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A bill to be entitled |
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An act relating to homeowners' and community
associations; |
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creating s. 712.11, F.S.; authorizing certain
associations |
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to revive lapsed covenants; amending s.
718.114, F.S.; |
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providing that certain leaseholds,
memberships, or other |
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possessory or use interests shall be
considered a material |
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alteration or substantial addition to certain
real |
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property; amending s. 720.302, F.S.; revising
certain |
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purposes for regulation; amending s. 720.303,
F.S.; |
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revising notice requirements relating to the
levy of |
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special assessments; authorizing associations
to charge |
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specified fees for providing certain
information to |
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prospective purchasers or lienholders;
limiting liability |
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for providing such information; revising
certain time |
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requirements relating to annual reports of
associations; |
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amending s. 720.305, F.S.; prohibiting a fine
levied by an |
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association from becoming a lien unless the
governing |
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documents claimed to have been violated are
recorded in |
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the public records; amending s. 720.306, F.S.;
providing |
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that certain mergers or consolidations do not
alter |
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specified voting interests; limiting the
right of members |
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to speak at membership meetings; amending s.
720.402, |
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F.S., relating to publication of false or
misleading |
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information; clarifying that the section does
not limit |
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common-law rights; amending s. 720.405, F.S.;
deleting a |
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requirement that a proposed revived governing
document not |
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contain certain restrictive covenants;
repealing s. |
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720.311, F.S., relating to an alternative
dispute |
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resolution process; amending s. 34.01, F.S.;
conforming a |
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cross-reference; providing an effective date. |
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|
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Be It Enacted by the Legislature of the State
of Florida: |
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|
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Section 1. Section
712.11, Florida Statutes, is created to |
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read: |
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712.11 Covenant
revitalization.--A homeowners' association |
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that is not subject to
chapter 720 may use the procedures in ss. |
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720.403-720.407 to revive
covenants that have lapsed pursuant to |
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this chapter. |
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Section 2. Section
718.114, Florida Statutes, is amended |
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to read: |
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718.114 Association
powers.--An association has the power |
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to enter into agreements, to acquire
leaseholds, memberships, |
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and other possessory or use interests in
lands or facilities |
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such as country clubs, golf courses, marinas,
and other |
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recreational facilities. It has this power
whether or not the |
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lands or facilities are contiguous to the
lands of the |
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condominium, if they are intended to provide
enjoyment, |
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recreation, or other use or benefit to the
unit owners. All of |
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these leaseholds, memberships, and other
possessory or use |
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interests existing or created at the time of
recording the |
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declaration must be stated and fully
described in the |
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declaration. Subsequent to the recording of
the declaration, |
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agreements acquiring these
leaseholds, memberships, or other |
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possessory or use
interests shall be considered a material |
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alteration or substantial
addition to the real property that is |
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association
property, and the association may not acquire or |
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enter into agreements acquiring these
leaseholds, memberships, |
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or other possessory or use interests except
as authorized by the |
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declaration as
provided in s. 718.113. The declaration may |
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provide that the rental, membership fees,
operations, |
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replacements, and other expenses are common
expenses and may |
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impose covenants and restrictions concerning
their use and may |
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contain other provisions not inconsistent
with this chapter. A |
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condominium association may conduct bingo
games as provided in |
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s. 849.0931. |
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Section 3. Section
720.302, Florida Statutes, is amended |
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to read: |
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720.302 Purposes,
scope, and application.-- |
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(1) The
purposes of this chapter are to give statutory |
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recognition to corporations not for profit
that operate |
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residential communities in this state, to
provide procedures for |
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operating homeowners' associations, and to
protect the rights of |
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association members without unduly impairing
the ability of such |
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associations to perform their functions. |
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(2) The
Legislature recognizes that it is not in the best |
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interest of homeowners' associations or the
individual |
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association members thereof to create or
impose a bureau or |
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other agency of state government to regulate
the affairs of |
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homeowners' associations. However,
in accordance with s. |
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720.311, the Legislature
finds that homeowners' associations and |
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their individual members
will benefit from an expedited |
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alternative process for
resolution of election and recall |
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disputes and presuit
mediation of other disputes involving |
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covenant enforcement and
authorizes the department to hear, |
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administer, and determine
these disputes as more fully set forth |
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in this chapter.
