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Implementing Condominium Restrictions

Couple preparing to sign a contract. (iStock)

Published November 5, 2023

When faced with a reoccurring issue in a condominium, the Board of the Directors may want to consider implementing a restriction as a long term solution to the problem. For example, after increasing complaints of loud music at late hours, the Board of Directors may consider a restriction as to when and to what extent music can be played at the condominium. Or, perhaps unit owners have complained of the increase in short term rentals in the condominium, prompting the Board of Directors to consider a restriction on the amount of times a unit may be rented throughout the year. How are such restrictions implemented?

Condominiums are primarily governed by Florida Statutes, the condominium’s governing documents (declaration, by-laws, articles of incorporation), and their rules and regulations. Generally, declarations supersede all other governing documents. Thus, when considering restrictions, the Board of Directors are often faced with the choice of either implementing restrictions via either an amendment to the declaration requiring a unit owner vote,  or revising the rules and regulations, which generally can be accomplished by the Board of Directors. But which is the right choice? As always, it depends.

One the one hand, if there is a high risk of a unit owner challenging a restriction, the Board of Directors may want to consider implementing a restriction via an amendment to the declaration,  as Florida courts are more likely to enforce such restrictions. Indeed, such restrictions are presumed to be valid and enforceable unless and until they are shown to be “arbitrary” or “capricious”. Some Florida courts have even opined that “unreasonable” restrictions in a declaration may be enforced, so long as they are not “arbitrary” or “capricious”.

On the other hand, if a restriction is implemented via an amendment to the rules and regulations of the condominium, it is subject to much more scrutiny if challenged. To be enforceable in the face of challenge, the rule must not contradict any express right or reasonably inferred right conferred to owners in  the declaration of condominium. Second, the rule must be shown to be reasonable, which means the rule must be reasonably related to the promoting the health, safety, and welfare of the unit owners, as well as be applied and enforced uniformly.

With that said, amendments to the declaration are often much more difficult and costly to pursue than amendments to the rules and regulations. While every condominium’s governing documents are different, amendments to a declaration generally require at least a majority vote of unit owners in favor of the amendment. Some governing documents may even require a vote by a super majority of unit owners. Thus, implementing a restriction via amendment to the declaration will likely require considerable efforts to galvanize support among unit owners. Furthermore, once a restriction is incorporated into your declaration via an amendment, it will be just as difficult and costly to amend the restriction in the future. As such,  restrictions that deal with issues that require flexibility, such as the operating hours of a pool, may be better suited for a rule, which generally only requires a vote by the Board of Directors.

But that is not the end of the matter. The Board of Director’s decision to either amend the declaration or the rules and regulations might be also influenced by Florida Statutes.

For example, Fla. Stat. § 718.110(13) expressly limits amendments relating to rentals as follows:

In addition, per Fla. Stat. 718.112(2)(a)(1), changes to rules, or implementing rules that affect unit use, require a 14 days’ notice to the owners of the Board meeting where such rule will be considered and put to a Board member vote.

(13) An amendment prohibiting unit owners from renting their units or altering the duration of the rental term or specifying or limiting the number of times unit owners are entitled to rent their units during a specified period applies only to unit owners who consent to the amendment and unit owners who acquire title to their units after the effective date of that amendment.

Ultimately, regardless of whether the Board of Directors is leaning towards amending the declaration or the rules of regulations, you should always consult legal counsel, as the decision is a complex one that requires the consideration of multiple factors and issues.

 

Nico Jimenez

Attorney at Law, BeckerMiami | bio

Why Condominium Associations Must Carefully Evaluate 
Their Long-Standing Tenant Approval Policies

by Jacob Epstein and David Podein

review

 

The tenant application process to a condominium association can be long, arduous, and sometimes, expensive. Associations often require that prospective tenants submit pages and pages of paperwork, undergo background and credit checks, and pay application fees. However, what information may the Association actually rely upon in making its decision to accept or deny a prospective tenant’s application? The answer is more complicated than you may think. When weighing the information discovered during the application process, the Association must consider: (i) whether the Association’s process for approving and/or rejecting prospective tenant applications complies with the Association’s governing documents and current laws; (ii) whether the evaluation criteria used by the Association will have a disparate impact on a minority group; and (iii) whether the Association can provide a prospective tenant with a specific and appropriate reason for rejection.

As a preliminary matter, the Association’s governing documents may not even grant the Association the power to approve or deny prospective tenants. Rather, such a decision may be left up solely to the unit owner/landlord. Additionally, the Association’s governing documents may or may not include the power to accept or reject a tenant for any reason or without having to provide an explanation. The Association should consult with its legal counsel before utilizing certain powers provided for in the governing documents, as sometimes, the very powers articulated in the those documents may be in violation of applicable laws.

If the Association does have tenant approval power, whatever the reason for rejecting the tenant, the Association must be prepared to explain. Miami-Dade County Ordinance Section 11A-18.1(b) requires that the Association must: (i) provide notice within 45 days of any tenant application rejection, and (ii) state, with specificity, the reason for the rejection. The Association should be prepared to provide this explanation even if the Association’s governing documents do not require the Association to do so.

Additionally, the federal Fair Housing Act1 (more commonly referred to as the “FHA”) and Florida’s Fair Housing Act2 each provide numerous protections from discrimination by housing providers, including condominium associations. Prior to denying an application, and prior to offering a “reason” for the denial, the Association must ensure compliance with these laws, the reach of which was recently expanded by the United States Supreme Court. Under the Court’s decision in Texas Dept. of Housing and Community Affairs v. Inclusive Communities Project, Inc.3, if a housing provider’s resident acceptance policy has a “disparate impact” on a minority group, such a policy would fall under the purview of FHA prohibited practices. For example, if it can be demonstrated that the Association’s reliance on a certain type of background check to reject tenant applications has a disparate impact on a minority group, the Association may open itself up to potential FHA liability.

