Independent Contractor Rules Change Again

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As business owners at The Orlando Law Group, we certainly use independent contractors as do many businesses throughout Florida. After all, independent contractors can often provide significant experience in a given field for a fraction of the cost of an employee.

Plus, many of the issues and costs surrounding employees – benefits, overtime, scheduling, time-off and more – are eliminated by working with independent contractors when possible.

Over the past few years, the “gig economy” has had courts, the IRS and the National Labor Relations Board looking closer at how workers should be categorized. And during the Trump administration in 2019, there was an expansion on who could be a contractor.

This June, however, the National Labor Relations Board issued a new ruling to basically reverse that decision. The issue comes down to entrepreneurial opportunity and if the contractor is working for multiple clients.

At The Orlando Law Group, we anticipate these types of criteria will fluctuate for a while as regulators work out how the gig economy will work.

The Orlando Law Group can help your business with any legal issue that might arise, including ones dealing with independent contractors. Our full-service firm helps businesses and individuals in Orlando, Winter Garden, Altamonte Springs, St. Cloud, Kissimmee, Sanford and throughout Central Florida.

What is an Independent Contractor?

Over the years, the independent contractor has been an important part of many business plans. They have been called consultants, 1099s, contractors and more.

But businesses that use them cannot simply substitute an employee for an independent contractor. There are specific rules, but for the most part, it comes down to control. Unlike an employee, a business does not provide any tools to the independent contractor – and cannot control how the contracted work is performed.

For instance, if you hire independent contractors as salespeople, you cannot provide them with sales leads. You cannot say they have to work every Friday or set their hours in any shape or form. You cannot require them to go to the office. You cannot provide them with a laptop or a computer. You shouldn’t even give them a business card with the company’s name on it.

Benefits are off the table. You are not responsible for overtime and certainly not responsible for taxes.

And you most certainly cannot prevent them from contracting to sell for another company at the same time, although you could make industry exclusivity a part of the contract.

The same applies if you are using a delivery driver as an independent contractor, or hiring a beautician, or a pilot, or myriad of other jobs.

Here’s how the IRS determines independent contractors, using three “Common Law Rules.”

  1. Behavioral: Does the company control or have the right to control what the worker does and how the worker does his or her job?
  2. Financial: Are the business aspects of the worker’s job controlled by the payer?
  3. Type of Relationship: Are there written contracts or employee type benefits? Will the relationship continue and is the work performed a key aspect of the business?

Businesses must weigh all these factors when determining whether a worker is an employee or independent contractor. Some factors may indicate that the worker is an employee, while other factors indicate that the worker is an independent contractor. There is no “magic” or set number of factors that “makes” the worker an employee or an independent contractor and no one factor stands alone in making this determination. Also, factors which are relevant in one situation may not be relevant in another.

These Common Law Rules have governed the independent contractor relationship for quite a while.

Entrepreneurial opportunity

So, what changed?

While the Common Law Rules have been part of the discussion on independent contractors for decades, what changed repeatedly in the last decade is how “entrepreneurial opportunity” is defined.

At the center of that term is how the independent contractor can grow their own business with other clients and other contracts.

In 2014, the NLRB said entrepreneurial opportunity was based on real entrepreneurial opportunity –the independent contractor acquired multiple clients. This ruling limited the number of independent contractors and classified many individuals as employees.

In 2019, that determination was expanded. It wasn’t specific to whether the independent contractor had acquired other clients, it became hypothetical. Could the independent contractor grow their business with other clients, even if they hadn’t? And that became the overriding element of classification.

Of course, applying potential instead of actual actions expanded who could be an independent contractor and the newest ruling from the NLRB returns to the 2014 meaning.

What does this mean for businesses? 

The classification of workers as employees or independent contractors is critically important. If you misclassify employees as independent contractors, you could be liable for back taxes and pay, and depending on the extent and negligence on your part, there could be major fines.

These fines can be significant. For instance, Nike is facing a $500 million fine for misclassifying employees. A small construction staffing company with 200 employees in Virginia has a $270,000 fine to pay for misclassifying employees.

At this point, it is important to be as conservative as possible with independent contractors.

We also believe to protect yourself; you should have an attorney at The Orlando Law Group review your independent contractor agreements. We understand your needs as a business owner and want to make sure your business thrives.

The attorneys at The Orlando Law Group represent clients in business law, labor issues and more in Orlando, Waterford Lakes, Altamonte Springs, Winter Garden, Lake Nona, St. Cloud, Kissimmee, and throughout Central Florida.

If you have questions about anything discussed in this article or other legal matters, give our office a call at 407-512-4394 or fill out our online contact form to schedule a consultation to discuss your case. We have an office conveniently located at 12301 Lake Underhill Rd, Suite 213, Orlando, FL 32828, as well as offices in Seminole, Osceola and West Orange counties to assist you.

The articles on this blog are for informative purposes only and are no substitute for legal advice or an attorney-client relationship. If you are seeking legal advice, please contact our law firm directly.

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Take Advantage of the Estate Tax Exemption Today

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As we look to 2025 with a new president, one of the most pressing topics is what will happen to the Tax and Job Cuts Act of 2017 passed during President Donald Trump’s first administration. Much of that bill is expected to expire in 2026, including several aspects of estate planning.

The biggest change could cost your estate millions of dollars if you do not act now – a significant decrease in the estate tax exemption.

Before the Trump tax law was passed, families did not have to pay estate taxes on roughly the first $6.5 million in an estate. The new law increased that exemption to the 2025 level of $13.6 million.