Further, the Legislature recognizes that |
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certain contract rights have been created for
the benefit of |
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homeowners' associations and members thereof
before the |
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effective date of this act and that ss.
720.301-720.407 are not |
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intended to impair such contract rights,
including, but not |
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limited to, the rights of the developer to
complete the |
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community as initially contemplated. |
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(3) Except
as specifically provided in this chapter, this |
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chapter does not apply to: |
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(a) A
community that is composed of property primarily |
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intended for commercial, industrial, or other
nonresidential |
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use; or |
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(b) The
commercial or industrial parcels in a community |
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that contains both residential parcels and
parcels intended for |
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commercial or industrial use. |
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(4) This
chapter does not apply to any association that is |
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subject to regulation under chapter 718,
chapter 719, or chapter |
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721; or to any nonmandatory association
formed under chapter |
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723. |
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(5) Unless
expressly stated to the contrary, corporations |
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not for profit that operate residential
homeowners' associations |
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in this state shall be governed by and
subject to chapter 617 |
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and this chapter or
chapter 607 if incorporated under that |
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chapter.
This subsection is intended to clarify existing law. |
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Section 4. Subsections
(2), (5), and (7) of section |
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720.303, Florida Statutes, are amended to
read: |
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720.303 Association
powers and duties; meetings of board; |
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official records; budgets; financial
reporting; association |
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funds; recalls.-- |
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(2) BOARD
MEETINGS.-- |
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(a) A
meeting of the board of directors of an association |
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occurs whenever a quorum of the board gathers
to conduct |
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association business. All meetings of the
board must be open to |
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all members except for meetings between the
board and its |
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attorney with respect to proposed or pending
litigation where |
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the contents of the discussion would
otherwise be governed by |
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the attorney-client privilege. |
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(b) Members
have the right to attend all meetings of the |
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board and to speak on any matter placed on
the agenda by |
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petition of the voting interests for at least
3 minutes. The |
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association may adopt written reasonable
rules expanding the |
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right of members to speak and governing the
frequency, duration, |
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and other manner of member statements, which
rules must be |
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consistent with this paragraph and may
include a sign-up sheet |
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for members wishing to speak. Notwithstanding
any other law, the |
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requirement that board meetings and committee
meetings be open |
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to the members is inapplicable to meetings
between the board or |
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a committee and the association's attorney,
with respect to |
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meetings of the board held for the purpose of
discussing |
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personnel matters. |
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(c) The
bylaws shall provide for giving notice to parcel |
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owners and members of all board meetings and,
if they do not do |
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so, shall be deemed to provide the following: |
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1. Notices
of all board meetings must be posted in a |
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conspicuous place in the community at least
48 hours in advance |
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of a meeting, except in an emergency. In
the alternative, if |
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notice is not posted in a conspicuous place
in the community, |
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notice of each board meeting must be mailed
or delivered to each |
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member at least 7 days before the meeting,
except in an |
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emergency. Notwithstanding this general
notice requirement, for |
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communities with more than 100 members, the
bylaws may provide |
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for a reasonable alternative to posting or
mailing of notice for |
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each board meeting, including publication of
notice, provision |
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of a schedule of board meetings, or the
conspicuous posting and |
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repeated broadcasting of the notice on a
closed-circuit cable |
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television system serving the homeowners'
association. However, |
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if broadcast notice is used in lieu of a
notice posted |
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physically in the community, the notice must
be broadcast at |
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least four times every broadcast hour of each
day that a posted |
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notice is otherwise required. When broadcast
notice is provided, |
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the notice and agenda must be broadcast in a
manner and for a |
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sufficient continuous length of time so as to
allow an average |
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reader to observe the notice and read and
comprehend the entire |
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content of the notice and the agenda. The
bylaws or amended |
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bylaws may provide for giving notice by
electronic transmission |
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in a manner authorized by law for meetings of
the board of |
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directors, committee meetings requiring
notice under this |
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section, and annual and special meetings of
the members; |
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however, a member must consent in writing to
receiving notice by |
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electronic transmission. |
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2. A
special An
assessment may not be levied at a board |
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meeting unless the notice of the meeting
includes a statement |
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that special
assessments will be considered and the nature of |
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such the
assessments. Written notice of any meeting at which |
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special assessments will be considered or at
which amendments to |
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rules regarding parcel use will be considered
must be mailed, |
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delivered, or electronically transmitted to
the members and |
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parcel owners and posted conspicuously on the
property or |
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broadcast on closed-circuit cable television
not less than 14 |
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days before the meeting. |
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3. Directors
may not vote by proxy or by secret ballot at |
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board meetings, except that secret ballots
may be used in the |
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election of officers. This subsection also
applies to the |
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meetings of any committee or other similar
body, when a final |
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decision will be made regarding the
expenditure of association |
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funds, and to meetings
of any body vested with the power to |
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approve or disapprove architectural decisions
with respect to a |
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specific parcel of residential property owned
by a member of the |
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community. |
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(d) If
20 percent of the total voting interests petition |
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the board to address an item of business, the
board shall at its |
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next regular board meeting or at a special
meeting of the board, |
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but not later than 60 days after the receipt
of the petition, |
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take the petitioned item up on an agenda. The
board shall give |
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all members notice of the meeting at which
the petitioned item |
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shall be addressed in accordance with the
14-day notice |
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requirement pursuant to subparagraph (c)2.
