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FINAL .JUDGMENT OF DECLARATORY
RELIEF
THIS
CAUSE coming to be heard at final hearing on May 31, 2007, and, upon taking
the testimony
of witnesses and hearing the argument of counsel, the Court finds that
In
late 2006, Plaintiff, LAKEWOOD VILLAGE CONDOMINIUM ASSOCIATION, INC., hereinafter
"Lakewood Village," provided its members with its first notice of
annual members meeting
and election of board of directors. At that time, no provision of the bylaws
for Lakewood Village
prohibited multiple owners from the same condominium unit from serving on
the board of directors
at the same time. The annual meeting and election was scheduled for March
21, 2007.
Sometime
in January 2007, Defendant, LAUREN ROSEN BERACHA, hereinafter "Mrs. Beracha,"
timely and properly announced her intention to run for the board of
directors of Lakewood Village.
At the same time, her husband, Phil Beracha, hereinafter "Mr. Beracha,"
not a party to this action,
also timely and properly announced his intention to run for the board of
directors of Lakewood
Village. Mr. and Mrs. Beracha own a single condominium unit at Lakewood
Village. Both
are listed on the legal title of record for the unit and are considered unit
owners. Florida Statute 718.103(28)
.
On
February 13, 2007, after both Mr. and Mrs. Beracha had announced their
respective intentions to run for the board of directors at the same time, the
three-member board of directors of Lakewood Village amended Section 5.01.01 of
the Bylaws of Lakewood Village to state the following, with the underlined
text added to the existing test: The
affairs of the Association shall be managed by the Board of not less than
three nor more than seven directors. So long as the Developer is entitled to
appoint any director pursuant to the Articles, the number of directors will be
determined, and may be changed from time to time, by the Developer by written
notice to the Board. After the Developer is no longer entitled to appoint any
director, the number of directors may be changed at any meeting where the
members are
to elect any directors (i) by the then existing Board, if prior to such
meeting of the members the Board votes to change the number of directors and
such change is indicated in the notice of the meeting sent to the
members, or (ii) by the members at the meeting prior to the election of
directors. If the number of directors on the Board is not changed, then the
number of directors shall be the same as the number
Notwithstanding
anything to the contrary herein there shall only be one (1) director serving from any one(1)unit at any time. In the event that more than one 1 owner of a unit is elected to the Board at the same time, one of those owners, preferably the one who received the lower number of votes, if that is ascertainable, shall be deemed to have resigned effective immediately. The Board shall than (sic) appoint to fill the remaining vacancy, as elsewhere provided herein. At
the election held on March 21, 2007, Mr. Beracha and Mrs. Beracha were among
the Lakewood
Village has filed this action for declaratory relief to determine (1) the
validity of the amendment of Section 5.01.01 of the Bylaws of Lakewood Village
and (2) whether Mrs. Beracha may properly serve on the board of directors. The
Court has jurisdiction of this matter pursuant to Chapter 86 of the Florida Statutes. Lakewood
Village operates a condominium association pursuant to its declaration,
articles of
incorporation, and bylaws. Florida Statute §718.112(1 )(a). The bylaws must
state the manner in which
officers and directors are elected. Florida Statute § 718.112(2)( d);
Florida Administrative Code R. 618-23.0021. All
unit owners, except convicted felons who have not had their civil rights
restored, are entitled
to run for the board of directors of a condominium association. Florida
Statute § 718.112(2)( d). All parties to this action concede that Mrs. Beracha is not a convicted felon. It
follows, then, that a statutory eligibility to run for the board of
directors of a condominium association
implicates an eligibility to thereafter serve on that board of directors
once elected. The intent
of the legislature to open the eligibility requirements for condominium
association directorship would
be thwarted by an interpretation that the legislature only wanted to open
eligibility to candidacy, but not board membership. The
legislature's intent in this regard is evident from the history of Florida
Statute §718.112(2)(d).
In 1998, the legislature added the following language to Florida Statute §718.112(2)(d): In
order to be eligible for board membership, a person must meet the
requirements set forth in the declaration. Ch. 1998-322, Laws of Florida (1998).
Shortly
thereafter, the Florida Division of Land Sales, Condominiums, and Mobile
Homes ("the
division") construed the 1998 amendment of Florida Statute §718.112(2)(d)
to permit a declaration
to restrict board membership to those unit owners \\'ho lived at the
condominium. In 2000,
the legislature repealed the 1998 amendment, thereby deleting the above
language. Ch. 2000- 302,
§ 53, Laws of Florida (2000). The legislative bill analysis for the 2000
amendment explains: Section 53 -
Amends s. 718.1 12(2)(d), F.S., regarding unit owner meetings; s. 718.112(2)(
e), F.S., relating to budget meetings; and s. 718.112(2)(f), F.S., relating to
the annual budget. Present Situation: In 1998 the
following sentence was added to s. 718.112(2)( d) 1., F.S.: "In order to be
eligible for board membership, a person must meet the requirements set forth
in the declaration." This sentence was added pursuant to CS/HB 3321, ch.
