out a Petition and mail it to the Ombudsman requesting an election Monitor with the signatures of 15% of the unit owners, and the other pertinent information such as time, date, place, number of directors to be elected, units and name of the association. Also include name and address of the condominium, its management company and its attorney. The fee for the monitor is $75.00 an hour. Assistant monitors are $50 an hour and may be required if the association is over 100 units. Travel expenses are additional. The Association should ultimately pay the monitor. A form will be sent to you to upon request. FAC 20B-23.0021(1)(d)8 states that the envelopes should be mailed to an entity designated to receive the ballots. After you have timely appointed an election monitor, the monitor may instruct the board to have the ballot envelopes mailed to the Condominium Ombudsman. He or she will then bring them to the election. Q.- Who supervises financial reporting?
A.- FINANCIAL REPORTING Florida Statute Section 718.111(13) and Section 61B-22.006 of the Florida Administrative Code govern financial reporting requirements. Q.- Are fines legal? A.- FINES. A fine is permitted only if the Declaration or bylaws so provide and a notice and opportunity for a hearing is provided. Fines are not to exceed $100 per violation or up to $1000 for a continuing violation. Fines may not be liens against a unit. Section 718.303 Florida Statutes. Q.- How do Boards select the right kind of hurricane shutters? A.- HURRICANE SHUTTERS Florida Statute Section 718.113(5). Each board of administration shall adopt hurricane shutter specifications for each building within each condominium operated by the association which shall include color, style, and other factors deemed relevant by the board. All specifications adopted by the board shall comply with the applicable building code. Notwithstanding any provision to the contrary in the condominium documents, if approval is required by the documents, a board shall not refuse to approve the installation or replacement of hurricane shutters conforming to the specifications adopted by the board. The Board may upon approval of a majority of the unit owners install hurricane shutters and may maintain, repair, or replace them whether on common property, limited common elements or association property. The board may adopt hurricane shutter specifications. A board shall not refuse to approve the installation or replacement of hurricane shutters. Q. What is the most secure procedure to have the Board listening to my problem? A.- INQUIRY, DEMAND, OR NOTICE LETTER In order to officially bring an issue to the attention of the board of directors you must make a written inquiry by certified mail to the Board of Directors pursuant to Section 718.112(2)(a)2 Florida Statutes. If they refuse to answer or do not give a substantive response in writing within 30 days you may seek help from the office of the Condominium Ombudsman or you may file a complaint with the Division of Condominium (DBPR) at www.myflorida.com. http://www.state.fl.us/dbpr/lsc/condominiums/forms/ complaint.pdf
If you meet the requirements you may seek a solution provided by Section 718.1255 Florida Statute. Alternate dispute resolution. Q.- I know that we have common elements, but what are the ones called limited? A.- LIMITED COMMON ELEMENTS Florida Statute Section 718.103(19). Limited common elements means those common elements which are reserved for the uses of a certain unit or units to the exclusion of all other units, as specified in the declaration. Section 718.113 Florida Statutes. The declaration may provide that certain limited common elements shall be maintained by those entitled to use the limited common elements If the maintenance is to be provided by the association at the expense of only those entitled to use the limited common elements, the declaration shall describe in detail the method of apportionment and may use 718.116 to enforce payment. Q.- Is there a regulation concerning Board and association meetings? A.- MEETINGS There are three types of meetings. There is the annual members meeting, the election meeting, and Board of Directors meetings. At the Annual Meeting there is also the election meeting. To have a quorum at the annual meeting there must be a majority of unit owners present in person or by proxy before business can be transacted. Florida Statute Section 718.112(2)(b) provides that "unless a lower number is provided in the bylaws, the percentage of voting interests required to constitute a quorum at a meeting of the members shall be a majority of the voting interests." The Election Meeting does not require a quorum of members to take place. It only requires that 20% of the unit owners cast ballots to have an official election. Board Meetings Florida Statute Section 718.112(2) (c) Board of administration meetings. -- Meetings of the board of administration at which a quorum of the members is present shall be open to all unit owners. Any unit owner may tape record or videotape meetings of the board of administration. Q.- What happens if I am denied to attend the meetings? A.- RIGHT TO SPEAK. The right to attend such meetings includes the right to speak at such meetings with reference to all designated agenda items. The association may adopt reasonable rules governing the tape recording and videotaping of the meeting. All meetings shall be open to all unit owners except meetings between the board and the association's attorney, with respect to proposed or pending litigation, when the meeting is held
