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Senate Bill 2984

Senate Bill sb2984c2

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    Florida Senate - 2004                    CS for CS for SB 2984

    By the Committees on Comprehensive Planning; Regulated
    Industries; and Senator Atwater




    316-2623-04

  1                      A bill to be entitled

  2         An act relating to homeowners' associations;

  3         amending s. 720.301, F.S.; defining the terms

  4         "department," "division," and "member";

  5         amending s. 720.302, F.S.; prescribing a

  6         legislative purpose of providing alternative

  7         dispute resolution procedures for disputes

  8         involving elections and recalls; providing acts

  9         that constitute crimes; providing penalties;

10         amending s. 720.303, F.S.; prescribing the

11         right of an association to enforce deed

12         restrictions; prescribing rights of members and

13         parcel owners to attend and address association

14         board meetings and to have items placed on an

15         agenda; prescribing additional requirements for

16         notice of meetings; providing for additional

17         materials to be maintained as records;

18         providing additional requirements and

19         limitations with respect to inspecting and

20         copying records; providing requirements with

21         respect to financial statements; providing

22         procedures for recall of directors; amending s.

23         720.304, F.S.; prescribing owners' rights with

24         respect to flag display; prohibiting certain

25         lawsuits against parcel owners; providing

26         penalties; allowing a parcel owner to construct

27         a ramp for a parcel resident who has a medical

28         need for a ramp; providing conditions; allowing

29         the display of a security-services sign;

30         amending s. 720.305, F.S.; providing that a

31         fine by an association cannot become a lien

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 1         against a parcel; providing for attorney's fees

 2         in actions to recover fines; creating s.

 3         720.3055, F.S.; prescribing requirements for

 4         contracts for products and services; amending

 5         s. 720.306, F.S.; providing for notice of and

 6         right to speak at member meetings; requiring

 7         election disputes between a member and an

 8         association to be submitted to mandatory

 9         binding arbitration; amending s. 720.311, F.S.;

10         expanding requirements and guidelines with

11         respect to alternative dispute resolution;

12         providing requirements for mediation and

13         arbitration; providing for training and

14         education programs; transferring, renumbering,

15         and amending s. 689.26, F.S.; modifying the

16         disclosure form that a prospective purchaser

17         must receive before a contract for sale;

18         providing that certain contracts are voidable

19         for a specified period; requiring that a

20         purchaser provide written notice of

21         cancellation; transferring and renumbering s.

22         689.265, F.S., relating to required financial

23         reports of certain residential subdivision

24         developers; amending s. 498.025, F.S., relating

25         to the disposition of subdivided lands;

26         conforming cross-references; creating s.

27         720.402, F.S.; providing remedies for

28         publication of false and misleading

29         information; amending s. 34.01, F.S.; providing

30         jurisdiction of disputes involving homeowners'

31         associations; amending ss. 316.00825, 558.002,

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 1         F.S.; conforming cross-references; providing

 2         for internal organization of ch. 720, F.S.;

 3         providing an effective date.

 4  

 5  Be It Enacted by the Legislature of the State of Florida:

 6  

 7         Section 1.  Section 720.301, Florida Statutes, is

 8  amended to read:

 9         720.301  Definitions.--As used in ss. 720.301-720.501

10  ss. 720.301-720.312, the term:

11         (1)  "Assessment" or "amenity fee" means a sum or sums

12  of money payable to the association, to the developer or other

13  owner of common areas, or to recreational facilities and other

14  properties serving the parcels by the owners of one or more

15  parcels as authorized in the governing documents, which if not

16  paid by the owner of a parcel, can result in a lien against

17  the parcel.

18         (2)  "Common area" means all real property within a

19  community which is owned or leased by an association or

20  dedicated for use or maintenance by the association or its

21  members, including, regardless of whether title has been

22  conveyed to the association:

23         (a)  Real property the use of which is dedicated to the

24  association or its members by a recorded plat; or

25         (b)  Real property committed by a declaration of

26  covenants to be leased or conveyed to the association.

27         (3)  "Community" means the real property that is or

28  will be subject to a declaration of covenants which is

29  recorded in the county where the property is located.  The

30  term "community" includes all real property, including

31  undeveloped phases, that is or was the subject of a

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 1  development-of-regional-impact development order, together

 2  with any approved modification thereto.

 3         (4)  "Declaration of covenants," or "declaration,"

 4  means a recorded written instrument in the nature of covenants

 5  running with the land which subjects the land comprising the

 6  community to the jurisdiction and control of an association or

 7  associations in which the owners of the parcels, or their

 8  association representatives, must be members.

 9         (5)  "Department" means the Department of Business and

10  Professional Regulation.

11         (6)(5)  "Developer" means a person or entity that:

12         (a)  Creates the community served by the association;

13  or

14         (b)  Succeeds to the rights and liabilities of the

15  person or entity that created the community served by the

16  association, provided that such is evidenced in writing.

17         (7)  "Division" means the Division of Florida Land

18  Sales, Condominiums, and Mobile Homes in the Department of

19  Business and Professional Regulation.

20         (8)(6)  "Governing documents" means:

21         (a)  The recorded declaration of covenants for a

22  community, and all duly adopted and recorded amendments,

23  supplements, and recorded exhibits thereto; and

24         (b)  The articles of incorporation and bylaws of the

25  homeowners' association, and any duly adopted amendments

26  thereto.

27         (9)(7)  "Homeowners' association" or "association"

28  means a Florida corporation responsible for the operation of a

29  community or a mobile home subdivision in which the voting

30  membership is made up of parcel owners or their agents, or a

31  combination thereof, and in which membership is a mandatory

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 1  condition of parcel ownership, and which is authorized to

 2  impose assessments that, if unpaid, may become a lien on the

 3  parcel.  The term "homeowners' association" does not include a

 4  community development district or other similar special taxing

 5  district created pursuant to statute.

 6         (10)(8)  "Member" means a member of an association, and

 7  may include, but is not limited to, a parcel owner or an

 8  association representing parcel owners or a combination

 9  thereof, and shall include any person or entity obligated by

10  the governing documents to pay an assessment or amenity fee.

11         (11)(9)  "Parcel" means a platted or unplatted lot,

12  tract, unit, or other subdivision of real property within a

13  community, as described in the declaration:

14         (a)  Which is capable of separate conveyance; and

15         (b)  Of which the parcel owner, or an association in

16  which the parcel owner must be a member, is obligated:

17         1.  By the governing documents to be a member of an

18  association that serves the community; and

19         2.  To pay to the homeowners' association assessments

20  that, if not paid, may result in a lien.

21         (12)(10)  "Parcel owner" means the record owner of

22  legal title to a parcel.

23         (13)(11)  "Voting interest" means the voting rights

24  distributed to the members of the homeowners' association,

25  pursuant to the governing documents.

26         Section 2.  Subsection (2) of section 720.302, Florida

27  Statutes, is amended to read:

28         720.302  Purposes, scope, and application.--

29         (2)  The Legislature recognizes that it is not in the

30  best interest of homeowners' associations or the individual

31  association members thereof to create or impose a bureau or

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 1  other agency of state government to regulate the affairs of

 2  homeowners' associations. However, in accordance with s.

 3  720.311, the Legislature finds that homeowners' associations

 4  and their individual members will benefit from an expedited

 5  alternative process for resolution of election and recall

 6  disputes and presuit mediation of other disputes involving

 7  covenant enforcement and authorizes the department to hear,

 8  administer, and determine these disputes as more fully set

 9  forth in this chapter. Further, the Legislature recognizes

10  that certain contract rights have been created for the benefit

11  of homeowners' associations and members thereof before the

12  effective date of this act and that ss. 720.301-720.501 ss.

13  720.301-720.312 are not intended to impair such contract

14  rights, including, but not limited to, the rights of the

15  developer to complete the community as initially contemplated.

