Henderson, Franklin, Starnes & Holt, P.A.

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House Bill 7037, recently adopted this past legislative session, expands the permitted practices of community association managers.

The bill, effective July 1, 2014, enlarges community association managers’ powers, some of which include:

  • determining the number of days required for statutory notices;
  • determining the amounts due to the association;
  • collecting amounts due to the association before the filing of a civil action;
  • calculating the number of votes required for a quorum;
  • negotiating monetary or performance terms of a contract subject to approval by an association; and,
  • drafting pre-arbitration demands.

Some members of the legal community have expressed concern that these new powers could constitute the unauthorized practice of law.

Under the Florida constitution, the Florida Supreme Court has the exclusive authority to both define and regulate the unauthorized practice of law. What constitutes the unauthorized practice of law has been partly defined as “[g]iving legal advice and counsel to others as to their rights and obligations under the law and the preparation of legal instruments.” Also included in the definition are activities requiring the interpretation of statutes, administrative rules, and community association governing documents.Continue Reading Florida Legislature Expands the Legal Work Permitted by Community Association Managers

One of my favorite events I look forward to every year is the Habitat for Humanity of Lee and Hendry Counties Women Build. Women Build is Habitat for Humanity’s nationwide program to empower women to take action against poor housing conditions by recruiting, educating and inspiring women to build and advocate for simple, decent and affordable homes in their communities.

According to the Census Bureau, more than 16 million children are living in poverty. The good news is that since the program began in 1998, more than 2,100 homes have been built by women crews in the United States. For Habitat for Humanity of Lee and Hendry Counties, this is the fourth year it has participated in Women Build.

Beginning in March of each year, women form teams to raise the money needed to renovate the homes. The women also physically renovate the homes, which are completed so they can be delivered to the families in May for Mother’s Day. This year, my team was comprised of members of the Cape Coral Construction Industry Association. We not only met our goal for the funds we pledged to raise, we also volunteered on various days to work on the home located in Cape Coral. The home was then officially dedicated to a wonderful mother, Vanessa Saez (pictured below), on May 10, 2014, just one day prior to Mother’s Day. There was an official Blessing of the Home, as well, at the dedication. It was an amazing experience!Continue Reading Habitat Women Build 2014

With the uptick in real estate activity it is helpful to recap the two primary ways that a licensed sales agent is entitled to a commission from the sale of real estate.

Contract

Most agents have their clients execute a listing agreement, which primarily comes in two forms and entitles the agent to a commission in different contexts.

Generally, the exclusive right to sell agreement entitles an agent to a commission irrespective of who sells the property. For instance, an owner who executes an exclusive right to sell agreement and consummates a sale to a buyer without the aid of the agent is still obligated to pay the commission. Intuitively, an owner might think that once the contract expires without the agent procuring a buyer, the agent’s right to a commission is extinguished. However, most exclusive right to sell agreements contain “protection period” provisions that extend the agent’s right to a commission for a certain number of months after expiration of the agreement. These provisions trigger the agent’s right to a commission if a sale is consummated with a buyer whom the agent or seller communicated with (regarding the property) while the listing agreement was in effect.

The second type of agreement is the exclusive agency agreement. Contrary to the exclusive right to sell agreement, this contract simply means the owner will not enlist another agent to sell the property. These agreements normally do not entitle the agent to a commission unless the agent procures a ready, willing and able buyer. Thus, an owner who consummates a sale without the agent’s aid is not obligated to pay the agent a commission.

Doctrine of Procuring Cause

Continue Reading Primer on Real Estate Commissions

Lawsuits regarding nondisclosure of a home’s problems are becoming more prevalent. Historically, the rule of “caveat emptor” or “buyer beware” was the prevailing standard in residential transactions. However, the law has evolved and Florida now requires sellers of residential property to make certain disclosures to buyers about the property’s condition and history. An increasing number…

Many condominium and homeowner’s associations have pet restrictions, ranging from prohibiting all pets to allowing only pets of a certain size and/or breed. These restrictions are increasingly being challenged and associations are finding it harder to enforce them and subjecting themselves to liability if they attempt to enforce them.

Exceptions Mandated By Federal Law

There…

Nationwide, one out of every five homes in foreclosure are abandoned — equating to a total of 170,000 abandoned homes, according to recent studies. Florida accounts for 33% of that figure, or about 55,000 abandoned homes. Florida cities, in fact, represent 85 out of the top 100 cities based on total number of owner-vacated foreclosures. Lee County’s city of Cape Coral is #13 on that list, with over 2,200 owner-vacated foreclosures.

To combat the security problems that can arise from vacant homes and the potential blight on neighborhoods and communities, counties and municipalities across Florida have responded by passing Abandoned Property ordinances. These ordinances place registration, inspection and maintenance obligations on lenders during the mortgage foreclosure process. Lee County recently passed its Abandoned Property Ordinance, which took effect January 2014:

When Registration is Required for Lenders

The lender obligations under the ordinance are triggered in a number of instances, but most commonly, lenders will need to register their properties when either a notice of foreclosure is filed or a notice of default is given to the property owner. Lenders should be cognizant that a mere default letter to the borrower — without filing a foreclosure lawsuit — requires the lender to register the property.

Additionally, lenders who have acquired title through a deed in lieu of foreclosure or a foreclosure sale are required to register their respective properties, even if they held title prior to January 1, 2014 – i.e., lenders who acquired title prior to the ordinance’s enactment are not exempt.

The ordinance does not distinguish between commercial and residential properties. For example, a commercial lender who has provided a notice of default to a property owner or who has acquired title through a foreclosure sale is required to register the property with the County. Nor does the ordinance distinguish between institutional lenders and private lenders.

What Registration Entails

Continue Reading Lenders Beware: Lee County Passes Abandoned Property Ordinance

The Foreign Investment in Real Property Act of 1980 (mercifully shortened in real estate and tax circles to “FIRPTA”) is a federal law designed to collect taxes on a foreign seller’s “disposition” of real property held in the U.S. The Act casts a wide net and applies not only to the sale of both commercial and residential properties, but also other real property interests such as swimming pools, mines, crops, and timber, just to name a few. Besides the typical sale of real property, the Act also extends to foreclosures and corporate mergers/reorganizations, among other “dispositions” of real property.

Foreign Investment on the Rise

With both residential and commercial real estate prices rising, but still deflated from the highs in 2008, both the U.S. as a whole, and Florida in particular, have experienced an influx of foreign investment in real estate.Continue Reading Increase in Foreign Investment = Increase in Tax Implications for Florida Real Estate Buyers