98-322, L.O.F. The division construed the sentence to allow declarations to
contain a requirement that a person must be a resident of the condominium in
order to become a member of the board. That sentence was not intended to allow
a residency requirement; it was simply intended to support other requirements
set forth in the declaration. This intent is clear based upon the previous
sentence in that subparagraph, which states that "any unit owner"
desiring to be a candidate is eligible. The pertinent provision in the 1998
legislation added language that was intended to prevent convicted felons (who
did not have their rights restored) from serving on condominium association
boards. Effect of Proposed Changes: Removes the sentence which was added in 1998, which the division construed to allow residency requirements with regard to membership on the board, and deletes superfluous language. Fla. HR Comm. Real Prop. & Prob., Final Staff Analysis for CS/CSHB 593, 1st Engrossed, at 38 (July 26, 2000) (footnotes omitted). The
above legislative analysis evinces a clear intent to prohibit any restriction
as to condominium
board membership that conflicts with the provisions of Florida Statute §
718.112(2)( d), which provides, in relevant part: 1
.... Any unit owner desiring to be a candidate for board membership shall
comply with subparagraph 3. A person who has been convicted of any felony by
any court of record in the United States and who has not had his or her right
to vote restored pursuant to law in the jurisdiction of his or her residence
is not eligible for board membership .... * * * 3. Any unit owner or other eligible person desiring to be a candidate for the board must give written notice to the association not less that 40 days before a scheduled election.
Condominiums
are created and governed by statute. Suntide Condo Assoc. Inc. V.
Division
of Fla. Land Sales and Condominiums. Dept of Business and Professional
Regulation 463 So.2d 314 (Fla.1st
DCA 1984). While Lakewood Village is also a not for profit corporation under
Chapter 617 of the Florida Statutes, its authority to operate under general
corporate law or the bylaws of the association is "expressly limited or
restricted" by the provisions of Chapter 718. Florida Statute 718.111(2).
Therefore, where Florida Statue 718.112(2)(d) expressly limits a condominium
association's authority to restrict board membership, such membership may not
be restricted under any provision contained in Chapter 617 of the bylaws Florida
Statutes Chapter 718 does not make specific reference to the eligibility for
anyone to serve on the Board of Directors. However, the Court finds that the
eligibility to run for the Board of Directors properly extends to and includes
serving on the Board of Directors. Accordingly., the governing documents of
Lakewood Village may not limit in any manner the legibility for unit owners or
other qualified individuals to serve on the Board of Directors. Any attempt to
limit or qualify the eligibility for unit owners or other qualified
individuals to serve on the Board of Directors is in direct conflict with
Florida Statute 718.1l2(2)(d). There
are no decisions of any Florida Court on this issue and the Court is treating
this issue as one of first impression. The resulting language of Florida
Statute 718.l12(2)(d) is that all unit owners, other than convicted felons who
have not had their civil rights restored, are eligible to run for and serve on
the board of directors of a condominium association, provided they give the
association not less that 40 days written notice of their desire to run as a
candidate for the board. See In re:Petition for Declaratory Statement,
Grubbs, DS 2005-013; Case No. 2005-01-6727 (Cochran, May 20,2005). In
re: Petition for Declaratory Statement, Hollybrook Golf and Tennis Club Condo.
Inc. Case NO. 961.0189 (Ellzey, September 18, 1996): In re: Petition
for Arb. Schultz v.Lacosta Beach Club Resort Condo Assoc. Inc.: Case No.
2003-08-3347 (Scheuerman, November 21, 2003). in re: Petition for
Declaratory Statement Maison Grande Condominium Association, Inc. DS
2006.043; Case No, 2006-05-1291 (Cochran, November 27, 2006). (While this
Court notes that arbitration rulings by the division are not binding upon this
Court, and the divisions' declaratory statements are not intended to have
prospective application beyond the parties involved, this Court has formed an
independent agreement with the decisions of the
Therefore:
IT
IS ORDERED AND ADJUDGED that the amendment of Section 5.01.01 of the Bylaws of
Lakewood Village on February 13, 2007, is in conflict with the requirements of
Florida Statute 718.112(2)(d) and is invalid, a Condominium association may
not prohibit more than one owner of a unit from simultaneously serving on its
Board. Defendant Lauren Rosen Baracha, having been validly elected to the
Board of Directors for Plaintiff, Lakewood Village Condominium Association,
Inc. may immediately assume her position of the board. While it may not always
be the wisest decision to have one family with multiple votes on a condominium
association board. However, this issue is for the legislature and the voters of each association. IT IS FURTHER ORDERED AND ADJUDGES that, given the large number of citizens in the State of Florida who reside in or own condominium units, and the fact that none of the States appellate courts has yet to address the first issue presented in the matter, the following question shall be certified to the Fourth District Court of Appeal as a matter of great public importance: MAY A CONDOMINIUM ASSOCIATION, IN ITS GOVERNING DOCUMENTS, SET FORTH ELIGIBILITY LIMITATIONS OR QUALIFICATIONS FOR SERVICE ON THE BOARD OF DIRECTORS BY UNIT OWNERS OR OTHER QUALIFIED INDIVIDUALS OTHERWISE ALLOWED BY SECTION 718.112(2)(d) F.S. SPECIFICALLY PROHIBITING MORE THAN ONE OWNER OF A UNIT FROM SIMULTANEOUSLY SERVING ON ITS BOARD OF DIRECTORS.
DONE AND ORDERED at Plantation,
Broward County, Florida this 26
day of
cc:
Mark M. Heinish, Esq. Deborah Sugerman, Esq. |
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