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

Transcription

1 STATE OF FLORIDA DEPARTMENT OF BUSINESS AND PROFESSIONAL REGULATION DIVISION OF FLORIDA LAND SALES, CONDOMINIUMS, AND MOBILE HOMES IN RE: PETITION FOR ARBITRATION Harrell Altizer, Luther Brown, Partricia Brown, Matthew Del Duca, Italia Del Duca, Leland Freeman, Minnie Freeman, Robert S. Jeffrey, Trustee, Robert D. Landuyt, Louise Landuyt, Robert Matus, Theresa Matus, Robert Moore, and Susan Moore, Petitioners, v. Case No Redington Towers No. 3, Inc., Respondent. / ORDER DENYING REQUEST TO INTERVENE AND FINAL ORDER ADOPTING SETTLEMENT AGREEMENT AND CLOSING CASE FILE Comes now, the undersigned arbitrator, and issues this final order as follows: This action was commenced by the fourteen petitioning unit owners on May 1, According to the petition, the board of the respondent association approved hurricane shutter specifications for the installation of shutters on both the bay and the gulf sides of the condominium building in The specifications were similar or identical for both the bay and the gulf installations. In 1999, petitioners submitted applications for approval of shutter installations on the bay side and received approval for the installations. The shutters were installed. However, a new board was subsequently elected, and an engineer has given the opinion that the shutters on the bay side pose a safety risk. The association has demanded that petitioners remove the shutters installed on the bay side. 1

2 The association has in fact removed the shutters on the bay side. The petition also alleges that the board now has adopted different specifications for the gulf and bay sides of the building, and that the board has arbitrarily applied the South Florida Building Code that requires an impact test. The association has apparently taken the position that it can require removal of the shutters installed on the bay side but that it cannot require removal on the gulf side. The association maintains that the balconies on the gulf side are limited common elements and that the balconies and walkways on the bay side are common elements. Petitioners maintain that the balconies on the bay side, for example, adjoining units 16 A and D, are part of the units and not part of the common elements, or at the very least constitute limited common elements. The association maintains that these balconies are common elements and that the owners of the adjoining units cannot erect shutters on the balconies or place items of personal property thereon. The end units in this condominium, except the end units on the 17 th and 18 th floors, had privacy gates on the bay side with latches that could be locked from one side. Over the years, the owners of the end units have treated the space inside the gates as their own personal property. The board, according to the petition, has removed the privacy gates without a vote of the owners. Petitioners maintain that if this property is limited common elements, the association has trespassed by removing the gates, and that if the property is common element, then the association by removal of the gates has altered the common elements without the consent of the owners. As relief, the petitioners request a determination of whether the balconies on the bay side form a portion of the units, limited common elements, or common elements; a determination of whether the areas behind the end unit gates on Floors 1 through 16 are 2

3 limited common elements; a determination of whether removal of the latches and gates constitute a material alteration to the common or limited common elements; a determination of whether the walkway on the 18 th floor is a common element, and if so, entry of an order requiring the association to permit all owners access to the walkway is requested; and a determination of whether the petitioners properly installed their shutters. Petitioners also request an order requiring the board to adopt uniform shutter specifications for the bay and gulf sides, as well as an order forcing the board to adopt specifications complying with the Standard Building Code. The association filed its answer on May 30, The parties were directed to attend mediation by order entered on July 27, A mediation session was conducted on August 22, The mediation session ultimately resulted in a settlement agreement being entered into among the parties in January The settlement agreement was filed with the arbitrator on February 5, According to the settlement agreement, the association agreed to reinstall the latches on the end unit privacy gates on floors 1 through 16 and to pay for the cost of reinstallation of the hurricane shutters up, to $2,500 per unit for the individual unit owner petitioners. The parties also agreed that "the area behind the end unit gates and the common area on the 18 th floor shall be identically treated as limited access common areas." The association also agreed to pay petitioners $30,000 in attorney's fees. All of the petitioners as well as the association executed the settlement agreement. The arbitrator entered an order commemorating communication on January 31, The order described a telephone conversation initiated by Bruce Robbins on January 30, Mr. Robbins, not a party to this dispute, owns a unit on the 18 th floor of the condominium building, and he objects to the terms of the settlement agreement. Mr. 3