Without any change, the exemption will go down to approximately $7 million in 2026. That simple change could cost your heirs millions of dollars.

The attorneys at The Orlando Law Group can work with you to find ways to limit your estate’s tax liabilities, regardless of who is in office.

How Does the Election Affect My Estate Tax?

The reality of the situation with the tax law is that it may not matter who is in the White House for this exemption. That is because the exemption is not something easily overturned. After all, the law was written with sunset provisions in place.

To overturn the exemption, a new law must be passed by Congress, a virtually impossible task considering how close the majorities are in the Senate and the House of Representatives.

What do each of the presidential candidates promise?

Trump has promised to make the exemption permanent.

Kamala Harris proposed following the current tax plan proposed in the American Housing and Economic Mobility Act of 2024, dropping the exemption to just $4 million.

However, that bill was introduced in Congress months ago and has yet to have one vote or committee hearing. Unless there is a major change in Congress, a similar fate would most likely happen to any large tax bills introduced with either Trump or Harris in office.

That’s why many groups are working hard to show how the Tax and Job Cuts Act of 2017 helped spur the economy and to convince Congress to eliminate the sunset provisions that were part of that act.

Still, don’t bet millions on that being successful.

The time to act on your estate plan and the transfer of any wealth accumulated must happen soon to ensure you are protected.

What Can I Do Today?

The biggest thing that needs to be done as soon as possible is to put together a full estate plan, including a will, any trusts that can be developed, charitable giving and more.

A high-income individual who will be affected by the estate tax exemption should have done this already. If not, stop reading and call The Orlando Law Group immediately.

If the will is done and the estate plan is complete, it is time to review to make sure you pay as little taxes as necessary under current and future rules.

One of the things you can do is establish legacy charity gifts in your estate plan. These are targeted gifts for your favorite non-profits who can all use your gifts to help others.

After all, do you want the Internal Revenue Service to take your money, or would you rather it go to help children, to help the homeless or help the environment? By having those gifts established in your estate plan, it will lessen the impact of taxes.

Another thing to do is develop and annual plan of gifting to your heirs. For instance, every year a couple can give $36,000 to each of their heirs. It’s not a lot of money compared to the change in estate tax exemption, but it will help lower the taxes on those gifts.

You could also set up a 529 account for your grandchildren’s college education. This fund is tax-free and can be used for a wide range of needs around higher education.

Finally, make sure you transfer assets into a trust. This creates a separate entity that is not taxed while you are alive and only taxed with funds or assets are removed from the trust.

When do I need an attorney?

Estate planning is truly a team effort with your financial planner, your accountant and your attorney. Each of those three has very specific roles and responsibilities that come with estate planning.

At The Orlando Law Group, our team of attorneys and advisors can work with your team to handle all legal aspects of your estate plan. After all, an estate plan is a set of legal documents for the courts to understand your wishes for your estate after your death.

The attorneys at The Orlando Law Group can these types of issues in Orlando, Waterford Lakes, Altamonte Springs, Winter Garden, Lake Nona, St. Cloud, Kissimmee, and Central Florida.

If you have questions about anything discussed in this article or other legal matters, give our office a call at 407-512-4394 or fill out our online contact form to schedule a consultation to discuss your case. We have an office conveniently located at 12301 Lake Underhill Rd, Suite 213, Orlando, FL 32828, as well as offices in Seminole, Osceola and West Orange counties to assist you.

The articles on this blog are for informative purposes only and are no substitute for legal advice or an attorney-client relationship. If you are seeking legal advice, please contact our law firm directly.

 

 

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Make Sure to Include a Safety Plan in Your IEP

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Unfortunately, it seems like every day at least one school in Central Florida is locked down by law enforcement because of some threat to the school.

While disruptive to teaching and extremely scary to our students, nearly all of the threats to schools rarely are seen through.

If you are a parent of a child with an Individualized Education Program (IEP) review how the school helped your child during the threat to see if a child’s special needs are being addressed during an emergency.

Was there someone to help a child in a wheelchair when the elevators or stairs were closed?

Was an autistic child providing all the tools and devices they needed?

Who made sure a deaf student knew there was a drill?

If your child has an Individualized Educational Program or IEP, it is truly critical to ensure those needs are taken care of during an emergency.

It quite simply is a matter of life or death for some of our children.

The attorneys at The Orlando Law Group help parents throughout Central Florida work with their schools to develop an IEP and ensure the plan includes instructions on what to do during an emergency.

What is an Individualized Educational Program?

If you have a child with unique needs, you’ve almost certainly worked with your school to build an IEP. These are required by state and federal law to ensure all children receive the best education possible with the least amount of disruption.

For some children, it is as simple as giving extra time during tests or making accommodations on how homework is given.

For other children, it can be significantly more. For instance, for deaf and hard-of-hearing children, a communication plan must be part of any IEP per state law.

According to the Florida Department of Education, an IEP is a document that is designed to meet your child’s unique educational needs. It’s not a contract, but it does guarantee the necessary support and services that are agreed upon and written for your child.

At the least, the IEP must contain these pieces of information:

  • Present levels of educational performance
  • Goals
  • Special education and related services

The state also says the IEP will address the following:

  • Supports and strategies for behavior management, if behavior interferes with her learning or the learning of others
  • Language needs as related to the IEP as outlined in the communication plan
  • Communication needs as outlined in the communication plan
  • Assistive technology devices or services required
  • Necessary accommodations in the general education classroom

You’ll note that none of those bullets or on the state’s IEP checklist found here is any reference to safety, code red drills or emergencies.