for the purpose of seeking or rendering legal advice. Florida Statute Section 718.112(2)(c). Board meetings require a quorum of directors to be valid for the directors to conduct official business. Robert's Rules of Order Chapter XI - Quorum Subheading-PROCEEDINGS IN THE ABSENCE OF A QUORUM. In the absence of a quorum, any business transacted (except for the procedural actions noted in the next paragraph) is null and void. Third paragraph-the prohibition against transacting business in the absence of a quorum cannot be waived even by unanimous consent. A Meeting of the board of administration means any gathering of the members of the board of directors, at which a quorum of the members is present, for the purposes of conducting association business. Florida Administrative Code 61B-23.001(1)(a). The bylaws shall provide the method of calling meetings of unit owners, including annual meetings. Written notice, which notice must include an agenda, shall be mailed, hand delivered, or electronically transmitted to each unit owner at least 14 days prior to the annual meeting and shall be posted in a conspicuous place on the condominium property at least 14 continuous days preceding the annual meeting. Florida Statute Section 718.112(2)(d)2. Adequate notice of all meetings, which notice shall specifically incorporate an identification of agenda items, shall be posted conspicuously on the condominium property at least 48 continuous hours preceding the meeting except in an emergency. Florida Statute 718.112(2)(c). MINUTES Roberts Rules under Minutes and Reports of Officers clearly states "they should contain mainly a record of what was done at the meeting not what was said by the members. The minutes should never reflect the secretary's opinion, favorable or otherwise, on anything said or done." By including only certain remarks, the secretary is editorializing. This is not fair or proper. Committee meeting minutes. According to Peter Dunbar in The Condominium Concept, if a committee is advisory in nature a formal record of the proceedings does not need to be maintained. If the committee has substantive authority and is carrying out a portion of the responsibilities of the board a formal record of each meeting must be kept in the same way as the board itself maintains records of its proceedings. Q. What can be done with a Board that does not call for elections in a proper way, sending the letter in due time, for three years in a row? A.- You can ask for election monitoring:
http://www.state.fl.us/ http://www.leg.state.fl.us/ Q.- There is a new Board in our condo association, and they are coming up with new assessments every month. Is there a way to prevent or stop this behavior, as it goes against my budget? A.- ASSESSMENTS Florida Statute Section 718.103(1) "Assessment" means a share of the funds which are required for the payment of common expenses, which from time to time is assessed against the unit owner. The Declaration of Condominium and Bylaws govern assessments. Most state that a special assessment has to be either approved by a majority of the Board of Directors or by a vote of the Association. If the Association has to approve the assessment it may be done by a vote. See Florida Statute Section 718.112 (2) (c) which states in part: "Notice of any meeting in which regular assessments against unit owners are to be considered for any reason shall specifically contain a statement that assessments will be considered and the nature of any such assessments." The specific purpose of a special assessment shall be set forth in the written notice. The funds collected shall be only used for that purpose. Any excess will be common surplus to be returned or applied as a credit. S. 718.116(10) F.S. Q.- We had the Board planning for Amendments to the bylaws by sending them to a lawyer and after that declaring that those were official norms for us, owners. No meeting was convened for us to decide. Is this behavior legal? A.- AMENDMENTS TO DECLARATION AND BYLAWS To amend the Declaration you must refer to the section in your Declaration of Condominium regarding amendments, your Bylaws and Florida Statute Section 718.110. If the declaration or bylaws fail to provide a method of amendment two-thirds of the units must approve it. No more than four-fifths is permitted unless it changes the percentage or proportion by which the unit owner shares the common expenses or permits timeshares which does require 100% approval. Bylaw amendments are covered in your Bylaws or in Section 718.112(1) Florida Statutes.
Q.- I think that my condo Board is arbitrary when it allows or not an owner requested alteration at will. Are there some norms to follow? A.- ALTERATION OR ADDITION A material alteration of the common elements is covered by Florida Statute Section 718.113(2) and permitted in a manner provided in your Declaration of Condominium. If your Declaration is silent regarding making a material alteration it would require a vote of 75% of unit owners. A material alteration or addition means to palpably or perceptively vary or change the form, shape, elements or specifications of a building from its original design, plan, or existing condition, in such a manner as to appreciably affect or influence is function, use or appearance. Q.- There is some confusion about the method used to form a committee. Please, can you explain how to do? A.- COMMITTEES If the bylaws do not prescribe a method by which committees are selected, the method can be decided by majority vote or unanimous consent at the time the committee is appointed. There are several ways this can be done. 1. Election by ballot (as in election of officers, a majority is necessary); 2. Nominations from the floor (open nominations) with viva-voce (by mouth) election; 3. Nominations by chair (to be voted on); 4. Appointment by the Chair; 5. Appointment by adoption of a motion naming members of a committee. Q.- Can the members of the Board vote on some way of payment for themselves? A.- COMPENSATION to Board Members. Unless provided otherwise in the bylaws the directors and officers shall serve without compensation. Sections 718.112(2)(a) and 718.111(1)(a) Florida Statutes. Officers and Directors cannot be compensated for their positions as such unless stated otherwise in the documents. They may receive compensation for other work that they perform if authorized by the Board of Directors.