4 Robbins at the time was considering moving to intervene in the case. The arbitrator in the order commemorating communication suggested that Mr. Robbins informally contact counsel for the parties to discuss his concerns. On February 21, 2001, Mr. Robbins filed his petition to intervene and memorandum of law in support thereof. He owns unit #18B, which is not an end-unit. According to the motion, each unit in the condominium is accessed from a common walkway or catwalk on the east side and each unit has a balcony on the west side. According to Mr. Robbins, the developer extended the end units on levels 17 and 18 to include an abutting walkway. There is key-only access on the elevator to the 18 th floor. Intervenor argues that the shuttering of the common element walkway or any part of it on any level of the building by the abutting end-unit owners would be a prohibited obstruction of the common elements and an attempt to privatize that portion of the common elements to the exclusive use of the end-unit owner. Intervenor further argues that the settlement agreement would have the effect of diluting the value of his unit while simultaneously enhancing the value of each end unit. Intervenor identifies the petitioners in this case as the owners of 7 out of the total of 32 end-unit owners, owning units on the first 16 floors of the building. Intervenor argues that the common element walkways on the 18 th floor are common elements, regardless of whether elevator access is restricted. Robbins urges that by the settlement agreement, the end-unit owners are capturing property for their private use. Robbins argues that he has a real and substantial interest in the subject matter of the litigation. The parties object to the motion to intervene, referring to the intervenor as an interloper has been aware of this controversy since it was first pending in circuit court, was removed to arbitration, and was subsequently settled by the parties. The 4

5 parties argue that permitting intervention would undermine the purpose of mediation and the arbitration program, and that if Mr. Robbins wishes to challenge the propriety of the settlement agreement, he may file his own action against the association. For all intents and purposes, this arbitration proceeding was essentially concluded when Mr. Robbins filed his motion to intervene. The arbitrator typically does not consider that he has the authority to approve or disapprove the substance of a settlement agreement 1, and but for the motion, the arbitrator would have in a ministerial capacity entered a final order incorporating the settlement agreement and closing the case file. Case law supports the view that intervention sought after dismissal of a case is intervention sought too late. Dickinson v. Segal, 219 So. 2d 435 (Fla. 1969). While a final judgement had not yet been entered, the timing of the filing of the motion to intervene, coming after execution of the settlement agreement and on the eve of entry of a final order adopting the settlement agreement, suggests that Mr. Robbins has not been timely in his efforts to assert his interests in this proceeding. His timing has certainly not facilitated his intervention efforts, and when his effort was finally initiated, the proceeding was barely "pending" within the meaning of the intervention rule, rule 1.230, Florida Rules of Civil Procedure, which permits anyone claiming an interest in "pending" litigation to seek to intervene in the action. The arbitrator finds that intervention at this late date would substantially disrupt the proceeding. 2 Mr. Robbins has also not shown that representation of his interests and the interests of all unit owners in this proceeding by the association has been inadequate. Pursuant to s (3), F.S., a condominium association is authorized to institute, 1 See, rule 61B (3),F.A.C. 2 Indeed, intervention would, if successful, necessarily derail the settlement agreement signed by the parties and would place the parties back to the beginning position with respect to resolving or adjudicating 5

6 maintain, settle, and appeal actions in its own name on behalf of all unit owners concerning matters of common interest to all or most owners including the common elements. See, also, rule 1.221, Florida Rules of Civil Procedure, which contains language similar to the statutory provision. Here, the association, pursuant to its grant of statutory authority, is defending an action that is uniquely situated within its area of primary responsibility. 3 The action concerns the hurricane shutter specifications and the association's overriding duty to maintain, repair, and preserve the common elements. In Oster et al. v. Cay Construction Company, 204 So. 2d 539 (Fla. 4 th DCA 1967), the appellate court affirmed the decision of the trial judge not to permit the majority stock holders of a corporation to intervene in an action brought by the corporation against a director and others for an accounting and damages arising out of an alleged breach of fiduciary duties. The court stated: The mere fact that they are stockholders in the plaintiff corporation does not give them sufficient interest to intervene in the absence of a showing that the plaintiff association is not adequately conducting the suit. [Id. at 542]. See also, Florida Wildlife Federation, Inc. v. Board of Trustees of the Internal Improvement Trust Fund, 707 So. 2d 841 (Fla. 5 th DCA 1998), in which the Florida Wildlife Federation and the Save Our St. Johns River environmental groups attempted to intervene in an action to determine the ownership of certain lakefront property. The court, in discussing the interest which would support intervention, stated: [T]he Florida Supreme Court established a two-step analysis to decide if the trial court should grant a motion to the dispute. 3 Compare, the rule of law employed in Ramos v. Phillip Morris Companies, Inc., 714 So. 2d 1146 (Fla. 3 rd DCA 1998), wherein the court decided that where a class member opts out of a class action settlement, the trial judge must grant the member's motion to intervene for purposes of appeal because the class member would be bound by the judgment. Here, Mr. Robbins is not a party and is not bound by the settlement agreement. 6

