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 LAFAYETTE SQUARE CONDOMINIUM ASSOCIATION, INC., Petitioner, v. Case No UNIT OWNERS VOTING FOR RECALL, Respondent. / SUMMARY FINAL ORDER On April 30, 2009, Lafayette Square Condominium Association, Inc. (the association) filed a petition for recall arbitration. Because the unit owners had not designated a unit owner representative, by order dated May 6, 2009, the association was directed to post copy of the recall petition and order requiring answer on the condominium property. By order dated May 6, 2009, the association was directed to file copy of the minutes for the board meeting at which its board of directors chose not to certify the recall. The board filed a copy of the minutes on May 13, On May 7 and 13, 2009, John Lamberth filed letters with the arbitration section stating that he was the unit owners representative. On May 21, 2009, Mr. Lamberth filed an answer to the petition. Findings of Fact 1. Lafayette Square Condominium Association, Inc. is the legal entity responsible for the operation of the Lafayette Square Condominium. 1

2 2. The association contains 50 voting interests and there are 5 seats on the association s board of directors. 3. On April 16, 2009, the association received a written recall agreement consisting of 27 ballots. All the ballots voted in favor of recalling Robin G. Nicholls. Twenty four ballots voted in favor of recalling Anthony Tony Branch. 4. The association s board of directors held a meeting on April 24, 2009, at which time they chose not to certify the recall. The minutes of the meeting state, in their entirety: LATFAYTEE SQUARE CONDOMINIUM ASSOCIATION 101 Lake Ave. NE, Largo, FL Minutes of Board Meeting of April 24, 2009 Meeting to consider certification of the Recall of Robin G. Nicholls and Anthony by Written Agreement was convened at 3:45 p.m. in the Club House in accordance the properly posted Notice of Board Meeting and Agenda Roll Call: Branch, Dorismond, Nicholls, present; Flowers, Lamberth absent. Guest included Randy Moody of RCM. A quorum was present. Per agenda, Old Business was waived. Original Resolutions and New Business: Manager, Randy Moody was asked to chair the meeting. Upon the Chairman addressing the Recall action and noting that a majority of the voting interests had expressed by written agreement to recall Robin G. Nicholls, he called for a motion to certify the Recall. The Board of Directors did not certify the Recall by unanimous agreement of the Board members present because of improper service, no Unit Owners Representative being appointed, and fraudulent and deceitful influence on the voters. The chairman advised that since the Recall was not certified by the Board, the Board must file a petition for arbitration, to be received by the DBPR within five (5) business days after adjournment of the meeting. The President announced that this non-certification by the Board requires the matter to be submitted to the Florida for arbitration pursuant to the Florida Administrative Code. Motion to adjourn the meeting offered at 3:50 p.m. by Branch, seconded by Dorismond. The Board voted 3-0 to adjourn. 2

3 Conclusions of Law The undersigned has jurisdiction over the parties and subject matter of this dispute, pursuant to (2)(j)3. and , Fla. Stat. In accordance with (2)(j)3., Florida Statutes, the unit owners voting in favor of the recall are the respondent in this matter. The minutes of the board meeting at which the association chose not to certify the recall state that it rejected the recall because it had not been properly served on the association. The petition states that the written recall agreement was sent to association s secretary by express mail. The association contends that such service does not comply with (j)2, Fla. Stat., which requires service by certified mail or personal service pursuant to chapter 48 of the Florida Rules of Civil Procedure. The purpose of requiring the unit owners to serve the association with the written recall agreement is to officially place the board on notice that a recall has been attempted by the unit owners. See Nautilus Condo. Assoc., Inc. v. Unit Owners Voting For Recall, Arb. Case No , Summary Final Order (December 3, 1999). Furthermore, the purpose of service by certified mail or pursuant to chapter 48 of the Florida Rules of Civil Procedure is to provide proof of when the board was served, not to invalidate the actual recall effort. The Beach Condo. Owners Assoc., Inc., Arb. Case No , Order Dismissing Petition (January 22, 1993). Arbitration case law has consistently held that where there is no dispute as to when the association received the recall agreement, the method of delivery is of no significance, as the law only requires formal service in order to determine exactly when the agreements were received. See Aqua Gardens Townhouse Assoc,, Inc. v. Unit Members Voting for Recall, Arb. Case 3

4 No , Recall Arbitration Summary Final Order (December 24, 2002)(service by hand-delivery deemed adequate); see also, Opal Towers Condo. Assoc., Inc. v. Unit Members Voting for Recall, Arb. Case No , Recall Arbitration Summary Final Order(December 24, 2002)(service by hand-delivery deemed adequate); and Stonebridge Gardens, Section One, Condo. Assoc. v. Unit Owners Voting for Recall, Arb. Case No , Summary Final Order (April 17, 2002) (method of delivery unkown). The date that the association received the written recall agreement is not in dispute. Therefore, the method of service is irrelevant in this case, and the recall should not be rejected due to inadequate service. The association also rejected the written recall agreement because it failed to designate a unit owner representative. Failure to designate a unit owner representative is not critical. Opal Glen Condo. Assoc., Inc. v. Unit Members Voting for Recall, Arb. Case No , Recall Arbitration Summary Final Order (December 24, 2002). The association argues that a unit owner representative is necessary because that is the only person to whom unit owners desirous of withdrawing their ballot would go to retrieve it prior to its service on the board. However, in accordance with Fla. Admin. Code R. 61B (1)(k), a unit owner may rescind a ballot by delivering written notice of the rescission to the board prior to service of the written recall agreement on the board. Therefore, the association s argument is rejected. The association contends that Kathryn McKnight provided the association written notice of the rescission of her ballot prior to the association s receipt of the written recall agreement. Ms. McKnight s written rescission consists of a form at the bottom of a letter from the association s attorney, Anne. M. Malley. The letter requests that if one 4

