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Unit owners may cancel contract

(ran HP HN HS editions)

Question: I live in a condominium that has a 25-year management contract made by the developer with a management company before any apartments were sold and while the developer elected and controlled all the directors of the condominium association.

Now all the apartments have been sold and the unit owners want to cancel the contract which was made without our consent or permission. Can this be done? _ A. N.

Answer: Section 718.302 of the Condominium Act deals with contracts made by an association prior to control of the association by the unit owners. That law provides that all such contracts be fair and reasonable.

It further provides that if the unit owners have assumed control of the association, the contract made by the developer may be canceled "by the concurrence of the owners of not less than 75 percent of the units other than the units owned by the developer."

Under that law, when all the apartments have been sold and the unit owners have assumed control of the condominium association, the management contract may be canceled if 75 percent of the owners so desire.

Illegal expenditures

Question: Our board of directors has been spending association funds for such items as a New Year's Eve party, other holiday parties, and flowers and cards for owners who have been hospitalized or had a death in the family.

I thought that condo funds could be spent only for maintaining and operating the condo. I would appreciate your opinion. _ O.

W.

Answer: Many condominium directors fail to realize that all money raised by assessment are trust funds and can be spent only for authorized purposes.

The law states that unit owners may be assessed for common expenses in the proportions or percentages set forth in the declaration of condominium. Thus, if an owner has a one percent undivided interest in the common elements, he can be assessed only one percent of the common expenses.

Section 718.115 of the Condominium Act states that common expenses include those incurred for the operation, maintenance, repair and replacement of the common elements, the costs of carrying out the powers and duties of the association and any other expense designated as common expense by the declaration, the documents creating the condominium or the bylaws.

In my opinion, funds spent for parties, flowers and cards are not a common expense unless specifically designated as such by the condominium documents. Money for such purposes should be raised by voluntary contribution.

Unwelcome guests

Question: I live in a condominium complex where we all own our apartments. We have security doors, for which each owner was issued two non-duplicating keys.

We now find that some owners obtained additional keys to give to their friends and relatives who do not live in the complex. The result is that some of these people with their families now come and go as they please, using all our recreational facilities.

What can we do to stop this freeloading? _ J.

L.

Answer: Section 718.123 of the Condominium Act states that all the recreational facilities of any condominium shall be available to unit owners and their guests. That law further provides that a board of directors may adopt reasonable rules and regulations about the use of such facilities. In doing so, many boards have imposed limits upon the number of guests a unit owner may invite, and others are charging fees for the use of the recreational facilities by guests.

Association liability

Question: A high-velocity wind and rain storm caused water damage to the ceilings in some of the townhouse units. The leaks were the result of inferior materials and construction defects.

A unit owner has presented a bill to the board of directors for the cost of repairing the ceiling in his apartment caused by the water damage. Another unit owner wants payment for water damage to his carpeting.

Is the condo association liable for water damage inside a unit. _ R.

S.

Answer: Section 718.113 of the Condominium Act imposes a statutory duty on the condominium association to maintain and care for the common elements.

If an association is negligent in the maintenance, operation and control of the common elements, it can be held liable for all the losses which are a natural, proximate and probable consequence of its negligence.

However, in order to recover, a plaintiff must prove that the association had actual notice of a defective condition and failed to cure it, or, by the exercise of reasonable care, should have had knowledge, which is known as constructive notice.

These are all questions of fact to be determined by a court or jury.

Claims based upon an association's negligence should be presented to the association's liability insurance carrier.

Harry Wood, a retired lawyer, is a consultant on condominium management. Address questions to: Harry Wood in care of At Home, the Times, P.O. Box 1121, St. Petersburg, FL 33731-1121. Questions of general interest will be answered in the column. Because of the volume of mail, personal answers to questions are impossible.

The State of Florida also has staff to answer questions about condominium law. Write to Liz Cloud, Department of State, Bureau of Administrative Code, Room 2002, the Capitol, Tallahassee, FL 32399-0250.

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