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 CANADIAN OCEAN BREEZE CONDOMINIUM ASSOCIATION, INC., Petitioner, v. Case No GIORGIO ARDIZZOLA, JR. GIORGIO ARDIZZOLA, and ELISA ARDIZZOLA, Respondents. / ORDER CORRECTING FINAL ORDER AND DENYING PETITIONER S MOTION FOR REHEARING Correction of Final Order On December 24, 2008, a Final Order was entered in the above-listed case. The parties stipulated at the final hearing that Respondents had removed their second dog from the property and that that issue was moot prior to Respondents receipt of the petition. At the final hearing, the parties stipulated that Respondents had complied with Petitioner s demand to remove the fence after Respondents receipt of the petition. The final order stated that the arbitrator would make a determination of prevailing party status of the parties. The final order failed to contain such determination. On December 31, 2009, Petitioner filed a Motion for Clarification of the Final Order or Rehearing. On January 26, 2009, Respondent filed a Motion for Extension of Time to Reply to Petitioner s Motion. On March 27, 2009, an Order Requiring 1

2 Respondents Reply to Be Filed was entered. On April 8, 2009, Respondent filed a Response to Petitioner s Motion. Background Petitioner, Canadian Ocean Breeze Condominium Association, Inc., filed an amended petition for non-binding arbitration on November 16, 2007, alleging Respondents were maintaining an unauthorized second dog in the unit and had constructed an unauthorized fence currently located on the common area. As relief, Petitioner requested an order permanently removing Respondents second dog from the condominium property and the permanent removal of Respondents fence located on the condominium property, along with an award of attorney s fees and costs. On January 15, 2008, Respondent filed an Answer alleging the violations had been cured prior to the filing of the petition. On January 17, 2008, an Order to Show Cause was entered. On January 31, 2008, Petitioner filed a Response to Order to Show Cause, alleging that Respondents had never informed Petitioner that they had cured the second dog issue, such that Petitioner had no knowledge of their compliance. Additionally, Petitioner alleged that, relating to the fence still located at that time on Petitioner s property, Respondents had and were relying on invalid or fraudulent approvals by board members. On April 8, 2008, a Final Hearing was held. 2

3 Dog Rule 61B (5), Florida Administrative Code, provides as follows: No petition shall be accepted for arbitration under these rules which involves issues which are moot, abstract, hypothetical, or otherwise lacking the requirements of a case or controversy; no dispute which is not a bona fide, actual and present dispute shall be accepted for arbitration. In the case at hand, the parties stipulated at the final hearing that the dog in question was removed after of the pre-arbitration notice but before Respondents receipt of the petition. The parties stipulated that Respondents had not communicated their compliance to Petitioner s demands to remove the dog and that Petitioner failed to determine the presence or absence of the dog on the condominium property before filing the petition. The doctrine of mootness is a limitation on jurisdiction. See Godwin v. State, 593 So.2d 211, 212 (Fla. 1992). An issue is moot when the controversy has been so fully resolved that a judicial determination can have no actual effect. A case is moot when it presents no actual controversy or when the issues have ceased to exist. Additionally, settlement of a case renders it moot. See Santa Rosa County v. Admini. Comm n, Div. of Admin. Hearings, 661 So.2d 1190, 1193 (Fla. 1995); Jones v. Champion, 675 So.2d 244 (2d DCA 1996); Seslow v. Seslow, 625 So.2d 1248 (4 th DCA 1993). To have standing in this forum, Petitioner must show the following: that a case or controversy exists between the petitioner and the respondent; that such case or controversy existed at the commencement of the proceeding; and that the controversy continued through the continuation of the proceeding. Rule 61B , Florida Administrative Code. 3

