Condo owner under “joint & several liability” under “Safe Harbor” is only liable for past due assessments as Ch. 718.116(1)(a) and (1)(b) do not permit charging of “late fees, attorneys fees, interests or collection costs” to subsequent owner

Wells Fargo took title August 2012. The Bank requested an estoppel letter from the Association. Wells Fargo brought a Declaratory Action in county court seeking clarification that 718.116 limited the amount it owed to the condominium to the lesser of 1% of the mortgage or past 12 months’ of unpaid maintenance fees. The trial court agreed, and the Association appealed to the Miami-Dade Circuit Court. The court stated that 718.116(1)(a) states, “[a] unit owner…is liable for all assessments which come due while he or she is the unit owner” and “jointly and severally liable with the previous owner for all unpaid assessments that came due up to the time of transfer of title.” 718.116(1)(b) is a carveout for banks/first mortgagees who foreclose on a condo unit and take title (i.e., bank is not jointly and severally liable with the prior owners). The court went on to say that “assessments” has specific meaning under the condo association statute: it is a “share of the fund which are required for the payment of common expenses, which from time to time is assessed against the unit owner.” (Ch. 718.103(1)). Ch. 718.116(3) treats interest, late fees and attorneys’ fees as different from, and not a part of, assessments. See also Bay Holdings, Inc. v. 2000 Island Blvd. Condo. Ass’n 895 So.2d 1197 (Fla. 3^rd DCA 2005); see also United States v. Forest Hill Gardens E. Condo. Ass’n, 990 F. Supp. 2d 1344 (S.D. Fla. 2014). Bay Holdings states that:

Interest, late charges, collection costs and attorney’s fees do not constitute “regular periodic assessments.” Fla. Stat. § 718.103(1) defines “assessment” to mean a share of the funds which are required for the payment of common expenses, which from time to time is assessed against the unit owner. Fla. Stat. § 718.103(1). In this context, the adjective “regular” differentiates normal from special assessments, while the adjective “periodic” suggests multiple dates on which the assessment is due and payable, i.e., monthly, quarterly or whatever period is set by the condominium’s declaration or by-laws. Individualized charges such as interest, late fees, collection costs and attorney’s fees simply do not fit within the statutory or common sense understanding of “regular periodic assessments.”

_{Case Law Alerts, 3rd Quarter, July 2015}

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