It’s up to you to make sure those are included in your child’s IEP.

How do I Have Safety Measures Included?

One of the steps in the process of building a program for your child is a meeting with teachers, administrators and counselors who are all involved in the education of your child.

While educating your child will be the primary goal of the meeting, we encourage all parents to ask about how their child will be taken care of during an emergency.

This is not always a threat of a school shooting or a bomb scare, it’s also what happens if there is a gas leak, a tornado warning or many other situations that can arise.

It should also cover accidents while riding the bus, a much more common occurrence than other emergencies.

Autism Parenting Magazine wrote a tremendous article on how to ensure the safety of your child during an emergency, including a list of questions to ask during your IEP meeting.

Here are a few of them:

  • Who, specifically by name, is responsible for getting my child to safety in an emergent situation?
  • Who, specifically by name, is the backup person if the primary person is unavailable?
  • Does the staff responsible for my child need training and practice? Will they practice with my child? When, where, and how will this practice take place? Who, specifically, will be involved? Who, specifically, will be providing the training?
  • Should there be separate plans for a lockdown, an evacuation, a fire, a tornado? Who, specifically, will be responsible for teaching my child about the different types of emergency situations and how to respond appropriately?
  • How will my child access medications or medical supplies such as personal care, food, headphones, or calming items to keep him or her safe and quiet? If my child uses an assistive technology device to communicate, how/will that be transported with my child or what alternate method of communication will my child temporarily use?
  • Will a “to-go” bag be made up for my child? What will be included? Where will it be kept? Who, specifically, will bring it to my child? Is a separate bag needed for the school bus? Is a copy of my child’s emergency plan included in the kit?
  • Does there need to be separate plans for each location such as the classroom, in communal areas like the cafeteria or playground, or on the bus?
  • Where can I go to locate my child in case of an emergency evacuation?
  • What are some talking points I can use to talk with my child and some ways to practice at home?
  • Does my child know what to do if the teacher’s or supporting adult is seriously injured or dies?
  • Will all emergency plans be in place, staff trained, etc. on the first day that students arrive in the building?

The article suggests many more questions to ask, which is key to making sure your child remains safe.

When do I need an attorney?

In most cases, a school will work hard to ensure your child is safe and is educated to the best of their ability. However, you may not agree with what is being offered and believe the school is not providing the required services in your child’s IEP.

If you do not agree, simply write “Not in agreement” on your child’s IEP and additional steps will be taken. This includes the school or you bringing in experts in this realm to help build the IEP.

That’s when it is important to work with The Orlando Law Group, which specializes in helping parents find success in their child’s IEP. This includes ensuring all protocols for your child’s safety are included in your IEP.

The attorneys at The Orlando Law Group can these types of issues in Orlando, Waterford Lakes, Altamonte Springs, Winter Garden, Lake Nona, St. Cloud, Kissimmee, and Central Florida.

If you have questions about anything discussed in this article or other legal matters, give our office a call at 407-512-4394 or fill out our online contact form to schedule a consultation to discuss your case. We have an office conveniently located at 12301 Lake Underhill Rd, Suite 213, Orlando, FL 32828, as well as offices in Seminole, Osceola and West Orange counties to assist you.

The articles on this blog are for informative purposes only and are no substitute for legal advice or an attorney-client relationship. If you are seeking legal advice, please contact our law firm directly.

 

 

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Child Support image

Reasons To Increase Child Support in Florida

For many parents, child support is an important part of ensuring the well-being of their children. In Florida, as in many other states, the amount of child support can be modified when circumstances change. Let’s explore what those circumstances are so you can be better informed about when a child support agreement may be modified.

Change in Financial Circumstances

One of the most common reasons an increase in child support is awarded is when a significant change in financial circumstances arises. While temporary changes in income won’t prompt a change, permanent changes will. These can come in the following forms:

  1. Increase in the paying parent’s income: Child support amounts are largely based on the income of the paying parent. A substantial, permanent increase in that income can open the door for a request for an increase in child support from the receiving parent. 
  2. Decrease in the receiving parent’s income: The purpose of child support is to ensure the child is able to receive the care they need. If the receiving parent suffers a significant decrease in income, child support may be increased to make up for the lost income.
  3. Job loss or career change: A parent losing a job or switching careers can lead to a drastic change in their financial situation. These changes in circumstance can prompt a reassessment of the child support arrangement. 
  4. Inheritance or windfall: If either parent receives a substantial inheritance or financial windfall and courts determine that it’s large enough, this change in fortunes may be grounds for increasing the amount of child support.

Additional Child Needs

Children’s needs aren’t static. They require different levels of financial support at various stages of their life. Unforeseen circumstances and other life events can also alter their financial needs. Some situations that may prompt a change include:

  1. Medical expenses: Chronic illness or other ongoing medical requirements can drastically increase the cost of raising a child. These may necessitate an increase in child support.
  2. Educational expenses: During a child’s education,  they may need additional resources for tutoring, special educational programs, or college preparation.
  3. Extracurricular activities: Participation in sports or other activities can be expensive. An increase in child support may be granted to help with those expenses.
  4. Special needs: If a child is diagnosed with a disability or special needs, the additional care and resources required may justify an increase in support.
  5. Cost of living increases: Inflation and other economic factors that increase the cost of living impact everyone. Courts account for that when determining if an increase is warranted. 

