Will legislation that impairs the contract rights of any one party be allowed to be added retroactively?

An Opinion By Jan Bergemann 
President, Cyber Citizens For Justice, Inc.

Published February 19, 2011


It seems that legislative changes to the Florida Community Association Statutes are only valid in the eyes of the commercial owners if they favor their own cause. Otherwise: Let's sue!


The issue at stake in this case:  Did the Florida legislature have the right to change the statutes that impair their “contractual rights” -- according to the commercial owners of THE GRAND CONDOMINIUM ASSOCIATION, INC. in Miami ?


The change in the statutes [FS 718.404(2)] was created by provisions contained in the 2007 bills S902(Senator Jones) and H1373 (Representative Robaina). The changes to the law were caused by many complaints by condo owners in mixed-used condominiums that the commercial owners abuse their majority on the board of directors to use most of the association funds -- even if private owners pay the bulk of the assessments -- to improve their commercial property.


During meetings of the HOUSE SELECT COMMITTEE ON CONDO GOVERNANCE (2004) and the FLORIDA HOUSE OF REPRESENTATIVES SELECT COMMITTEE ON CONDOMINIUM & HOMEOWNERS ASSOCIATION GOVERNANCE (2008) outraged condo owners complained about this abuse of their funds. The Condo Ombudsman received lots of  complaints about this issue and forwarded them to the legislators, who finally in 2007 took the necessary action to stop this abuse and create laws to give the actual majority in the building the right to elect a board according to votes cast at the election.


Former State Representative Julio Robaina, who sponsored this provision of the bill in 2007, said when hearing about this lawsuit: "We heard so many complaints from owners that we thought it's high time to file this bill. But as soon as owner-friendly laws are enacted the industry sues."

Despite these many well-known and well-founded complaints, the appellees (the commercial owners) contend that the Statute is unconstitutional because they do not know why it was enacted. 

Or do you think that it is good law if the 810 residential unit owners vote for only three (3) of the seven (7) members of The Grand's board of directors, while the Controlling Entities, which own only 400 units, vote for five (5) of the seven (7) members. There is nothing equal about that -- don't you agree?

After losing in the lower court and in the Third District Court of Appeals [3D08-3051], the condo owners turned to the Florida Supreme Court for help.


After his appearance in front of the Supreme Court attorney Eric Glazer from the law firm Glazer & Associates P.A. said: In the Woodside case………the Florida Supreme Court once again held that condominiums are entirely subject to legislative control.  We are hoping that they take the same position this time.”


 Watch VIDEO

Eric Glazer, Esq. 

For Appellant

Susan Cohn (Owner)

 Watch VIDEO

Daniel S. Rosenbaum, Esq. For Appellee Grand Condominium Association

 Watch VIDEO

H. Hugh McDonnell, Esq. For Appellee PH Hotel and PH Retail


For the Legal Eagles here are the briefs submitted to the Supreme Court by the attorneys on record:

Eric Glazer, Esq. for Appellant Condo Owner Susan Cohn

Important statements: 

This has always been the intent of the Legislature, as set forth in § 718.102 Fla. Stat., which expressly states that all condominiums created and existing in this state are subject to the Condominium Act.

If a condominium is not subject to legislative regulation and control, and is instead forevermore governed only by those set of statutes that were in effect when the condominium was created, the corollary is an extremely absurd result. Virtually every condominium in this State would be governed not only by a different declaration of condominium, but a different set of laws as well. It cannot be the policy of this State that when the Legislature determines that laws need to be passed in order to protect those who live in condominiums that such laws will only inure to the benefit of future citizens who will one day reside in condominiums that have not even been created yet, and will simply ignore the millions of families living in condominiums that already exist. 


Daniel Rosenbaum, Esq. for Appellee The Grand Condominium Associatiom, Inc.


H. Hugh McDonnell, Esq. (Siegfried, Rivera, Lerner, De La Torre & Sobel, P.A.) for Appellee PH Hotel and PH Retail

Important statement: 

She [Cohn] takes for granted that commercial control over a residential minority is abusive, drawing on the imagination, rather than record evidence, for support. Finally, it is not a stretch of the imagination for one to believe that the Legislature, in its wisdom and in order to protect the millions of Floridians who make condominiums their primary homes, twenty-four hours a day, seven days a week, 365 days a year, thought best that residential unit owners govern the majority of the board of directors instead of the board being dominated by the owners of the on-site grocery store or hair salon that occupy the properties solely as an income stream and only during normal business hours.


Eric Glazer, Esq. for Appellant Condo Owner Susan Cohn

Important statement: 

It simply cannot be the policy in Florida that the Legislature is only able to enact laws to protect condominiums that do not even exist yet, and is powerless to help the millions of citizens who live in condominiums, simply because the condominiums already exist.

The ruling of the Florida Supreme Court will have serious impact on future legislation for community associations in general. We will get an answer to the question: Will legislation that impairs contract rights of any one party be allowed to be added retroactively?

718.102  Purposes.--The purpose of this chapter is:

(1)  To give statutory recognition to the condominium form of ownership of real property.

(2)  To establish procedures for the creation, sale, and operation of condominiums.
Every condominium created and existing in this state shall be subject to the provisions of this chapter.

718.404  Mixed-use condominiums.--When a condominium consists of both residential and commercial units, the following provisions shall apply:

(2)  Subject to s. 718.301, where the number of residential units in the condominium equals or exceeds 50 percent of the total units operated by the association, owners of the residential units shall be entitled to vote for a majority of the seats on the board of administration. This subsection shall apply retroactively as a remedial measure.