4 In West Wind Estates Condominium Association, Inc. v. Becker, Arb. Case No F, Order on Motion for Attorney s Fees (August 15, 1995), the arbitrator stated the test for determining the prevailing party where the arbitration petition is dismissed as moot: A party can be considered a prevailing party, even though the case is moot, when (1) it has obtained the relief it sought in the arbitration or lawsuit; (2) the petition for arbitration or lawsuit was the catalyst that motivated the opposing party to take the action causing the case to become moot; and (3) the action taken by the opposing party was required by law. See also, Bermuda Cays Condo. Assoc., Inc. v. Baker, Arb. Case No , Final Order on Attorney's Fees (March 12, 1999). In the case at hand, Respondents removed the dog from the condominium property after receipt of Petitioner s pre-arbitration notice and before receiving the petition. Accordingly, the issue related to Respondents second dog was moot prior Respondents receipt of the petition, and Petitioner has not established that Respondent s compliance, which was required by Article 10.2 of the Declaration of Condominium, was motivated by their receipt of the petition for arbitration. Fence Paragraph of the Declaration of Condominium, states as follows: Exterior of Apartment No Owner shall paint, refurbish, stain, alter, decorate, or change any outside or exterior portion or surface of the Condominium Property, including any walls, balconies, door, windows, or screens; repair or replace any such item in any manner except in the manner which existed prior to the need for such repair or replacement; place any screening or awning on or in any Apartment; or install on any portion of the condominium Property any exterior lighting fixture, mailbox, screen door or other similar item without first obtaining specific written approval thereof by the Board, which approval may be withheld by the Board in its sole and 4

5 absolute discretion and which approval the Board shall not grant if in its opinion the effect of any of the foregoing will be unsightly and detrimental to the aesthetic appearance of the Condominium Property. At the final hearing the parties stipulated that Respondents, sometime after receipt of the petition and prior to the hearing, removed the fence. Accordingly, the dispute related to Respondents fence is moot. As previously stated, where the underlying case is rendered moot due to the respondent's compliance, the petitioner is the prevailing party for the purpose of awarding costs and attorney fees if legal action is the catalyst motivating the opposing party's compliance and the action was required by law. West Wend Estates Condominium Association, Inc. v. Becker. In the case at hand, the parties stipulated at the final hearing that Respondents compliance with Petitioners demand for the removal of the fence occurred after the Respondents receipt of the petition. Additionally at that time, four of the five seated board members 1 approved Mr. Ardizzola s request to install a fence. Furthermore, Article XIII, Section 1.2 of the Declaration of Condominium, grants the board the sole and absolute discretion to approve changes to the exteriors of apartments and nothing in the section requires the board to hold a meeting to confirm their approval. Petitioner did not prove at the final hearing that the signatures of the board members were forged. Additionally, Article XII, Section 1.2 of the Declaration of Condominium, does not require the board to ratify any approval granted under that section in a subsequently held board meeting. Accordingly, Respondents reliance on the written approval of four of the five board members was valid. 1 The parties agree that one board seat was vacant at the time in question and that Mr. Ardizzola was a member of the board. 5

6 While the parties and Petitioner stipulated that Respondent did remove the fence after receipt of the petition, therefore the petition was the catalyst for Respondent s action, Petitioner did not prevail on this issue. As previously stated, the three-part Westwind test requires the Petitioner to have obtained the relief it sought in the arbitration or lawsuit, which it did; and that the petition for arbitration or lawsuit was the catalyst that motivated the opposing party to take the action causing the case to become moot, which it was; and that the action taken by the opposing party was required by law, which is was not. Accordingly, Petitioner is not the prevailing party on this issue. 2 Petitioner s Motion for Rehearing Rule 61B , Florida Administrative Code, provides as follows: (1) A motion for rehearing may be filed within 15 days after the date of entry of the final order. The motion shall state with particularity the points of law or fact that the arbitrator has overlooked or misapprehended and shall not reargue the merits of the final order. Any response to the motion must be filed within 10 days of service of the motion. (2) The arbitrator shall not modify the substance of the final order except upon a showing that the decision is based on a clear error of law or fact. A motion that is timely filed pursuant to this rule shall suspend the operation of the final order, and the time for filing a complaint for trial de novo, a motion seeking to recover prevailing party costs and attorney s fees, or a petition for enforcement under Sections and , F.S., shall not commence until the arbitrator either denies the motion or enters an amended final order. An untimely filed motion for rehearing does not toll or otherwise stop the time provided for the filing of a motion for prevailing party costs and attorney s fees or the time provided for the filing of a petition for trial de novo in the courts. 2 As it was stated in the Final Order, Respondents installation of another fence on the common element or reinstallation of the prior fence on the common element must, of course, be approved by the association s board pursuant to the requirements of the association s governing documents. 6