Changes in Custody Arrangements

The custody arrangement is another large factor in the amount of child support payment. When this arrangement changes, the child support order can change with it. Some reasons for a change include:

  1. Decrease in parenting time: If the paying parent receives a decrease in their parenting time, the court may order them to pay additional child support. 
  2. Change in overnight stays: In addition to overall parenting time, the number of overnight stays with each parent is also accounted for in calculating child support.
  3. Relocation impacts: If the custody arrangements are modified because a parent relocated, the additional travel expenses for the custodial parent could result in an increase in child support.

Do You Need Legal Help in Florida? Contact The Orlando Law Group

If you’re a custodial parent and any of the changes apply to you, The Orlando Law Group may be able to get you an increase in the child support payments you receive. To find out if you qualify for an increase or for any other questions you may have about your child support or custodial agreements, contact our office today. 

Image Source: New Africa / Shutterstock

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Lane V. Erickson

How to Change Name on Property Title Deeds in Florida

A property title deed is the legal document that defines who owns a piece of property and allows an owner to transfer all or a portion of property ownership to another person. Adding individuals to or removing them from a deed is a legal process that requires you to follow specialized regulations. Failure to follow the right procedures can change the validity of your deed. In most situations, it’s essential to partner with an experienced real estate lawyer to accurately change names on property title deeds in Florida. 

Why Would Someone Need To Change a Name on a Property Title Deed?

A property deed proves ownership of the property and contains important information, including the names of the owners, a legal description of the property, and any conditions or rights that come with ownership. There are several reasons you may need to change a name on a deed. 

  • Marriage or divorce
  • Death of a property owner
  • Inheritance
  • Changing your legal name for any reason
  • To correct existing errors

Laws Around Changing a Name on a Property Title Deed in Florida

Changing a property title deed in Florida requires you to follow specific real estate laws and regulations. Florida Statute Chapter 695.26 defines the requirements for changing a property title deed and officially recording the new deed. House Bill 1419 lists legal requirements that must be followed when recording deeds. Legal requirements you must follow under the statutes include: 

  • The person wishing to change the deed (grantor) must present a government-issued photo identification. 
  • The grantor(s) names and addresses must be legibly printed in the body of the deed. 
  • The deed must be signed by all current owners while in the presence of two independent witnesses and a notary.

Other Things to Keep in Mind when Changing a Name on a Property Title Deed

A property title deed is a legal document that gives individuals rights to ownership of a property or part of the property. Any changes you make are legally binding and can impact how you use your property. As such, it’s essential to keep these considerations in mind when changing a name on a property title deed. 

Reversing the Change Can Be Challenging

Adding a person’s name to a title deed gives them legal rights of ownership. If the relationship changes, you can’t automatically revert the title to its original form. You only have two courses of action to remove an individual’s name from a property title deed: Having the person voluntarily transfer the deed or filing a lawsuit. 

Changing Names on a Title Can Affect Your Taxes

Transferring property may lead to the loss of certain tax exemptions (such as the Florida homestead exemption) for the grantor. In some situations, the transfer may qualify as a taxable gift, requiring the recipient to pay additional taxes. Discussing your unique situation with an experienced real estate attorney from The Orlando Law Group can help you determine the best way to transfer your property without facing unexpected tax increases. 

Adding Names to a Deed Doesn’t Guarantee the Property will be Transferred Upon Your Death

Many people mistakenly believe adding a name to a property deed will ensure the property will be passed to that person upon the original owner’s passing. However, this isn’t always the case. If the deed doesn’t specifically include language regarding your wishes, the property may be awarded in accordance with Florida probate laws. 

Are You in Need of Legal Help in Florida? Contact The Orlando Law Group

If you’re planning to change the names on a property title deed in Florida, it’s a good idea to talk to an experienced real estate attorney from The Orlando Law Group first. Our attorneys can help you understand the details of the process, and help you obtain all the necessary documents before getting started. Contact The Orlando Law Group to learn more about the requirements for changing the name on a deed or to book your consultation.

Image Source: Lane V. Erickson / Shutterstock

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Know the Rules for Service Animals as an AirBNB Host

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Being a host of an AirBNB can be a rewarding business, providing a source of income for investment properties. Of course, there are always hassles with guests over myriad issues.

One thing that is difficult to argue over is service animals.

To be clear, if you are an AirBNB host and try to deny a guest accommodation for a service animal, you could be charged with a crime.

When it comes to service animals, it’s best to let guests utilize a service animal in nearly all cases otherwise you risk serious repercussions.

The Orlando Law Group can help you work through all the regulations – like service animals and other Americans with Disability Act issues – that come with being an AirBNB host.

What are the service animal rules for an AirBNB?

In Florida, any AirBNB rentals are classified as vacation rentals, which puts them under the “public accommodation” category. That means any regulations under the ADA legislation apply to AirBNB.

Federal law prohibits any business offering public accommodation from refusing any service animal from entering an establishment.

In some ways, the regulations covering service animals are relatively strict. According to ADA.gov, “a service animal is defined as a dog that has been individually trained to do work or perform tasks for an individual with a disability.  The task(s) performed by the dog must be directly related to the person’s disability.”

In Florida, the only difference is that a service animal can also be a miniature horse.

While the service animal must be a dog or a horse, there are no certifications, training or any other item that is required to call either a service animal.

How do I prevent service dogs and horses?

In a nutshell, you can’t.

If a guest shows up with a service animal, even without prior notice, you must let them stay, although you can ask two key questions to confirm the animal is a true service animal, according to ADA.gov.

