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

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1 STATE OF FLORIDA DEPARTMENT OF BUSINESS AND PROFESSIONAL REGULATION DIVISION OF FLORIDA LAND SALES, CONDOMINIUMS, AND MOBILE HOMES IN RE: PETITION FOR ARBITRATION ANDREW MOZZONE, BETTY MOZZONE, RICHARD McQUEARY, ROSEMARY McQUEARY, STANLEY NEWBERRY and BARBARA NEWBERRY, Petitioners, v. Case No COUNTRY CLUB MANOR CONDOMINIUM ASSOCIATION, INC., a Florida not-for-profit corporation, Respondent. / SUMMARY FINAL ORDER This order is entered pursuant to Rule 61B , Florida Administrative Code, which requires the arbitrator to enter a summary order where there are no disputed issues of material fact. On February 2, 2001, Andrew Mozzone, Richard McQueary and Stanley Newberry filed a petition for non-binding arbitration against Country Club Manor Condominium Association, Inc. (respondent or association). The petition alleged that the association failed to properly conduct a vote on an amendment to the declaration, resulting in the adoption of an amendment to limit occupancy of the condominium to individuals over the age of 55. The association moved to dismiss the petition on several grounds and an amended petition was filed on March 27, 2001: Rosemary McQueary, Betty Mozzone and Barbara Newberry were added as petitioners with the filing of the amended petition. Thereafter, on June 14, 2001, Stanley Newberry and Barbara Newberry filed a motion to withdraw as petitioners. The motion is granted. This final order is 1

2 based on the amended petition that includes as petitioners Andrew Mozzone, Betty Mozzone, Richard McQueary and Rosemary McQueary (petitioners or unit owners). On May 31, 2001, a notice of intent to enter summary final order was entered and the parties were given an opportunity to file legal argument. The petitioners filed a memorandum of fact and law on June 13, The respondent did not file any legal argument. The undisputed facts follow. At the association's annual meeting held on February 10, 2000, the members voted on a proposal to amend the declaration to permit the association to qualify as "housing for older persons." Following the meeting, the association's board of directors declared that the amendments were approved and directed that they be recorded in the public records of the county. There were 104 votes cast at the meeting, either in person or by limited proxy. There were 70 votes in favor of the amendments. Three of these, proxy votes, were undated, however (unit nos. A-102, B-203 and E-302). There were 31 votes against the amendments. One of these, a proxy vote, was undated (unit no. E-202). Three of the votes cast by proxy did not specify whether the voter was for or against the amendments (unit nos. C-202, D-303 and E-203). Section 21 of the declaration provides that the declaration shall be amended "if the proposed amendment is approved by a least two-thirds (2/3rds) of the voting interests who are present and voting, in person or by proxy, at any annual or special meeting called for the purpose. Section 3.7 of the bylaws states in part "...To be valid, a proxy must be in writing, dated, signed by the person authorized to cast the vote for the unit, and specifying the date, time and place of the meeting or continuance thereof " The petitioners contend that the undated proxies should not have been included in the vote count for and against the amendments, but should have been included for the purpose of 2

3 determining the number of votes necessary for majority approval (i.e., the necessary 2/3rds voting interests present in person or by proxy). Thus, the petitioners contend that the number of votes needed to pass the amendment is 70 (2/3rds of 104), and that there were 67 votes in favor of the amendments, 30 votes opposed to the amendments, and 3 votes cast by proxies that did not contain a vote specified for or against the amendments. Using the petitioners approach the vote falls short. The petitioners err, however. The declaration requires approval of 2/3rds of the voting interests "present and voting, in person or by proxy... at a meeting. (e.s.). A voting interest represented by an invalid proxy cannot be said to be present and voting. To be present by proxy requires a unit owner to submit a valid proxy. An undated proxy is invalid. See Section 3.7 of the bylaws, above; Habana Park Condominium Association, Inc. v. Delgado, Arb. Case No , Summary Final Order (Nov. 19, 1993) (proxies that did not include the date executed by the unit owner could not be used to establish a quorum at the recall meeting or to vote any unit owner's interest in the recall/replacement question). Accordingly, the voting interests that submitted the undated proxies did not appear at the meeting because they did not submit a valid proxy. As a result, four of the 104 ballots are excluded from consideration altogether, either for the purpose of determining the number of voting interests present or the number of voting interests "for or "against" the amendments. The petitioners cite State et al. v. City of Tampa, 187 So. 604 (Fla. 1939) for the proposition that the undated and invalid proxy votes should have been included in determining the total number of votes cast at the meeting (and the number upon which the 2/3rds requirement is based). In that case, the City of Tampa adopted an ordinance providing for the construction of sewers and the issuance of sewage revenue certificates. The applicable constitutional provision required participation of a majority of qualified electors for the approval of sewage revenue certificates. There were 6,375 qualified voters, thus 3,188 qualified electors were required to 3