Each member shall |
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have the right to speak for at least 3
minutes on each matter |
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placed on the agenda by petition, provided
that the member signs |
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the sign-up sheet, if one is provided, or
submits a written |
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request to speak prior to the meeting. Other
than addressing the |
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petitioned item at the meeting, the board is
not obligated to |
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take any other action requested by the
petition. |
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(5) INSPECTION
AND COPYING OF RECORDS.--The official |
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records shall be maintained within the state
and must be open to |
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inspection and available for photocopying by
members or their |
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authorized agents at reasonable times and
places within 10 |
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business days after receipt of a written
request for access. |
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This subsection may be complied with by
having a copy of the |
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official records available for inspection or
copying in the |
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community. If the association has a photocopy
machine available |
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where the records are maintained, it must
provide parcel owners |
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with copies on request during the inspection
if the entire |
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request is limited to no more than 25 pages. |
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(a) The
failure of an association to provide access to the |
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records within 10 business days after receipt
of a written |
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request creates a rebuttable presumption that
the association |
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willfully failed to comply with this
subsection. |
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(b) A
member who is denied access to official records is |
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entitled to the actual damages or minimum
damages for the |
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association's willful failure to comply with
this subsection. |
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The minimum damages are to be $50 per
calendar day up to 10 |
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days, the calculation to begin on the 11th
business day after |
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receipt of the written request. |
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(c) The
association may adopt reasonable written rules |
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governing the frequency, time, location,
notice, records to be |
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inspected, and manner of inspections, but may
not impose a |
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requirement that a parcel owner demonstrate
any proper purpose |
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for the inspection, state any reason for the
inspection, or |
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limit a parcel owner's right to inspect
records to less than one |
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8-hour business day per month. The
association may impose fees |
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to cover the costs of providing copies of the
official records, |
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including, without limitation, the costs of
copying. The |
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association may charge up to 50 cents per
page for copies made |
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on the association's photocopier. If the
association does not |
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have a photocopy machine available where the
records are kept, |
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or if the records requested to be copied
exceed 25 pages in |
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length, the association may have copies made
by an outside |
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vendor and may charge the actual cost of
copying. The |
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association shall maintain an adequate number
of copies of the |
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recorded governing documents, to ensure their
availability to |
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members and prospective members.
