January 9, 2004

TO: DBPR TASK FORCE ON HOMEOWNERS’ ASSOCIATIONS

OUR COMMETS REGARDING TOPIC #1 ALTERNATIVE DISPUTE RESOLUTION (LACK OF ENFORCEMENT), #3 DISCLOSURE, #6 INSPECTION RECORDS.

I am here to speak of concerns developed in dealing with the State Agency of the Department of Business and Professional Regulation (DBPR) the Division Charged with overseeing my condominium association.

My wife and I have had over 2 to 3 years of dealings with the DIVISION, beginning with confident hopes of an agency with the desire to help, protect and enforce Florida Statutes 718 concerning condos and educate consumers on how to exercise their rights.

Our stunning realization after all that time: the Division’s enforcement officials, at least their senior officials, have in large part been apparently reduced to  “paper tigers”, apparently lacking the motivation, resources, political focus, and/or legislative and regulatory power to play a meaningful enforcement role to protect and ensure compliance of the laws enacted by the legislature.

This conclusion has been drawn from both our personal experiences and the stories of numerous condominium owners that I have heard speak here and elsewhere about abuses of association power and the lack of effort, concern, or capability the Division has responded with in all virtually cases I have heard and been contacted by people throughout the State.

This ineffective action has appeared in a number of forms, often involving a high level policy (evident in our personal experiences), trumping and overruling lower level officials who would otherwise find in favor of consumers, and substituting a policy of virtual “apologist” for association boards, which boards are inevitably assumed to have done nothing wrong in the first place, to be operating with altruistic motives, and regardless of resources should always be treated as innocent, naive unsophisticated wrongdoers and not to be punished for any action if there is a way to avoid it by interpreting (perhaps even misinterpreting) laws and regulations to make complaints against associations be dismissed, and simultaneously make owners less capable to exercise their rights.  Even when the assumptions protecting boards are flagrantly wrong, and even when consumers cry out for guidance in understanding the rules supposedly protecting their rights, the policy of aiding associations against the interest of aggrieved consumer owners is relentless, and even obvious in our later encounters.

The ineffective action also appears in the form of extended times to resolve cases even when pitifully little investigation is actually done by the investigator, presumably a symptom of inadequate resources and staff, and possibly of a political philosophy of “ let the strong survive on their own in private court fights”  Regrettably, this kind of systematic under-funding or underutilizing of regulators inevitably leads to abuses being perpetrated against those private individuals less or unable to protect themselves in the costly litigation frontiers of this state and elsewhere, and regrettably, this is intensified by the fact the first effort of the condominium or home owner in defending themselves has to be “wasted” in a “non-binding arbitration” proceeding in front of those very same Division officials who are forever busy finding reasons to determine that associations did not really do anything wrong, or if they did, they did not mean it, or if they did, will get a stern “letter of education” to rectify the utter destruction of some of the most important private property rights destroyed (of the owner) through the allegedly malicious actions of a board.  Essentially if the “cops” are on the side of the wrongdoer in the same fashion as the mother of a bully, who can never see their “angel” do wrong (please excuse the analogy); where does someone who can not afford a personal private court fight turn, against an adversary (the board) who has virtually limitless resources to continue their contested actions through assessments?

This problem has been echoed in whispers I and others have heard in the legislature and the bureaucracy that the low level investigation officers are under overpowering pressure “to close cases at all costs” ; and the only way to do that in a way that does not lead to appeals is to acquit the associations of all wrongdoings, and then refuse to reconsider since a finding of impropriety would mandate additional and possibly long running administrative appeals by the deep pocketed associations.  “Chop the legs out from under the little guys, and they’ll run out of money first.”

Even when a board does engage in outrageous and flagrant enough actions such that the DIVISION has NO CHOICE but to become involved, it would seem that almost all the most powerful remedies against the wrongdoers (large fines) are assessed against the association as a whole, including innocent owners, and the actually wrongdoers, typically planted on the board, cannot be removed effectively, since they control the means, timetable and agenda for electing their own would be successors (I am referencing a well known extreme case in south Florida where outrageous fines have done little to remove embezzling board members).

There is a major problem in the system as now designed and implement to regulate the condo laws of Florida, and the same problems could arise in any other state and in any other system of regulating owner associations where the state tries to remove itself from the system and leaves average individuals under the sway of neighbor political cliques that have no checks and balances over them except private court actions, for those who can afford to challenge to deep pockets of the association.  To have “cops on the beat” who only watch the crime happen but then recommend to the victim “take it to private court”; what a scary system that is.  It is wrong for a state to create the power base that can be abused by bullies, such as creating the rules and regulations that give a condominium association power over individual property owners, and then claim to be not responsible when a wrongdoer gets into a position of power and cannot be challenged effectively by an average person on their own.