16         Section 3.  Section 720.303, Florida Statutes, is

17  amended to read:

18         720.303  Association powers and duties; meetings of

19  board; official records; budgets; financial reporting;

20  association funds; recalls.--

21         (1)  POWERS AND DUTIES.--An association which operates

22  a community as defined in s. 720.301, must be operated by an

23  association that is a Florida corporation. After October 1,

24  1995, the association must be incorporated and the initial

25  governing documents must be recorded in the official records

26  of the county in which the community is located. An

27  association may operate more than one community. The officers

28  and directors of an association have a fiduciary relationship

29  to the members who are served by the association. The powers

30  and duties of an association include those set forth in this

31  chapter and, except as expressly limited or restricted in this

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 1  chapter, those set forth in the governing documents. After

 2  control of the association is obtained by members unit owners

 3  other than the developer, the association may institute,

 4  maintain, settle, or appeal actions or hearings in its name on

 5  behalf of all members concerning matters of common interest to

 6  the members, including, but not limited to, the common areas;

 7  roof or structural components of a building, or other

 8  improvements for which the association is responsible;

 9  mechanical, electrical, or plumbing elements serving an

10  improvement or building for which the association is

11  responsible; representations of the developer pertaining to

12  any existing or proposed commonly used facility; and

13  protesting ad valorem taxes on commonly used facilities. The

14  association may defend actions in eminent domain or bring

15  inverse condemnation actions. Before commencing litigation

16  against any party in the name of the association involving

17  amounts in controversy in excess of $100,000, the association

18  must obtain the affirmative approval of a majority of the

19  voting interests at a meeting of the membership at which a

20  quorum has been attained. This subsection does not limit any

21  statutory or common-law right of any individual member or

22  class of members to bring any action without participation by

23  the association. A member does not have authority to act for

24  the association by virtue of being a member. An association

25  may have more than one class of members and may issue

26  membership certificates. An association of 15 or fewer parcel

27  owners may enforce only the requirements of those deed

28  restrictions established prior to the purchase of each parcel

29  upon an affected parcel owner or owners.

30         (2)  BOARD MEETINGS.--

31  

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 1         (a)  A meeting of the board of directors of an

 2  association occurs whenever a quorum of the board gathers to

 3  conduct association business.  All meetings of the board must

 4  be open to all members except for meetings between the board

 5  and its attorney with respect to proposed or pending

 6  litigation where the contents of the discussion would

 7  otherwise be governed by the attorney-client privilege.

 8         (b)  Members have the right to attend all meetings of

 9  the board and to speak on any matter placed on the agenda by

10  petition of the voting interests for at least 3 minutes. The

11  association may adopt written reasonable rules expanding the

12  right of members to speak and governing the frequency,

13  duration, and other manner of member statements, which rules

14  must be consistent with this paragraph and may include a

15  sign-up sheet for members wishing to speak. Notwithstanding

16  any other law, the requirement that board meetings and

17  committee meetings be open to the members is inapplicable to

18  meetings between the board or a committee and the

19  association's attorney, with respect to meetings of the board

20  held for the purpose of discussing personnel matters.

21         (c)  The bylaws shall provide for giving notice to

22  parcel owners and members of all board meetings and, if they

23  do not do so, shall be deemed to provide the following:

24         1.  Notices of all board meetings must be posted in a

25  conspicuous place in the community at least 48 hours in

26  advance of a meeting, except in an emergency.  In the

27  alternative, if notice is not posted in a conspicuous place in

28  the community, notice of each board meeting must be mailed or

29  delivered to each member at least 7 days before the meeting,

30  except in an emergency. Notwithstanding this general notice

31  requirement, for communities with more than 100 members, the

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 1  bylaws may provide for a reasonable alternative to posting or

 2  mailing of notice for each board meeting, including

 3  publication of notice, provision of a schedule of board

 4  meetings, or the conspicuous posting and repeated broadcasting

 5  of the notice on a closed-circuit cable television system

 6  serving the homeowners' association. However, if broadcast

 7  notice is used in lieu of a notice posted physically in the

 8  community, the notice must be broadcast at least four times

 9  every broadcast hour of each day that a posted notice is

10  otherwise required. When broadcast notice is provided, the

11  notice and agenda must be broadcast in a manner and for a

12  sufficient continuous length of time so as to allow an average

13  reader to observe the notice and read and comprehend the

14  entire content of the notice and the agenda. The bylaws or

15  amended bylaws may provide for giving notice by electronic

16  transmission in a manner authorized by law for meetings of the

17  board of directors, committee meetings requiring notice under

18  this section, and annual and special meetings of the members;

19  however, a member must consent in writing to receiving notice

20  by electronic transmission.

21         2.  An assessment may not be levied at a board meeting

22  unless the notice of the meeting includes a statement that

23  assessments will be considered and the nature of the

24  assessments. Written notice of any meeting at which special

25  assessments will be considered or at which amendments to rules

26  regarding parcel use will be considered must be mailed,

27  delivered, or electronically transmitted to the members and

28  parcel owners and posted conspicuously on the property or

29  broadcast on closed-circuit cable television not less than 14

30  days before the meeting.

31  

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 1         3.  Directors may not vote by proxy or by secret ballot

 2  at board meetings, except that secret ballots may be used in

 3  the election of officers.  This subsection also applies to the

 4  meetings of any committee or other similar body, when a final

 5  decision will be made regarding the expenditure of association

 6  funds, and to any body vested with the power to approve or

 7  disapprove architectural decisions with respect to a specific

 8  parcel of residential property owned by a member of the

 9  community.

10         (d)  If 20 percent of the total voting interests

11  petition the board to address an item of business, the board

12  shall at its next regular board meeting or at a special

13  meeting of the board, but not later than 60 days after the

14  receipt of the petition, take the petitioned item up on an

15  agenda. The board shall give all members notice of the meeting

16  at which the petitioned item shall be addressed in accordance

17  with the 14-day notice requirement pursuant to subparagraph 2.

18  Each member shall have the right to speak for at least 3

19  minutes on each matter placed on the agenda by petition,

20  provided that the member signs the sign-up sheet, if one is

21  provided, or submits a written request to speak prior to the

22  meeting. Other than addressing the petitioned item at the

23  meeting, the board is not obligated to take any other action

24  requested by the petition.

25         (3)  MINUTES.--Minutes of all meetings of the members

26  of an association and of the board of directors of an

27  association must be maintained in written form or in another

28  form that can be converted into written form within a

29  reasonable time.  A vote or abstention from voting on each

30  matter voted upon for each director present at a board meeting

31  must be recorded in the minutes.

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 1         (4)  OFFICIAL RECORDS.--The association shall maintain

 2  each of the following items, when applicable, which constitute

 3  the official records of the association:

 4         (a)  Copies of any plans, specifications, permits, and

 5  warranties related to improvements constructed on the common

 6  areas or other property that the association is obligated to

 7  maintain, repair, or replace.

 8         (b)  A copy of the bylaws of the association and of

 9  each amendment to the bylaws.

10         (c)  A copy of the articles of incorporation of the

11  association and of each amendment thereto.

12         (d)  A copy of the declaration of covenants and a copy

13  of each amendment thereto.

14         (e)  A copy of the current rules of the homeowners'

15  association.

16         (f)  The minutes of all meetings of the board of

17  directors and of the members, which minutes must be retained

18  for at least 7 years.

19         (g)  A current roster of all members and their mailing

20  addresses and parcel identifications. The association shall

21  also maintain the electronic mailing addresses and the numbers

22  designated by members for receiving notice sent by electronic

23  transmission of those members consenting to receive notice by

24  electronic transmission. The electronic mailing addresses and

25  numbers provided by unit owners to receive notice by

26  electronic transmission shall be removed from association

27  records when consent to receive notice by electronic

28  transmission is revoked. However, the association is not

29  liable for an erroneous disclosure of the electronic mail

30  address or the number for receiving electronic transmission of

31  notices.

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 1         (h)  All of the association's insurance policies or a

 2  copy thereof, which policies must be retained for at least 7

 3  years.

 4         (i)  A current copy of all contracts to which the

 5  association is a party, including, without limitation, any

 6  management agreement, lease, or other contract under which the

 7  association has any obligation or responsibility.  Bids

 8  received by the association for work to be performed must also

 9  be considered official records and must be kept for a period

10  of 1 year.

11         (j)  The financial and accounting records of the

12  association, kept according to good accounting practices.  All

13  financial and accounting records must be maintained for a

14  period of at least 7 years.  The financial and accounting

15  records must include:

16         1.  Accurate, itemized, and detailed records of all

17  receipts and expenditures.

18         2.  A current account and a periodic statement of the

19  account for each member, designating the name and current

20  address of each member who is obligated to pay assessments,

21  the due date and amount of each assessment or other charge

22  against the member, the date and amount of each payment on the

23  account, and the balance due.

24         3.  All tax returns, financial statements, and

25  financial reports of the association.

26         4.  Any other records that identify, measure, record,

27  or communicate financial information.

28         (k)  A copy of the disclosure summary described in s.

29  720.401(2).

30  

31  

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 1         (l)  All other written records of the association not

 2  specifically included in the foregoing which are related to

 3  the operation of the association.

