Just about every year there is at least one legislative change to the Florida Statutes that regulate community associations and this year was no different. House Bill 841 was passed by the 2018 Florida legislative session and Governor Scott signed it into law on March 23, 2018. These are short summaries of the changes for 2018, that will be effective July 1, 2018.
Official Records: Certain official records must be permanently maintained from the inception of the association, including the following:
(i) a copy of the plans, permits, warranties, and other items provided by the developer;
(ii) a copy of the recorded declaration of condominium and all amendments thereto
(iii) a copy of the recorded bylaws and all amendments thereto;
(iv) a certified copy of the articles of incorporation and all amendments thereto;
(v) a copy of the current rules; and
(vi) all meeting minutes.
All other official records of the association must be maintained within the state for at least seven years, unless otherwise provided by general law. Notwithstanding, all election records, including electronic election records, must only be maintained for one year from the election.
Website: The website requirement now applies to condominiums containing 150 or more non-timeshare units. Digital copies of the governing documents, association contracts, budget, financial report, and other required documents must be on the association’s website by January 1, 2019. The Website must also include a list of bids received by the association within the past year for contracts entered into by the association and any monthly income and expense statement must also be posted. Although, the failure to post these documents on the website does not, in and of itself, invalidate any action or decision of the association. If the association is complying with the posting requirement, there is no liability for disclosing information that is protected or restricted unless such disclosure was made with a knowing or intentional disregard of the protected or restricted nature of such information.
Finances: In the event an association fails to comply with an order by the Division of Florida Condominiums, Timeshares, and Mobile Homes to provide an owner with a copy of the financial report within a specified amount of days, then the association is prohibited from waiving the financial reporting requirement for the fiscal year in which the owner’s initial request for a copy was made and for the following fiscal year, too.
Board Meeting Notices: Meetings in which regular or special assessments are to be considered must have a notice that specifically states that assessments will be considered and provide the estimated cost and description of the purposes for such assessments.
Meeting Notices: The association may create a rule for posting meeting notices and agendas on the association’s website for at least the minimum time frame for which a notice of a meeting is also required to be physically posted on the condominium property. The rule must include a requirement that the association send an electronic notice in the same manner as a notice for a meeting of the members, including a hyperlink to the website where the notice is posted. The notice is required to be conspicuous on the website.
Directors: A director can serve a term longer than one year if permitted by the bylaws or articles of incorporation, but a director cannot serve more than eight consecutive years, unless approved by two-thirds of all votes cast in the election or unless there are not enough eligible candidates to fill vacancies on the board.
Electronic Notice: A unit owner who consents to receiving notices by electronic transmission is responsible for eliminating any filters that block receipt of mass emails sent to members on behalf of the association in the course of giving electronic notices.
Director Recall: A recall is only effective if it is facially valid. If the recall is determined to be facially invalid by the board, then the unit owner representative of the recall effort may file a petition challenging the board’s determination on facial validity. A recalled board member may file a petition challenging the facial validity of the recall effort. If the arbitrator determines that the recall was invalid, the petitioning board member is immediately reinstated and the recall is null and void.
Material Alterations: If the declaration as amended does not specify the procedure for approving material alterations or substantial additions to the common elements or association property, the already statutorily required approval of seventy-five percent of the total voting interests of the association must now be obtained prior the material alterations or substantial additions to the common elements or association property are commenced.
Electric Vehicles: A declaration of condominium or restrictive covenant may not prohibit or be enforced so as to prohibit any unit owner from installing an electric vehicle charging station within the boundaries of the unit owner’s limited common element parking area. The board may not prohibit a unit owner from installing an electric vehicle charging station for an electric vehicle within the boundaries of his or her limited common element parking area, but the unit owner is entirely responsible for the charging station, including its installation, maintenance, utilities charges, insurance, and removal if no longer needed. The association may impose certain requirements upon the installation and operation of the charging station. Labor performed on or materials furnished for the installation of a charging station may not be the basis for filing a construction lien against the association, but such a lien may be filed against the unit owner.
