Dear Business Partner: Spring is a time of growth and I am pleased and grateful to announce that The Ruggieri Law Firm, P.A. is growing quickly. I want to express my sincerest thanks to all of you for the support. I am pleased and excited to announce the addition of Tracy Durham to our team. As many of you know, Tracy is an accomplished Community Association Manager who has always had a keen interest in the law. Tracy will be our Director of Operations, a fancy phrase for “anything and everything” that needs to get done! She will be assisting me with collections, taking on administration such as banking, and bringing her unique ability to network and market the firm to our team. I also wanted to take the opportunity to update you on some recent developments in the law affecting Community Associations. The first article is a discussion regarding the growing tendency and willingness that banks have to dispute not just their liability for assessments that accrued before they took title in their foreclosure, but also the safe harbor amounts. Associations and their law firms may be exposed to significant liability for both damages and attorney’s fees and costs should erroneous demands be made upon a bank for delinquent assessments or the safe harbor amounts. My second article addresses an appellate decision from 2012 that may have a significant impact on covenant enforcement. The instances in which this case has been raised as a defense by homeowners has only increased since the decision was first released in 2012. Continued success to you as we approach the Summer and be sure to call us with any of your legal needs.
BE CAREFUL WHAT YOU ASK FOR ON PAGE 2 →
IS SELF-HELP MANDATORY? ON PAGE 3 →
Frank A. Ruggieri The Ruggieri Law Firm, P.A.
Be Careful What You Ask For BY FRANK A. RUGGIERI
July of 2010, the Florida legislature modified
Several appellate decisions have been issued indicating
both Chapters 718 and 720, altering a
that the 2010 change to the Statute cannot be applied to
bank’s liability for assessments when they take title
mortgages which existed and were written prior to the
to the property in their foreclosure proceedings or
effective date of the Act (July 1, 2010).
by obtaining a deed from the homeowner in lieu
Some associations have taken a “it can’t hurt to ask”
of foreclosure. Effective July 1, 2010, banks which
approach and have either demanded all of the delinquent
have issued a purchase money mortgage on either a
assessments that accrued prior to the time that the bank
condominium unit or a single family residence are
took title or the safe harbor amount of twelve (12) months or
limited to paying twelve (12) months of assessments
one percent (1%) from banks whose mortgages were written
or one percent (1%) of the face value of the mortgage,
prior to the effective date of the Statute.
whichever is less.
The Condominium Act was
The Federal Fair Debt Practices Act prohibits attempts
amended in 1992 in a similar fashion, limiting
to collect improper amounts from a debtor, can trigger
a bank’s liability to six (6) months’ worth of
liability for punitive damages, and entitles the debtor to
assessments or one percent (1%) of the face value
recover their attorney’s fees and costs incurred in connection
of the mortgage, whichever is less. Banks were
with a violation of the Act. It has been increasingly common
quick to challenge the statutory change and were
for banks to seek a Declaration of their rights, challenging
successful in doing so.
the Association’s attempts to collect pre-certificate of title
assessments or the safe harbor amount. They are likewise
requesting an award of their attorney’s fees and costs pursuant
retroactively to modify a contractual right that
to the Declaration and State Statute. I have also witnessed
existed on the date the Statute was adopted.
banks challenge associations when they voluntarily paid the
The banks argued that, because their mortgages
amount, seeking a refund of those monies. Consequently,
were written prior to the 1992 change to the
in a situation where a bank has voluntarily paid, this doesn’t
Condominium Act, the Statute could not be
mean “the case is closed.”
applied retroactively to make them liable for
In summary, caution should be used in making demand
assessments which they were not previously
upon banks whose mortgages were written before July 1 of
required to pay. I knew it was a matter of
2010. Consult your legal counsel regarding a bank’s liability
time before banks would challenge the
in a particular circumstance and be certain that you are
2010 changes to the Statute.
demanding the correct amounts.
Ask the Attorney HAVE A LEGAL QUESTION? NEED AN ATTORNEY? DON’T KNOW WHAT TO DO? Then ask the attorney! The Ruggieri Law Firm is pleased to announce this new feature to our quarterly newsletter. You can now submit general questions regarding Community Association Law via our facebook page or website under the “Ask the Attorney” tab and select questions will be answered in our next newsletter. The Ruggieri Law Firm is here to assist and educate you in effectively managing your community. So don’t wait...ask the attorney today!
Is Self-Help Mandatory? BY FRANK A. RUGGIERI
January 2012, the Florida Second District Court of
if necessary, fix the violation, and lien the property to recover
Appeals issued an opinion titled Alorda v. Sutton Place
the costs incurred.
Based upon the Second District Court of
Homeowners Association, Inc., 82 So. 3d 1077 (Fla. App. 2nd
Appeals’ decision, are homeowners associations always required
DCA 2012). The homeowners association filed suit against the
to exercise self-help, as opposed to filing a lawsuit to compel the
homeowner seeking an injunction ordering the homeowner to
homeowner to cure the violation? I have always counseled my
obtain insurance as required by the terms of the Declaration. The
community association clients not to exercise self-help by going
homeowner ultimately purchased the insurance while the lawsuit
onto a homeowner’s lot unless the property is vacant. I believe
was pending. Consistent with applicable caselaw, the association
that going onto a homeowner’s property to mow the lawn or cure
was deemed the prevailing party for purposes of attorney’s fees and costs and a judgment was entered against the homeowners for the attorney’s fees and costs incurred by the Association. The homeowner appealed and the Second District Court of Appeals
“Consult your Association’s counsel before taking action to enforce your restrictive covenants.”
overturned the trial court’s ruling, holding that the association’s lawsuit should have been dismissed, and further ruled that the
any other maintenance violation can lead to confrontations and
Association was therefore not the prevailing party.
other liability concerns. This is despite the fact that self-help
In order for a party in a lawsuit to obtain an injunction or
provisions universally contain language which specifically allows
injunctive relief, one of the items it must establish is that it has
the association to go onto the homeowner’s property to cure the
no adequate remedy at law. Injunctive relief is deemed to be
violation and that this is not deemed a trespass.
an “equitable remedy” which differs from a legal remedy. The
This argument has been raised as a defense on behalf of
homeowner argued that the association had an adequate remedy
homeowners on several occasions in cases which I have litigated,
at law, namely the right under the Declaration to purchase the
and I see no indication that this trend will slow. Despite the
insurance where a homeowner fails to do so, and to lien and
Second District Court of Appeals’ decision, the Firm continues to
foreclose if necessary if the homeowner fails to pay.
recommend to its community association clients that self-help not
The Second District Court of Appeals has created a dangerous precedent with their decision.
Most, if not all, Declarations
allow the Association to enter onto a homeowner’s property
be exercised unless the property is vacant. As always, consult your Association’s counsel before taking action to enforce your restrictive covenants.
“Devoted to the Personalized Representation of Community Associations”
390 North Orange Avenue Suite 2300 Orlando, FL 32801
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