For Condominium Associations and Homeowners’ Associations (HOAs) in Florida, maintaining compliance with state regulations and ensuring proper management of community properties can be complex. Among the critical responsibilities are performing milestone reports and 40-year certifications, which are essential for the safety and upkeep of aging buildings. In cases where there is uncertainty about these obligations or potential disputes with residents, declaratory judgments can offer a valuable solution. This article explores how declaratory judgments can assist Condo Associations and HOAs in managing these regulatory requirements and avoiding potential conflicts, with a focus on Florida Statute 553.899, its legislative history, and recent case law.

If you have questions about declaratory judgments in Florida, milestone reports, 40-year certifications, condominium associations and HOAs in Florida, please contact Bernhard Law Firm at www.bernhardlawfirm.com, 786-871-3349, abernhard@bernhardlawfirm.com.

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What are Milestone Reports and 40-Year Certifications?

Milestone Reports

In Florida, a milestone inspection is required for buildings that are 30 years old or older and must be performed every 10 years thereafter. This inspection assesses the structural integrity and safety of the building, including the condition of concrete and load-bearing elements. The goal is to identify any necessary repairs or maintenance to ensure the building’s safety.

In May 2022 the Florida Legislature passed SB 4-D to implement new and swifter building inspections and maintenance following the Champlain Towers collapse.

Florida now requires milestone inspections for condominium and cooperative association buildings that are three stories or higher when they reach their 30th year. See Florida Statutes Section 553.899. Additional inspections must be performed every 10 years thereafter. Further, local enforcement agencies may determine that local circumstances (coastal cities like Miami in particular) require a milestone inspection when the building reaches 25 years of age and every 10 years thereafter.

The milestone statute is brand new and has many nuances that condo associations and HOAs must decipher, often raising new questions and uncertainty about the association’s rights and obligations. These are fertile grounds for disputes, noncompliance, excessive spending, or inadequate inspection and maintenance. All of these circumstances may need a court’s declaratory judgment to allow a condo association to properly continue.

Florida Statutes 553.899 and its new milestone regimen has generated substantial backlash from residents facing enormous special assessments to fund the reports, inspections, and maintenance to aging buildings. This in turn has raised additional questions about condo association compliance with statutory and covenant requirements to pass and enforce special assessments upon residents. See Florida Statutes Section 718.116 and Florida Statutes 720.308. These associations and residents may need to seek court clarification on the propriety of these special assessments, their passage, amount, and compliance with the declaration of condominium and Florida Statutes. The new milestone inspection deadline is the last day of 2024.

40-Year Certifications

The 40-year certification process is a more comprehensive inspection that involves a detailed review of the building’s structural and electrical systems. This certification is crucial for ensuring that the building remains safe and compliant with current codes. The process includes not only inspections but also the completion of any required repairs or upgrades.

40-year recertification generally requires that Florida buildings be re-certified for electrial and structural safety updates that align with modernized industry standards, technology, and safety reports. The City or County building inspector usually sends out a Notice of Required Inspection to remind associations of their impending certification deadlines, but any building constructed in the 1980s and 1990s can readily calendar their certification deadlines and begin planning, budgeting, and assessing appropriately.

The combination of the new milestone statute and the impending 40-year certifications for much of the Florida construction and growth from the 1980s and 90s has imposed substantial strain and novel obligations for associations and their management teams. This in turn has raised questions about professional practice standards; professional, management, and association liability in the performance of the statutory obligations; and uncertainty as associations wade through the new statutory regime. Association property managers and association boards should review Florida Statutes Section 468.4334 (on professional practice standards, liability, and community association manager requirements) and consider whether they need a court’s declaratory judgment as to the specific requirements under the milestone statute or any community’s particular set of covenants or declaration of condominium.

Declaratory Judgments and Their Role

Declaratory judgments are judicial declarations that clarify legal rights, duties, or obligations. For HOAs, these judgments can address uncertainties or disputes related to milestone reports and 40-year certifications. These are generally governed by Florida Statutes Chapter 86. Here’s how they can be beneficial:

Clarifying Compliance Requirements

HOAs may face uncertainty regarding their responsibilities for conducting milestone reports and 40-year certifications. A declaratory judgment can provide a court’s interpretation of the relevant statutes and regulations, ensuring that the HOA understands its obligations clearly. This can be particularly useful if there are ambiguous provisions or conflicting opinions about what constitutes compliance.

Addressing Disputes with Residents

Residents might challenge the HOA’s handling of milestone inspections or 40-year certifications, perhaps questioning the adequacy of the inspections or the management of required repairs. A declaratory judgment can resolve these disputes by clarifying the HOA’s obligations and confirming that the association’s actions meet legal and regulatory standards.