Notwithstanding the provisions |
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of this paragraph, the following records
shall not be accessible |
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to members or parcel owners: |
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1. Any
record protected by the lawyer-client privilege as |
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described in s. 90.502 and any record
protected by the work- |
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product privilege, including, but not limited
to, any record |
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prepared by an association attorney or
prepared at the |
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attorney's express direction which reflects a
mental impression, |
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conclusion, litigation strategy, or legal
theory of the attorney |
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or the association and was prepared
exclusively for civil or |
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criminal litigation or for adversarial
administrative |
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proceedings or which was prepared in
anticipation of imminent |
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civil or criminal litigation or imminent
adversarial |
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administrative proceedings until the
conclusion of the |
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litigation or adversarial administrative
proceedings. |
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2. Information
obtained by an association in connection |
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with the approval of the lease, sale, or
other transfer of a |
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parcel. |
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3. Disciplinary,
health, insurance, and personnel records |
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of the association's employees. |
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4. Medical
records of parcel owners or community |
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residents. |
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(d) The
association is not required to give a prospective |
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purchaser or lienholder
information about the subdivision or the |
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association other than
that required to be disclosed under this |
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chapter. It may charge the
prospective purchaser, lienholder, or |
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current parcel owner or
member a reasonable fee not to exceed |
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$150 to provide such
information, other than information |
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required by law, plus the
reasonable cost of photocopying and |
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attorney's fees incurred
by the association in connection with |
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the response. |
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(e) An
association is not liable for providing such |
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information in good faith
pursuant to a written request if the |
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person providing the
information includes a written statement in |
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substantially the
following form: "The responses herein are made |
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in good faith and to the
best of my ability as to their |
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accuracy." |
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(7) FINANCIAL
REPORTING.--The association shall prepare an |
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annual financial report by
a date specified in the bylaws or |
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within 90
60 days after the close of the
fiscal year. The |
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association shall, within 21
days after the report is prepared |
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but not later than
120 days after the end of the fiscal year the |
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time limits set
forth in subsection (5), provide each member |
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with a copy of the annual financial report or
a written notice |
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that a copy of the financial report is
available upon request at |
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no charge to the member. Financial reports
shall be prepared as |
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follows: |
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(a) An
association that meets the criteria of this |
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paragraph shall prepare or cause to be
prepared a complete set |
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of financial statements in accordance with
generally accepted |
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accounting principles. The financial
statements shall be based |
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upon the association's total annual revenues,
as follows: |
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1. An
association with total annual revenues of $100,000 |
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or more, but less than $200,000, shall
prepare compiled |
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financial statements. |
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2. An
association with total annual revenues of at least |
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$200,000, but less than $400,000, shall
prepare reviewed |
