In Florida, condominium governance involves a nuanced interplay of laws designed to protect both individual unit owners and the collective community interests. A common source of contention is special assessments—extra fees levied by a condominium association to cover unforeseen expenses or improvements not included in the annual budget. If you face a special assessment you deem unfair, understanding your rights and the steps to challenge it under Florida law is crucial. This comprehensive guide will help you navigate this process effectively.

If you have questions about condo special assessments, challenges to special assessments, or seek to invalidate a special assessment, please contact Bernhard Law Firm at www.bernhardlawfirm.com, 786-871-3349, abernhard@bernhardlawfirm.com.

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What Are Special Assessments?

Special assessments are charges imposed by a condominium association for unexpected expenses or significant capital improvements not covered by the regular budget. These assessments might be triggered by major repairs, unexpected maintenance, or substantial renovations. Florida law outlines the procedures for implementing these assessments, but disputes often arise concerning their fairness or legality.

Legal Framework for Special Assessments

Florida’s condominium laws are detailed in Chapter 718 of the Florida Statutes, known as the Condominium Act. Key provisions regarding special assessments include:

• Approval Requirements: According to Florida Statutes Section 718.116(3), the condominium association must follow specific procedures to approve special assessments. Generally, the board of directors can levy these assessments, but in some cases, approval from unit owners may be required. Proper disclosure and voting, as stipulated in the condominium’s governing documents, are also mandatory.
• Budget and Notice: Under Florida Statutes Section 718.112(2)(e), unit owners must receive adequate notice of any special assessment. The association is required to provide a detailed explanation of the assessment’s purpose and how the amount was determined, ensuring transparency and allowing unit owners to challenge the assessment if needed.
• Material Alterations or Substantial Additions. Under Florida Statutes Section 718.113(2)(a), there is a general prohibition on material alterations and substantial additions to the common elements or association property, except as per the exact manner in the declaration of covenants. If the declaration is silent on the exact procedure for material alterations or substantial additions, then 75% of the unit owners must approve the alterations or additions before they are commenced. This rule creates a heavy burden on the passage of any special assessment that may be seen as making material alterations or substantial additions. If unit owners feel that the procedure was not followed where necessary, they may sue for declaratory judgment to have the special assessment overturned. Bailey v. Shelborne Ocean Beach Hotel Condo. Ass’n, Inc., 307 So. 3d 74 (Fla. 3d DCA 2020); but see George v. Beach Club Villas Condo. Ass’n, 833 So. 2d 816 (Fla. 3d DCA 2002) (termite repair was ordinary maintenance that did not require unit owner approval).
• Business Judgment Rule. A condo association’s board may generally be protected by the “business judgment rule,” so long as the board acts in a reasonable manner. Farrington v. Casa Solana Condo. Ass’n, Inc., 517 So. 2d 70 (Fla. 3d DCA 1987). However, while the business judgment rule may protect the board from personal liability in its decision-making, the rule does not prevent a unit owner from challenging a special assessment and overturning the assessment by declaratory judgment.
• Lack of Necessity May Not Be a Defense. A unique aspect of Florida law requires a unit owner to pay a special assessment, even if the homeowner argues that the special assessment is not necessary, or was even caused by breaches and failures by the condo association and management. Under Florida law, an allegation that a special assessment would not have been necessary if not for the condo association’s breach of fiduciary duty is not a defense to the owner’s obligation to pay the special assessment. Coral Way Condo Invs., Inc. v. 21/22 Condo. Ass’n, Inc., 66 So. 3d 1038 (Fla. 3d DCA 2011).
• Lack of Necessity May Be a Basis to Sue and Overturn. Although lack of necessity and various breaches and failures of the condo association may not be a defense to a homeowner’s initial obligation to pay a special assessment, they may be good grounds to sue the condo association to overturn the special assessment.
• Special Assessments to Pay the Association’s Legal Bills. Generally, a condo association can impose and enforce a special assessment to pay court judgments, attorneys fees, and litigation costs incurred in connection with a lawsuit brought by unit owners against the association. Ocean Trail Unit Owners Ass’n, Inc. v. Mead, 650 So. 2d 4 (Fla. 1994). However, the unit owner who sues and wins against the condo association does not have to share in the payment of the condo association’s legal expenses, and instead the unit owner can recover his or her legal fees from the condo association. See Florida Statutes Section 718.125; Florida Statutes Section 718.303(1)

Common Grounds for Challenging a Special Assessment

If you believe a special assessment is unjust or excessive, consider these common grounds for challenge:

• Improper Procedure: Ensure the assessment process adhered to legal requirements. For instance, in Bailey v. Shelborne Ocean Beach Hotel Condo. Ass’n, Inc., 307 So. 3d 74 (Fla. 3d DCA 2020), the court invalidated a special assessment due to procedural errors in notifying unit owners and obtaining approvals.
• Unreasonable Amount; Arbitrarily, Unreasonably, and Selectively Enforced: Assessments must be reasonable and justified, and cannot be arbitrarily, unreasonably, and selectively enforced. McAllister v. Breakers Seville Ass’n, Inc., 981 So. 2d 566 (Fla. 4th DCA 2008); Prisco v. Forest Hills Condo. Apartments, Inc., 847 So. 2d 1012 (Fla. 2003). In Workman Enters., Inc. v. Hernando County, 790 So. 2d 598 (Fla. 5^th DCA 2001), the court found a local government special assessment must be fairly and reasonably apportioned according to the benefits received. A special assessment cannot unreasonable and excessive relative to actual costs. Emerald Estates Cmty. Ass’n v. Gorodetzer, 819 So. 2d 190, 193 (Fla. 4th DCA 2002).
• Lack of Transparency: The association must provide clear documentation and justification for the special assessment. Id. Florida Statutes Sections 718.111(12) to (15) emphasize the need for financial transparency in special assessments.
• Violation of Governing Documents: Verify that the assessment complies with your condominium’s declaration, bylaws, and other governing documents. In Springsted Holdings, Inc. v. Del Prado Mall Professional Condo. Ass’n, Inc., 349 So. 3d 939 (Fla. 2d DCA 2022), the court ruled a plaintiff was entitled to a permanent injunction against the condo association for violating a clear right under the association’s documents, rendering the violation invalid for exceeding the authority granted by the governing documents. See also Cool Spaze, LLC v. Boca View Condo. Ass’n, Inc., 292 So. 3d 769 (Fla. 4th DCA 2020).

Steps to Challenge a Special Assessment

Follow these steps:

1. Review Governing Documents: Examine your condominium’s declaration, bylaws, and any amendments to understand the rules and procedures for special assessments.
2. Request Documentation: Obtain a detailed breakdown of the special assessment from the association, including the rationale, cost estimates, and related correspondence.
3. Consult with an Attorney: Seek advice from an attorney specializing in condominium law to assess whether you have a valid claim and the best course of action.
4. Attend Association Meetings: Participate in meetings where the special assessment is discussed to voice your concerns and gain support from other unit owners.
5. File a Complaint with the Division: If the issue remains unresolved, file a formal complaint with the Division of Condominiums, Timeshares, and Mobile Homes. However, under Florida Statutes Section 718.303(1), a dispute subject to alternative dispute resolution does not include a disagreement primarily involving the levy of a fee or assessment. Thus, a direct lawsuit may be the best option.
6. Consider Mediation or Arbitration: Explore alternative dispute resolution methods like mediation or arbitration, which can be less costly and quicker than litigation.
7. File a Complaint with the Florida Attorney General. The Consumer Protection Division of the Office of the Attorney General provides civil enforcement for violations of the Florida Deceptive and Unfair Trade Practices Act. The AG protects consumers by pursuing entities that engage in unfair and deceptive business practices. An AG complaint may not be an orthodox route to address special assessments, but it is generally free.
8. File a Lawsuit for Declaratory Judgment, Injunction, and Other Relief. The primary method to directly confront an improper special assessment may be to directly sue the condo association. In court, unit owners can seek declaratory judgment that the special assessment is invalid, injunction to prevent its enforcement or performance of the underlying work, and attorney’s fees and costs for having to bring the lawsuit.

When to Seek a Declaratory Judgment

A declaratory judgment may be appropriate in these situations:

• Legal Uncertainty: If there is confusion about whether the special assessment complies with the Condominium Act or the governing documents, a declaratory judgment can clarify the matter. For instance, Cohn v. Grand Condo Ass’n, Inc., 62 So. 3d 1120 (Fla. 2011) demonstrated how such judgments can resolve ambiguities in the association’s authority.
• Failed Negotiations: When informal resolutions fail, a declaratory judgment can provide a formal resolution.
• Preventive Measure: To address and resolve potential ongoing disputes related to the special assessment preemptively.

Steps to Seek a Declaratory Judgment

You may follow these steps to suing for declaratory judgment:

1. Review Governing Documents and Laws: Understand your condominium’s declaration, bylaws, and relevant amendments. Familiarize yourself with the applicable provisions of the Condominium Act.
2. Consult with an Attorney: Engage a condominium law specialist to evaluate the viability of seeking a declaratory judgment and guide you through the process.
3. Gather Evidence: Compile all relevant documents, including meeting minutes, assessment notices, and correspondence from the association.
4. File a Petition: Your attorney will prepare and file a petition for declaratory judgment with the appropriate court, outlining the legal questions and factual background of the dispute.
5. Court Proceedings: The court will review the petition, schedule a hearing, and issue a judgment clarifying the legal status of the special assessment.
6. Comply with the Judgment: Adhere to the court’s determination, which will be binding on both parties.

Benefits of a Declaratory Judgment

• Clarity: Provides a clear resolution to legal questions surrounding the special assessment.
• Preventive Action: Helps avoid further disputes and potential legal battles.
• Cost-Effective: Often less expensive than prolonged litigation, especially if it resolves the dispute early.

Conclusion

Challenging a special assessment in Florida requires a thorough understanding of the legal framework and specific case details. By reviewing the association’s procedures, consulting legal professionals, and possibly seeking a declaratory judgment, you can safeguard your rights and ensure fair resolution of disputes. While navigating these challenges can be complex, being informed about your rights and options will help you achieve a just outcome.

If you have questions about condo special assessments, challenges to special assessments, or seek to invalidate a special assessment, please contact Bernhard Law Firm at www.bernhardlawfirm.com, 786-871-3349, abernhard@bernhardlawfirm.com.