Determining Financial Responsibilities

In some cases, disputes may arise over who should bear the costs of repairs or upgrades identified during inspections. A declaratory judgment can help determine whether these costs should be covered by the HOA’s reserves, individual unit owners, or through special assessments. This clarity can help prevent conflicts and ensure fair distribution of financial responsibilities.

Requirements to Obtain Declaratory Judgment

A declaratory judgment is a statutorily created remedy under Florida Statutes Section 86.021 et seq. A person seeking declaratory judgment must show: (1) there is a bona fide, actual, present practical need for the declaratoin; (2) the declaration should deal with a present, ascertained, or ascertainable state of facts or present controversy as to a state of facts; (3) that some immunity, power, privilege, or right of the complaining party is dependent upon the facts or the law applicable to the facts; (4) that there is some person or persons who have, or reasonably may have an actual, present, adverse, and antagonistic interest in the subject matter, either in fact or law; and (5) the antagonistic and adverse interests are all before the court by proper process or class representation. Guttenberg v. Smith & Wesson Corp., 357 So. 2d 690 (Fla. 4th DCA 2023).

Florida Statute 553.899 and Its Legislative History

Overview of Florida Statute 553.899

Florida Statute 553.899 pertains to the inspection and maintenance of condominium and cooperative buildings in Florida. It specifically addresses the milestone inspections and 40-year recertification requirements, aiming to ensure the safety and structural integrity of aging buildings.

1. Inspection Requirements (F.S. § 553.899(1)): The statute mandates that buildings over 30 years old undergo milestone inspections to assess their structural safety. This is a preventive measure designed to identify potential hazards before they become serious issues.

2. Certification Process (F.S. § 553.899(2)): It requires a detailed certification process every 40 years, focusing on both structural and electrical systems. The certification ensures that the building complies with current safety standards and codes.

3. Enforcement and Compliance (F.S. § 553.899(4)): The statute outlines the responsibilities of building owners and HOAs to complete required inspections and certifications. It also provides for enforcement mechanisms to address non-compliance.

Legislative History

Florida Statute 553.899 was enacted as part of broader legislative efforts to enhance building safety and maintenance standards, particularly in the wake of high-profile building failures and safety concerns. Here’s a brief overview of its legislative history:

1. Initial Enactment: The statute was first introduced as part of the Florida Building Code, which was revised to include more stringent safety measures for aging buildings. The aim was to address concerns about the safety of condominium and cooperative buildings, especially in high-density urban areas.

2. Revisions and Amendments: Over the years, Florida Statute 553.899 has undergone several revisions to refine the inspection and certification processes. Amendments have been made to clarify the scope of inspections, update compliance requirements, and enhance enforcement provisions. These changes reflect the evolving understanding of building safety and the need for more rigorous maintenance protocols.

In particular, Senate Bill 154 (SB 154) targets milestone inspections and structural integrity reserve studies, and may substantially change how associations must operate. SB 154 requires that condo associations carry non-waivable reserves of funds for structural inpsections, maintenance, and repairs. SB 154 also requires that inspections focus on structural integrity of the condominium building, to avoid Champlain type collapse and danger. Florida Statutes Section 718.112(g) now provides for a “structural integrity reserve study” that is required every 10 years to determine the safety and structure of the roof, load-bearing walls and columns, fireproofing and fire protection, plumbing, electrical systems, waterproofing, exterior windows and doors, and any other deferred maintenance item over $10K.

These most recent amendments and provisions provide more fertile ground for dispute and disagreement among condo association board members and the association’s unit owners, which may need a court’s declaratory judgment to ensure compliance and proper reserve savings, budgeting, assessment, and procedure.

3. Recent Developments: Recent legislative sessions have focused on strengthening the enforcement mechanisms and providing clearer guidelines for HOAs and building owners. This includes enhanced requirements for documentation and reporting, as well as increased penalties for non-compliance.

In particular, Senate Bill 4D (along with House Bills 59, 1203, 1029, and 1021) will affect condo associations and HOAs. HB1021 targets condo association budgets, financial reporting, and reserves, with pre-sale disclosures required for new prospective purchasers buying in the condominium building. HB1029 is the My Safety Florida Condominium Pilot Program (with similar HB293 for HOAs) to assist condo associations and HOAs with hurricane inspections and mitigation near the coast. HB59 addresses condo association covenants and rules for managers and their professional standards of practice. All of these may require court declaratory judgment to illuminate the nuances of obligations and rights for property managers, condo association boards, and unit owners.

