Attention Condo Owners & Board Members: Changes to HOA Laws are Different from the Condominium Law Changes

In the short time these new laws have been in place, multiple news outlets, property owners, Association Boards, and Social Media "experts" have made sweeping statements about how the changes no longer allow (something) or must now allow (something else). Many of these statements are based on incomplete information or hopeful assumptions.

Even Florida attorneys can't fully determine to what degree the changes may affect a residential Owners Association without first interpreting that Association's Governing Documents in relation to the new laws. It is quite likely that for the same Association some Statute changes may apply, yet others may not. Yes, really.

Important - changes to HOA Laws are different from the Condominium Law changes. Know which one may apply to your Owners Association!

Every Homeowners Association (HOA) or Condominium Owners Association (COA) must comply with the appropriate Chapter of Florida Statutes and their own Governing Documents which are recorded in Public Records of the County where the property is located. HB-1203 became law that amended the Homeowners Association Act (FS Chapter 720), and HB-1021 became law that amended the Condominium Act (FS Chapter 718).

Governing Documents cannot conflict with the applicable Florida Statute, so what happens when a Statute is amended? Here are some Discussion Points related to our headline question:

• An Association's Governing Documents may or may not contain what is called Kaufman Language ("...as amended from time to time") referring to the Homeowners Association Act or the Condominium Act. If similar language is in an HOA's Declaration of Covenants or a COA's Declaration of Condominium, the Governing Docs automatically stay in agreement with any amended Statutes. Kaufman Language keeps an Association's Governing Docs in step with Chapter 720 or Chapter 718 as the Acts may be amended over the years. Best practices suggest that Boards send notices to all Association members/property owners explaining any changes when they occur.

• The language is called Kaufman because it comes from a 1977 Florida Civil Lawsuit in which judgment was made in favor of the Lead Plaintiff, Mr. Kaufman. The suit was filed over Florida Statute Application in a North Miami Condominium Association and has become often referred-to case law which is part of this discussion.

• Things get much more complex when an HOA or COA Declaration does NOT contain this Kaufman Language. Without some version of "...as amended from time to time" referring to the Homeowners Act or Condominium Act, periodic Statute Amendments by State Legislators may not apply to that Association. Governing Docs without Kaufman are often considered frozen in time to the version of Chapter 720 or 718 that was in place when the Docs were drafted and recorded in County Public Records. Though it is not quite that simple...

• Attorneys mention the difference between substantive (affecting owners' rights) changes in the law, and procedural (administrative) changes. Changes affecting owners' existing rights are handled very differently from procedural changes. This is one of the areas in which some parts of the new laws may apply, and some may not. The Association's Attorney has to make that call, not the Board of Directors or Management Company. (Procedural changes usually apply without dispute, substantive changes can be challenged when there is no Kaufman language in an Association's Declaration.)

• Neither of the Bills (nor the resulting Statute Amendments) appear to say they apply retroactively. Unless specifically stated otherwise, Florida Statutes are presumed to apply prospectively (going forward from their effective dates). What does this suggest for application to existing Governing Docs? Do the changes apply to all existing Governing Docs or just those drafted or amended after July 1st, 2024? Without specific language, we will likely have to wait for a few civil lawsuits to create case law.

• Attorneys also tell us that Governing Documents (in particular, Declarations) create a contract between an Association and its members (property owners). Florida's Constitution includes a section establishing a general rule that amended or new State Legislation cannot interfere with existing contracts between parties. This can include impairing vested rights granted under a Declaration, according to attorneys I asked when researching this article. Does this have any bearing on how the new HOA and Condominium Act Amendments are applied to Associations without Kaufman Language in their Declarations? Only your Association's Attorney can accurately answer that question.

• The Florida Legislature's intent when considering and enacting changes in the HOA and Condominium Acts was to protect property owners' rights while promoting proper administration and management of Residential Owners Associations. If Boards do not apply certain parts of the new laws, could that be construed as breach of Fiduciary Duty?

We have already heard rumors of Boards selectively deciding which parts of the Amended Statutes they want to enforce, and which they do not. Some Directors and owners are allowing their own Confirmation Bias to influence their interpretations of what the new laws say. This means that parts of the Amended Statutes supporting their points of view could be taken as applicable and enforceable, while those clauses that conflict with their own opinions could be disregarded.

Scenario 1: A property owner in a Florida HOA Community wants to park her pickup truck in her driveway, not in the garage as the community's Governing Docs have required since the original Declaration was recorded back in the late 1990’s. She tells the Board they can no longer issue a Violation if she parks her pickup in the driveway because she saw on the evening news that the Recently-Amended HOA Act says so. Not exactly...

To determine applicability and enforcement, interpretation and legal advice from the Association's Attorney is needed. This situation may affect an owner's rights (a substantive issue), yet the existing Governing Docs requiring trucks to be parked in a property's garage are part of all owners' contracts with the HOA. Does the Declaration include "...as amended from time to time..." language? Are the posted and distributed Rules & Regulations for residents sufficient basis for continued enforcement?

Scenario 2: A Condominium building has a high percentage of seasonal residents. Not many owners occupy their individual units during the summer months from May to October, so Board meetings are not held during those months. And for many years the Board has been comfortable with newly-elected Directors just signing a self-certification saying they read the Governing Docs rather than attending a State-Approved Certification Class presented by a law firm specializing in COA Governance.

A well-informed owner brings it to the Board's attention that recently Amended FS Chapter 718 (The Condominium Act) now requires properly-noticed Board meetings to be held at least once each calendar quarter, and that Director self-certification is no longer an option, class attendance is mandatory and retroactive to sitting Directors.

The Board President quickly responds that their Declaration does not include "...as amended from time to time" (Kaufman) Language, so none of the new clauses apply to them.

The owner reminds the President that the sections on quarterly meetings and Mandatory Director Certification Classes are procedural and do not affect owners' rights, so they DO apply to their Association.

Who is right? Only an attorney can answer that question after closely reviewing the Association's Governing Documents and interpreting the Statute Amendments in relation to them.

Are you starting to see some of the complications with applying and enforcing the changes? (Note - Procedural changes usually do apply, even without Kaufman Language.)

All property owners in Condominium Buildings and HOA Communities should be aware of the significant changes made in Florida Statutes that regulate their Associations. I suggest Boards of Directors consult with the Association's Attorney for clarification on applicability and enforcement, then schedule a Board meeting (with the attorney attending) to present the changes to all owners.

Since it is now summer and many owners are "up north," it is a good idea to arrange real-time video of the meeting (Zoom or similar platform) to present the changes within the context of your own Governing Docs and encourage owner questions. Announce the meeting well in advance and multiple times in order to promote owner participation. Be sure your Association Attorney is involved from the start to help explain the changes. Any legal fees for this purpose are money well-spent.

Best practices regarding these changes to the HOA and Condominium Acts will take time to sort out. The Florida Legislature has a long history of passing legislation before receiving sufficient input from non-government individuals trained and experienced in the matter being considered, reviewed, and debated.

As mentioned above, future civil lawsuits may create case law on which to base more reliable application of these new Statute changes. After all, Kaufman Language itself is based on the outcome of a civil lawsuit that became very significant Florida case law.

Until then, only your Association's Attorney can provide dependable, actionable interpretation and guidance.

Editor's Note: Christopher Carter is NOT an attorney. He does not give legal advice. For interpretation and application to specific circumstances of anything you read in this article, you must speak with a Florida-Licensed attorney.

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