First, is the service animal required because of a disability?

Second, what work or task has the animal been trained to perform?

You cannot request proof they are service animals. You can’t ask to see the animal in action. You cannot ask about the disability the animal is assisting.

However, there are a few things that a host can utilize to ask a service animal to leave. According to Florida statutes, A public accommodation may exclude or remove any animal from the premises, including a service animal, if the animal is out of control and the animal’s handler does not take effective action to control it, the animal is not housebroken, or the animal’s behavior poses a direct threat to the health and safety of others.

A properly trained service animal should not bark, should not be wild, and should not go to the restroom any place it is not supposed to.

Tampa AirBNB Host Charged with a Misdemeanor

Earlier this year, an AirBNB host in Tampa was charged with a crime after forcing a guest with a service dog out of the AirBNB. The host offered the guest a free night stay but wanted the dog to leave.

In that case, the guests contacted AirBNB customer support explaining the dog was a service animal trained to sense seizures. However, AirBNB responded that the owner was highly allergic to pet hair and that the dog needed to leave.

The result was the owner being arrested for a second-degree misdemeanor, “denial of rights of the disabled.”

According to ADA regulations, “allergies and fear of animals are not valid reasons for denying access or refusing service to an individual with a service animal.”

Luckily for the owner, his attorney found a loophole because the host lived in the AirBNB that was being rented out. Thus it was not a fully public accommodation and the ADA laws did not apply. The charges were dismissed.

That sort of arraignment is very rare with AirBNB, though. In nearly all cases, you will need to allow a service animal into your AirBNB without any pet deposit or any other restrictions.

The attorneys at The Orlando Law Group can help AirBNB hosts with these types of issues in Orlando, Waterford Lakes, Altamonte Springs, Winter Garden, Lake Nona, St. Cloud, Kissimmee, and Central Florida.

If you have questions about anything discussed in this article or other legal matters, give our office a call at 407-512-4394 or fill out our online contact form to schedule a consultation to discuss your case. We have an office conveniently located at 12301 Lake Underhill Rd, Suite 213, Orlando, FL 32828, as well as offices in Seminole, Osceola and West Orange counties to assist you.

The articles on this blog are for informative purposes only and are no substitute for legal advice or an attorney-client relationship. If you are seeking legal advice, please contact our law firm directly.

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How Does My Business Deal with Service Animals?

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Most businesses that interact with the public have encountered an issue with service animals. Perhaps someone wanted to bring their emotional support cat into the restaurant or wanted to trot their miniature horse around the grocery store.

On the surface, it seems both of those examples would be easy to deny, but in Florida, denying the public entrance because of a service dog or miniature horse can get you into significant trouble.

But the cat?

It’s an emotional support animal and is not covered under the Americans with Disability Act

The rules on accommodating those with disabilities can be difficult for many businesses because their owners want to do the right thing, but often want to do prevent an animal from entering when it affects the overall business.

The attorneys at The Orlando Law Group can help any business that might have concerns about accommodations for service animals.

What is a service animal?

It’s important to understand what constitutes a service animal according to legal definitions.

According to ADA.gov, “A service animal is defined as a dog that has been individually trained to do work or perform tasks for an individual with a disability.  The task(s) performed by the dog must be directly related to the person’s disability.”

Let’s start with the animal must be a dog in most places. In Florida, it also includes a miniature horse.

Then the laws covering what is a service animal are based on the honor system. There are no certifications, training, or any other item that is required to call a dog or miniature horse a service animal.

There cannot legally be a support alligator, cat, parrot or any other type of animal. Those could be emotional support animals, but that is not covered by the ADA.

And, if a person walks into your store with an emotional support dog, one that is there to calm anxiety and not trained as a service animal, you can deny access.

Do the Laws Apply to My Business?

If you have anyone from the public enter your business, the laws covering service animals apply.

According to the ADA and Florida Statutes, an individual with a disability has the right to be accompanied by a service animal in all areas of public accommodation that the public or customers are normally permitted to occupy.

According to Pettable.com, examples of this include:

  • Parks, zoos, and other recreational facilities
  • Sales, rental, and service establishments
  • Convention centers, sports stadiums, and other gathering places
  • Hotels and lodging establishments
  • Restaurants
  • Public transportation stations
  • Museums, galleries, and libraries
  • Educational institutions

Frankly, if you allow anyone who is not an employee into your business, you need to allow a service animal into your business.

How do I prevent service dogs?

In a nutshell, you can’t.

If a customer shows up with a service dog, you must let them in, although you can ask two key questions to confirm the dog or horse is a true service animal, according to ADA.gov.

First, is the service animal required because of a disability?

Second, what work or task has the animal been trained to perform?

You cannot request proof they are service animals. You can’t ask to see the dog in action. You cannot ask about the disability the dog is assisting.

However, there are a few things that a host can utilize to ask a guest with a service animal to leave.

According to Florida statutes, A public accommodation may exclude or remove any animal from the premises, including a service animal, if the animal is out of control and the animal’s handler does not take effective action to control it, the animal is not housebroken, or the animal’s behavior poses a direct threat to the health and safety of others.

A properly trained service animal should not bark, should not be wild, and should not go to the restroom any place it is not supposed to.

A service dog should not be carried in a shopping cart but could be carried by the guest. The service animal can’t be fed at the table in a restaurant or sit in a chair at the table. The service animal cannot go in the pool at the gym and cannot be left in the hotel room.

