Q: My wife slipped and fell in our condominium parking lot in the rain, fracturing her right ankle. She is in extreme pain and confined to bed with her foot elevated. I think we would have a good case against the condominium because the spot where she slipped is not level and there is a hole that was covered with rainwater. We certainly wouldn't want to alienate our neighbors by bringing an action against our association, and would not we be bringing legal action on ourselves since we are part of the association?
A: I am not trying to talk you out of bringing suit against the association, but consider the following. Yes, it is like suing yourself and, yes, it can alienate neighbors. However, was it a life-altering situation in that your wife will never fully recover? Was the board or manager aware of the uneven pavement? Have others fallen at the same area, or was this the first time? Has the area been a hazard for some time, or was it new, possibly caused by the rain? Lawsuits take time and money and, to me, there is a sort of trauma to the legal process. If you want to chastise the board for doing a poor job, then sue. If you want to recover some of the medical expenses and lost wages, then notify the board and file an insurance claim against the association's insurance. Keep in mind, however, that rain is an act of God and can release the board from liability.
Rentals upside down
Q: I have three condominiums in different locations. One is paid for, which is my residence, and the other two are rentals that are upside down with the current real estate market. I stopped paying mortgage and HOA dues on the rentals two months ago. The condominium has filed a lien on one of my units. I owe the bank $445,000, and the property value is down to around $350,000. Can a condominium foreclose on a property that is upside down? Why would they? What can I tell my renters who are scared of being evicted?
A: Yes, the association can foreclose on your property, and I highly recommend that they take fast action. Condominiums must lien and foreclose to make the unit start paying fees. This action enables the association to take title to the unit and start recovering losses. Once they have title, they have several options, including renting the unit. They can collect the rent to recover their loss or they can sell the property, even if it has a mortgage. Keep in mind that most association foreclosures will eliminate the second mortgage. They can ask the bank to agree to a short sale or deed the property to the bank (if the bank agrees). The association is not obligated to the first mortgage, you are. You signed the notes and mortgages, so your credit would be affected. Keep in mind, too, that when a bank loses mortgage money it can cause a lien to be placed on your other assets and your current home. Though the bank cannot foreclose on your home (homesteaded property), it can collect when you sell or lose your homestead. Better contact an attorney and discuss your options.
Getting lien release
Q: Our association hired a contractor to repair a roof on one of the buildings in our complex. The contractor did the job and was paid by our association. The company that sold the contractor his supplies later put a lien against our association and all owners, as the contractor did not pay for the supplies and has since gone out of business. The association paid the supplier and received a certification relieving them of the lien about a year ago. There is still a lien against each condo owner as we just found out when someone tried to sell their condo. Now that there is a lien against my condominium on record, how does that affect my credit rating? What action can be taken?
A: All boards of directors must be aware of the construction lien laws, also known as mechanics liens. If a person or board of directors hire a contractor and the repairs or improvements cost more than $2,500, you need to protect yourselves by recording a notice of commencement. Your first step is to have your attorney review your contract. Put the burden on the attorney to advise the board on necessary procedures. Review Florida Statute 713 for information on why you need certain clauses in the contract, such as having the contractor provide all sources of material, vendor services and subcontractors. Failure to follow the procedures can result, as you know, in a lien on the property. As for liens on each unit, the attorney should make sure that a release of lien is properly filed since the association has paid the amount due. As for your credit rating, this type of lien should not affect your credit as long as it has been paid.
Richard White is a licensed community associations manager. Write to him at 6039 Cypress Gardens Blvd., No. 201, Winter Haven, FL 33884-4115 or send an e-mail to him at CAMquestions@cfl.rr.com. Please include your name and city.