Beginning this week, this column will begin its yearly review of legislative changes affecting community associations. Today, we will start with the main bill, Senate Bill 630, which became effective July 1, 2021.
Section 627.714(4), Florida Statutes: Insurance Subrogation
The new law provides that if a condominium association’s insurance policy does not provide rights for subrogation against the unit owners, an insurance policy issued to an individual unit owner may not provide rights of subrogation against the association.
“Subrogation” refers to the insurance carrier assuming the right of its insured to attempt to collect from the party alleged to be responsible for damage. There is a fair amount of litigation involving this issue, most frequently when the “HO-6” (individual unit) insurer sues the association after having paid a unit owner claim. The practical impact of this change remains to be seen, and associations should address questions to their insurance agent.
Section 718.111(12), Florida Statutes: Official Records
The Florida Condominium Act has been amended to address certain record-keeping requirements and records access provisions:
- Bids for work to be performed must be maintained for at least 1 year after receipt of the bid. The previous version of the law required bids to be kept for 7 years.
- A renter has a right to inspect and copy only the declaration of condominium and the association’s bylaws and rules.
- An association may not adopt rules requiring a member to demonstrate any purpose or state any reason for a record inspection.
- For condominiums with 150 or more units, an association, in lieu of posting copies of certain required documents to a website, may alternatively make the documents available through an application (“app”) that can be downloaded on a mobile device.
Section 718.112(1)(c), Florida Statutes: Discriminatory Restrictions
The new law allows boards to easily remove “discriminatory” provisions in their governing documents by an amendment approved by a majority of the board.
This law was enacted in response to offensive and of course illegal racially restrictive subdivision covenants that appear in the title chains in many county land records offices. Unlawful restrictions in condominium documents are not common but should be eliminated by action of the board if they exist, and the law extends beyond race.
Section 718.112(2)(d)2., Florida Statutes: Board Term Limits
Section 718.112(2)(d)2 of the Florida Condominium Act provides a much-needed clarification regarding the board term limits that were added to the statute in 2018. The amendment provides that for calculating the statutory 8-year board term limits, the service start date will be on or after July 1, 2018. Term limits set forth in bylaws are not affected by the statute.
Section 718.112(2)(d)3., Florida Statute: Notice of Meetings
These changes are intended to fix a problem created by prior legislation regarding the posting of notices of meetings, which required posting of notices on “condominium property,” ignoring the fact that many condominiums have “association property,” which is legally different. Condominium property is “submitted” to condominium ownership and is “owned” by the unit owners in undivided shares. Association property is titled in the association by deed. This is a common set-up in multi-phase developments, and association property often includes clubhouses, where notices were traditionally posted. The law once again allows posting of official notices on association property.
The law has also provided additional requirements for special membership meetings. Basically, the requirements applicable to annual meetings must be followed including requirements for the inclusion of the agenda with the notice, and notice posting requirements. One significant difference is that notice of annual meetings must always be given 14 days in advance, regardless of any contrary provision in the bylaws. Notice of special member meetings may be given as provided in the bylaws, and if the bylaws are silent, the 14-day standard applicable to annual meetings applies.
Next week, I will continue review of SB 630.