7 Petitioner alleges the arbitrator has misapprehended a point of law and states as a basis, as follows: [I]t does not matter whether the Association s board of directors grants its approval with or without conditions. The approval is illegal per se, and null and void ab inito, because it was given by the previous board of directors, where the Respondent serves as the Vice-President, without a properly noticed and held meeting of the board of directors, and because it was not subsequently ratified by a majority of the board of directors in a properly noticed and conducted meeting. Petitioner cited the following cases: Petito v. Greenglades Condominium Association II, Inc., Arb. Case No , Summary Final Order (January 13, 1994)(citing Fla.Jur.2d Business Relationships, s. 291 and Am.Jur.2d Corporations, s. 1446, for the general rule is that directors can only take official corporate action when they act at legal board meetings); Palmer v. Bellamy Forge Association, Inc., Arb. Case , Summary Final Order (July 28, 1994)(where agenda listed only committee reports as an item where the board was considering adopting a use fee for use of the clubhouse, agenda and notice were insufficient to give unit owners notice and an opportunity to present their opinions on the imposition of a user fee. Accordingly, the user fee was not lawfully adopted); Dehne v. Ocean Club III Condominium Association, Inc., Arb. Case No , Summary Final Order (January 31, 1994)(board violated (2)(c), F.S., by appointing replacement board members at board meeting where replacement of directors was not an item listed on the agenda. Replacement of board members deemed void); The Village Condominium Association Inc., v. Martinez, Arb. Case. No , Summary Final Order (March 16, 2002). In each of the cases cited by Petitioner the disputed issue was related to the action taken by the board which impacted the community as a whole. In Petito the 7

8 board held emergency meetings, held meetings without a quorum present, allowed for the election to the board of non-members of the association, and improperly conducted other association business. In Palmer the board was considering the imposition of user fees for certain recreational facilities and had not properly identified the issue in the agenda. In Dehne the board appointed replacement directors in violation of Section (2)(c), F.S., by not listing appointment of replacement directors on the agenda for the meeting. In The Village the board held an emergency meeting to adopt a rule limiting the number of automobiles per unit. In each instance cited by Petitioner, the board was conducting business that required a properly noticed meeting. In the case at hand, Petitioner alleges Respondents were in violation of Article XIII, Section 1.2 of the Declaration of Condominium. This section applies to unit owners and the necessity for the board s approval for a unit owner to obtain approval prior to making certain changes to the exterior of the unit. This section grants the board the sole authority to grant approvals. At that time, the six-member board had five members seated, including Respondent. Respondent obtained the approval of four members of the board, including his own, to erect a fence behind his unit. Petitioner subsequently challenged Respondent s approval alleging some signatures were forged and the board failed to subsequently ratify their approval at a board meeting. Petitioner s allegation that signatures on the approval were forged was not proven by Petitioner at the final hearing and Article XIII, Section 1.2 of the Declaration of Condominium, does not require the board to ratify their approval under this section at a subsequent board meeting. 8