Q.- What are the resources available to solve condo disputes with the Board or other owners? A.-COMPLAINT You may file a complaint with the DBPR, Division of Condominiums. The form is online at www.myflorida.com. The Office of the Ombudsman may also be able to mediate your problem. If you meet the requirements you can seek a solution provided by Section 718.1255 Florida Statute. Alternate dispute resolution. CONDO CONVERSIONS See Florida Statute Sections 718.604 622. Q.- Are there any time limitations when receiving a unit from a developer? DEVELOPER TURNOVER The situations that arise after you purchase from a developer have specific statute, contractual and time requirements. The unit owners should contact an attorney as soon as possible in order not to be excluded by these time limitations in which to make a claim. Deposits and warranties are covered in Section 718.202-203 Florida Statutes. See also Florida Statutes Sections 718.502 et seq. Q.- How are the Board Members elected? A.- DIRECTOR BOARD ELIGIBILITY The by-laws of the association specify and provide the eligibility requirements for the members of the board of administration. Section 718.112 (2)(a) Florida Statutes. Florida law does not require individual board members to be members of the association to be eligible for election to the board, but most association by-laws do impose a membership requirement for eligibility When a corporation or other type of artificial person owns a unit, determining the eligibility for a representative of the unit to serve on the board of administration presents a unique dilemma. If the bylaws permit, the designated voting representative of the corporation may be eligible to serve as a member of the board. If eligibility is contingent on association membership then the unit may be effectively excluded from offering a candidate for the board since a corporation cannot sit as a member of the board. Section 617.0802 Florida Statutes. An exception to this eligibility standard is made when the unit is owned by a trust Q.- En case of condominiums for people over 55 years, what are the rules? A.- DISCRIMINATION, Age 55 and over communities. See http://fchr.state.fl.us. The association must conduct and maintain adequate surveys every two years and establish that at least one occupant is age 55 or older in at least 80% of the units. If this is not done it may
incur liability if it refuses to allow persons under 55 to live in or purchase a unit in the condominium under discrimination law. Not all members must be 55 or older. If your community is restricted for housing for older aged persons, then your community is required to register upon its initial designation as a community for older aged persons and every two years on the anniversary of the first day of the month in which the community originally filed. The address for the filing is now: Florida Commission on Human Relations, Post Office Box 3388 Tallahassee, FL 32315-3388. Florida Commission Human Relations www.fchr.state.fl.us (850) 488-7082 (954) 712-4605 800-440-8091 or 888-341-7781 for Federal Fair Housing. www.fairhousingflorida.com 561-533-8717. Federal Fair Housing 800-440-8091 or 888-341-7781. ESTOPPEL CERTIFICATE s. 718.116(8) F.S. Q.- What kind of fees can the Board charge? A.- FEES: USE FEE The association may not charge a use fee against a unit owner for the use of the common elements unless the charges relate to expenses incurred by an owner having exclusive use of the common elements or association property. Section 718.111(4) Florida Statutes. TRANSFER FEES Section 718.112(2)(i) Florida Statutes. No charge shall be made by the association in connection with the sale, mortgage, lease, or sublease, or other transfer of a unit unless the association is required to approve such transfer and a fee for such approval is provided for in the declaration, articles or bylaws. Any such fee may be preset, but in no event may such fee exceed $100 per applicant. However, if the lease or sublease is a renewal of a lease with the same lessee, no charge shall be made. LATE FEE Interest 18%/yr $25 fee. If the Declaration or Bylaws provide. Florida Statute Section 718.116(3) Assessments and installments on them which are not paid when due bear interest at the rate provided in the declaration, from the due date until paid. This rate may not exceed the rate allowed by law, and, if no rate is provided in the declaration, interest shall accrue at the rate of 18 percent per year.
