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 BINDING ARBITRATION - HOA Paul Preston, Petitioner, v. Case No Spanish Isles Property Owners Association, Inc., Respondent. / ORDER ON PETITIONER S MOTION FOR DISCOVERY AND ORDER ON RESPONDENT S MOTION FOR CLARIFICATION AND REQUEST FOR ADDITIONAL TIME A telephonic case management conference was held on February 8, On February 11, 2008, the undersigned entered an Order After Case Management Conference. Based upon the representations of the parties, the order required Respondent to provide to Petitioner and the undersigned, on or before February 22, 2008, copies of all the written recall ballots served on Respondent in Petitioner s recall in August 2006, and the order authorized Petitioner to file, on or before March 3, 2008, an Amended Petition using DBPR Form ARB , Mandatory Non-Binding Petition. Petitioner s Motion for Discovery On February 25, 2008, Petitioner filed a motion to allow discovery. Petitioner s motion for discovery is premature, since Petitioner has not yet filed an amended petition. 1

2 Nevertheless, the arbitrator will address the motion to prevent later delay in this case. Petitioner seeks discovery in the form of Request for Admissions, Request for Production, Interrogatories (questions), Depositions (pretrial interviews), and Court Process (subpoenas). With respect to the request for admissions, Petitioner states the questions asked would provide the board of directors and their attorneys a chance to exhibit that they have deal [sic] fair [sic] and honest [sic] with the residence [sic] under control of the association. With respect to the request for production, Petitioner seeks certain budgets, financial reports, insurance agent information, and meeting minutes. Under Rule 61B (1), Florida Administrative Code, Petitioner s request of admissions is not specific and does not appear necessary for the disposition of the petition. Petitioner gives no indication whatsoever as to the necessity or specifics of interrogatories or depositions. Under Rule 61B (2), Florida Administrative Code, Petitioner s request for production seeks documents available through the owner s right of access to the official records of the Association under section (12), Florida Statutes. Based upon the foregoing, Petitioner s Motion to Allow Discovery is DENIED in its entirety. Therefore, subpoenas related to these requests also are unnecessary. 1. Motion for Clarification Respondent s Motion for Clarification and Request for Additional Time Respondent seeks clarification as to the availability of a reverse recall in a case arising under chapter 720, Florida Statutes, Homeowners Associations. 2

3 Section (10), Florida Statutes, provides for recall of directors of a homeowners association. Section (2)(j), Florida Statues, provides for recall of board members in condominium associations. The provisions of these statutes are substantively similar. At Paragraph 6 of Respondent s motion, Respondent notes on one hand, that homeowners association recall disputes are to be resolved in the same manner as condominium association recall disputes. In Paragraph 7 of Respondent s motion, Respondent on the other hand notes that chapter 720 does not permit homeowners to file a petition for non-binding arbitration. Essentially, Respondent argues that because section (10)(d) provides for filing a binding arbitration petition when the board of a homeowners association determines not to certify a written recall agreement and section (2)(j)3. provides for filing a petition for arbitration, Petitioner in this case in not entitled to review of his reverse recall case. Essentially, Respondent s argument is one of form, literally and figuratively, over substance. The undersigned directed that Petitioner may file an Amended Petition using DBPR Form ARB , Mandatory Non-Binding Petition to initiate his reverse recall case. Regardless, the outcome will still be one of binding arbitration under chapter 720. which states, In any event, the more relevant provision in this case is section (10)(f), (f) If the board fails to duly notice and hold a board meeting within 5 full business days after service of an agreement in writing or within 5 full business days after the adjournment of the member recall meeting, the recall shall be deemed effective and the board directors so recalled shall immediately turn over to the board all records and property of the association. 3

4 This is the provision upon which Respondent relies for the recall of Petitioner. The similar provision for condominiums, section (2)(j)4. underlies the reverse recall precedent in the condominium context. This provision says nothing about the type of arbitration. The arbitration decisions are replete with numerous instances in which arbitrators have applied the precedents of condominium recall case law to homeowners association recall cases. It would be manifestly unfair not to apply in the homeowners association context the precedent of authorizing a reverse recall petition in the condominium context. Therefore, the undersigned will adopt in the homeowners association context the precedent of reverse recall established in the condominium context and allow Petitioner to file his reverse recall petition using DBPR Form ARB Request for Additional Time In the Order After Case Management Conference, Respondent was directed to provide to Petitioner and the undersigned, on or before February 22, 2008, copies of all the written recall ballots served on Respondent in Petitioner s recall in August In its motion filed on February 25, 2008, Respondent requests additional time to complete its search for the 2006 recall ballots, but indicates some or all of the ballots may no longer be in existence. With respect to retention of the ballots, Respondent notes that in the condominium context, the association must maintain as official records under section (12)(a)12., Florida Statutes, Ballots, sign-in sheets, voting proxies, and all other papers relating to voting by unit owners, which shall be maintained for a period of 1 year 4

5 from the date of the election, vote, or meeting to which the document relates. Respondent notes that there is no equivalent provision in the homeowners association context under section (4), Florida Statutes. While is true that chapter 718 and chapter 720 do not have identical specific provisions with respect to maintaining papers relating to unit owner voting, both chapters have identical provisions requiring the association to maintain as official records, All other records of the association not specifically included in the foregoing which are related to the operation of the association. Sections (12)(a)15. and (4)(l), Florida Statutes. Recall ballots ultimately relate to the operation of the association, because they affect who sits on the board of directors which actually operates the association. Some items listed as official records in section (4) have specific retention periods, others do not. Nevertheless, it is clear that some official records must be retained for periods of time even though no specific time frame is set out in the statute. For example, while there is no retention period stated for copies of the declaration of covenants and amendments thereto, section (4)(d), they must be kept continuously in order for the provision to be meaningful, because the declaration must be available for review by homeowners at all times. Based upon the foregoing, recall ballots in the possession of the homeowners association are records of the association related to the operation of the association. It appears that Petitioner was elected to a three year term in February of It also appears he was recalled in August of 2006 and another individual is filling that seat. Therefore, in order for section (4)(l) to be given meaning in the context of this case and similar cases, it is reasonable to expect a homeowners association to retain 5

6 the recall ballots relating to an individual board member who has been recalled at least until the expiration of the term to which the person was elected. Irrespective of the above interpretation, the issue of spoliation of evidence may arise at a latter date. At a minimum, Respondent was given ten (10) days to locate and forward to Petitioner and the undersigned on or before February 22, 2008, copies of the recall ballots so that Petitioner could file an amended petition on or before March 3, Based upon the foregoing, Respondent s motion for additional time to produce the recall ballots is DENIED, and Respondent shall forward them forthwith so that Petitioner timely may file an amended petition. Based upon the foregoing, it is ORDERED: The parties shall comply with the requirements set forth herein. DONE AND ORDERED this 28 th day of February, 2008, at Tallahassee, Leon County, Florida. Glenn Lang, Arbitrator Department of Business and Professional Regulation Arbitration Section 1940 North Monroe Street Tallahassee, Florida Copies furnished to: Paul Preston 9276 Saddlebrook Drive Boca Raton, Florida Phone: Fax: J. Steven Hudson, Esq. Randall Roger & Associates 621 NW 53 rd Street Boca Raton, Florida Phone: Fax:

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