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

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1 STATE OF FLORIDA DEPARTMENT OF BUSINESS AND PROFESSIONAL REGULATION DIVISION OF FLORIDA CONDOMINIUMS, TIMESHARES AND MOBILE HOMES IN RE: PETITION FOR ARBITRATION COOPERATIVE Peter Zimmerman and Gerald Parsons, Petitioners, v. Case No Norfolk House, Inc., Respondent. / ORDER DISMISSING CERTAIN DISPUTES AND REQUIRING AMENDED PETITION On June 15, 2015, Peter Zimmerman and Gerald Parsons (Petitioners) filed, through counsel, a Petition for Mandatory Non-Binding Arbitration. 1 The petition names Norfolk House, Inc. (the Association) as Respondent. 2 First, the petition alleges an election dispute and requests as relief, in pertinent part, an Order declaring, the elections and shareholders meeting held on March 10, 2015, along with all decisions made therein, null and void. In part, Section (1)(d)1.a., Florida Statutes, states, Any challenge to the election process must be commenced within 60 days after the election results are announced. In as much as Petitioners allege in their petition that the election was held on March 10, 2015, Petitioners were required to show cause why the petition should not 1 Pursuant to an Order Requiring Filing Fee entered on June 23, 2015, the required $50.00 filing fee was received on June 29, The cooperative consists of eight (8) units. Page 1 of 6

2 be dismissed for failure to comply with the statute, i.e., the petition was filed well beyond 60 days after the election. 3 On July 10, 2015, Petitioners filed a response to the Order to Show Cause. Essentially, Petitioners assert they were trying to negotiate a resolution to the dispute through May 15, 2015, but the negotiations terminated without agreement. Unfortunately, the statute does not provide for any exceptions to filing a petition within 60 days after the election, therefore the election dispute must be dismissed as untimely filed, including all of the matters relating to notice, proxies and certificate of mailing. See, e.g., Sanson v. Reflection Key Condo. Ass n, Inc., Arb. Case No , Summary Final Order (May 4, 2015) (construing similar condominium statute in the same way); Martinez v. Sunset Hills Condo. Ass n, Inc., Arb. Case No , Final Order of Dismissal (Oct. 24, 2014) (construing similar condominium statute in the same way); Ruffner v. Spencer s Plantation Homeowners Ass n, Inc., Arb. Case No , Final Order of Dismissal (May 19, 2015)( construing similar homeowners association statute in the same way); Martin v. Watermill Master Ass n, Inc., Arb. Case No , Summary Final Order (April 2, 2014) (construing similar homeowners association statute in the same way). The petition makes numerous other allegations relating to the following: notice of board meetings; budget meetings; and records and their retention. These are addressed below. Budget Section (1), Florida Statutes, provides as follows: 3 Sixty (60) days after the election would be May 10, Page 2 of 6

3 (1) DEFINITIONS.--As used in this section, the term dispute means any disagreement between two or more parties that involves: (a) The authority of the board of directors, under this chapter or association document to: 1. Require any owner to take any action, or not to take any action, involving that owner s unit or the appurtenances thereto. 2. Alter or add to a common area or element. (b) The failure of a governing body, when required by this chapter or an association document, to: 1. Properly conduct elections. 2. Give adequate notice of meetings or other actions. 3. Properly conduct meetings. 4. Allow inspection of books and records. "Dispute" does not include any disagreement that primarily involves: title to any unit or common element; the interpretation or enforcement of any warranty; the levy of a fee or assessment, or the collection of an assessment levied against a party; the eviction or other removal of a tenant from a unit; alleged breaches of fiduciary duty by one or more directors; or claims for damages to a unit based upon the alleged failure of the association to maintain the common elements or condominium property. With respect to the budget, the petition alleges as follows:... Page 3 of 6

4 The Association s budget ultimately relates to assessments. Under Section (1), disputes relating to the levy of a fee or assessment are not subject to arbitration. See Perez v. Tuscany at Innisbrook Condo. Ass n, Inc., Arb. Case No , Final Order Dismissing Petition for Lack of Jurisdiction (Jan. 28, 2015); Baron v. Greynolds Park Club Ass n, Inc., Arb. Case No , Final Order Dismissing Petition for Lack of Jurisdiction (Jan. 9, 2012); Mitchell v. Beach Club of Hallandale Condo. Ass n, Inc., 17 So. 3d 1265 (Fla. 4 th DCA 2009) (failure to give proper notice of assessment meeting, failure to establish quorum, use of expired proxies and failure to provide audited financial statement all related to levy of assessment and therefore were not disputes subject arbitration). Therefore, the budget disputes alleged are not subject to arbitration and must be dismissed. Records Petitioners allege the Association is failing to maintain official records. In this regard, Petitioners simply list in the petition all of the official records to be maintained by an Association, as set forth in Section (2)(a), Florida Statutes. However, under Section (1) only disputes relating to allowing the inspection of books and records are subject to arbitration, and Petitioners make no such allegation. 4 Therefore, the records dispute relating to the failure to maintain records is not subject to arbitration and must be dismissed. 4 Petitioners include a letter dated March 2, 2015, sent by counsel for Petitioners to the Association s board of directors which appears to be a request to inspect certain records. Petitioners include a letter dated March 5, 2015, addressed to counsel for Petitioners from counsel for the Association inviting Petitioners to inspect the documents requested at a mutually agreed upon day and time. There is no allegation in the petition that Petitioners ever responded to this invitation which ultimately resulted in a violation of Section (2)(c), Florida Statutes. Additionally, there is no proof of proper pre-arbitration notice pursuant to Section (4)(b), Florida Statutes, for any access to records dispute. Page 4 of 6

5 Meeting Notice The only remaining dispute alleged in the petition not being dismissed as setout above relates to the Association s alleged failure to properly notice meetings of the board of directors. Petitioners will be permitted to file an Amended Petition containing only this dispute. Accordingly, it is ORDERED: As set out above herein, all of the disputes alleged in the petition are DISMISSED, except the dispute relating to failure to properly notice meetings of the board of directors. No later than 5:00 p.m. on July 27, 2015, the Association shall file a proper and complete Amended Petition, and include a copy for service on Respondent, containing only the failure to properly notice meetings of the board of directors dispute, 5 failing which the petition shall be dismissed without further notice. DONE and ORDERED this 17 th day of July, 2015, at Tallahassee, Leon County, Florida. Glenn Lang, Arbitrator Department of Business and Professional Regulation Arbitration Section Northwood Centre 1940 North Monroe Street Tallahassee, Florida Phone: ; FAX: The petition as originally filed does not specifically allege the date of any particular board meeting that was held without proper notice. The Amended Petition, should one be filed, should reference a particular board meeting or meetings on a date certain after the date of pre-arbitration notice, wherein proper notice was not provided pursuant to Section (1)(c), Florida Statutes. Page 5 of 6

6 Copy furnished by facsimile and by U.S. mail to: Stuart P. Schneider, Esq. Rajtar & Associates, P.A Polk Street Hollywood, Florida Facsimile: / Attorneys for Petitioner Page 6 of 6