The FHA prohibits housing providers from refusing to “otherwise make unavailable or deny, a dwelling to any person because of race, color, religion, sex, familial status, or national origin.”4 Despite the FHA’s language, which provides protections for minority groups based on race, color, religion, sex, familial status, or national origin, the FHA’s reach has been expanded to protect other minority groups not specifically listed in the statute. Specifically, the Department of Housing and Urban Development has warned housing providers of potential FHA liability for denying tenant applications based on requests by individuals with disabilities to reside with assistance animals.5 Associations must be careful to ensure that their tenant application policy and reasons for denying tenant applications do not have a “disparate impact” on any particular race, sex, or people of any particular national origin or familial status, or for that matter, on people with disabilities.

Despite this recent expansion of the FHA’s reach, Associations retain the discretion to reject tenant applications for a variety of reasons. In the Inclusive Communities Project opinion, Justice Kennedy explained: “An important and appropriate means of ensuring that disparate-impact liability is properly limited is to give housing authorities and private developers leeway to state and explain the valid interest served by their policies.” For example, prior to the Inclusive Communities Project decision, certain federal Courts found that limiting the number of occupants in a unit can be an acceptable policy under the FHA. The Association should carefully consider its policy regarding tenant applications, specifically the criteria used by the Association in making its decisions, to ensure that “valid interests” are protected by such policy. A careful analysis – – and potential corresponding adjustment – – of the Association’s tenant acceptance policy could protect the Association should a disgruntled applicant bring a FHA claim against the Association.

It is dangerous for Associations to deny tenant applications without having a specific, justifiable basis, as such a rejection may open the Association up to potential liability. Reliance on outdated governing documents to reject “undesirable” tenants could lead to liability under the FHA and/or violation of local ordinances. Whenever a tenant application is about to be denied, the Association must be ready to provide the specific reason for the denial, with such reason having its basis in a counsel-reviewed, tenant application policy. Although nothing will completely prevent challenges by applicants and potential liability in this process, the Association should consult with legal counsel, and carefully evaluate whether any changes to its tenant application process are necessary to prevent discrimination against a minority group or to ensure compliance with applicable laws and the Association’s governing documents. Addressing any flaws in the Association’s tenant application process now may help to prevent or reduce litigation down the road.

jacob-epsteinJacob Epstein is an associate with the Miami-based law firm of Haber Slade, P.A. He concentrates his practice areas on business litigation, condominium and community association law, construction law, and real estate litigation. He can be reached at jepstein@dhaberlaw.com.

 

 

david-podeinDavid T. Podein is a senior associate at Haber Slade. He concentrates his practice in the areas of complex commercial and business litigation, real estate leasing and construction, contract negotiations, real estate development disputes, condominium and community association law and bankruptcy litigation. He can be reached at dpodein@dhaberlaw.com.

 

 

1 42 U.S.C. § 3604.

2 Fla. Stat. § 760.23.

3 Texas Dept. of Housing and Community Affairs v. Inclusive Communities Project, Inc., 135 S.Ct. 2507 (2015).

4 42 U.S.C. § 3604(a).

5 See Mem. from U.S. Dept. of Hous. and Urban Dev. on Service Animals and Assistance Animals for People with Disabilities in Housing and HUD-Funded Programs, FHEO-2013-01 (April 25, 2013).

6 Texas Dept. of Housing and Community Affairs, 135 S.Ct. at 2522.

7 Mountain Side Mobile Estates Partnership v. Secretary of Hous. and Urban Dev., 56 F.3d 1243 (10th Cir. 1995); U.S. v. Weiss, 847 F. Supp. 819 (D. Nev. 1994).

FCAP Presents CFCAM Designation to Robert Johnson

From L to R: Alan Jones-Corporate Trainer, KW Management, Richard Johns-FCAP, Robert Johnson-CFCAM, KW Management, Sandy Bennett-Executive Director, Bruce Masia-Regional Manager, Robert White-Managing Director, all with KW Management.

From Left to Right: Alan Jones-Corporate Trainer, KW Property Management & Consulting, Richard Johns-FCAP, Robert Johnson-CFCAM, KW Property Management & Consulting, Sandy Bennett-Executive Director, Bruce Masia-Regional Manager, Robert White-Managing Director, all with KW Property Management & Consulting.

 

On Wednesday evening, April 21, FCAP presented Robert P. Johnson with his certificate of achievement for successfully completing the Certified Florida Community Association Manager curriculum. Robert joins a group of nearly 60 Community Association Managers within FCAP that hold this designation.

Mr. Johnson first began managing community associations at The Estates, an 860 unit HOA community. He later managed a couple of luxury high-rise condominiums before settling into his current position as General Manager of the luxurious Turnberry Village, a pristine 14 story condominium located in Aventura, Florida.

Robert has experienced the rewards of pursuing educational achievements along his journey. Along with being a CFCAM (Certified Florida Community Association Manager), he also has completed the educational requirements for being a CMCA (Certified Manager of Community Associations), AMS (Association Management Specialist), and a PCAM (Professional Community Association Manager). In 2013 and 2014, Robert was selected as one of the 100 Finalists for the “Manager of the Year” award, presented by Association Reserves.

The FCAP family congratulates Robert for his accomplishments and the contributions he makes to the community association industry in Florida.