Conflicts of Interest: Directors and officers of non-timeshare condominiums must disclose to the board any activity that could be reasonably considered a conflict of interest. A rebuttable presumption of such a conflict exists if:
i) directors or officers of the association (including their relatives) enter into a contract for goods or services with the association;
ii) directors or officers of the association (including their relatives) holds an interest in a corporation. Limited liability corporation, partnership or other business entity that conducts business with the association.
In the event of such a conflict, then the proposed activity and all relevant contracts must be attached to the meeting agenda and the requirements of section 617.0832, Florida Statutes must be adhered to, as well. The relevant provisions of section 617.0832, Florida Statutes follow:
“No contract or other transaction between a corporation and one or more of its directors or any other corporation, firm, association, or entity in which one or more of its directors are directors or officers or are financially interested shall be either void or voidable because of such relationship or interest, because such director or directors are present at the meeting of the board of directors or a committee thereof which authorizes, approves, or ratifies such contract or transaction, or because his or her or their votes are counted for such purpose, if:
i) The fact of such relationship or interest is disclosed or known to the board of directors or committee which authorizes, approves, or ratifies the contract or transaction by a vote or consent sufficient for the purpose without counting the votes or consents of such interested directors;
ii) The fact of such relationship or interest is disclosed or known to the members entitled to vote on such contract or transaction, if any, and they authorize, approve, or ratify it by vote or written consent; or
iii) The contract or transaction is fair and reasonable as to the corporation at the time it is authorized by the board, a committee, or the members.”
In addition, section 718.3027, Florida Statutes, provides that the disclosures required by this section must be set out in the meeting minutes, and the contract must be approved by two-thirds of all of the directors present (excluding the conflicted director). At the next membership meeting, the existence of the contract must be disclosed to the members and then may be canceled by a majority vote of the members present. If the contract is canceled, the association is only liable for the reasonable value of the goods and services provided up to the time of cancellation and is not liable for any termination fee, liquidated damages, or other form of penalty for such cancellation. Finally, in the event of a failure to disclose a conflict or potential conflict, the contract is voidable and terminates upon the filing of a written notice terminating the contract which contains at least 20 percent of the voting interests of the association.
Grievance Committee: The grievance committee appointed by the board to conduct hearings for fines and use right suspensions for violations of the governing documents must be comprised of at least three members who are not officers, directors, or employees of the association, or the spouse, parent, child, brother, or sister of an officer, director, or employee. The fine or suspension can only be imposed if approved by a majority of the committee. If a fine is approved, the fine payment is due five days after the date of the committee meeting at which the fine is approved. The association must provide written notice of the approved fine or suspension by mail or hand delivery.
Board of Directors Email Use: Members of the board may use email as a means of communication but may not cast a vote on an association matter via email.
Fines: If a fine levied by the board is approved by the grievance committee, the fine payment is due five days after the date of the committee meeting at which the fine is approved.
Amendments: A proposal to amend the governing documents must contain the full text of the provision to be amended with new language underlined and deleted language stricken. However, if the proposed change is so extensive that underlining and striking through language would hinder, rather than assist, the understanding of the proposed amendment, the following notation must be inserted immediately preceding the proposed amendment: “Substantial rewording. See governing documents for current text.” An immaterial error or omission in the amendment process does not invalidate an otherwise properly adopted amendment.
Elections: If an election is not required because there are either an equal number or fewer qualified candidates than vacancies exist, and if nominations from the floor are not required and write-in nominations are not permitted, then such qualified candidates shall commence service on the board of directors, regardless of whether a quorum is attained at the annual meeting.
Application of Payments: The application of assessment payments received by the association is applicable regardless of any purported accord and satisfaction or any restrictive endorsement, designation, or instruction placed on or accompanying a payment.