Abuse of power —living miserably in a Florida association
Florida Community Association Law Blog
Barbara Billiot Stage
16 April 2014
If I had to briefly describe Florida community associations (COAs,
HOAs, Mobile Home Parks) I would sum it up to "abuse of power."
A majority of the associations in the State of Florida abuse the power
granted to them by the statutes and the governing documents
(Declarations, Bylaws, Articles of Incorporation, and Rules and
Regulations) of the association. In the early to mid-2000s, House
Representative Julio Robaina, who was head of the House Select
Committee on Condominium and HOA Reform set up town hall meetings all
over the state to listen to the complaints by owners regarding their
associations. Hundreds of people attended these town hall meetings and
only one or two people ever spoke up to say they were happy with their
association. As you can guess these one or two people were board
members.
Don't get me wrong; there are a number of good associations out there
who do their job without abusing the owners. I know because the
associations I represent operate their communities that way or I would
not be representing them.
The problem lies with the association attorneys, as well as the courts
and the Florida Bar for letting the association attorneys behave badly.
The problem lies with the Florida Legislature for not enacting more
laws to protect the owners or creating an agency to properly regulate
the associations. Homeowner associations are not regulated at all. The
other types of associations that are regulated do not provide adequate
protection for the owners or do not have jurisdiction to investigate
the biggest problems, such as assessment disputes. This means the
only remedy available to homeowners is costly litigation and the
attorneys know this. They advise their clients the likelihood of
someone litigating against the association is slim and even if they do
chances are they will drop the case when they realize the money it will
take, which is between $100,000 and $150,000 on average to get a case
to court. In fact one association law firm gave a sales presentation
that I sat in on and stated that 95% of the homeowners cannot afford to
litigate against you. Their motto was "do now, defend later." The board
members, once educated on this fact, then start to abuse the power they
have to suppress the property rights of the owners.
Tactics include censorship of those outspoken owners and litigation
against them if possible. Associations will foreclose on an owner who
is past due a few hundred dollars and is outspoken rather than
foreclose on someone who owes more but doesn't make trouble.
Attorneys' fees are the biggest problem with association abuse. The
statutes actually provide for the owner to reimburse the association
the attorneys' fees without a court action! Even worse, any payments
are applied to interest, late fees and attorneys' fees first.
Payments are applied to assessments last, so if you are past due,
unless you pay the amount in full, you will always be at risk of
foreclosure. Knowing this, the law firms representing the associations
pad their bills heavily. A recent case I was involved in, where the
association lost the client's monthly payment of $160 resulted in
almost $800 the first month and $62.50 each month, minimum, just for
handling an account in collections and processing the payment. This
client paid in advance several months at a time and there was only one
month in dispute, but the association sold off the debt to a finance
company who then applied hundreds of dollars in legal fees almost every
month on top of the legal fees the association attorney charged.
The attorneys' fees reached $20,000 quickly despite one $160 payment
being in dispute.
I have had clients who are turned over to the association attorney for
collections and they are told they cannot go by the law firm and cannot
call. They are given the email address of a contact person to
discuss settlement. Guess what? That person no longer works there
and the owner is given two or three email addresses of former
employees. While I complained about this to the law firm several years
ago, I recently discovered the firm is still engaging in this practice.
When they finally do read the emails the owner sent, they want to bill
the owner for all the emails sent despite no one reading them when they
were sent.
Violations are another area of abuse. If your association doesn't like
you, you will be targeted with violation notices and possibly fines,
which then can be a lien and foreclosure on your home if the fines
exceed $1,000 and are unpaid.
Life in an association does not have to be this way. There is a better
way of operating these associations, but until the State of Florida
wises up and realizes they are promoting a "cash cow," not just for the
attorneys, but for the community association managers, as well, life in
an association will be a living hell with a dictatorship form of
government. By the way, the courts have ruled long ago associations are
not governments or quasi-governments.
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