 4         (5)  INSPECTION AND COPYING OF RECORDS.--The official

 5  records shall be maintained within the state and must be open

 6  to inspection and available for photocopying by members or

 7  their authorized agents at reasonable times and places within

 8  10 business days after receipt of a written request for

 9  access. This subsection may be complied with by having a copy

10  of the official records available for inspection or copying in

11  the community. If the association has a photocopy machine

12  available where the records are maintained, it must provide

13  parcel owners with copies on request during the inspection if

14  the entire request is limited to no more than 25 pages.

15         (a)  The failure of an association to provide access to

16  the records within 10 business days after receipt of a written

17  request creates a rebuttable presumption that the association

18  willfully failed to comply with this subsection.

19         (b)  A member who is denied access to official records

20  is entitled to the actual damages or minimum damages for the

21  association's willful failure to comply with this subsection.

22  The minimum damages are to be $50 per calendar day up to 10

23  days, the calculation to begin on the 11th business day after

24  receipt of the written request.

25         (c)  The association may adopt reasonable written rules

26  governing the frequency, time, location, notice, records to be

27  inspected, and manner of inspections, but may not impose a

28  requirement that a parcel owner demonstrate any proper purpose

29  for the inspection, state any reason for the inspection, or

30  limit a parcel owner's right to inspect records to less than

31  one 8-hour business day per month. The association and may

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 1  impose fees to cover the costs of providing copies of the

 2  official records, including, without limitation, the costs of

 3  copying. The association may charge up to 50 cents per page

 4  for copies made on the association's photocopier. If the

 5  association does not have a photocopy machine available where

 6  the records are kept, or if the records requested to be copied

 7  exceed 25 pages in length, the association may have copies

 8  made by an outside vendor and may charge the actual cost of

 9  copying. The association shall maintain an adequate number of

10  copies of the recorded governing documents, to ensure their

11  availability to members and prospective members, and may

12  charge only its actual costs for reproducing and furnishing

13  these documents to those persons who are entitled to receive

14  them. Notwithstanding the provisions of this paragraph, the

15  following records shall not be accessible to members or parcel

16  owners:

17         1.  Any record protected by the lawyer-client privilege

18  as described in s. 90.502 and any record protected by the

19  work-product privilege, including, but not limited to, any

20  record prepared by an association attorney or prepared at the

21  attorney's express direction which reflects a mental

22  impression, conclusion, litigation strategy, or legal theory

23  of the attorney or the association and was prepared

24  exclusively for civil or criminal litigation or for

25  adversarial administrative proceedings or which was prepared

26  in anticipation of imminent civil or criminal litigation or

27  imminent adversarial administrative proceedings until the

28  conclusion of the litigation or adversarial administrative

29  proceedings.

30  

31  

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 1         2.  Information obtained by an association in

 2  connection with the approval of the lease, sale, or other

 3  transfer of a parcel.

 4         3.  Disciplinary, health, insurance, and personnel

 5  records of the association's employees.

 6         4.  Medical records of parcel owners or community

 7  residents.

 8         (6)  BUDGETS.--The association shall prepare an annual

 9  budget. The budget must reflect the estimated revenues and

10  expenses for that year and the estimated surplus or deficit as

11  of the end of the current year.  The budget must set out

12  separately all fees or charges for recreational amenities,

13  whether owned by the association, the developer, or another

14  person.  The association shall provide each member with a copy

15  of the annual budget or a written notice that a copy of the

16  budget is available upon request at no charge to the member.

17  The copy must be provided to the member within the time limits

18  set forth in subsection (5).

19         (7)  FINANCIAL REPORTING.--The association shall

20  prepare an annual financial report within 60 days after the

21  close of the fiscal year. The association shall, within the

22  time limits set forth in subsection (5), provide each member

23  with a copy of the annual financial report or a written notice

24  that a copy of the financial report is available upon request

25  at no charge to the member. Financial reports shall be

26  prepared as follows The financial report must consist of

27  either:

28         (a)  An association that meets the criteria of this

29  paragraph shall prepare or cause to be prepared a complete set

30  of financial statements in accordance with generally accepted

31  

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 1  accounting principles. The financial statements shall be based

 2  upon the association's total annual revenues, as follows:

 3         1.  An association with total annual revenues of

 4  $100,000 or more, but less than $200,000, shall prepare

 5  compiled financial statements.

 6         2.  An association with total annual revenues of at

 7  least $200,000, but less than $400,000, shall prepare reviewed

 8  financial statements.

 9         3.  An association with total annual revenues of

10  $400,000 or more shall prepare audited financial statements.

11  Financial statements presented in conformity with generally

12  accepted accounting principles; or

13         (b)  A financial report of actual receipts and

14  expenditures, cash basis, which report must show:

15         1.  An association with total annual revenues of less

16  than $100,000 shall prepare a report of cash receipts and

17  expenditures. The amount of receipts and expenditures by

18  classification; and

19         2.  An association in a community of fewer than 50

20  parcels, regardless of the association's annual revenues, may

21  prepare a report of cash receipts and expenditures in lieu of

22  financial statements required by paragraph (a) unless the

23  governing documents provide otherwise. The beginning and

24  ending cash balances of the association.

25         3.  A report of cash receipts and disbursement must

26  disclose the amount of receipts by accounts and receipt

27  classifications and the amount of expenses by accounts and

28  expense classifications, including, but not limited to, the

29  following, as applicable: costs for security, professional,

30  and management fees and expenses; taxes; costs for recreation

31  facilities; expenses for refuse collection and utility

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 1  services; expenses for lawn care; costs for building

 2  maintenance and repair; insurance costs; administration and

 3  salary expenses; and reserves if maintained by the

 4  association.

 5         (c)  If 20 percent of the parcel owners petition the

 6  board for a level of financial reporting higher than that

 7  required by this section, the association shall duly notice

 8  and hold a meeting of members within 30 days of receipt of the

 9  petition for the purpose of voting on raising the level of

10  reporting for that fiscal year. Upon approval of a majority of

11  the total voting interests of the parcel owners, the

12  association shall prepare or cause to be prepared, shall amend

13  the budget or adopt a special assessment to pay for the

14  financial report regardless of any provision to the contrary

15  in the governing documents, and shall provide within 90 days

16  of the meeting or the end of the fiscal year, whichever occurs

17  later:

18         1.  Compiled, reviewed, or audited financial

19  statements, if the association is otherwise required to

20  prepare a report of cash receipts and expenditures;

21         2.  Reviewed or audited financial statements, if the

22  association is otherwise required to prepare compiled

23  financial statements; or

24         3.  Audited financial statements if the association is

25  otherwise required to prepare reviewed financial statements.

26         (d)  If approved by a majority of the voting interests

27  present at a properly called meeting of the association, an

28  association may prepare or cause to be prepared:

29         1.  A report of cash receipts and expenditures in lieu

30  of a compiled, reviewed, or audited financial statement;

31  

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 1         2.  A report of cash receipts and expenditures or a

 2  compiled financial statement in lieu of a reviewed or audited

 3  financial statement; or

 4         3.  A report of cash receipts and expenditures, a

 5  compiled financial statement, or a reviewed financial

 6  statement in lieu of an audited financial statement.

 7         (8)  ASSOCIATION FUNDS; COMMINGLING.--

 8         (a)  All association funds held by a developer shall be

 9  maintained separately in the association's name. Reserve and

10  operating funds of the association shall not be commingled

11  prior to turnover except the association may jointly invest

12  reserve funds; however, such jointly invested funds must be

13  accounted for separately.

14         (b)  No developer in control of a homeowners'

15  association shall commingle any association funds with his or

16  her funds or with the funds of any other homeowners'

17  association or community association.

18         (c)  Association funds may not be used by a developer

19  to defend a civil or criminal action, administrative

20  proceeding, or arbitration proceeding that has been filed

21  against the developer or directors appointed to the

22  association board by the developer, even when the subject of

23  the action or proceeding concerns the operation of the

24  developer-controlled association.

25         (9)  APPLICABILITY.--Sections 617.1601-617.1604 do not

26  apply to a homeowners' association in which the members have

27  the inspection and copying rights set forth in this section.

28         (10)  RECALL OF DIRECTORS.--

29         (a)1.  Regardless of any provision to the contrary

30  contained in the governing documents, subject to the

31  provisions of s. 720.307 regarding transition of association

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 1  control, any member of the board or directors may be recalled

 2  and removed from office with or without cause by a majority of

 3  the total voting interests.

 4         2.  When the governing documents, including the

 5  declaration, articles of incorporation, or bylaws, provide

 6  that only a specific class of members is entitled to elect a

 7  board director or directors, only that class of members may

 8  vote to recall those board directors so elected.