7 intervene. The court wrote: First, the trial court must determine if the interest asserted is appropriate to support intervention. Once the trial judge determines that the requisite interest exists, it must exercise its sound discretion to determine whether to permit intervention. Id. at 507. See also, Morgareidge v. Howey, 78 So. 14 (Fla. 1918) (finding the interest necessary to entitle the right to intervene must be of such a direct and immediate character that the intervenor will either gain or lose by the direct legal operation and effect of the judgement.) The trial court correctly applied the two-step analysis established by Union Central. Although the court determined that the appellants showed a direct and immediate interest in the case, the trial court also found that the Trustees, a responsible governmental entity, will fully protect the appellants' interest. [Citations omitted]. Moreover, intervention is a matter of a court's discretion; though the trial court may liberally grant the motion, there is no absolute right to intervention We find that the appellants' interests are protected by the Trustees. [Id. at 841]. In this case, the association is defending this action on behalf of all members including Mr. Robbins, and it was neither suggested nor shown that the association's 7

8 efforts in the litigation have been misdirected or inadequate. 4 In order for intervention to be appropriate, it must be shown that the interests of the intervenor will be directly impacted by the judgement. An instructive case is Heatherwood Community Homeowners Association, Inc. v. Florida Rock Industries, Inc., 629 So. 2d 928 (Fla. 5 th DCA 1993), in which the court was asked to review the trial judge's decision to deny the motion to intervene filed by a homeowners association in a suit brought by a mining company against Citrus County seeking to challenge the county's comprehensive plan which would prohibit mining on property owned by Florida Rock. The mining company intended to mine the ground within 200 feet of the association's property. The appellate court concluded that an appropriate occasion for intervention was not shown: The general rule of intervention allows a party to intervene where the intervenor will either gain or lose by the direct legal operation and effect of the judgment [T]here is no direct and immediate interest which the intervenors have in this action. Furthermore, Heatherwood does not stand to gain or lose by the direct legal operation and effect of the judgment in this action. [Id. at 929]. In this case, Intervenor argues that if the settlement agreement is given effect, the market value of his unit will decrease and that of his neighbors will correspondingly increase. Such an interest would not appear to be of a direct and immediate nature sufficient to support intervention. The interest might be characterized as speculative, 4 Compare, Brickell Bay Condominium Association, Inc. v. Forte, 410 So. 2d 522 (Fla. 1982), in which the court commented that in a suit for damages by the developer of a condominium against a contractor providing services to the condominium, the condominium association should be permitted to intervene because, among other reasons, the developer could not be counted on the adequately represent the interests of the association. 8

9 uncertain, and occurring if at all at some unidentified time in the future. 5 Based on these considerations, the motion to intervene is denied. The settlement agreement of the parties is attached hereto and incorporated here for all purposes. The parties shall comply with the terms thereof; enforcement if necessary shall be in a court of competent jurisdiction. The case file of the arbitrator is hereby closed. DONE AND ORDERED this 6th day of March, 2001, at Tallahassee, Leon County, Florida. Karl M. Scheuerman, Arbitrator Department of Business and Professional Regulation Arbitration Section Northwood Centre 1940 North Monroe Street Tallahassee, Florida Certificate of Service I hereby certify that a true and correct copy of this order has been sent by U.S. Mail on this 6th day of March, 2001, to the following: Lee L. Haas, Esquire, Haas & Castillo, P.A., Arbor Shoreline Office Park, C U.S. 19 North, Suite 401, Clearwater, Florida 33764, to Francis E. Friscia, Esquire, 500 North Westshore Boulevard, Suite 830, Tampa, Florida 33609, and to Bruce J. Robbins, Esquire, 509 S. Greenwood Avenue, Clearwater, Florida Karl M. Scheuerman, Arbitrator 5 This case is similar to the decision in Marks v. Marks, 609 So. 2d 710 (Fla. 4 th DCA 1992), wherein the court determined that the interest of a minority shareholder in a closely held corporation consisting of his speculated potential for future tax consequences due to the judgement is not of a direct and immediate character sufficient to support intervention. Intervenor Robbins candidly states that in addition to decreasing the value of his unit, the settlement agreement will in ways "not yet determined" affect the current use of the 18 th floor walkways. 9

10 Right to Appeal As provided by s , F.S., this final order may be appealed by filing a petition for trial de novo with a court of competent jurisdiction in the circuit in which the condominium is located, within 30 days of the entry and mailing of this final order. This order does not constitute final agency action and is not appealable to the district courts of appeal. If this final order is not timely appealed, it will become binding on the parties and may be enforced in the courts. 10