Rob Samouce: Special interest groups to benefit from legislative session

Assuming some of the new bills passed in the 2004 state legislative session are not vetoed by the governor by the end of the month, it looks like certain special interest groups were quite proficient this year in getting the Legislature to approve changes to community association laws for these special interest groups' benefit. Without veto, these law changes will become effective either July 1, 2004 or Oct. 1, 2004.

Let us look at how some interest groups will benefit. Although some of the law changes can be consider by many favorable for the "general public good," special interests will still particularly benefit from the changes.

— The big winner of "new business" resulting from a massive expansion of governmental bureaucracy is the state Department of Business and Professional Regulations (the department); Division of Florida Land Sales, Condominiums and Mobile Homes (the division).

The division will expand by the creation of an Advisory Council on Condominiums (to receive input prom the public and make recommendations for changes to condominium law), and the creation of an Office of the Condominium Ombudsman (supposed to act as a liaison between the division and condominium owners and directors).

The department and the division also will reap the benefits of additional expansion, as they will now handle (in addition to condominium association disputes) most homeowner association disputes.

The department will now oversee required mandatory mediation prior to most disputes being filed in court and mandatory arbitration for homeowner association election and recall disputes.

This is quite a turnabout when just a few years ago there was serious consideration given by the some in Tallahassee, because of tight state budget revenues, to disbanding or minimizing the functions of the division.

— The home security service industry won in getting language added to the homeowner association laws that prevents an association from prohibiting an owner from displaying "security service" signs within 10 feet from the entrance to a home.

— Cable TV companies won in getting new statutory language which allows for closed circuit cable television as an alternative method to posting notice to provide legal notice to owners of member meetings.

— Accounting firms win as homeowner associations will have to now follow the same guidelines as condominium associations concerning the level of association annual financial reporting that must be made. Where many homeowner associations used to be able to get by with simple year end financial reporting, they will now have to hire CPAs to perform more costly reviews, compilations or audits.

— Developers and general contractors were the last big winners in achieving additional changes affecting legal claims for construction defects. Last year, the developer/contractor lobby was successful in getting new legislation passed that made it much more difficult for them to be sued by community associations (both condominium and homeowner associations) for construction defects.

What they did was put in place complicated pre-suit procedures that the associations have to now follow prior to bringing a construction defect lawsuit. The procedures are very similar to pre-suit medical malpractice procedures that have been in place for many years. The pre-suit procedures are full of traps for the unwary that could easily compromise an association's claim if not strictly followed.

However, the developers/contractors shot themselves in the foot with the language they had passed last year because they put in time frames that were too short for themselves to practically respond in time to associations' notices of claims. The result was that many lawsuits had to be filed prematurely against the developer/contractors in order for the associations to comply with their new impractical time frames.

Well it looks like the developers/contractors fixed the time-frame problem they self-inflicted in 2003. The new language they got passed in the 2004 legislation ads a lot more time for them to respond. They should now be able to timely comply with their required responses to association notices of claims.

The developers/contractors will benefit from the complicated pre-suit procedures they expanded in 2004. They will now avoid some claims and some responsibility for their defects if an association is not keenly aware of the nuances of the complicated procedures and inadvertently slips up in following the procedures.

Rob Samouce, a principal in the Naples law firm of Samouce, Murrell, & Gal, P.A. concentrates his practice in the areas of community associations including condominium, cooperative and homeowners' associations, real estate transactions, general business law, estate planning, construction defect litigation and general civil litigation. This column is not based on specific legal advice to anyone and is based on principles subject to change from time to time. Those persons interested in specific legal advice on topics discussed in this column should consult competent legal counsel.

© 2004 All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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