 9         (b)1.  Board directors may be recalled by an agreement

10  in writing or by written ballot without a membership meeting.

11  The agreement in writing or the written ballots, or a copy

12  thereof, shall be served on the association by certified mail

13  or by personal service in the manner authorized by chapter 48

14  and the Florida Rules of Civil Procedure.

15         2.  The board shall duly notice and hold a meeting of

16  the board within 5 full business days after receipt of the

17  agreement in writing or written ballots. At the meeting, the

18  board shall either certify the written ballots or written

19  agreement to recall a director or directors of the board, in

20  which case such director or directors shall be recalled

21  effective immediately and shall turn over to the board within

22  5 full business days any and all records and property of the

23  association in their possession, or proceed as described in

24  paragraph (d).

25         3.  When it is determined by the department pursuant to

26  binding arbitration proceedings that an initial recall effort

27  was defective, written recall agreements or written ballots

28  used in the first recall effort and not found to be defective

29  may be reused in one subsequent recall effort. However, in no

30  event is a written agreement or written ballot valid for more

31  than 120 days after it has been signed by the member.

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 1         4.  Any rescission or revocation of a member's written

 2  recall ballot or agreement must be in writing and, in order to

 3  be effective, must be delivered to the association before the

 4  association is served with the written recall agreements or

 5  ballots.

 6         5.  The agreement in writing or ballot shall list at

 7  least as many possible replacement directors as there are

 8  directors subject to the recall, when at least a majority of

 9  the board is sought to be recalled; the person executing the

10  recall instrument may vote for as many replacement candidates

11  as there are directors subject to the recall.

12         (c)1.  If the declaration, articles of incorporation,

13  or bylaws specifically provide, the members may also recall

14  and remove a board director or directors by a vote taken at a

15  meeting. If so provided in the governing documents, a special

16  meeting of the members to recall a director or directors of

17  the board of administration may be called by 10 percent of the

18  voting interests giving notice of the meeting as required for

19  a meeting of members, and the notice shall state the purpose

20  of the meeting. Electronic transmission may not be used as a

21  method of giving notice of a meeting called in whole or in

22  part for this purpose.

23         2.  The board shall duly notice and hold a board

24  meeting within 5 full business days after the adjournment of

25  the member meeting to recall one or more directors. At the

26  meeting, the board shall certify the recall, in which case

27  such member or members shall be recalled effective immediately

28  and shall turn over to the board within 5 full business days

29  any and all records and property of the association in their

30  possession, or shall proceed as set forth in subparagraph (d).

31  

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 1         (d)  If the board determines not to certify the written

 2  agreement or written ballots to recall a director or directors

 3  of the board or does not certify the recall by a vote at a

 4  meeting, the board shall, within 5 full business days after

 5  the meeting, file with the department a petition for binding

 6  arbitration pursuant to the applicable procedures in ss.

 7  718.1255 and 718.112(2)(j) and the rules adopted thereunder.

 8  For the purposes of this section, the members who voted at the

 9  meeting or who executed the agreement in writing shall

10  constitute one party under the petition for arbitration. If

11  the arbitrator certifies the recall as to any director or

12  directors of the board, the recall will be effective upon

13  mailing of the final order of arbitration to the association.

14  The director or directors so recalled shall deliver to the

15  board any and all records of the association in their

16  possession within 5 full business days after the effective

17  date of the recall.

18         (e)  If a vacancy occurs on the board as a result of a

19  recall and less than a majority of the board directors are

20  removed, the vacancy may be filled by the affirmative vote of

21  a majority of the remaining directors, notwithstanding any

22  provision to the contrary contained in this subsection or in

23  the association documents. If vacancies occur on the board as

24  a result of a recall and a majority or more of the board

25  directors are removed, the vacancies shall be filled by

26  members voting in favor of the recall; if removal is at a

27  meeting, any vacancies shall be filled by the members at the

28  meeting. If the recall occurred by agreement in writing or by

29  written ballot, members may vote for replacement directors in

30  the same instrument in accordance with procedural rules

31  

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 1  adopted by the division, which rules need not be consistent

 2  with this subsection.

 3         (f)  If the board fails to duly notice and hold a board

 4  meeting within 5 full business days after service of an

 5  agreement in writing or within 5 full business days after the

 6  adjournment of the member recall meeting, the recall shall be

 7  deemed effective and the board directors so recalled shall

 8  immediately turn over to the board all records and property of

 9  the association.

10         (g)  If a director who is removed fails to relinquish

11  his or her office or turn over records as required under this

12  section, the circuit court in the county where the association

13  maintains its principal office may, upon the petition of the

14  association, summarily order the director to relinquish his or

15  her office and turn over all association records upon

16  application of the association.

17         (h)  The minutes of the board meeting at which the

18  board decides whether to certify the recall are an official

19  association record. The minutes must record the date and time

20  of the meeting, the decision of the board, and the vote count

21  taken on each board member subject to the recall. In addition,

22  when the board decides not to certify the recall, as to each

23  vote rejected, the minutes must identify the parcel number and

24  the specific reason for each such rejection.

25         (i)  When the recall of more than one board director is

26  sought, the written agreement, ballot, or vote at a meeting

27  shall provide for a separate vote for each board director

28  sought to be recalled.

29         Section 4.  Section 720.304, Florida Statutes, is

30  amended to read:

31  

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 1         720.304  Right of owners to peaceably assemble; display

 2  of flag; SLAPP suits prohibited.--

 3         (1)  All common areas and recreational facilities

 4  serving any homeowners' association shall be available to

 5  parcel owners in the homeowners' association served thereby

 6  and their invited guests for the use intended for such common

 7  areas and recreational facilities.  The entity or entities

 8  responsible for the operation of the common areas and

 9  recreational facilities may adopt reasonable rules and

10  regulations pertaining to the use of such common areas and

11  recreational facilities.  No entity or entities shall

12  unreasonably restrict any parcel owner's right to peaceably

13  assemble or right to invite public officers or candidates for

14  public office to appear and speak in common areas and

15  recreational facilities.

16         (2)  Any homeowner may display one portable, removable

17  United States flag or official flag of the State of Florida in

18  a respectful manner, and on Armed Forces Day, Memorial Day,

19  Flag Day, Independence Day, and Veterans Day may display in a

20  respectful manner portable, removable official flags, not

21  larger than 4 1/2 feet by 6 feet, which represents the United

22  States Army, Navy, Air Force, Marine Corps, or Coast Guard,

23  regardless of any declaration rules or requirements dealing

24  with flags or decorations.

25         (3)  Any owner prevented from exercising rights

26  guaranteed by subsection (1) or subsection (2) may bring an

27  action in the appropriate court of the county in which the

28  alleged infringement occurred, and, upon favorable

29  adjudication, the court shall enjoin the enforcement of any

30  provision contained in any homeowners' association document or

31  rule that operates to deprive the owner of such rights.

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 1         (4)  It is the intent of the Legislature to protect the

 2  right of parcel owners to exercise their rights to instruct

 3  their representatives and petition for redress of grievances

 4  before the various governmental entities of this state as

 5  protected by the First Amendment to the United States

 6  Constitution and s. 5, Art. I of the State Constitution. The

 7  Legislature recognizes that "Strategic Lawsuits Against Public

 8  Participation" or "SLAPP" suits, as they are typically called,

 9  have occurred when members are sued by individuals, business

10  entities, or governmental entities arising out of a parcel

11  owner's appearance and presentation before a governmental

12  entity on matters related to the homeowners' association.

13  However, it is the public policy of this state that government

14  entities, business organizations, and individuals not engage

15  in SLAPP suits because such actions are inconsistent with the

16  right of parcel owners to participate in the state's

17  institutions of government. Therefore, the Legislature finds

18  and declares that prohibiting such lawsuits by governmental

19  entities, business entities, and individuals against parcel

20  owners who address matters concerning their homeowners'

21  association will preserve this fundamental state policy,

22  preserve the constitutional rights of parcel owners, and

23  assure the continuation of representative government in this

24  state. It is the intent of the Legislature that such lawsuits

25  be expeditiously disposed of by the courts.

26         (a)  As used in this subsection, the term "governmental

27  entity" means the state, including the executive, legislative,

28  and judicial branches of government, the independent

29  establishments of the state, counties, municipalities,

30  districts, authorities, boards, or commissions, or any

31  agencies of these branches which are subject to chapter 286.

