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 MAROTT PARTNERSHIP, Petitioner, v. Case No MARACAY ASSOCIATION, INC., Respondent. / SUMMARY FINAL ORDER This order is entered pursuant to Rule 61B , Florida Administrative Code, which permits the arbitrator to enter a summary order where there are no disputed issues of material fact. On March 8, 2000, Frank Martire filed a petition for non-binding arbitration against Maracay Association, Inc. (respondent or association). The petition alleges that the association improperly conducted the election of directors by not counting Martire s vote and by permitting election ballots and envelopes to be received and handled by opposing candidates who were also current board members. Martire was a candidate for a director position in the election. The association filed its answer and defenses on April 7, 2000, and a response to the amended petition on May 17, The answer asserts that the arbitrator lacks jurisdiction over Martire, because he is not the owner of any unit at Maracay Condominium. The answer cites an attachment to the petition, a letter dated February 5, 2000 fro m Martire to the association, stating that the unit whose vote Martire alleges was improperly disregarded unit no. 203 is one of two owned by the Marott Partnership, and that Martire is the president of Marott. The association also filed a copy of a warranty deed confirming that Marott Partnership, rather than Martire, owns unit no At that point, Martire filed a properly executed qualified representative application and asked that

2 Marott Partnership be substituted as the petitioner in this action. The request was granted by order of May 9, 2000, and the style of the case was amended to reflect the substitution. The answer contends that the association properly rejected Martire s vote because a Certificate of Appointment was never filed by the owner of unit no. 203 authorizing Martire to vote the unit s interests. Paragraph 2.5(b) of the bylaws provides in pertinent part: If an apartment is owned by one person his right to vote shall be established by the record title to his apartment. If an apartment is owned by more than one person, or is under lease, the person entitled to cast the vote for the apartment shall be designated by a certificate signed by all of the record owners of the apartment and filed with the secretary of the Association. If an apartment is owned by a corporation, the person entit led to cast the vote for the apartment shall be designated by a certificate of appointment signed by the president or vice-president and attested by the secretary or assistant secretary of the corporation and filed with the Secretary of the Association. Such certificates shall be valid until revoked or until superseded by a subsequent certificate or until a change in the ownership of the apartment concerned...if such a certificate is not on file, the vote of such owners shall not be considered in determining the requirement for a quorum nor for any other purpose. (emphasis supplied) Martire submitted a copy of a Certificate of Partnership that provides that Frank Martire, Connie Ottolino and Sebastiano Ottolino are business partners doing business under the name of Marott Partnership. Therefore, under 2.5(b) of the bylaws, in order for the unit s vote to be cast by one person, Marott Partnership must file a Certificate of Appointment with the association designating the person authorized to cast the unit s vote. Marott argues that Martire provided a Certificate of Appointment to the association in 1997, and that Martire has been allowed to cast votes on behalf of Marott s units ever since, with the exception of the election at issue. Marott refers to a letter dated November 24, 1997, f rom Martire to the association president stating: I received your letter regarding the certificate of appointment needed for the election. Please note I am the President of the Marott Partnership [and] have the authority to vote for apartments 203 and

3 The letter is signed by Frank Martire, President, Marott Partnership. The letter is inadequate to authorize Martire to vote Marott s units as it is not signed by all three individuals who comprise the Marott Partnership. Marott claims that Martire has been allowed to vote the Marott units votes ever since Martire filed the November 24, 1997 letter with the association; therefore, Marott argues the association cannot now assert that Marott has not complied with the certificate of appointment requirement. The association does not contest the assertion that Martire has been permitted to vote on behalf of Marott s units in elections since In numerous recall arbitration cases, arbitrators have held that where an association fails to enforce its voting certificate requirements to disqualify ballots in regular elections, it is precluded from relying on the requirements as a basis for rejecting ballots in a recall situation. See The Caribbean Condo. Mgmt. Association, Inc. v. Kennedy, Arb. Case No , Final Order (October 27, 1993) (association, by not enforcing provision of declaration in regard to voting certificates, has established a pattern of allowing irregularit ies in the certificates; therefore, provision will not be enforced in recall arbitration; in absence of a showing by associat ion of a consistent effort to enforce provision regarding voter certificates, enforcement of provision against irregular voter certificates in recall proceeding would constitute selective enforcement); Courts of Inverrary Condo. Association, Inc. v. Shepard, et al., Arb. Case No , Final Order (January 18, 1995) (association's failure to enforce designated voter requirements on other associat ion voting precludes use of it to disqualify votes cast in favor of recall agreement). This rule is based on concepts of fairness embodied in the affirmative defense of selective enforcement. See White Egret Condominium, Inc. v. Franklin, 379 So. 2d 346 (Fla. 1979). In White Egret the court refused to enforce a rule prohibiting unit residency by children under 12 years of age, where the association had not enforced the rule against at least six other children. The court wrote: We agree with the district 3

