FINING OWNERS FOR DEED VIOLATIONS?
DO IT THE RIGHT WAY!

(The Law Changed In 2015)

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

Published August 11, 2016

"Be careful what you wish for" should be the headline for the chapter about FINING! Fines levied the right way may serve the community well, but if the board doesn't follow the FINING Procedure as required by Florida Statutes 720.305 it can come back to haunt the whole community.

Fines can be as well a great way to bankrupt a community association and its members, if it backfires and the legal bills have to be paid by the association and its members. Our website is full of examples of lawsuits regarding fines that came back to haunt the community! Many very expensive lawsuits are witness to abuse and selective enforcement.

Before starting the FINING procedure, make sure that your original governing documents allow fining. Remember: The US Constitution only allows government entities to fine its citizens. State Supreme Courts of Virginia and Rhode Island already ruled that fining by community associations is unconstitutional. Our Florida legislature has so far refused to remove the fining provisions from the statutes governing community associations. It's all about money: Service providers love it -- it's a great source of income for them. Management companies write the violation letters -- for a price -- and attorneys are kept busy with the many lawsuits caused by fining procedures.

Many governing documents, especially in older communities, don’t allow boards to fine their neighbors. Make sure there is a provision in the original governing documents that allows the board to levy fines against owners.

Make sure that the provisions regarding "FINING" in the original governing documents are followed, especially when it comes to the amounts that can be charged as fines.

But if a board feels that it needs to FINE neighbors, please make sure that it is done the correct way. Otherwise the board members may get a lot of egg on their faces and have to pay big legal bills from the opposing attorney!

Here are some ideas to do it right – trying to avoid lawsuits, in which the “fined” neighbor ends up being the prevailing party.

Make sure that you have accurate guidelines and fine charts in place, guidelines that will hold up to legal challenges. Especially since more and more communities are trying the self-manage approach due to serious budget deficits caused by unpaid dues and/or foreclosures, it’s important that the board watches the fining process carefully in order to avoid serious financial harm to the community.

2015 LAW CHANGES

In 2015 the Florida legislature made significant changes to the "FINING PROCESS." It is now the the board of Directors levying the fines -- in a publicly noticed board meeting. Each board member has to vote on levying the fine. The vote has to be recorded in the minutes. That makes it easy for each owner to find out out who the fining-happy board members are. A fine can only be levied by the board after giving the homeowner a 14-day notice to remedy any alleged violation.

After the board has imposed a fine at a public board meeting, the owner has to be informed in writing that a fine has been levied against him/her.

Any board should be very careful to avoid SELECTIVE ENFORCEMENT. It is still the best defense owners have against being fined -- and it has cost associations hundreds of thousands of dollars in legal fees after losing such "violation" cases.

Fining procedures are regulated by FS 720.305(2)(b)

(b) A fine or suspension may not be imposed by the board of administration without at least 14 days’ notice to the person sought to be fined or suspended and an opportunity for a hearing before a committee of at least three members appointed by the board who are not officers, directors, or employees of the association, or the spouse, parent, child, brother, or sister of an officer, director, or employee. If the committee, by majority vote, does not approve a proposed fine or suspension, it may not be imposed. The role of the committee is limited to determining whether to confirm or reject the fine or suspension levied by the board. If the board of administration imposes a fine or suspension, the association must provide written notice of such fine or suspension by mail or hand delivery to the parcel owner and, if applicable, to any tenant, licensee, or invitee of the parcel owner.

Compliance Committee

The Compliance Committee (or whatever each association calls it) should be a committee of independent owners (not board members and/or their spouses or association employees) charged with approving or rejecting a fine levied by the board. The function of this committee resembles an "appeals court", where the owner -- in a public meeting -- has the opportunity to plead his/her case, trying to get the committee to reverse the fine imposed by the board.

Don't forget: Even if the compliance confirms the fine, it's still a long way for the association to really collect the fine. Most associations file a lien against the property if the owner doesn't pay the lien voluntarily. That is the moment when the owner, if unwilling to pay the fine, should take action. Remember, FS 720.3085 contains the valuable form : "CONTEST OF LIEN".

That court filing would then trigger the lawsuit that will finally decide about the validity of the imposed fine. Association boards should never forget: The association will be the plaintiff in this case, meaning the O&E insurance policy will not cover the expenses.

And if our Florida legislature doesn't act and stops the unconstitutional fining process by amending the statutes, one day an owner will take his case to the Florida Supreme court in order to get the same result as owners in Virginia and Rhode Island already got: A ruling by the Florida Supreme Court declaring fining by community associations UNCONSTITUTIONAL!