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 1         (b)  A governmental entity, business organization, or

 2  individual in this state may not file or cause to be filed

 3  through its employees or agents any lawsuit, cause of action,

 4  claim, cross-claim, or counterclaim against a parcel owner

 5  without merit and solely because such parcel owner has

 6  exercised the right to instruct his or her representatives or

 7  the right to petition for redress of grievances before the

 8  various governmental entities of this state, as protected by

 9  the First Amendment to the United States Constitution and s.

10  5, Art. I of the State Constitution.

11         (c)  A parcel owner sued by a governmental entity,

12  business organization, or individual in violation of this

13  section has a right to an expeditious resolution of a claim

14  that the suit is in violation of this section. A parcel owner

15  may petition the court for an order dismissing the action or

16  granting final judgment in favor of that parcel owner. The

17  petitioner may file a motion for summary judgment, together

18  with supplemental affidavits, seeking a determination that the

19  governmental entity's, business organization's, or

20  individual's lawsuit has been brought in violation of this

21  section. The governmental entity, business organization, or

22  individual shall thereafter file its response and any

23  supplemental affidavits. As soon as practicable, the court

24  shall set a hearing on the petitioner's motion, which shall be

25  held at the earliest possible time after the filing of the

26  governmental entity's, business organization's or individual's

27  response. The court may award the parcel owner sued by the

28  governmental entity, business organization, or individual

29  actual damages arising from the governmental entity's,

30  individual's, or business organization's violation of this

31  section. A court may treble the damages awarded to a

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 1  prevailing parcel owner and shall state the basis for the

 2  treble damages award in its judgment. The court shall award

 3  the prevailing party reasonable attorney's fees and costs

 4  incurred in connection with a claim that an action was filed

 5  in violation of this section.

 6         (d)  Homeowners' associations may not expend

 7  association funds in prosecuting a SLAPP suit against a parcel

 8  owner.

 9         (5)(a)  Any parcel owner may construct an access ramp

10  if a resident or occupant of the parcel has a medical

11  necessity or disability that requires a ramp for egress and

12  ingress under the following conditions:

13         1.  The ramp must be as unobtrusive as possible, be

14  designed to blend in aesthetically as practicable, and be

15  reasonably sized to fit the intended use.

16         2.  Plans for the ramp must be submitted in advance to

17  the homeowners' association. The association may make

18  reasonable requests to modify the design to achieve

19  architectural consistency with surrounding structures and

20  surfaces.

21         (b)  The parcel owner must submit to the association an

22  affidavit from a physician attesting to the medical necessity

23  or disability of the resident or occupant of the parcel

24  requiring the access ramp. Certification used for s. 320.0848

25  shall be sufficient to meet the affidavit requirement.

26         (6)  Any parcel owner may display a sign of reasonable

27  size provided by a contractor for security services within 10

28  feet of any entrance to the home.

29         Section 5.  Subsection (2) of section 720.305, Florida

30  Statutes, is amended to read:

31  

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 1         720.305  Obligations of members; remedies at law or in

 2  equity; levy of fines and suspension of use rights; failure to

 3  fill sufficient number of vacancies on board of directors to

 4  constitute a quorum; appointment of receiver upon petition of

 5  any member.--

 6         (2)  If the governing documents so provide, an

 7  association may suspend, for a reasonable period of time, the

 8  rights of a member or a member's tenants, guests, or invitees,

 9  or both, to use common areas and facilities and may levy

10  reasonable fines, not to exceed $100 per violation, against

11  any member or any tenant, guest, or invitee. A fine may be

12  levied on the basis of each day of a continuing violation,

13  with a single notice and opportunity for hearing, except that

14  no such fine shall exceed $1,000 in the aggregate unless

15  otherwise provided in the governing documents. A fine shall

16  not become a lien against a parcel. In any action to recover a

17  fine, the prevailing party is entitled to collect its

18  reasonable attorney's fees and costs from the nonprevailing

19  party as determined by the court.

20         (a)  A fine or suspension may not be imposed without

21  notice of at least 14 days to the person sought to be fined or

22  suspended and an opportunity for a hearing before a committee

23  of at least three members appointed by the board who are not

24  officers, directors, or employees of the association, or the

25  spouse, parent, child, brother, or sister of an officer,

26  director, or employee.  If the committee, by majority vote,

27  does not approve a proposed fine or suspension, it may not be

28  imposed.

29         (b)  The requirements of this subsection do not apply

30  to the imposition of suspensions or fines upon any member

31  because of the failure of the member to pay assessments or

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 1  other charges when due if such action is authorized by the

 2  governing documents.

 3         (c)  Suspension of common-area-use rights shall not

 4  impair the right of an owner or tenant of a parcel to have

 5  vehicular and pedestrian ingress to and egress from the

 6  parcel, including, but not limited to, the right to park.

 7         Section 6.  Section 720.3055, Florida Statutes, is

 8  created to read:

 9         720.3055  Contracts for products and services; in

10  writing; bids; exceptions.--

11         (1)  All contracts as further described in this section

12  or any contract that is not to be fully performed within 1

13  year after the making thereof for the purchase, lease, or

14  renting of materials or equipment to be used by the

15  association in accomplishing its purposes under this chapter

16  or the governing documents, and all contracts for the

17  provision of services, shall be in writing. If a contract for

18  the purchase, lease, or renting of materials or equipment, or

19  for the provision of services, requires payment by the

20  association that exceeds 10 percent of the total annual budget

21  of the association, including reserves, the association must

22  obtain competitive bids for the materials, equipment, or

23  services. Nothing contained in this section shall be construed

24  to require the association to accept the lowest bid.

25         (2)(a)1.  Notwithstanding the foregoing, contracts with

26  employees of the association, and contracts for attorney,

27  accountant, architect, community association manager,

28  engineering, and landscape architect services are not subject

29  to the provisions of this section.

30         2.  A contract executed before October 1, 2004, and any

31  renewal thereof, is not subject to the competitive bid

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 1  requirements of this section. If a contract was awarded under

 2  the competitive bid procedures of this section, any renewal of

 3  that contract is not subject to such competitive bid

 4  requirements if the contract contains a provision that allows

 5  the board to cancel the contract on 30 days' notice.

 6  Materials, equipment, or services provided to an association

 7  under a local government franchise agreement by a franchise

 8  holder are not subject to the competitive bid requirements of

 9  this section. A contract with a manager, if made by a

10  competitive bid, may be made for up to 3 years. An association

11  whose declaration or bylaws provide for competitive bidding

12  for services may operate under the provisions of that

13  declaration or bylaws in lieu of this section if those

14  provisions are not less stringent than the requirements of

15  this section.

16         (b)  Nothing contained in this section is intended to

17  limit the ability of an association to obtain needed products

18  and services in an emergency.

19         (c)  This section does not apply if the business entity

20  with which the association desires to enter into a contract is

21  the only source of supply within the county serving the

22  association.

23         (d)  Nothing contained in this section shall excuse a

24  party contracting to provide maintenance or management

25  services from compliance with s. 720.309.

26         Section 7.  Present subsections (5) through (8) of

27  section 720.306, Florida Statutes, are renumbered as

28  subsections (7) through (10), respectively, present subsection

29  (7) is amended, and new subsections (5) and (6) are added to

30  that section to read:

31  

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 1         720.306  Meetings of members; voting and election

 2  procedures; amendments.--

 3         (5)  NOTICE OF MEETINGS.--The bylaws shall provide for

 4  giving notice to members of all member meetings, and if they

 5  do not do so shall be deemed to provide the following: The

 6  association shall give all parcel owners and members actual

 7  notice of all membership meetings, which shall be mailed,

 8  delivered, or electronically transmitted to the members not

 9  less than 14 days prior to the meeting. Evidence of compliance

10  with this 14-day notice shall be made by an affidavit executed

11  by the person providing the notice and filed upon execution

12  among the official records of the association. In addition to

13  mailing, delivering, or electronically transmitting the notice

14  of any meeting, the association may, by reasonable rule, adopt

15  a procedure for conspicuously posting and repeatedly

16  broadcasting the notice and the agenda on a closed-circuit

17  cable television system serving the association. When

18  broadcast notice is provided, the notice and agenda must be

19  broadcast in a manner and for a sufficient continuous length

20  of time so as to allow an average reader to observe the notice

21  and read and comprehend the entire content of the notice and

22  the agenda.