Recent Case Law Decisions

Recent Florida case law has further shaped the application of Florida Statute 553.899 and the use of declaratory judgments in the context of milestone reports and 40-year certifications. Here are a few notable decisions:

1. Allison v. Grand at Olde Carrolwood Condominium Association, Inc., 369 So. 3d 1200 (Fla. 2d DCA 2023), holding that trial court improperly failed to enforce condo association’s rights against unit owner as to replacement of flooring in violation of the governing documents, seeking declaratory judgment. This case confirms that the courts are open and declaring condo association and unit owners rights, and that the trial and appellate courts must parse through specific language in the contracts and covenants to ensure that each side is properly performing as to repairs, replacements, maintenance, and assessments.
2. North Florida Mango, LP v. LLS Holdings, LLC, 375 So. 3d 906 (Fla. 4th DCA 2023), holding that genuine issues of material fact existed as to the meaning of essential terms in a property sales contract , including as to the phrase “business as currently run” in provision conveying “all fixtures & equipment for the operation of the building units ad business currently run” and “seller will deliver possession and occupancy of the property to buyer at closing.” This case shows that the courts are ready and able to take cases seeking to clarify the meaning, rights, and obligations of buyers, sellers, unit owners, condo associations, and other parties affected by contract, covenant, declaration, and statute provisions. This includes as to milestones, reserves, special assessments, and related obligations and rights for condo associations.
3. Guttenberg v. Smith & Wesson Corp., 357 So. 3d 690 (Fla. 4th DCA 2023), holding that when a claim of unavoidable harm or litigation rests on pure speculation as to what might happen, there are no ripening seeds of controversy, and thus a court cannot make a declaratory judgment. Here, a couple requested a declaratory judgment determining that a statute extending immunity to certain manufacturers and sellers–for lawful design, marketing, distribution, or sale of products–did not prohibit the couple from bringing a lawsuit against the manufacturers. This case provides a backstop to seeking an advisory opinion as to the tenability of a lawsuit, and requires those bringing the lawsuit to show imminent harm or present problem. Condo associations and unit owners seeking declaratory relief must be sure that their issue has accrued into an actual dispute that needs resolution between two opposing sides as to what their rights and obligations are at the condominium building.

How to Seek a Declaratory Judgment

For a condo association or HOA seeking a declaratory judgment regarding milestone reports or 40-year certifications, the process involves:

1. Filing a Petition (a Lawsuit Complaint): The condo association or HOA must file a petition with the court outlining the specific legal issues and requesting a declaratory judgment. The petition should detail the relevant facts, statutes, and any disputes or uncertainties.

2. Providing Evidence: The condo association or HOA needs to provide evidence related to the milestone reports, 40-year certifications, and any related correspondence or documentation. This helps the court understand the context and basis for the request.

3. Court Review: The court will review the petition and evidence to determine whether issuing a declaratory judgment will help clarify the legal issues and serve a useful purpose. The decision to grant or deny the judgment is at the court’s discretion.

4. Obtaining the Judgment: If granted, the declaratory judgment will provide a legal interpretation of the condo association or HOA’s obligations and responsibilities. This can guide the condo association or HOA’s actions and resolve any disputes or uncertainties.

Practical Considerations

– Proactive Approach: Seeking a declaratory judgment proactively can help condo association or HOAs avoid potential disputes and ensure compliance with regulations. It’s a preventive measure that can clarify obligations before issues escalate.

– Legal Costs: While obtaining a declaratory judgment can be beneficial, it involves legal costs and time. HOAs and condo associations should weigh these factors against the potential benefits of resolving uncertainties.

– Impact on Community Relations: Clear and transparent management of milestone reports and certifications, aided by a declaratory judgment, can improve trust and relations with residents by demonstrating a commitment to compliance and fair handling of responsibilities.

Conclusion

Declaratory judgments offer a valuable mechanism for Florida condo association and HOAs to address and clarify their obligations related to milestone reports and 40-year certifications. By seeking judicial clarification, condo association or HOAs can ensure they meet their regulatory requirements, resolve disputes with residents, and manage financial responsibilities effectively. Understanding Florida Statute 553.899 and its legislative history, along with recent case law, is crucial for navigating these responsibilities. For condo association or HOAs navigating these complex requirements, consulting with legal counsel to explore the possibility of a declaratory judgment can provide essential clarity and help maintain a well-managed and compliant community.

If you have questions about declaratory judgments in Florida, milestone reports, 40-year certifications, condominium associations and HOAs in Florida, please contact Bernhard Law Firm at www.bernhardlawfirm.com, 786-871-3349, abernhard@bernhardlawfirm.com.