9 Petitioner alleges that [s]hould the arbitrator hold that no ratification was necessary when a board acts without the formality of the meeting, then such conclusion would turn the statutory language to its head, including the intent of F.S (2)(c), which is all about transparency and the right of a unit owner to know and to participate in the actions of its board. Section (2)(c), Florida Statutes, provides as follows: Board of administration meetings.--meetings of the board of administration at which a quorum of the members is present shall be open to all unit owners. Any unit owner may tape record or videotape meetings of the board of administration. The right to attend such meetings includes the right to speak at such meetings with reference to all designated agenda items. The division shall adopt reasonable rules governing the tape recording and videotaping of the meeting. The association may adopt written reasonable rules governing the frequency, duration, and manner of unit owner statements. Adequate notice of all meetings, which notice shall specifically incorporate an identification of agenda items, shall be posted conspicuously on the condominium property at least 48 continuous hours preceding the meeting except in an emergency. If 20 percent of the voting interests petition the board to address an item of business, the board shall at its next regular board meeting or at a special meeting of the board, but not later than 60 days after the receipt of the petition, place the item on the agenda. Any item not included on the notice may be taken up on an emergency basis by at least a majority plus one of the members of the board. Such emergency action shall be noticed and ratified at the next regular meeting of the board. However, written notice of any meeting at which nonemergency special assessments, or at which amendment to rules regarding unit use, will be considered shall be mailed, delivered, or electronically transmitted to the unit owners and posted conspicuously on the condominium property not less than 14 days prior to the meeting. Evidence of compliance with this 14-day notice shall be made by an affidavit executed by the person providing the notice and filed among the official records of the association. Upon notice to the unit owners, the board shall by duly adopted rule designate a specific location on the condominium 9

10 property or association property upon which all notices of board meetings shall be posted. If there is no condominium property or association property upon which notices can be posted, notices of board meetings shall be mailed, delivered, or electronically transmitted at least 14 days before the meeting to the owner of each unit. In lieu of or in addition to the physical posting of notice of any meeting of the board of administration on the condominium property, the association may, by reasonable rule, adopt a procedure for conspicuously posting and repeatedly broadcasting the notice and the agenda on a closed-circuit cable television system serving the condominium association. However, if broadcast notice is used in lieu of a notice posted physically on the condominium property, the notice and agenda must be broadcast at least four times every broadcast hour of each day that a posted notice is otherwise required under this section. When broadcast notice is provided, the notice and agenda must be broadcast in a manner and for a sufficient continuous length of time so as to allow an average reader to observe the notice and read and comprehend the entire content of the notice and the agenda. Notice of any meeting in which regular or special assessments against unit owners are to be considered for any reason shall specifically state that assessments will be considered and the nature, estimated cost, and description of the purposes for such assessments. Meetings of a committee to take final action on behalf of the board or make recommendations to the board regarding the association budget are subject to the provisions of this paragraph. Meetings of a committee that does not take final action on behalf of the board or make recommendations to the board regarding the association budget are subject to the provisions of this section, unless those meetings are exempted from this section by the bylaws of the association. Notwithstanding any other law, the requirement that board meetings and committee meetings be open to the unit owners is inapplicable to meetings between the board or a committee and the association's attorney, with respect to proposed or pending litigation, when the meeting is held for the purpose of seeking or rendering legal advice. 10

11 This section is not relevant to the issue at hand. The board s approval of the fence did not require subsequent ratification at a board meet. 3 Accordingly, the board was not required to hold a meeting to ratify their approval under Article XIII, Section 1.2 of the Declaration of Condominium. Based on the foregoing, it is ORDERED: 1. Petitioner s Motion for Rehearing is Denied. 2. Respondent s compliance with Petitioner s demand to remove the unauthorized dog was in response to Petitioner s pre-arbitration notice and occurred prior to their receipt of the petition. 3. Respondents compliance with Petitioner s demand to remove the fence was in response to Petitioner s filing of the petition but was not a violation of Article XIII, Section 1.2 of the Declaration of Condominium. DONE AND ORDERED this day of September, 2009, at Tallahassee, Leon County, Florida. Tonya S. Chavis, Arbitrator Department of Business and Professional Regulation Arbitration Section Northwood Centre 1940 North Monroe Street Tallahassee, Florida Telephone: FAX: Of course, had the board decided to ratify Respondents fence approval at a meeting, such ratification would be subject to the requirements of Section (2)(c), Florida Statutes. 11

12 Copies furnished to: Patrick Dervishi, Esquire Kahan & Shir, PL 1800 NW Corporate Blvd. Suite 102 Boca Raton, Florida G. William Allen, Jr., Esquire 310 SE 13 th Street Fort Lauderdale, FL