23         (6)  RIGHT TO SPEAK.--Members and parcel owners have

24  the right to attend all membership meetings and to speak at

25  any meeting with reference to all items opened for discussion

26  or included on the agenda. Notwithstanding any provision to

27  the contrary in the governing documents or any rules adopted

28  by the board or by the membership, a member and a parcel owner

29  have the right to speak for at least 3 minutes on any item,

30  provided that the member or parcel owner submits a written

31  request to speak prior to the meeting. The association may

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 1  adopt written reasonable rules governing the frequency,

 2  duration, and other manner of member and parcel owner

 3  statements, which rules must be consistent with this

 4  paragraph.

 5         (9)(7)  ELECTIONS.--Elections of directors must be

 6  conducted in accordance with the procedures set forth in the

 7  governing documents of the association.  All members of the

 8  association shall be eligible to serve on the board of

 9  directors, and a member may nominate himself or herself as a

10  candidate for the board at a meeting where the election is to

11  be held.  Except as otherwise provided in the governing

12  documents, boards of directors must be elected by a plurality

13  of the votes cast by eligible voters. Any election dispute

14  between a member and an association must be submitted to

15  mandatory binding arbitration with the division. Such

16  proceedings shall be conducted in the manner provided by s.

17  718.1255 and the procedural rules adopted by the division.

18         Section 8.  Section 720.311, Florida Statutes, is

19  amended to read:

20         720.311  Dispute resolution.--

21         (1)  The Legislature finds that alternative dispute

22  resolution has made progress in reducing court dockets and

23  trials and in offering a more efficient, cost-effective option

24  to litigation. The filing of any petition for mediation or

25  arbitration provided for in this section shall toll the

26  applicable statute of limitations. Any recall dispute filed

27  with the department pursuant to s. 720.303(10) shall be

28  conducted by the department in accordance with the provisions

29  of ss. 718.1255 and 718.112(2)(j) and the rules adopted by the

30  division. In addition, the department shall conduct mandatory

31  binding arbitration of election disputes between a member and

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 1  an association pursuant to s. 718.1255 and rules adopted by

 2  the division. Neither election disputes nor recall disputes

 3  are eligible for mediation; these disputes shall be arbitrated

 4  by the department. At the conclusion of the proceeding, the

 5  department shall charge the parties a fee in an amount

 6  adequate to cover all costs and expenses incurred by the

 7  department in conducting the proceeding. Initially, the

 8  petitioner shall remit a filing fee of at least $200 to the

 9  department. The fees paid to the department shall become a

10  recoverable cost in the arbitration proceeding and the

11  prevailing party in an arbitration proceeding shall recover

12  its reasonable costs and attorney's fees in an amount found

13  reasonable by the arbitrator. The department shall adopt rules

14  to effectuate the purposes of this section.

15         (2)(a)  Disputes between an association and a parcel

16  owner regarding use of or changes to the parcel or the common

17  areas and other covenant enforcement disputes, disputes

18  regarding amendments to the association documents, disputes

19  regarding meetings of the board and committees appointed by

20  the board, membership meetings not including election

21  meetings, and access to the official records of the

22  association shall be filed with the department for mandatory

23  mediation before the dispute is filed in court. Mediation

24  proceedings must be conducted in accordance with the

25  applicable Florida Rules of Civil Procedure, and these

26  proceedings are privileged and confidential to the same extent

27  as court-ordered mediation. An arbitrator or judge may not

28  consider any information or evidence arising from the

29  mediation proceeding except in a proceeding to impose

30  sanctions for failure to attend a mediation session. Persons

31  who are not parties to the dispute may not attend the

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 1  mediation conference without the consent of all parties,

 2  except for counsel for the parties and a corporate

 3  representative designated by the association. When mediation

 4  is attended by a quorum of the board, such mediation is not a

 5  board meeting for purposes of notice and participation set

 6  forth in s. 720.303. The department shall conduct the

 7  proceedings through the use of department mediators or refer

 8  the disputes to private mediators who have been duly certified

 9  by the department as provided in paragraph (c). The parties

10  shall share the costs of mediation equally, including the fee

11  charged by the mediator, if any, unless the parties agree

12  otherwise. If a department mediator is used, the department

13  may charge such fee as is necessary to pay expenses of the

14  mediation, including, but not limited to, the salary and

15  benefits of the mediator and any travel expenses incurred. The

16  petitioner shall initially file with the department upon

17  filing the disputes, a filing fee of $200, which shall be used

18  to defray the costs of the mediation. At the conclusion of the

19  mediation, the department shall charge to the parties, to be

20  shared equally unless otherwise agreed by the parties, such

21  further fees as are necessary to fully reimburse the

22  department for all expenses incurred in the mediation.

23         (b)  If mediation as described in paragraph (a) is not

24  successful in resolving all issues between the parties, the

25  parties may file the unresolved dispute in a court of

26  competent jurisdiction or elect to enter into binding or

27  nonbinding arbitration pursuant to the procedures set forth in

28  s. 718.1255 and rules adopted by the division, with the

29  arbitration proceeding to be conducted by a department

30  arbitrator or by a private arbitrator certified by the

31  department. If all parties do not agree to arbitration

                                  33

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 1  proceedings following an unsuccessful mediation, any party may

 2  file the dispute in court. A final order resulting from

 3  nonbinding arbitration is final and enforceable in the courts

 4  if a complaint for trial de novo is not filed in a court of

 5  competent jurisdiction within 30 days after entry of the

 6  order.

 7         (c)  The department shall develop a certification and

 8  training program for private mediators and private arbitrators

 9  which shall emphasize experience and expertise in the area of

10  the operation of community associations. A mediator or

11  arbitrator shall be certified by the department only if he or

12  she has attended at least 20 hours of training in mediation or

13  arbitration, as appropriate, and only if the applicant has

14  mediated or arbitrated at least 10 disputes involving

15  community associations within 5 years prior to the date of the

16  application, or has mediated or arbitrated 10 disputes in any

17  area within 5 years prior to the date of application and has

18  completed 20 hours of training in community association

19  disputes. In order to be certified by the department, any

20  mediator must also be certified by the Florida Supreme Court.

21  The department may conduct the training and certification

22  program within the department or may contract with an outside

23  vendor to perform the training or certification. The expenses

24  of operating the training and certification and training

25  program shall be paid by the moneys and filing fees generated

26  by the arbitration of recall and election disputes and by the

27  mediation of those disputes referred to in this subsection and

28  by the training fees.

29         (d)  The mediation procedures provided by this

30  subsection may be used by a Florida corporation responsible

31  for the operation of a community in which the voting members

                                  34

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 1  are parcel owners or their representatives, in which

 2  membership in the corporation is not a mandatory condition of

 3  parcel ownership, or which is not authorized to impose an

 4  assessment that may become a lien on the parcel.

 5         (3)  The department shall develop an education program

 6  to assist homeowners, associations, board members, and

 7  managers in understanding and increasing awareness of the

 8  operation of homeowners' associations pursuant to chapter 720

 9  and in understanding the use of alternative dispute resolution

10  techniques in resolving disputes between parcel owners and

11  associations or between owners. Such education program may

12  include the development of pamphlets and other written

13  instructional guides, the holding of classes and meetings by

14  department employees or outside vendors, as the department

15  determines, and the creation and maintenance of a website

16  containing instructional materials. The expenses of operating

17  the education program shall be initially paid by the moneys

18  and filing fees generated by the arbitration of recall and

19  election disputes and by the mediation of those disputes

20  referred to in this subsection. At any time after the filing

21  in a court of competent jurisdiction of a complaint relating

22  to a dispute under ss. 720.301-720.312, the court may order

23  that the parties enter mediation or arbitration procedures.