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financial statements. |
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3. An
association with total annual revenues of $400,000 |
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or more shall prepare audited financial
statements. |
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(b)1. An
association with total annual revenues of less |
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than $100,000 shall prepare a report of cash
receipts and |
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expenditures. |
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2. An
association in a community of fewer than 50 parcels, |
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regardless of the association's annual
revenues, may prepare a |
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report of cash receipts and expenditures in
lieu of financial |
| 304 |
statements required by paragraph (a) unless
the governing |
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documents provide otherwise. |
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3. A
report of cash receipts and disbursement must |
| 307 |
disclose the amount of receipts by accounts
and receipt |
| 308 |
classifications and the amount of expenses by
accounts and |
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expense classifications, including, but not
limited to, the |
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following, as applicable: costs for security,
professional, and |
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management fees and expenses; taxes; costs
for recreation |
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facilities; expenses for refuse collection
and utility services; |
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expenses for lawn care; costs for building
maintenance and |
| 314 |
repair; insurance costs; administration and
salary expenses; and |
| 315 |
reserves if maintained by the association. |
| 316 |
(c) If
20 percent of the parcel owners petition the board |
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for a level of financial reporting higher
than that required by |
| 318 |
this section, the association shall duly
notice and hold a |
| 319 |
meeting of members within 30 days of receipt
of the petition for |
| 320 |
the purpose of voting on raising the level of
reporting for that |
| 321 |
fiscal year. Upon approval of a majority of
the total voting |
| 322 |
interests of the parcel owners, the
association shall prepare or |
| 323 |
cause to be prepared, shall amend the budget
or adopt a special |
| 324 |
assessment to pay for the financial report
regardless of any |
| 325 |
provision to the contrary in the governing
documents, and shall |
| 326 |
provide within 90 days of the meeting or the
end of the fiscal |
| 327 |
year, whichever occurs later: |
| 328 |
1. Compiled,
reviewed, or audited financial statements, if |
| 329 |
the association is otherwise required to
prepare a report of |
| 330 |
cash receipts and expenditures; |
| 331 |
2. Reviewed
or audited financial statements, if the |
| 332 |
association is otherwise required to prepare
compiled financial |
| 333 |
statements; or |
| 334 |
3. Audited
financial statements if the association is |
| 335 |
otherwise required to prepare reviewed
financial statements. |
| 336 |
(d) If
approved by a majority of the voting interests |
| 337 |
present at a properly called meeting of the
association, an |
| 338 |
association may prepare or cause to be
prepared: |
| 339 |
1. A
report of cash receipts and expenditures in lieu of a |
| 340 |
compiled, reviewed, or audited financial
statement; |
| 341 |
2. A
report of cash receipts and expenditures or a |
| 342 |
compiled financial statement in lieu of a
reviewed or audited |
| 343 |
financial statement; or |
| 344 |
3. A
report of cash receipts and expenditures, a compiled |
| 345 |
financial statement, or a reviewed financial
statement in lieu |
| 346 |
of an audited financial statement. |
| 347 |
Section 5. Subsection
(2) of section 720.305, Florida |
| 348 |
Statutes, is amended to read: |
| 349 |
720.305 Obligations
of members; remedies at law or in |
| 350 |
equity; levy of fines and suspension of use
rights; failure to |
| 351 |
fill sufficient number of vacancies on board
of directors to |
| 352 |
constitute a quorum; appointment of receiver
upon petition of |
| 353 |
any member.-- |
| 354 |
(2) If
the governing documents so provide, an association |
| 355 |
may suspend, for a reasonable period of time,
the rights of a |
| 356 |
member or a member's tenants, guests, or
invitees, or both, to |
| 357 |
use common areas and facilities and may levy
reasonable fines, |
| 358 |
not to exceed $100 per violation, against any
member or any |
| 359 |
tenant, guest, or invitee. A fine may be
levied on the basis of |
| 360 |
each day of a continuing violation, with a
single notice and |
| 361 |
opportunity for hearing, except that no such
fine shall exceed |
| 362 |
$1,000 in the aggregate unless otherwise
provided in the |
| 363 |
governing documents. A fine shall not become
a lien against a |
| 364 |
parcel unless it is
levied for a violation of governing |
| 365 |
documents that have been
recorded in the public records of the |
| 366 |
county where the
property is located. In any action to recover a |
| 367 |
fine, the prevailing party is entitled to
collect its reasonable |
| 368 |
attorney's fees and costs from the
nonprevailing party as |
| 369 |
determined by the court. |
| 370 |
(a) A
fine or suspension may not be imposed without notice |
| 371 |
of at least 14 days to the person sought to
be fined or |
| 372 |
suspended and an opportunity for a hearing
before a committee of |
| 373 |
at least three members appointed by the board
who are not |
| 374 |
officers, directors, or employees of the
association, or the |
| 375 |
spouse, parent, child, brother, or sister of
an officer, |
| 376 |
director, or employee. If the committee, by
majority vote, does |
| 377 |
not approve a proposed fine or suspension, it
may not be |