5 wishes to have his or her name removed from the written recall agreement, that the person sign the rescission statement at the bottom of the letter and mail the letter back to the attorney. The association has filed a copy of the letter with the rescission portion signed by Kathryn McKnight and dated April 16, Ms. McKnight s rescission is dated the same date that the association states that it received the written recall agreement. The rescission must be received prior to the receipt of the written recall agreement. Fla. Admin. Code R. 61B (1)(k). The initial impression of the facts alleged in the petition would lead to the presumption that the rescission was received by the association after it received the written recall agreement, and, therefore, the rescission would be of no effect. Even if Ms. McKnight s rescission is deemed to have been delivered prior to the written recall agreement, it cannot be considered because the minutes of the board meeting at which the recall was rejected fail to reference the rescission. The arbitrator may not consider any reason for not certifying the recall stated in the petition that is not found in the minutes of the board meeting at which the board chose not to certify the recall. Fla. Admin. Code R 61B (5)(h). Even if that single rescission had been delivered to the association prior to service of the written recall agreement and had been addressed by the minutes, acceptance of the rescission would not change the outcome of this case as there still would be sufficient number of votes to recall Robin G. Nicholls. The minutes state that the association rejected the written recall agreement due to fraudulent and deceitful influence on the voters. The petition elaborates on this basis stating that one of the persons involved with the recall effort had circulated a 5

6 document and incorrectly claimed that it indicated that Robin G. Nicholls was a convicted felon. The fact that a unit owner may have received misinformation is not a valid basis for rejecting a recall agreement and shall not be considered by the arbitrator. Fla. Admin. Code R 61B (5)(h). As noted by the arbitrator in The Board of Directors of Boca Cove Home Condominium Ass n, Inc. v. Martin and Other Unit Owners Executing the Recall Agreement, Arb. Case No , Summary Final Order Certifying Recall (Nov. 30, 1993): In Hidden Harbour Estates, Inc. v. Norman, 309 So. 2d 180 (Fla. 4th DCA 1975), the court stated that "[c]ondominium unit owners comprise a little democratic sub-society." As in the greater democratic society, the right to vote carries with it the corresponding duty to be informed about the issues and candidates. Each unit owner has the responsibility to discover the facts and vote intelligently. If the unit owner shirks that responsibility, that unit owner as well as others may suffer. Nevertheless, the board has neither the responsibility nor the authority to ignore a vote because it believes the vote was based on misinformation. Thus, a board cannot refuse to certify a recall agreement signed by the majority of the unit owners on the grounds that the unit owners were told untruths or were misinformed. Indeed, if the dissemination of misleading or deceptive information were sufficient grounds to invalidate an election, we would have had few, if any, valid elections in this country. Therefore, the written recall agreement should not be rejected because of misinformation by the persons initiating the recall. The association has failed to provide a valid reason for rejecting the recall in its entirety or for rejecting any individual ballots. In order for a board member to recalled, at least 26 ballots must vote in favor of recalling that board member. On the face of the written recall agreement there are only 24 ballots that voted in favor of recalling Anthony Tony Branch. Therefore, Mr. Branch is not recalled. However, because 27 ballots 6

7 voted in favor of recalling Robin G. Nicholls, the recall of Ms. Nicholls should be certified. In its answer, the respondent has asserted various defenses. Since the arbitrator has determined that the recall should be certified as to Ms. Nicholls and not certified as to Mr. Branch, because the recall is deficient on its face as to Mr. Branch, even if the defenses were proven, it would not change result of this case. Based upon the foregoing, it is ORDERED: 1. Anthony Tony Branch is not recalled. 2. The recall of Robin G. Nicholls is certified and she is removed from the board of directors effective upon the date of the mailing of this order. Within five days of the date this order, Ms. Nicholls shall return all association records and property in her possession to the board. 3. Because less than a majority of the members of the board have been recalled, pursuant to (2)(j)5., Fla. Stat., the vacancy created by the recall may be filled by the affirmative vote of a majority of the remaining directors. Florida. DONE AND ORDERED this 3 rd day of June, 2009, at Tallahassee, Leon County, James W. Earl, Arbitrator Department of Business and Professional Regulation Arbitration Section 1940 North Monroe Street Tallahassee, Florida

8 Certificate of Service I hereby certify that a true and correct copy of the foregoing summary final order has been sent by U.S. Mail and facsimile to the following persons on this 3 rd day of June, 2009: Anne M. Malley, Esq. Connely, Malley & Golson, P.A. 210 South Pinellas Avenue Suite 270 Tarpon Springs, Florida Facsimile: John L. Lamberth 101 Lave Avenue NE Unit 213 Largo, Florida Facsimile: James W. Earl, Arbitrator 8