720.31
Recreational leaseholds; right to acquire; escalation clauses.--
(1) Any
lease of recreational or other commonly used facilities serving a
community, which lease is entered into by the association or its
members before control of the homeowners' association is turned
over to the members other than the developer, must provide as
follows:
(a) That
the facilities may not be offered for sale unless the homeowners'
association has the option to purchase the facilities, provided
the homeowners' association meets the price and terms and
conditions of the facility owner by executing a contract with the
facility owner within 90 days, unless agreed to otherwise, from
the date of mailing of the notice by the facility owner to the
homeowners' association. If the facility owner offers the
facilities for sale, he or she shall notify the homeowners'
association in writing stating the price and the terms and
conditions of sale.
(b) If a
contract between the facility owner and the association is not
executed within such 90-day period, unless extended by mutual
agreement, then, unless the facility owner thereafter elects to
offer the facilities at a price lower than the price specified in
his or her notice to the homeowners' association, he or she has no
further obligations under this subsection, and his or her only
obligation shall be as set forth in subsection (2).
(c) If the
facility owner thereafter elects to offer the facilities at a
price lower than the price specified in his or her notice to the
homeowners' association, the homeowners' association will have an
additional 10 days to meet the price and terms and condition of
the facility owner by executing a contract.
(2) If a
facility owner receives a bona fide offer to purchase the
facilities that he or she intends to consider or make a
counteroffer to, his or her only obligations shall be to notify
the homeowners' association that he or she has received an offer,
to disclose the price and material terms and conditions upon which
he or she would consider selling the facilities, and to consider
any offer made by the homeowners' association. The facility owner
shall be under no obligation to sell to the homeowners'
association or to interrupt or delay other negotiations, and he or
she shall be free at any time to execute a contract for the sale
of the facilities to a party or parties other than the homeowners'
association.
(3)(a) As
used in subsections (1) and (2), the term "notify" means
the placing of a notice in the United States mail addressed to the
president of the homeowners' association. Each such notice shall
be deemed to have been given upon the deposit of the notice in the
United States mail.
(b) As used
in subsection (1), the term "offer" means any
solicitation by the facility owner directed to the general public.
(4) This
section does not apply to:
(a) Any
sale or transfer to a person who would be included within the
table of descent and distribution if the facility owner were to
die intestate.
(b) Any
transfer by gift, devise, or operation of law.
(c) Any
transfer by a corporation to an affiliate. As used herein, the
term "affiliate" means any shareholder of the
transferring corporation; any corporation or entity owned or
controlled, directly or indirectly, by the transferring
corporation; or any other corporation or entity owned or
controlled, directly or indirectly, by any shareholder of the
transferring corporation.
(d) Any
transfer to a governmental or quasi-governmental entity.
(e) Any
conveyance of an interest in the facilities incidental to the
financing of such facilities.
(f) Any
conveyance resulting from the foreclosure of a mortgage, deed of
trust, or other instrument encumbering the facilities or any deed
given in lieu of such foreclosure.
(g) Any
sale or transfer between or among joint tenants in common owning
the facilities.
(h) The
purchase of the facilities by a governmental entity under its
powers of eminent domain.
(5)(a) The
Legislature declares that the public policy of this state
prohibits the inclusion or enforcement of escalation clauses in
land leases or other leases for recreational facilities, land, or
other commonly used facilities that serve residential communities,
and such clauses are hereby declared void. For purposes of this
section, an escalation clause is any clause in a lease which
provides that the rental rate under the lease or agreement is to
increase at the same percentage rate as any nationally recognized
and conveniently available commodity or consumer price index.
(b) This
public policy prohibits the inclusion of such escalation clauses
in leases entered into after the effective date of this amendment.
(c) This
section is inapplicable:
1. If the
lessor is the Federal Government, this state, any political
subdivision of this state, or any agency of a political
subdivision of this state; or
2. To
a homeowners' association that is in existence on the effective
date of this act, or to an association, no matter when created, if
the association is created in a community that is included in an
effective development-of-regional-impact development order as of
the effective date of this act, together with any approved
modifications thereto.
(6)
An association may enter into agreements to acquire leaseholds,
memberships, and other possessory or use interests in lands or
facilities, including, but not limited to, country clubs, golf
courses, marinas, submerged land, parking areas, conservation
areas, and other recreational facilities. An association may enter
into such agreements regardless of whether the lands or facilities
are contiguous to the lands of the community or whether such lands
or facilities are intended to provide enjoyment, recreation, or
other use or benefit to the owners. All leaseholds, memberships,
and other possessory or use interests existing or created at the
time of recording the declaration must be stated and fully
described in the declaration. Subsequent to recording the
declaration, agreements acquiring leaseholds, memberships, or
other possessory or use interests not entered into within 12
months after recording the declaration may be entered into only if
authorized by the declaration as a material alteration or
substantial addition to the common areas or association property.
If the declaration is silent, any such transaction requires the
approval of 75 percent of the total voting interests of the
association. The declaration may provide that the rental,
membership fees, operations, replacements, or other expenses are
common expenses; impose covenants and restrictions concerning
their use; and contain other provisions not inconsistent with this
subsection. An association exercising its rights under this
subsection may join with other associations that are part of the
same development or with a master association responsible for the
enforcement of shared covenants, conditions, and restrictions in
carrying out the intent of this subsection. This subsection is
intended to clarify law in existence before July 1, 2010. |