24         Section 9.  Section 689.26, Florida Statutes, is

25  transferred, renumbered as section 720.401, Florida Statutes,

26  and amended to read:

27         720.401 689.26  Prospective purchasers subject to

28  association membership requirement; disclosure required;

29  covenants; assessments; contract cancellation voidability.--

30         (1)(a)  A prospective parcel owner in a community must

31  be presented a disclosure summary before executing the

                                  35

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 1  contract for sale.  The disclosure summary must be in a form

 2  substantially similar to the following form:

 3  

 4                        DISCLOSURE SUMMARY

 5                                FOR

 6                        (NAME OF COMMUNITY)

 7  

 8         1.  AS A PURCHASER OF PROPERTY IN THIS COMMUNITY, YOU

 9  WILL (WILL) (WILL NOT) BE OBLIGATED TO BE A MEMBER OF A

10  HOMEOWNERS' ASSOCIATION.

11         2.  THERE HAVE BEEN OR WILL BE RECORDED RESTRICTIVE

12  COVENANTS GOVERNING THE USE AND OCCUPANCY OF PROPERTIES IN

13  THIS COMMUNITY.

14         3.  YOU WILL (WILL) (WILL NOT) BE OBLIGATED TO PAY

15  ASSESSMENTS TO THE ASSOCIATION. ASSESSMENTS MAY BE SUBJECT TO

16  PERIODIC CHANGE. IF APPLICABLE, THE CURRENT AMOUNT IS $______

17  PER ______. YOU WILL ALSO BE OBLIGATED TO PAY ANY SPECIAL

18  ASSESSMENTS IMPOSED BY THE ASSOCIATION. SUCH SPECIAL

19  ASSESSMENTS MAY BE SUBJECT TO CHANGE. IF APPLICABLE, THE

20  CURRENT AMOUNT IS $______ PER ______.

21         4.  YOU MAY (WILL) (WILL NOT) BE OBLIGATED TO PAY

22  SPECIAL ASSESSMENTS TO THE RESPECTIVE MUNICIPALITY, COUNTY, OR

23  SPECIAL DISTRICT. ALL ASSESSMENTS ARE SUBJECT TO PERIODIC

24  CHANGE.

25         5.4.  YOUR FAILURE TO PAY SPECIAL ASSESSMENTS OR

26  ASSESSMENTS LEVIED BY A MANDATORY HOMEOWNERS' ASSOCIATION

27  COULD RESULT IN A LIEN ON YOUR PROPERTY.

28         6.5.  THERE MAY BE (IS) (IS NOT) AN OBLIGATION TO PAY

29  RENT OR LAND USE FEES FOR RECREATIONAL OR OTHER COMMONLY USED

30  FACILITIES AS AN OBLIGATION OF MEMBERSHIP IN THE HOMEOWNERS'

31  ASSOCIATION. IF APPLICABLE, THE CURRENT AMOUNT IS $______ PER

                                  36

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 1  ______. (If such obligation exists, then the amount of the

 2  current obligation shall be set forth.)

 3         7.6.  THE DEVELOPER MAY HAVE THE RIGHT TO AMEND THE

 4  RESTRICTIVE COVENANTS (CAN) (CANNOT) BE AMENDED WITHOUT THE

 5  APPROVAL OF THE ASSOCIATION MEMBERSHIP OR THE APPROVAL OF THE,

 6  IF NO MANDATORY ASSOCIATION EXISTS, PARCEL OWNERS.

 7         8.7.  THE STATEMENTS CONTAINED IN THIS DISCLOSURE FORM

 8  ARE ONLY SUMMARY IN NATURE, AND, AS A PROSPECTIVE PURCHASER,

 9  YOU SHOULD REFER TO THE COVENANTS AND THE ASSOCIATION

10  GOVERNING DOCUMENTS BEFORE PURCHASING PROPERTY.

11         9.8.  THESE DOCUMENTS ARE EITHER MATTERS OF PUBLIC

12  RECORD AND CAN BE OBTAINED FROM THE RECORD OFFICE IN THE

13  COUNTY WHERE THE PROPERTY IS LOCATED, OR ARE NOT RECORDED AND

14  CAN BE OBTAINED FROM THE DEVELOPER.

15  DATE:                                               PURCHASER:

16                                                      PURCHASER:

17  

18  The disclosure must be supplied by the developer, or by the

19  parcel owner if the sale is by an owner that is not the

20  developer.  Any contract or agreement for sale shall refer to

21  and incorporate the disclosure summary and shall include, in

22  prominent language, a statement that the potential buyer

23  should not execute the contract or agreement until they have

24  received and read the disclosure summary required by this

25  section.

26         (b)  Each contract entered into for the sale of

27  property governed by covenants subject to disclosure required

28  by this section must contain in conspicuous type a clause that

29  states:

30  

31  

                                  37

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 1         IF THE DISCLOSURE SUMMARY REQUIRED BY SECTION

 2         720.401 689.26, FLORIDA STATUTES, HAS NOT BEEN

 3         PROVIDED TO THE PROSPECTIVE PURCHASER BEFORE

 4         EXECUTING THIS CONTRACT FOR SALE, THIS CONTRACT

 5         IS VOIDABLE BY BUYER BY DELIVERING TO SELLER OR

 6         SELLER'S AGENT OR REPRESENTATIVE WRITTEN NOTICE

 7         OF THE BUYER'S INTENTION TO CANCEL WITHIN 3

 8         DAYS AFTER RECEIPT OF THE DISCLOSURE SUMMARY OR

 9         PRIOR TO CLOSING, WHICHEVER OCCURS FIRST. ANY

10         PURPORTED WAIVER OF THIS VOIDABILITY RIGHT HAS

11         NO EFFECT. BUYER'S RIGHT TO VOID THIS CONTRACT

12         SHALL TERMINATE AT CLOSING.

13  

14         (c)  If the disclosure summary is not provided to a

15  prospective purchaser before the purchaser executes a contract

16  for the sale of property governed by covenants that are

17  subject to disclosure pursuant to this section, the purchaser

18  may void the contract by delivering to the seller or the

19  seller's agent or representative written notice canceling the

20  contract within 3 days after receipt of the disclosure summary

21  or prior to closing, whichever occurs first. This right may

22  not be waived by the purchaser but terminates at closing. A

23  contract that does not conform to the requirements of this

24  subsection is voidable at the option of the purchaser prior to

25  closing.

26         (2)  This section does not apply to any association

27  regulated under chapter 718, chapter 719, chapter 721, or

28  chapter 723 or to a subdivider registered under chapter 498;

29  and also does not apply if disclosure regarding the

30  association is otherwise made in connection with the

31  

                                  38

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 1  requirements of chapter 718, chapter 719, chapter 721, or

 2  chapter 723.

 3         Section 10.  Section 689.265, Florida Statutes, is

 4  transferred and renumbered as section 720.3086, Florida

 5  Statutes, to read:

 6         720.3086 689.265  Financial report.--In a residential

 7  subdivision in which the owners of lots or parcels must pay

 8  mandatory maintenance or amenity fees to the subdivision

 9  developer or to the owners of the common areas, recreational

10  facilities, and other properties serving the lots or parcels,

11  the developer or owner of such areas, facilities, or

12  properties shall make public, within 60 days following the end

13  of each fiscal year, a complete financial report of the

14  actual, total receipts of mandatory maintenance or amenity

15  fees received by it, and an itemized listing of the

16  expenditures made by it from such fees, for that year.  Such

17  report shall be made public by mailing it to each lot or

18  parcel owner in the subdivision, by publishing it in a

19  publication regularly distributed within the subdivision, or

20  by posting it in prominent locations in the subdivision.  This

21  section does not apply to amounts paid to homeowner

22  associations pursuant to chapter 617, chapter 718, chapter

23  719, chapter 721, or chapter 723, or to amounts paid to local

24  governmental entities, including special districts.

25         Section 11.  Paragraphs (g) and (h) of subsection (2)

26  of section 498.025, Florida Statutes, are amended to read:

27         498.025  Exemptions.--

28         (2)  Except as provided in s. 498.022, the provisions

29  of this chapter do not apply to offers or dispositions of

30  interests in lots, parcels, or units contained in a recorded

31  subdivision plat, or resulting from the subdivision of land in

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 1  accordance with applicable local land development laws and

 2  regulations pursuant to part II of chapter 163, including

 3  lots, parcels, units, or interest vested under such part, if

 4  all of the following conditions exist:

 5         (g)  The contract for purchase or lease contains, and

 6  the subdivider complies with, the following provisions:

 7         1.  The purchaser must inspect the subdivided land

 8  prior to the execution of the contract or lease.

 9         2.  The purchaser shall have an absolute right to

10  cancel the contract or lease for any reason whatsoever for a

11  period of 7 business days following the date on which the

12  contract or lease was executed by the purchaser.

13         3.  In the event the purchaser elects to cancel within

14  the period provided, all funds or other property paid by the

15  purchaser shall be refunded without penalty or obligation

16  within 20 days of the receipt of the notice of cancellation by

17  the developer.

18         4.  All funds or property paid by the purchaser shall

19  be put in escrow until closing has occurred and the lease or

20  deed has been recorded.

21         5.  Unless otherwise timely canceled, closing shall

22  occur within 180 days of the date of execution of the contract

23  by the purchaser.

24         6.  When title is conveyed, said title shall be

25  conveyed by statutory warranty deed unencumbered by any lien

26  or mortgage except for any first purchase money mortgage given

27  by the purchaser and restrictions, covenants, or easements of

28  record.

29         7.  The subdivider presents to the purchaser the

30  disclosure required by s. 720.401 s. 689.26 prior to the

31  execution of the contract or lease.

