STATE OF FLORIDA DEPARTMENT OF BUSINESS AND PROFESSIONAL REGULATION DIVISION OF FLORIDA LAND SALES, CONDOMINIUMS, AND MOBILE HOMES

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1 STATE OF FLORIDA DEPARTMENT OF BUSINESS AND PROFESSIONAL REGULATION DIVISION OF FLORIDA LAND SALES, CONDOMINIUMS, AND MOBILE HOMES IN RE: PETITION FOR ARBITRATION ESTHER MILLER, ROY KRONENBERG, AUDREY CLOUTIER, JOHN GALLAGHER, GRETA GORDON, YOLETTE GUERRIER, PATRICIA RATTRAY, SHERRY GIBSON, ANTHONY PISA, ED HUBBARD, KAREN RISCH and ROY GIL, Petitioners, v. Case No OLIVE GLEN CONDOMINIUM ASSOCIATION, INC., Respondent. / ORDER TO SHOW CAUSE The petitioners/unit owners filed on November 12, 1999, a petition for arbitration naming Olive Glen Condominium as respondent. The arbitrator has corrected the case style to reflect that the respondent is the association, per Rule 61B (1), Florida Administrative Code. provides: The undersigned arbitrator notes that Section (4)(b), Florida Statutes, The petition must recite, and have attached thereto, supporting proof that the petitioner gave the respondents: 1. Advance written notice of the specific nature of the dispute; 2. A demand for relief, and a reasonable opportunity to comply or to provide the relief; and 3. Notice of the intention to file an arbitration petition or other legal action in the absence of a resolution of the dispute. 1

2 Failure to include the allegations or proof of compliance with these prerequisites requires dismissal of the petition without prejudice. The petition in the case at bar gives no indication that the association was advised of the petitioners intention to file an arbitration petition or other legal action in the absence of a resolution of the dispute. In addition, no letters or other documentation are attached as proof that the unit owners gave the association advance written notice of such intention. The October 1, 1999, letter attached to the petition, which states that the unit owners wish to meet with the board to discuss some of the issues which are raised in the petition, does not meet the requirement of the statute quoted above. The arbitrator further notes that, even if it is determined that the pre-arbitration notice requirement has been met, the petition is otherwise insufficient. The petitioners first request for relief is that A set number of Directors must be established. (suggested, 5 or 7). The undersigned arbitrator notes that he is without authority to fix the number of directors, since this is determined by the by-laws of the condominium. In the case of the present condominium, the by-laws do not fix the number, since Article III, 1., of the bylaws provides that there shall be not less than three (3) nor more than fifteen (15) Directors. In that eventuality, the number of directors shall be five, pursuant to Section (2)(a)1., Florida Statutes. In the event that the petitioners are determined by the arbitrator to have satisfied the notice requirement, they must file an amended petition consistent with the above authority. The petitioners next claim for relief requests that the arbitrator order elections in order to begin the two-term directors, 2 or 3 directors must remain. The arbitrator notes 2

3 that the petitioners are apparently alleging that some directors are remaining on the board for five years, in violation of Article III, Section 3. of the bylaws, which provides that directors shall serve two-year terms, with such terms being staggered so that a majority is elected one year and the remainder the following year. The petitioners, however, have stated no specific facts which demonstrate a violation of this principle. If an individual was re-elected, his presence on the board for more than two years would not, in and of itself, seem to violate the by-laws; although failure to follow proper nominating procedures (another claim raised by petitioners) might cast doubt upon the validity of the elections. Any amended petition should list specific directors and when they were elected, so that the association can respond to the allegations. A further request for relief raised by petitioners requests, in part, that the arbitrator order that notices of the annual meeting & elections must be sent out with this list of 5 or 7 candidates, with a proxy form. The arbitrator notes that this request for relief apparently overlooks Section (b)2., Florida Statutes, which prohibits elections by proxy after Jan. 1, There is no indication in the petition that the bylaws were amended after Jan. 1, 1992, to provide for such a method, as contemplated by Section (d), Florida Statutes. The petition states only that the Condominium voted by a majority to continue to use the manner of elections as provided in the Bylaws If, in fact, the bylaws were amended in 1995 to allow proxies to elect directors, as the petitioners may be implying, such an amendment was not quoted, nor was it provided with the petition, which includes only a set of documents dated Any amended petition filed should include such documentation of a post-1992 amendment; otherwise, the claim will be stricken. The petitioners further request that the arbitrator order that if no quorum at the 3

4 annual meeting of unit owners is achieved, those nominated for directors positions by the nominating committee will be deemed elected. The arbitrator notes that the petition cites no authority in the condominium documents or statute which would require such a procedure. Moreover, Section (2)(d), Florida Statutes, provides that Elections shall be decided by a plurality of those ballots cast. There shall be no quorum requirement; however, at least 20 percent of the eligible voters must cast a ballot in order to have a valid election of members of the board of administration. In light of this provision, this claim, which seeks an order requiring an automatic installation of nominated candidates in the absence of a quorum, appears to fail to state a claim for relief which the arbitration could lawfully grant, and would therefore be stricken. The next claim for relief reads: We wish to have proper Reserve accounts. The request for an order requiring establishment of reserve accounts raises an issue outside the arbitrator s authority, and this claim would therefore be stricken. See, Dacher v. Heatherwood Condo. Assn. of Boca Raton, Florida, Inc., Arb. Case No (Final Order Dismissing Petition for Arbitration Without Prejudice (May 21, 1997) (arbitrator had no jurisdiction over claim alleging the association s failure to properly fund reserves). Such a claim would more properly be raised in court, as appropriate or referred to the Bureau of Condominiums for investigation and possible enforcement action. The petitioners final request for relief states simply, We wish to have access to the Records. The petition further alleges only individuals refused access to the records. This claim is bereft of facts sufficient to raise a claim under Section (12)(c), Florida Statutes, since it does not allege or attach proof that any specific written request was made to inspect the official records of the association. Thus, unless sufficient, specific, facts were 4

5 stated in an amended petition, the claim would be stricken. The reason for this requirement is so that the other party is sufficiently apprised of what is being claimed so that it can respond and so that the arbitrator can fashion the appropriate relief. Based upon the foregoing, it is hereby ORDERED: 1. The petitioners shall mail a response within 15 days of the date of this order and show cause why the petition for arbitration should not be dismissed for failure to comply with Section (4)(b), Florida Statutes. 2. If the arbitrator determines that this arbitration proceeding will go forward, the arbitrator will so notify the petitioners and the petitioners will be required to file an amended petition consistent with this order. If this petition, on the other hand, is dismissed for lack of pre-arbitration notice, any new petition must be accompanied by an additional filing fee and must comport with the requirements of this order. DONE AND ORDERED this 1st day of December, 1999, at Tallahassee, Leon County, Florida. Copy furnished to: ESTHER E MILLER 3004 NW 4TH AVE APT 2 POMPANO BEACH FL Petitioner designated to receive mail on behalf of all individual petitioners Tyler Powell, Arbitrator Dept. of Business and Professional Regulation Arbitration Section 1940 North Monroe Street Tallahassee, Florida