November 14, 2003 HOA TASK FORCE AGENDA ITEM: DISCLOSURE There have been many discussions about disclosure, but so far nobody found a workable solution. Homeowners, who dare to complain about unfair treatment, are always told that they should have read the deed-restrictions before buying the home. Especially the industry attorneys are always fast to use this as an excuse for nearly everything bad that happens. But everybody who made the effort to look deeper into the matter knows that this is not the truth! In many cases the facts are not properly disclosed and since the industry knows that there is no punishment for blatantly ignoring the law it is just being ignored in many cases. And how good is disclosure if rules can be changed in the middle of the game? We all know that this is done on a daily basis, and with no oversight the consumer is left helpless against the deep pockets of the industry. Consumer protection is ZERO! Let’s start with
enforcement of existing laws:
The quick response: “No funds available to prosecute this kind of violations!” With other words – the law looks good but doesn’t protect the customer. The newest disclosure Law – FS 689.26 – just amended in the last legislative session, is another item that looks good on paper but is useless in daily life for the consumer.
Considering the many headlines regarding problems in HOAs more and more sellers and gents are unwilling to tell potential buyers that properties are located in a HOA. The remedy given by the law for the buyer is (quote): “THIS CONTRACT IS VOIDABLE BY BUYER BY DELIVERING TO SELLER OR SELLER'S AGENT WRITTEN NOTICE OF THE BUYER'S INTENTION TO CANCEL WITHIN 3 DAYS AFTER RECEIPT OF THE DISCLOSURE SUMMARY OR PRIOR TO CLOSING, WHICHEVER OCCURS FIRST.” More and more homebuyers only find out that they are members of an association after receiving a letter from an attorney that they are past due with their assessments – often 3 – 6 month after they moved in. What should they do now? Give the seller back the home for the price they paid after investing lots of money and work leaving them homeless? The law sure doesn’t offer any reasonable alternative! With DISCLOSURE we have the exact same problem we faced when discussing the other HOA problems. Without government enforcement consumers are left to fight for themselves – absolutely unrealistic against the deep-pockets industry and attorneys. Attorneys defending lack of disclosure know that the new homeowner most likely can’t afford to pay huge legal bills, after paying for his/her American Dream. So the defense is often not aimed at the legal issues but at the knowledge of the attorneys that the new homeowner doesn’t have the finances to continue a lengthy legal battle. And if push comes to shove a sealed settlement agreed to in the hallways of the courthouse will avoid any kind of case law, useable for future references. We can propose all kinds of lengthy amendments, and even if the legislature enacts them, consumers will still be left helpless if there is no easy remedy provided to protect the buyer. We don’t need more lip service, not even in writing, if there is no punishment for violators. CAVEAT EMPTOR [buyer beware] is the rule in Florida now, but what we really need is CONSUMER PROTECTION, as our Attorney General Charlie Crist stated so nicely in his election platform! |