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 1         (h)  The agreement for deed contains, and the

 2  subdivider complies with, the following provisions:

 3         1.  The purchaser must inspect the subdivided land

 4  prior to the execution of the agreement for deed.

 5         2.  The purchaser shall have an absolute right to

 6  cancel the agreement for deed for any reason whatsoever for a

 7  period of 7 business days following the date on which the

 8  agreement for deed was executed by the purchaser.

 9         3.  If the purchaser elects to cancel within the period

10  provided, all funds or other property paid by the purchaser

11  shall be refunded without penalty or obligation within 20 days

12  after the receipt of the notice of cancellation by the

13  developer.

14         4.  All funds or for property paid by the purchaser

15  shall be put in escrow until the agreement for deed has been

16  recorded in the county in which the subdivision is located.

17         5.  Unless otherwise timely canceled, the agreement for

18  deed shall be recorded within 180 days after its execution by

19  the purchaser.

20         6.  Sale of lots in the subdivision shall be restricted

21  solely to residents of the state.

22         7.  The underlying mortgage or other ancillary

23  documents shall contain release provisions for the individual

24  lot purchased.

25         8.  The subdivider presents to the purchaser the

26  disclosure required by s. 720.401 s. 689.26 prior to the

27  execution of the agreement for deed.

28         Section 12.  Section 720.402, Florida Statutes, is

29  created to read:

30         720.402  Publication of false and misleading

31  information.--

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 1         (1)  Any person who, in reasonable reliance upon any

 2  material statement or information that is false or misleading

 3  and published by or under authority from the developer in

 4  advertising and promotional materials, including, but not

 5  limited to, a contract of purchaser, the declaration of

 6  covenants, exhibits to a declaration of covenants, brochures,

 7  and newspaper advertising, pays anything of value toward the

 8  purchase of a parcel in a community located in this state has

 9  a cause of action to rescind the contract or collect damages

10  from the developer for his or her loss before the closing of

11  the transaction. After the closing of the transaction, the

12  purchaser has a cause of action against the developer for

13  damages under this section from the time of closing until 1

14  year after the date upon which the last of the events

15  described in paragraphs (a) through (d) occur:

16         (a)  The closing of the transaction;

17         (b)  The issuance by the applicable governmental

18  authority of a certificate of occupancy or other evidence of

19  sufficient completion of construction of the purchaser's

20  residence to allow lawful occupancy of the residence by the

21  purchaser. In counties or municipalities in which certificates

22  of occupancy or other evidences of completion sufficient to

23  allow lawful occupancy are not customarily issued, for the

24  purpose of this section, evidence of lawful occupancy shall be

25  deemed to be given or issued upon the date that such lawful

26  occupancy of the residence may be allowed under prevailing

27  applicable laws, ordinances, or statutes;

28         (c)  The completion by the developer of the common

29  areas and such recreational facilities, whether or not the

30  same are common areas, which the developer is obligated to

31  complete or provide under the terms of the written contract,

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 1  governing documents, or written agreement for purchase or

 2  lease of the parcel; or

 3         (d)  In the event there is not a written contract or

 4  agreement for sale or lease of the parcel, then the completion

 5  by the developer of the common areas and such recreational

 6  facilities, whether or not they are common areas, which the

 7  developer would be obligated to complete under any rule of law

 8  applicable to the developer's obligation.

 9  

10  Under no circumstances may a cause of action created or

11  recognized under this section survive for a period of more

12  than 5 years after the closing of the transaction.

13         (2)  In any action for relief under this section, the

14  prevailing party may recover reasonable attorney's fees. A

15  developer may not expend association funds in the defense of

16  any suit under this section.

17         Section 13.  Subsection (1) of section 34.01, Florida

18  Statutes, is amended to read:

19         34.01  Jurisdiction of county court.--

20         (1)  County courts shall have original jurisdiction:

21         (a)  In all misdemeanor cases not cognizable by the

22  circuit courts;

23         (b)  Of all violations of municipal and county

24  ordinances; and

25         (c)  Of all actions at law in which the matter in

26  controversy does not exceed the sum of $15,000, exclusive of

27  interest, costs, and attorney's fees, except those within the

28  exclusive jurisdiction of the circuit courts. The party

29  instituting any civil action, suit, or proceeding pursuant to

30  this paragraph where the amount in controversy is in excess of

31  $5,000 shall pay to the clerk of the county court the filing

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 1  fees and service charges in the same amounts and in the same

 2  manner as provided in s. 28.241; and.

 3         (d)  Of disputes occurring in the homeowners'

 4  associations as described in s. 720.311(2)(a), which shall be

 5  concurrent with jurisdiction of the circuit courts.

 6         Section 14.  Paragraph (a) of subsection (1) of section

 7  316.00825, Florida Statutes, is amended to read:

 8         316.00825  Closing and abandonment of roads; optional

 9  conveyance to homeowners' association; traffic control

10  jurisdiction.--

11         (1)(a)  In addition to the authority provided in s.

12  336.12, the governing body of the county may abandon the roads

13  and rights-of-way dedicated in a recorded residential

14  subdivision plat and simultaneously convey the county's

15  interest in such roads, rights-of-way, and appurtenant

16  drainage facilities to a homeowners' association for the

17  subdivision, if the following conditions have been met:

18         1.  The homeowners' association has requested the

19  abandonment and conveyance in writing for the purpose of

20  converting the subdivision to a gated neighborhood with

21  restricted public access.

22         2.  No fewer than four-fifths of the owners of record

23  of property located in the subdivision have consented in

24  writing to the abandonment and simultaneous conveyance to the

25  homeowners' association.

26         3.  The homeowners' association is both a corporation

27  not for profit organized and in good standing under chapter

28  617, and a "homeowners' association" as  defined in s.

29  720.301(8) s. 720.301(7) with the power to levy and collect

30  assessments for routine and periodic major maintenance and

31  

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 1  operation of street lighting, drainage, sidewalks, and

 2  pavement in the subdivision.

 3         4.  The homeowners' association has entered into and

 4  executed such agreements, covenants, warranties, and other

 5  instruments; has provided, or has provided assurance of, such

 6  funds, reserve funds, and funding sources; and has satisfied

 7  such other requirements and conditions as may be established

 8  or imposed by the county with respect to the ongoing

 9  operation, maintenance, and repair and the periodic

10  reconstruction or replacement of the roads, drainage, street

11  lighting, and sidewalks in the subdivision after the

12  abandonment by the county.

13         Section 15.  Subsection (2) of section 558.002, Florida

14  Statutes, is amended to read:

15         558.002  Definitions.--As used in this act, the term:

16         (2)  "Association" has the same meaning as in s.

17  718.103(2), s. 719.103(2), s. 720.301(8) s. 720.301(7), or s.

18  723.025.

19         Section 16.  The Division of Statutory Revision is

20  requested to designate sections 720.301-720.312, Florida

21  Statutes, as part I of chapter 720, Florida Statutes; to

22  designate sections 720.401 and 720.402, Florida Statutes, as

23  part II of chapter 720, Florida Statutes, and entitle that

24  part "DISCLOSURE PRIOR TO SALE OF RESIDENTIAL PARCELS"; and to

25  designate section 720.501, Florida Statutes, as part III of

26  chapter 720, Florida Statutes, and entitle that part "RIGHTS

27  AND OBLIGATIONS OF DEVELOPERS."

28         Section 17.  This act shall take effect October 1,

29  2004.

30  

31  

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 1          STATEMENT OF SUBSTANTIAL CHANGES CONTAINED IN
                       COMMITTEE SUBSTITUTE FOR
 2                            CS/SB 2984

 3                                 

 4  The committee substitute (CS) allows any parcel owner to
    construct an access ramp if a resident or occupant of the
 5  parcel has a medical necessity or disability, attested to in
    an affidavit from a physician, that requires a ramp for egress
 6  and ingress. The ramp must be approved in advance by the
    association and meet certain requirements. It also allows a
 7  parcel owner to display a sign of reasonable size provided by
    a contractor for security services within 10 feet of any
 8  entrance to the home.

 9  This CS deletes language creating a third degree felony for an
    officer, director, or manager of an association who solicits,
10  offers to accept, or accepts any thing or service of value,
    for which consideration has not been provided, from any person
11  providing or proposing to provide goods or services to the
    association. It also deletes language providing that a
12  developer shall be deemed to have granted to a homeowners'
    association an implied warranty of fitness and merchantability
13  for a specified period.

14  

15  

16  

17  

18  

19  

20  

21  

22  

23  

24  

25  

26  

27  

28  

29  

30  

31  

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