4 participate in the election. A total of 3,238 persons entered the polling places and signed the voting registration books and entered the booths to vote: 1,846 voted for the issuance of sewage revenue certificates; 1,215 voted against issuance; and 177 failed to indicate a choice. An issue on appeal was whether the 177 electors who failed to indicate a vote in the election were considered to be "participants" in the election. The court held that if a voter is qualified to vote, appears at the polling place, is given a blank ballot, and enters the voting booth but by mistake, inadvertence or some unknown reason his ballot cannot be counted, it is reasonable to conclude the voter has participated in the election. This case does not support the petitioners' position, however. The question in City of Tampa was whether or not the 177 electors participated in the election within the meaning of the constitutional provision that required that a majority of qualified voters participate in the election, and a majority of those approve the bond issue. The instant case differs in that the critical issue is whether 2/3rds of the voting interests present and voting approved the amendment. In City of Tampa, the court distinguished between those electors that participated in the election and those that participated but did not vote. The court stated: It is clear that the 177 freeholders and electors failed to cast a legal vote in the sense that they could be counted for or against the issuance of the certificates. (at 614). If the drafters of the declaration in the instant case intended that 2/3rds of the voting interests present at a meeting must approve an amendment, they would have so specified. Instead, the drafters provided that 2/3rds of the voting interests both present and voting are required to approve an amendment. Since four proxies were invalid, they are excluded altogether from the vote. Thus, 100 voting interests participated in the election. Another three proxies did not contain a vote on the amendments; thus, the number of voting interests present and voting was 97. Two-thirds of 97 is 65. Since there were 67 votes in favor of the amendments, the amendment was approved by the requisite number of voting interests. 4

5 Florida. Based on the foregoing, the relief requested by the petitioners is DENIED. DONE AND ORDERED this 23rd day of July 2001, at Tallahassee, Leon County, Patricia A. Draper, Arbitrator Department of Business and Professional Regulation Arbitration Section 1940 North Monroe Street Tallahassee, Florida

6 RIGHT OF APPEAL In accordance with Section , Florida Statutes, a party adversely affected by this final order may appeal from the order by filing, within 30 days of entry and mailing of the order, a complaint for trial de novo with a court of competent jurisdiction within the circuit in which the condominium is located. This order does not constitute final agency action and is not appealable to the district courts of appeal. ATTORNEY S FEES As provided by Section , Florida Statutes, the prevailing party in this proceeding is entitled to have the other party pay its reasonable costs and attorney s fees. Rule 61B , F.A.C., requires that a party seeking an award of costs and attorney s fees must file a motion seeking the award not later than 45 days after rendition of this final order. The motion must be actually received by the Division within this 45-day period and must conform to the requirements of rule 61B , F.A.C. The filing of an appeal of this order does not toll the time for the filing of a motion seeking prevailing party costs and attorney s fees. CERTIFICATE OF MAILING I HEREBY CERTIFY that a true and correct copy of the foregoing was mailed by U.S. mail, postage prepaid, to Robert W. McClure, Esq., Robert W. McClure, P.A., 500 Fifth Avenue So., Suite 509, Naples, FL and Robert E. Murrell, Esq., Samouce, Murrell & Francoeur, P.A., 800 Laurel Oak Drive, Suite 300, Naples, FL this the 23rd day of July Patricia A. Draper, Arbitrator 6