What we believe is called for: Stronger, more explicit rules and rights for the individual consumer/owner, and protect them from change and abuse by local associations   trying to take those rights from the owners after they are acquired; more guidance of how to exercise those rights from the state officials judging their exercise; more clear obligations and more strict obligations on associations/boards concerning record keeping, elections; and more rules allowing the state enforcing agency to directly go after wrong doers who gain positions of power on local association boards and hold them more accountable for their wrongdoings rather than punishing only the association as a whole.  Let the state be able to remove them from the position of power and put new blood in.  

BASED ON WHAT WE HAVE HEARD FROM TESTIMONY FROM HOME OWNERS AT THESE TASK FORCE MEETINGS AND FROM OTHER TESTIMONY WE GAVE AND HEARD AT COMMITTEE ON CONDOMINIM GOVERNANCE, CREATED BY SPEAKER OF THE HOUSE, JOHNNIE BYRD & CHAIRED BY REP. ROBAINIA ALONG WITH WHAT WE HAVE BEEN TOLD AND EXPERIENCED IT IS EVIDENT AN INVESTIGATION MUST BE MADE INTO THE REVAMPING OF THE ENTIRE DIVISION OF CONDOMINIUMS, TO ADDRESS THE RESOURCES SHORTAGE THAT WAS CUT FROM 160 TO 91, STATUTES MUST BE DEVELOPED WHICH WILL GIVE THE DIVISION STAFF THE AUTHORITY THEY WANT AND NEED TO DO THEIR JOB THE LEGISLATORS INTENDED.  THIS LACK OF AUTHORIUZATION BUILT INTO THE STATUTES HAS CREATED ATTITUDE PROBLEMS OR PHILOSOPHICAL IMBALANCE OF POWER AND BIAS BETWEEN ASSOCIATION POWER AND OWNER RIGHTS IN DISPUTES.

For those of you interested in just how slanted the Division has appeared to us in our experience, we invite you to read the attached documents including our letter of September 17, 2003 to the Division’s Director Ross Fleetwood and Secretary Carr’s Deputy Secretary Lianne Acebo response (which totally ignored our comments and requests) we have provided to give you a detailed sense of where our opinion, that started out so benignly naive, has come from.  Please pay particular attention to page 3 & 4 (underlined highlights) of our September 17, 2003 letter to Ross Fleetwood Director DBPR pertaining to “Letters of Inquiry” which the Division dismissed in our complaints concerning the board’s failure to respond to numerous letters we had sent to them seeking a response, and which we thought qualified as letters of inquiry that the board was required to answer in writing by Florida law.  In those letters, (enclosed) we repeatedly, respectfully asked (ie: inquired) the board to follow through on verbal promises, to explain their actions in light of the context of the situation, and to conduct discussions to address our legitimate concerns, and in every case responses have been expected.  Nevertheless, we have been now advised by the Division, that our letters to the board were deemed to be not statutory “letters of inquiry” and therefore (impliedly) deserved the blatant disregard and lack of any written (and no material) response the board arrogantly afforded them.

In any event the Division’s Director’s (Chief of Compliance’s) interpretation has now clearly produced a “loophole” that allows the board to, and rewards it to, hide from the statutory obligation to respond.  We appealed in our letter of 9/17/03 to Mr. Fleetwood for the formal “technical guideline” from the Division, we assume the Chief of Compliance has one, even though it is not published for the public in the statute or regulation, and it was not previously known to the division’s own officials and the very experienced attorney for the Piper Dunes North Association.  Enforcement of the inquiry letter statutes affords us the protection to recover legal fees and pursue this matter in mediation, arbitration or court.  As you can see Secretary Carr’s Deputy Secretary chose not to even address this important issue.

This Task has discussed whether they should recommend that more pages be added to the HOA Chapter 720 because Chapter 718 of the Florida Statutes of the Condominium Act contains some 200 pages.  Unless effective enforcement of the present statutes is exercised what is the point of creating more.

We hope all the members of this task force will take the time to go over this material thoroughly and make a recommendation and join ours and others call for a through investigation of the DBPR.  Hopefully the results of this investigation will bring about government agency with a strong effectual force which will represent and protect the property rights of Florida citizens the way the legislature intended.  Again, we want to stress that our concern has come not just from our personal losing battles to have our rights recognized by our board and the Division, but from our hearing and reading of so many stories that are just like ours, and some are far worse.  I do believe there are a lot of conscientious people at the DBPR who are trying to complete thorough investigations of complaints they receive.  Unfortunately I believe that in many cases Division Staff cannot complete them because of Budget cuts, lack of staff, interference by supervisors and the fact the Statutes do not (too vendor friendly) have the teeth built in them so investigators have the authority they want and need to do their job.

Thank you for allowing us to attend and participate at this meeting.

Sincerely,

Stephen Comley