A service animal is there to provide a medically needed service, just like a wheelchair or an oxygen tank, not to be a part of the family or a pet.

Two Exceptions for Businesses

While most businesses must allow service dogs, there are two exceptions where businesses can summarily ban service dogs.

First, the law allows a business to prevent service animals if the service animal fundamentally changes the nature of the business.

ADA.gov gives a great example of where a boarding school, that is open to the public, has a set of rooms specifically for children with allergies. The school could ban service animals – but only for that section of the school.

Second, if the service dog presents a safety hazard to the business, service animals can be banned.

The ADA.gov example showcases the issues with a zoo. Many animals are prey to dogs, and the presence of a dog could create serious issues for those animals. The zoo could ban service animals only in those exhibits and not in the entire zoo.

It’s hard for most businesses to fit into those exemptions and before establishing such a requirement, a business owner should have an attorney review their specific case.

The attorneys at The Orlando Law Group can help businesses with these types of issues in Orlando, Waterford Lakes, Altamonte Springs, Winter Garden, Lake Nona, St. Cloud, Kissimmee, and Central Florida.

If you have questions about anything discussed in this article or other legal matters, give our office a call at 407-512-4394 or fill out our online contact form to schedule a consultation to discuss your case. We have an office conveniently located at 12301 Lake Underhill Rd, Suite 213, Orlando, FL 32828, as well as offices in Seminole, Osceola and West Orange counties to assist you.

The articles on this blog are for informative purposes only and are no substitute for legal advice or an attorney-client relationship. If you are seeking legal advice, please contact our law firm directly.

 

 

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Statutory Warranty Deed vs. Special Warranty Deed In Florida

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When you buy or sell a home or other real estate, the warranty deed is the legal document to formally transfer ownership from the seller to the buyer. Deeds guarantee that the seller owns the property and has the right to sell it, which provides important protection for the buyer. Understanding the different deed types can help buyers and sellers navigate real estate transactions. 

What is a Statutory Warranty Deed?

A statutory warranty deed in Florida can also be called a general warranty deed. These deeds offer the most protection and are the most common way to transfer property. A statutory warranty deed guarantees that the seller who owns the property will be responsible for any problems with the property and is allowed to sell the property. This means the property hasn’t already been sold and is not subject to any liens or mortgages that aren’t noted in the deed. 

What is a Special Warranty Deed?

In addition to a statutory deed, Florida real estate buyers might also see a special warranty deed. A special warranty deed offers protections to the buyer, but they’re a bit narrower than those guaranteed by a statutory warranty deed. It only guarantees no problems with the property or debts against the property that happened while the seller owned it. It doesn’t make any promises about concerns that may have come up with a previous owner. 

Major Differences Between the Two

The major distinction between a statutory vs. special warranty deed in Florida is the timeframe the deed covers. A statutory warranty deed covers the entire history of the property. This means the deed needs to include any debts or problems, even if they happened before the current owner bought the property. For example, if a previous owner’s creditors placed a lien on the house, this must be noted in a statutory warranty deed. 

A special warranty deed only covers the period the current owner owns the property. It would not need to include a lien placed on a previous owner. Special warranty deeds make the transaction simpler for sellers who may not be aware of their property’s full history. Each type of warranty deed also tends to be used in transactions involving different property types. 

Which One is Best for Me?

Generally, statutory warranty deeds are used for residential property sales, and special warranty deeds are used for commercial property sales. Therefore, you’ll probably decide whether to use a statutory vs. special warranty deed in Florida based on the type of property involved. Special warranty deeds are more popular for commercial property because these properties tend to change ownership more frequently than homes do. This seller usually hasn’t owned the property for very long, so they don’t want to make guarantees about what may have happened under previous owners. 

The one scenario in which special warranty deeds are used for homes is foreclosure sales. The bank owns the property and has only been the owner for a short time. It doesn’t necessarily know what the previous owner did with the property. Statutory warranty deeds offer more protection for buyers because they cover a longer period, but special warranty deeds are the standard in some transactions. 

For All Your Legal Needs, Reach Out to the Team at The Orlando Law Group

You don’t need to decide which type of warranty deed is right for your property. The Orlando Law Group team has the knowledge and experience to guide you. Contact us to schedule a consultation today! 

Image Source: CrizzyStudio / Shutterstock

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What is a Quitclaim Deed?

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Different real estate transactions require different types of deeds. Deeds are the legal documents that transfer property ownership between a buyer and a seller. A quitclaim deed transfers property ownership, but it doesn’t make any promises about the title. This means there could be a lien on the property or some other issue, but the seller doesn’t need to include this information in the deed. Quitclaim deeds may be easier to assemble, but buyers have the least protection of any real estate deed. 

Types of Quitclaim Deed

There aren’t multiple types of quitclaim deeds, but there are similar deeds that also don’t provide the guarantees that a statutory warrant deed would. For example, a correction deed is designed to fix any errors, like an incorrect name on a deed. These deeds don’t transfer the property ownership. Instead, they just update the information. However, they can be used to add a spouse to the deed. If someone is giving away their property, either to a loved one or a nonprofit organization, they might use a deed of gift. These deeds can transfer real estate and money if the recipient isn’t paying for the property. A deed of release simply gives up a claim to a property. This is most common when a property owner finishes paying off their mortgage. The lender will then file a deed of release, indicating that the company has no claim against the property. 

When is it Appropriate to Use a Quitclaim Deed?