Also, if the declaration or bylaws so provide, the association may charge an administrative late fee in addition to such interest, in an amount not to exceed the greater of $25 or 5 percent of each installment of the assessment for each delinquent installment that the payment is late. INFORMATION FEE Section 718.111(12) (e)1 Florida Statutes. The association or its authorized agent may charge a reasonable fee to the prospective purchaser, lienholder, or current unit owner for providing good faith responses to requests for information by or on behalf of a prospective purchaser or lienholder, other than that required by law, if the fee does not exceed $150 plus the reasonable cost of photocopying and any attorney's fees incurred by the association in connection with the response. LATE FEE Florida Statute Section 718.116(3) Assessments and installments on them which are not paid when due bear interest at the rate provided in the declaration, from the due date until paid. This rate may not exceed the rate allowed by law, and, if no rate is provided in the declaration, interest shall accrue at the rate of 18 percent per year. Also, if the declaration or bylaws so provide, the association may charge an administrative late fee in addition to such interest, in an amount not to exceed the greater of $25 or 5 percent of each installment of the assessment for each delinquent installment that the payment is late. LEASE DISAPPROVAL may be made for an assessment delinquency. Section 718.116(4) Florida Statutes. Q.-What kind of insurance is needed to be maintained by the Condominium Association? A.- INSURANCE Florida Statute Section 718.111(11) The association must maintain adequate insurance to protect the property. It shall cover 1. All portions of the condominium property located outside the units; 2. The condominium property located inside the units as such property was initially installed, or replacements thereof of like kind and quality and in accordance with the original plans and specifications or, if the original plans and specifications are not available, as they existed at the time the unit was initially conveyed; and 3. All portions of the condominium property for which the declaration of condominium requires coverage by the association. The individual unit owner shall insure all real or personal property located within the boundaries of the unit owner's unit, which is excluded from the coverage to be provided by the association as set forth above. Casualty Coverage The association must have a master insurance policy for adequate insurance to cover serious damage to the common elements. It is the board of director's decision to determine how much
deductible they wish to have under the master policy. If the policy's limits do not cover the total amount of the damages the association is then obligated to specially assess the unit owners to cover the damages that are not covered by the master policy. The individual owners are ultimately responsible for the deficit and assessment that is not covered by the association's policy for the common elements. Bear in mind that the obligations of the association are funded by the individual unit owners' maintenance payments. The Master Insurance policy (hazard insurance) is to cover, up to its limits and less the deductible, all damage to the common elements and possibly each apartment due to the casualty. (Each Declaration of Condominium and each insurance Policy must be reviewed). Florida Statute Section 718.111(11) only governs your current insurance obligations. Usually the Declaration states that the premises shall be repaired or reconstructed to substantially the same condition as originally built or existing immediately prior to the casualty and substantially in accordance with the original plans and specifications of the condominium and any subsequent modifications thereto. The extent of this damage must usually be determined within 60 days. If the cost of damages to the common elements and apartments exceed the policy limits of the Master Policy as stated therein, the association must obtain the balance by an assessment. The Declaration of Condominium sets out the extent each owner must contribute to the assessment. Usually all unit owners must pay the assessment to rebuild the common elements. The extent that the unit owners must contribute to the rebuilding of the individual damaged units is also set out in the declaration of condominium. If the Board refuses to pursue its claim against the master policy insurer, you must send a certified letter to them with an inquiry (demand) pursuant to Section 718.112(2)(a)2 Florida Statutes. If they refuse to answer within 30 days you may seek legal action against the Association and Board of directors pursuant to Chapters 617 and 718 Florida Statutes. If the master policy insurer refuses to comply with its contract with the association you should contact the Florida Department of Financial Services at (800) 342-2762 or at www.fldfs.com. You may also qualify for assistance from FEMA and the IRS (800) 829-3676. Q. What to do with an owner who becomes a nuisance for the others? A. If the occupier of a unit or the unit owner is creating a nuisance the board of directors should be notified and they should take steps to have the nuisance abated. If the board refuses to take action they should be notified by certified mail and after 30 days if they continue to refuse or fail to respond then legal action may be taken. If the problem is serious the police should be notified immediately to document the problem. MISMANAGEMENT OR DISSATISFACTION
The Office of the Ombudsman is unable to impose a timetable or conditions with respect to how your Condominium Association complies with State Law and the Association's Declaration, By Laws and Rules, as long as it is in reasonable compliance with them. The board has unquestionable power and authority to mismanage the association under the judicial Business Judgment Rule. A grievance that management of a condominium does not perform its' duty fast enough to satisfy some of the Unit Owners, is not within the jurisdiction of the Ombudsman's office, as long as Management acts reasonably. Unit Owners might consult with their personal attorney in the event they sustain personal injuries or are otherwise damaged as a result of Managements' negligence or refusal to reasonably comply with Florida Statutes, or the Condominium Declaration, By Laws or Rules. If Unit Owners are dissatisfied with Management they should consider a recall. Q. Can the Board mortgage common elements at its will? A.- MORTGAGE OF COMMON ELEMENTS The association may mortgage association property in the manner provided in the declaration or upon the approval of 75% of the total voting interests. Section 718.111(7) Florida Statutes.