4 court s finding that this constituted unequal and arbitrary enforcement of the restri ction. The rule is equally applicable in the instant situation. Accordingly, the association s defense to Marott s claim that the association wrongfully disregarded the vote cast on behalf of unit no. 203 is rejected. The petition also alleges that election ballots and envelopes were received and handled by opposing candidates, Anna White (secretary) and Ruth Snyder (president), and that the envelope containing a ballot for unit no. 203 was marked Disregard at the direction of White and Snyder (apparently the ballot for unit no. 204 was accepted). The association does not dispute these specific allegations, responding only that the election met the regulations set forth in the Election Brochure for Condominium and Cooperative Associations produced by the Department of Business and Professional Regulation, Bureau of Condominiums, Education Section. Rule 61B , Florida Administrative Code, does not place limitations on who shall receive election ballots on behalf of the association or who may handle them prior to delivery to their review and tabulation at the annual meeting. Paragraph 10(a) states that [a]ny envelopes containing ballots shall be collected by the association and shall be transported to the locat ion of the duly called meeting of the unit owners. (emphasis supplied). See also Calcagno et al. v. Marlborough House, Inc., Partial Summary Final Order, Arb. Case No (June 14, 2000) (association wrongfully refused to count ballots and envelopes of owners because the ballots/envelopes were hand carried to election meeting by candidates; safeguards provided in the statute for ensuring the validity of the ballots, such as the impartial review committee, provide for integrity of the ballots). The rule does place limitations on the handling of ballots and envelopes once the meeting commences, however. The first order of business is to collect any ballots not yet cast, and to submit them for review and tabulation. The rule further provides:...the ballots and envelopes shall then be handled as stated below by an impartial committee...appointed by the board...the signature and unit identification on the outer envelope shall be checked against a list of qualified voters...any exterior envelope not signed by the 4

5 eligible voter shall be marked Disregarded or with words o f similar import, and any ballots contained therein shall not be counted...(emphasis supplied) The rule defines an impartial committee as one whose members do not include current board members, officers, candidates for the board, or their spouses. See Rule 61B (10)(b), Florida Administrative Code. Therefore, the president and secretary s handling of the ballots and participation in the committee s review by directing that certain ballots, including the one cast by Martire on behalf of the petitioner, be disregarded, is a clear violation of the rule. Based on the foregoing, it is ORDERED: 1. The petitioner s claim that the election was improperly conducted is found to be meritorious. The relief requested by the petitioner, that a re-election be conducted, is DENIED, however, because the petitioner has not alleged that the outcome o f the election would have been any different had its ballot not been disregarded by the association. 2. In the future, the association shall conduct its elect ions in compliance with Rule 61B , Florida Administrative Code. 5

6 DONE AND ORDERED this 28th day of June 2000, at Tallahassee, Leon County, Florida. Patricia A. Draper, Arbitrator Department of Business and Professional Regulation Arbitration Section 1940 North Monroe Street Tallahassee, Florida 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 forego ing was mailed by U.S. mail, postage prepaid, to Frank Martire, 2612 W. Superior St., Chicago, IL and James M. Powers, Esq., Leonard & Morrison, P.O. Box 11025, Ft. Lauderdale, FL this the 28th day of June Patricia A. Draper, Arbitrator 6