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 W. Kelly Stanton and Grady White, Petitioners, v. Case No Twin Towers Homeowners Association, Inc., Respondent. / CORRECTED FINAL ORDER OF DISMISSAL On February 4, 2009, a Final Order of Dismissal was entered in the above styled case, but the order was unsigned. This order corrects that omission. On December 29, 2008, Petitioner s filed a Petition for Mandatory Non-Binding Arbitration alleging that Twin Towers Homeowners Association, Inc. (Association) seeks to materially alter limited common element cement or concrete parking structures by replacing them with aluminum structures without approval of the Association membership. The work was approved only by the board of directors. The petition also alleges that the Association levied a special assessment for the work. On January 22, 2009, Petitioners filed a Verified Motion and Petition for Emergency Stay of Arbitration stating the contractor began tearing down the relevant structures on January 5, 2009, and the Association continues to allow the contractor to proceed in violation of the condominium documents and the statutes. Petitioners state they are without adequate remedy at law to stop the alleged violation of the 1

2 condominium documents and the statutes and there is the high probability of success by Petitioners. On January 30, 2009, a telephonic case management conference (CMC) was held with both parties in attendance. At the CMC the parties argued the motion. XIX The Twin Towers Declaration of Condominium (Declaration) provides at Article ASSOCIATION shall have the right to make or cause to be made such alterations or improvements to the COMMON PROPERTY which do not prejudice the rights of the owner of any PRIVATE DWELLING in the use and enjoyment of his PRIVATE DWELLING, unless such owner s written consent has been obtained, provided the making of such alterations and improvements are approved by the Board of Directors of said ASSOCIATION, and the cost of such alterations or improvements shall be assessed as common expenses and collected from all of the owners of PRIVATE DWELLINGS. (emphasis in the original). No amendments to this provision were attached to the petition. Petitioners argue in their motion to stay that because Article XIX of the Declaration does not refer to material alterations, but only alterations, current section (2)(a), Florida Statutes, applies. Current section (2)(a) provides Except as otherwise provided in this section, there shall be no material alteration or substantial additions to the common elements or to real property which is association property, except in a manner provided in the declaration as originally recorded or as amended under the procedures provided therein. If the declaration as originally recorded or as amended under the procedures provided therein does not specify the procedure for approval of material alterations or substantial additions, 75 percent of the total voting interests of the association must approve the alterations or additions. This paragraph is intended to clarify existing law and applies to associations existing on October 1, From the foregoing, Petitioners reason that since the provision of Article XIX of the Declaration only refers to alterations and not material alterations, the provisions of 2

3 current section (2)(a) require approval for the parking structure changes by 75 percent of the total voting interests of the Association. On January 28, 2009, the Association filed Respondent s Response to Verified Motion and Petition for Emergency Stay of Arbitration. The Association s response to the motion to stay arbitration argues that the controlling statutory language is found in section , Florida Statutes (1977), based upon the Department of Business and Professional Regulation declaratory statement in Princess Del Mar Condo. Owners Ass n, DS (Jan. 27, 2006). The declaratory statement asserts at page 4, The Condominium Act governing a particular condominium is the act in existence on the date of recording the declaration of condominium. (citations omitted). The Association argues that since the Declaration was filed on August 16, 1977, section , Florida Statutes (1977) controls and not current section (2)(a), Florida Statutes. The Association s interpretation that the 1977 statute applies is supported by the Department s declaratory statement. In pertinent part, section , Florida Statutes (1977), provides, (2) There shall be no material alteration or substantial additions to the common elements except in a manner provided in the declaration. Petitioners argue that because the Declaration says that alterations must be approved by a majority of the board, and the Declaration does not refer to material alterations, current section (2)(a) controls and requires that the changes to the parking structures must be approved by 75 percent of the total voting interests of the association. The Association counters that because Article XIX of the Declaration does not distinguish between alterations and material alterations, all alterations, regardless of their nature, are subject only to board approval. 3