| 378 |
imposed. |
| 379 |
(b) The
requirements of this subsection do not apply to |
| 380 |
the imposition of suspensions or fines upon
any member because |
| 381 |
of the failure of the member to pay
assessments or other charges |
| 382 |
when due if such action is authorized by the
governing |
| 383 |
documents. |
| 384 |
(c) Suspension
of common-area-use rights shall not impair |
| 385 |
the right of an owner or tenant of a parcel
to have vehicular |
| 386 |
and pedestrian ingress to and egress from the
parcel, including, |
| 387 |
but not limited to, the right to park. |
| 388 |
Section 6. Subsections
(1) and (6) of section 720.306, |
| 389 |
Florida Statutes, are amended to read: |
| 390 |
720.306 Meetings
of members; voting and election |
| 391 |
procedures; amendments.-- |
| 392 |
(1) QUORUM;
AMENDMENTS.-- |
| 393 |
(a) Unless
a lower number is provided in the bylaws, the |
| 394 |
percentage of voting interests required to
constitute a quorum |
| 395 |
at a meeting of the members shall be 30
percent of the total |
| 396 |
voting interests. Unless otherwise provided
in this chapter or |
| 397 |
in the articles of incorporation or bylaws,
decisions that |
| 398 |
require a vote of the members must be made by
the concurrence of |
| 399 |
at least a majority of the voting interests
present, in person |
| 400 |
or by proxy, at a meeting at which a quorum
has been attained. |
| 401 |
(b) Unless
otherwise provided in the governing documents |
| 402 |
or required by law, and other than those
matters set forth in |
| 403 |
paragraph (c), any governing document of an
association may be |
| 404 |
amended by the affirmative vote of two-thirds
of the voting |
| 405 |
interests of the association. |
| 406 |
(c) Unless
otherwise provided in the governing documents |
| 407 |
as originally recorded or permitted by this
chapter or chapter |
| 408 |
617, an amendment may not materially and
adversely alter the |
| 409 |
proportionate voting interest appurtenant to
a parcel or |
| 410 |
increase the proportion or percentage by
which a parcel shares |
| 411 |
in the common expenses of the association
unless the record |
| 412 |
parcel owner and all record owners of liens
on the parcels join |
| 413 |
in the execution of the amendment. For
purposes of this section, |
| 414 |
a change in quorum requirements is not an
alteration of voting |
| 415 |
interests. The
merger or consolidation of associations under a |
| 416 |
plan of merger or
consolidation pursuant to chapter 607 or |
| 417 |
chapter 617 is not a
material or adverse alteration of the |
| 418 |
proportionate voting
interest appurtenant to a parcel. |
| 419 |
(6) RIGHT
TO SPEAK.--Members and parcel owners have the |
| 420 |
right to attend all membership meetings and
to speak at any |
| 421 |
meeting with reference to all items opened
for discussion or |
| 422 |
included on the agenda. Notwithstanding any
provision to the |
| 423 |
contrary in the governing documents or any
rules adopted by the |
| 424 |
board or by the membership, a member and a
parcel owner have the |
| 425 |
right to speak for at least 3 minutes on any agenda
item, if |
| 426 |
provided that the
member or parcel owner submits a written |
| 427 |
request to speak prior to the meeting. The
association may adopt |
| 428 |
written reasonable rules governing the
frequency, duration, and |
| 429 |
other manner of member and parcel owner
statements, which rules |
| 430 |
must be consistent with this subsection. |
| 431 |
Section 7. Subsection
(3) is added to section 720.402, |
| 432 |
Florida Statutes, to read: |
| 433 |
720.402 Publication
of false and misleading information.-- |
| 434 |
(3) This
section does not limit any rights provided by |
| 435 |
common law. |
| 436 |
Section 8. Subsection
(4) of section 720.405, Florida |
| 437 |
Statutes, is amended to read: |
| 438 |
720.405 Organizing
committee; parcel owner approval.-- |
| 439 |
(4) The
proposed revived declaration and other governing |
| 440 |
documents for the community shall: |
| 441 |
(a) Provide
that the voting interest of each parcel owner |
| 442 |
shall be the same as the voting interest of
the parcel owner |
| 443 |
under the previous governing documents; |
| 444 |
(b) Provide
that the proportional-assessment obligations |
| 445 |
of each parcel owner shall be the same as
proportional- |
| 446 |
assessment obligations of the parcel owner
under the previous |
| 447 |
governing documents; |
| 448 |
(c) Contain
the same respective amendment provisions as |
| 449 |
the previous governing documents or, if there
were no amendment |
| 450 |
provisions in the previous governing
document, amendment |
| 451 |
provisions that require approval of not less
than two-thirds of |
| 452 |
the affected parcel owners; and |
| 453 |
(d) Contain
no covenants that are more restrictive on the |
| 454 |
affected parcel owners than the covenants
contained in the |
| 455 |
previous governing
documents, except as permitted under s. |
| 456 |
720.404(3); and |
| 457 |
(d)(e) Comply
with the other requirements for a |
| 458 |
declaration of covenants and other governing
documents as |
| 459 |
specified in this chapter. |
| 460 |
Section 9. Section
720.311, Florida Statutes, is repealed. |
| 461 |
Section 10. Subsection
(1) of section 34.01, Florida |
| 462 |
Statutes, is amended to read: |
| 463 |
34.01 Jurisdiction
of county court.-- |
| 464 |
(1) County
courts shall have original jurisdiction: |
| 465 |
(a) In
all misdemeanor cases not cognizable by the circuit |
| 466 |
courts; |
| 467 |
(b) Of
all violations of municipal and county ordinances; |
| 468 |
(c) Of
all actions at law in which the matter in |
| 469 |
controversy does not exceed the sum of
$15,000, exclusive of |
| 470 |
interest, costs, and attorney's fees, except
those within the |
| 471 |
exclusive jurisdiction of the circuit courts;
and |
| 472 |
(d) Of
disputes occurring in the homeowners' associations |
| 473 |
as described in s. 720.311(2)(a),
Florida Statutes 2005, which |
| 474 |
shall be concurrent with jurisdiction of the
circuit courts. |
| 475 |
Section 11. This
act shall take effect July 1, 2006. |