SB 0714: Relating to Condo Associations/Lien Foreclosure

S714    GENERAL BILL by Siplin
Condo Associations/Lien Foreclosure; provides that lien foreclosure
action or action to recover money judgment brought as result of unpaid
condominium association assessments may be brought only in instances
meeting monetary threshold; provides that association is not entitled to
recover attorney's fees in foreclosure actions or in actions to recover
money judgment brought as result of unpaid association assessments, etc.
Amends 718.116. EFFECTIVE DATE: 07/01/2007.
01/23/07 SENATE Filed

Senate Bill sb0714

CODING: Words stricken are deletions; words underlined are additions.

    Florida Senate - 2007                                   SB 714

    By Senator Siplin

    19-288-07
  1                      A bill to be entitled
  2         An act relating to condominium associations;
  3         amending s. 718.116, F.S.; providing that a
  4         lien foreclosure action or an action to recover
  5         a money judgment brought as a result of unpaid
  6         condominium association assessments may be
  7         brought only in instances meeting a monetary
  8         threshold; providing that an association is not
  9         entitled to recover attorney's fees in
10         foreclosure actions or in actions to recover a
11         money judgment brought as a result of unpaid
12         association assessments; requiring an
13         association to provide 180 days' written notice
14         of its intention to foreclose its lien before
15         foreclosure judgment may be entered; providing
16         an effective date.
17  
18  Be It Enacted by the Legislature of the State of Florida:
19  
20         Section 1.  Subsection (3), paragraph (b) of subsection
21  (5), and subsections (6) and (8) of section 718.116, Florida
22  Statutes, are amended to read:
23         718.116  Assessments; liability; lien and priority;
24  interest; collection.--
25         (3)  Assessments and installments on them which are not
26  paid when due bear interest at the rate provided in the
27  declaration, from the due date until paid. This rate may not
28  exceed the rate allowed by law, and, if no rate is provided in
29  the declaration, interest shall accrue at the rate of 18
30  percent per year. Also, if the declaration or bylaws so
31  provide, the association may charge an administrative late fee
                                  1
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 1  in addition to such interest, in an amount not to exceed the
 2  greater of $25 or 5 percent of each installment of the
 3  assessment for each delinquent installment that the payment is
 4  late. Any payment received by an association shall be applied
 5  first to any interest accrued by the association, then to any
 6  administrative late fee, then to any costs and reasonable
 7  attorney's fees incurred in collection, and then to the
 8  delinquent assessment. The foregoing shall be applicable
 9  notwithstanding any restrictive endorsement, designation, or
10  instruction placed on or accompanying a payment. A late fee
11  shall not be subject to the provisions in chapter 687 or s.
12  718.303(3).
13         (5)
14         (b)  To be valid, a claim of lien must state the
15  description of the condominium parcel, the name of the record
16  owner, the name and address of the association, the amount
17  due, and the due dates. It must be executed and acknowledged
18  by an officer or authorized agent of the association. No such
19  lien shall be effective longer than 1 year after the claim of
20  lien was recorded unless, within that time, an action to
21  enforce the lien is commenced. The 1-year period shall
22  automatically be extended for any length of time during which
23  the association is prevented from filing a foreclosure action
24  by an automatic stay resulting from a bankruptcy petition
25  filed by the parcel owner or any other person claiming an
26  interest in the parcel. The claim of lien shall secure all
27  unpaid assessments which are due and which may accrue
28  subsequent to the recording of the claim of lien and prior to
29  the entry of a certificate of title, as well as interest and
30  all reasonable costs and attorney's fees incurred by the
31  association incident to the collection process. Upon payment
                                  2
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 1  in full, the person making the payment is entitled to a
 2  satisfaction of the lien.
 3         (6)(a)  The association may bring an action in its name
 4  to foreclose a lien for assessments in the manner a mortgage
 5  of real property is foreclosed and may also bring an action to
 6  recover a money judgment for the unpaid assessments without
 7  waiving any claim of lien. A lien foreclosure action or an
 8  action to recover a money judgment brought as a result of
 9  unpaid condominium association assessments may be brought only
10  in those instances in which the amount in question equals or
11  exceeds $2,500. The association is not entitled to recover its
12  reasonable attorney's fees incurred in either a lien
13  foreclosure action or an action to recover a money judgment
14  for unpaid assessments.
15         (b)  No foreclosure judgment may be entered until at
16  least 180 30 days after the association gives written notice
17  to the unit owner of its intention to foreclose its lien to
18  collect the unpaid assessments. If this notice is not given at
19  least 30 days before the foreclosure action is filed, and if
20  the unpaid assessments, including those coming due after the
21  claim of lien is recorded, are paid before the entry of a
22  final judgment of foreclosure, the association shall not
23  recover attorney's fees or costs. The notice must be given by
24  delivery of a copy of it to the unit owner or by certified or
25  registered mail, return receipt requested, addressed to the
26  unit owner at his or her last known address; and, upon such
27  mailing, the notice shall be deemed to have been given, and
28  the court shall proceed with the foreclosure action and may
29  award attorney's fees and costs as permitted by law. The
30  notice requirements of this subsection are satisfied if the
31  unit owner records a notice of contest of lien as provided in
                                  3
 1  subsection (5). The notice requirements of this subsection do
 2  not apply if an action to foreclose a mortgage on the
 3  condominium unit is pending before any court; if the rights of
 4  the association would be affected by such foreclosure; and if
 5  actual, constructive, or substitute service of process has
 6  been made on the unit owner.
 7         (c)  If the unit owner remains in possession of the
 8  unit after a foreclosure judgment has been entered, the court,
 9  in its discretion, may require the unit owner to pay a
10  reasonable rental for the unit. If the unit is rented or
11  leased during the pendency of the foreclosure action, the
12  association is entitled to the appointment of a receiver to
13  collect the rent. The expenses of the receiver shall be paid
14  by the party which does not prevail in the foreclosure action.
15         (d)  The association has the power to purchase the
16  condominium parcel at the foreclosure sale and to hold, lease
17  mortgage, or convey it.
18         (8)  Within 15 days after receiving a written request
19  therefor from a unit owner purchaser, or mortgagee, the
20  association shall provide a certificate signed by an officer
21  or agent of the association stating all assessments and other
22  moneys owed to the association by the unit owner with respect
23  to the condominium parcel. Any person other than the owner who
24  relies upon such certificate shall be protected thereby. A
25  summary proceeding pursuant to s. 51.011 may be brought to
26  compel compliance with this subsection, and in any such action
27  the prevailing party is entitled to recover reasonable
28  attorney's fees. Notwithstanding any limitation on transfer
29  fees contained in s. 718.112(2)(i), the association or its
30  authorized agent may charge a reasonable fee for the
31  preparation of the certificate.
                                  4
 1         Section 2.  This act shall take effect July 1, 2007.
 2  
 3            *****************************************
 4                          SENATE SUMMARY
 5    Limits a lien foreclosure or an action to recover a money
      judgment brought as a result of an unpaid assessment by a
 6    condominium association to those instances in which the
      amount in question equals or exceeds $2,500. Requires a
 7    written notice of 180 days rather than 30 days before
      entry of a foreclosure judgment. Removes authorization
 8    for the association to recover attorney's fees and costs.

CODING: Words stricken are deleted; words underlined are additions

   

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