4 It is clear that the drafters of the Declaration were capable of distinguishing alterations from material alterations. Section (E) of Article XXIX provides E) Until such time as the owners of PRIVATE DWELLINGS, other than DEVELOPER, shall be entitled to elect a majority of the Board of Directors of the ASSOCIATION, this Declaration of Condominium may be amended by the DEVELOPER by recording such Amendment in the public records of Brevard County, Florida, and no meeting of the membership nor any approval thereof need be had, provided that the Amendment does not increase the number of PRIVATE DWELLINGS to be located in the apartment buildings as otherwise provided for in ARTICLE I hereof nor alter the boundaries of the common elements as otherwise provided for in ARTICLE I hereof, nor change the configuration or size of any PRIVATE DWELLING in any material fashion or materially alter or modify the appurtenances to such PRIVATE DWELLING. (capitalization emphasis in the original; underline emphasis added). Based upon the foregoing, alterations in Article XIX of the Declaration will be taken to mean that all alterations, whether material or otherwise, are subject to approval only by the board of directors. Cf. Coastal Garden Condo., Inc. v. Winfrey, Arb. Case No , Final Order (Sept. 13, 2005) (Declaration provided no material alteration to common elements, except upon affirmative vote of 75 % of unit owners, and no unit owner shall make any alteration within his unit, unless approval is first given by board. Installation of plumbing line for washer and dryer vent both through outside wall of unit was material alteration without requisite unit owner approval. Installation of washer and dryer in unit also occurred without board approval and therefore violated requirement for board approval of any alteration within unit.) On January 30, 2009, Petitioners filed Petitioners Reply to Respondent s Response to Verified Motion and Petition for Emergency Stay of Arbitration. Petitioners quote the following language from Article XIX of the Declaration ASSOCIATION shall have the right to make or cause to be made such alterations or improvements to the COMMON PROPERTY which do not prejudice the rights of the owner of any PRIVATE DWELLING in the 4

5 use and enjoyment of his PRIVATE DWELLING, unless such owner s written consent has been obtained.... (emphasis supplied by Petitioners). Petitioners further argue that the language quoted immediately above should require approval by the voting interests of the association because the modifications to the parking structures prejudiced the rights of the owners in the use and enjoyment of their private dwelling in that the garage area has been temporality shut down creating the need to make additional arrangements for parking. Under Petitioners reading of Article XIX, the Association could never make alterations to the common elements if the alteration temporarily required the unit owner to do anything other than what the unit owner was used to doing. Petitioners interpretation of Article XIX arguably would preclude any alteration that temporarily inconvenienced the unit owners. Such an interpretation will not be accepted. Finally, the Association argues that work on the parking structures is maintenance or repair of the common property for which the Association is responsible under section (1), Florida Statutes (1977), and Article XIX of the Declaration. 1 Petitioners counter that Article XIX and XXI, when read together, clearly shows an intention that the Association s rights are defined by those Articles, which do not include any authority for material alteration. Here, Petitioners are reiterating their argument that the term alterations in Article XIX does not include material alterations and suggesting that this argument is bolstered by the fact that the Association is responsible for maintenance and repair of the common property under Article XXI of the Declaration. Petitioners argument is not persuasive for the same reasons discussed above. 1 The 1977 version of section (1) provides Maintenance of the common elements is the responsibility of the association. The declaration may provide that limited common elements shall be maintained by those entitled to the use the limited common elements. Article XXI of the Declaration provides in pertinent part, ASSOCIATION is responsible for the maintenance, repair and replacement of all the COMMON PROPERTY.... 5

6 The Association s Response to Verified Motion and Petition for Emergency Stay of Arbitration will be treated as the Association s motion in opposition to the petition for failure to state a cause of action pursuant to Rule 61B , Florida Administrative Code. Based upon the foregoing, the Association s motion in opposition must be granted. Therefore, it is ORDERED: 1. Petitioners Verified Motion and Petition for Emergency Stay of Arbitration is DENIED. 2. The Association s motion in opposition to the petition is GRANTED and Arbitration Case No is DISMISSED. DONE AND ORDERED this day of February, 2009, at Tallahassee, Leon County, Florida. Glenn Lang, Arbitrator Department of Business and Professional Regulation Arbitration Section 1940 North Monroe Street Tallahassee, Florida

7 Certificate of Service I hereby certify that a true and correct copy of the foregoing final order has been sent by U.S. Mail to the following persons on this day of February, 2009: Karl W. Bohne, Esq. Schillinger & Coleman 1311 Bedford Drive Melbourne, FL Facsimile: John Soileau, Esq. Watson Soileau Deleo, Et Al North US Highway 1 Cocoa, FL Facsimile: Glenn Lang, Arbitrator 7