Quitclaim deeds in Florida offer buyers the lowest level of protection, but they are a good option in some situations. Transferring property with a quitclaim deed is much simpler than the requirements for other types of deeds. When there’s trust between the buyer and seller, like if they’re close friends or relatives, quitclaim deeds work well. This can happen during a divorce settlement or when a homeowner sells to a relative. Using a quitclaim deed is also a good idea when a property owner transfers their personal property to their business or when setting up a trust as part of an estate plan. 

Understanding how to change the name on property title deeds in Florida can be tricky. However, a quitclaim deed can be used to fix errors like typos or misspellings or to add people, like a new spouse, to the deed. In this case, the deed only updates the information, not transferring ownership. 

How Can I Nullify a Quitclaim Deed?

When using quitclaim deeds in Florida, buyers and sellers should be cautious. Buyers usually will not be able to nullify the deed if they discover a lien or problem with the property after the transfer of ownership goes through. This is part of the risk of using a quitclaim deed instead of a statutory warranty deed. 

The process can be fairly simple if both parties agree to nullify the quitclaim deed. Otherwise, it can only be nullified if used to transfer property illegally. If a buyer or seller believes their transaction was illegal, contacting an attorney is a good next step.  

Are You in Need of Legal Help? Contact The Orlando Law Group for all Your Legal Needs

If you’re considering using a quitclaim deed to transfer your property in Florida, it’s a good idea to talk to an attorney first. Our team will determine which type of deed makes sense for your situation. Contact the Orlando Law Group to book a consultation today! 

Image Source: Lana U / Shutterstock

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Welcome Back Non-Compete Contracts

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For much of the past year, nearly one in five of all employees in the United States have been waiting for September 4.

That was the day the Federal Trade Commission set to ban most non-compete contracts between employees and their employers.

Due to a recent judicial ruling, the wait for a non-compete contracts ban will take significantly longer, if it happens at all.

On August 21, a federal court in Texas ruled the FTC does not have the authority to make sweeping bans on any business practice nationwide and has halted the FTC’s new regulation from taking effect.

What that means is that for the foreseeable future, employees and employers should continue as they have been for years, looking at non-competes on a case-by-case basis.

And both groups should not presume this will change anytime soon.

The Orlando Law Group wrote about the possible impacts of this rule last November, warning businesses about the ban when the final ruling was announced. With the recent news, it is still high time to review your non-compete contracts.

How did we get here?

Under most non-compete contracts, an employee is not able to work for a competitor for a specified period, many times several years. If the employee decides to work for a competitor, they will be required to pay back any severance and, perhaps, pay damages.

For many employees, it was not a negotiated contract, but something that was required – basically a “sign this if you want to work here.”

The Federal Trade Commission went through its rule-making process, saying non-compete contracts are an “unfair method of competition” and are in violation of Section 5 of the Federal Trade Commission Act.

Plus, the Federal Trade Commission projected non-compete contracts lowered wages by $300 billion for more than 30 million Americans and that eliminating non-compete contracts would increase competition and lower prices.

“The freedom to change jobs is core to economic liberty and to a competitive, thriving economy,” said FTC Chair Lina M. Khan in the release announcing the rulemaking process last November. “Noncompetes block workers from freely switching jobs, depriving them of higher wages and better working conditions, and depriving businesses of a talent pool that they need to build and expand.”

What is the Power of Executive Agencies?

The ruling by the FTC was challenged in a Texas court by a company called Ryan LLC, a local tax firm. In the lawsuit, which was joined by the U.S. Chamber of Commerce, the company said the following according to NPR:

“In requesting relief, Ryan, the tax services firm, had argued that the ban on noncompetes would inflict ‘serious and irreparable injuries’ on its business, including by putting its confidential information at risk and enabling its competitors to poach valuable employees, whose knowledge and training would go out the door.”

The judge put a limited injunction on the FTC ban in July, and on August 21, expanded the injunction nationwide.

The reason?

Basically, the Federal Trade Commission does not have the authority to enact such a sweeping ban without the direction of Congress.

Chevron Decision Impacts Non-Competes

Earlier this year, the U.S. Supreme Court overturned a decades-old practice of considering the “Chevron Test” to the actions of federal agencies.

That test said that if a current regulation was ambiguous or silent on an issue, then the courts must follow the agency’s direction.

In June, that changed with the U.S. Supreme Court saying that there must be direction from Congress for an agency to act in a manner like the FTC acted.

The Texas court ruling specifically referred to Chevron explaining that Congress did not give the FTC the authority to make a rule as it did with the non-compete ban, as among other issues the court had with the FTC’s ban.

What Comes Next?

The most likely next step is for the federal government to appeal the injunction to the 5th District Court of Appeals and eventually to the U.S. Supreme Court.

That process will take years and could get stopped by a future Presidential Administration. Besides, with the current makeup of the 5th District and the Supreme Court, it is highly unlikely the injunction would be overturned.

After all, this Supreme Court overturned the Chevron Test, which allowed this injunction to happen.

Of course, Congress could enact a ban on non-compete clauses, but that is not expected to happen without a major change in the partisan makeup of Congress.

Various states are enacting non-compete bans or other restrictions. If you work in Oklahoma, California, Minnesota or North Dakota, non-competes are not allowed. Other states have restrictions which you can see at the Economic Innovation Group’s website here.

In Florida, the last change to non-compete laws was more than five years ago. There are some restrictions, with the key one being non-compete contracts must be reasonably necessary and (in some instances) should be six months or less, and certainly not more than two years.

For now, employers and employees should review their non-compete contracts for compliance with state and federal laws. They also must understand the notion that a national non-compete ban has vanished.

The attorneys at The Orlando Law Group can help businesses with these types of issues in Orlando, Waterford Lakes, Altamonte Springs, Winter Garden, Lake Nona, St. Cloud, Kissimmee, and Central Florida.

If you have questions about anything discussed in this article or other legal matters, give our office a call at 407-512-4394 or fill out our online contact form to schedule a consultation to discuss your case. We have an office conveniently located at 12301 Lake Underhill Rd, Suite 213, Orlando, FL 32828, as well as offices in Seminole, Osceola and West Orange counties to assist you.

The articles on this blog are for informative purposes only and are no substitute for legal advice or an attorney-client relationship. If you are seeking legal advice, please contact our law firm directly.

 

 

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Florida May Close Your Business for Not Following This Law

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Over the past few weeks, The Orlando Law Group has received multiple calls from business owners who have been subject to workers’ compensation investigations by Florida officials.

In each case, investigators walk into a business and ask to review all documentation as to how individuals are being compensated – to see if they are truly covered under workers’ compensation law or not.

At the heart of the issue is whether an individual is an independent contractor or an employee. Generally, an employer is not required to carry workers’ compensation for independent contractors.

What is happening, however, is that investigators are finding a significant lack of documentation as to an individual’s status and some businesses are threatened with shutting down the business until documentation on employment status can be provided.

That’s a position no business wants to be in, but it doesn’t have to happen when you have the proper documentation for independent contractors.

The Orlando Law Group can help review all the required documentation for independent contractors and employees to ensure you comply if a state investigator decides to review your business practices.

What is an Independent Contractor?

It is fairly easy to identify an employee of a business.

They get a regular paycheck.

They are told what they need to do in their job.

The company covers business expenses and provides employees with the tools they need to accomplish a job, like a computer and business cards.

Taxes are taken out of their paycheck and the individual may be eligible for employment benefits.

An independent contractor should be straightforward, yet many businesses confuse the line.

In a nutshell, a business using an independent contractor does not influence how the contractor performs a job, it cannot tell the contractor when they must work and certainly does not take out taxes or provide employment benefits.

Unfortunately, many businesses try to slide the rules a bit. They may provide a business card to an independent contractor or a list of potential sales customers to target. They may pay in cash or try to enforce hours.

All of that might get a company in trouble if they were investigated by state or even federal officials.

How Do You Classify an Independent Contractor?

For many businesses, using independent contractors can be advantageous. There is a lower cost associated with taxes and employment benefits. Termination is significantly easier and usually spelled out in a contract.

According to state statute, to classify someone as an independent contractor, four of the following six criteria for an independent contract must exist :

  1. the independent contractor maintains a separate business with his or her own work facility, truck, equipment, materials, or similar accommodations;
  2. the independent contractor holds or has applied for a federal employer identification number unless he or she is a sole proprietor who is not required to obtain a federal employer identification number under state or federal regulations;
  3. the independent contractor receives compensation for services rendered or work performed and such compensation is paid to a business rather than to an individual;
  4. the independent contractor holds one or more bank accounts in the name of the business entity for purposes of paying business expenses or other expenses related to services rendered or work performed for compensation;
  5. the independent contractor performs work or is able to perform work for any entity in addition to or besides the employer at his or her own election without the necessity of completing an employment application or process; or
  6. the independent contractor receives compensation for work or services rendered on a competitive-bid basis or completion of a task or a set of tasks as defined by contractual agreement unless such contractual agreement expressly states that an employment relationship exists.

Furthermore, state statute says that if four of the above scenarios is not met, you may still have an independent contractor if that independent contractor satisfies any of the following conditions:

  • performs or agrees to perform specific services or work for specific amounts of money and controls the means of performing the services or work,
  • incurs the principal expenses related to the service or work that he or she performs or agrees to perform,
  • is responsible for the satisfactory completion of work or services that he or she performs or agrees to perform,
  • receives compensation for work or services performed for a commission or on a per-job basis and not on any other basis,
  • realizes a profit or suffer a loss in connection with performing work or services,
  • has continuing or recurring business liabilities or obligations, or
  • the business’ success or failure is dependent on the relationship of business receipts to expenditures.

What Happens if a Business isn’t Compliant?

In all seriousness, a small business may have to close its doors if an agency finds that it is treating employees as independent contractors.

In the calls we’ve received from business owners, the state has issued stop-work orders against the business when it could not demonstrate it in fact uses independent contractors.

The reason for that is employees should be covered by workers’ compensation insurance. And the state does not forgive a business for misclassifying its workers.

Even if the company is not forcibly shut down, the financial implications are significant.

In addition to fines, a company can be ordered to pay back wages and taxes for misclassifying. And, in other states, a business owner can be sentenced to jail time as well. For instance, this April, a concrete contractor in Virginia was ordered to pay $1.2 million for improperly classifying employees. Last year, a drywall contractor in Wisconsin was fined nearly $600,000 and sentenced to 18 months in prison.

You don’t want that to happen to you.

As soon as you can, schedule a review of your independent contractor relationships with an attorney from The Orlando Law Group. We’ll review your situation to see if you are compliant and can provide proper direction.

The attorneys at The Orlando Law Group can help businesses with these types of issues in Orlando, Waterford Lakes, Altamonte Springs, Winter Garden, Lake Nona, St. Cloud, Kissimmee, and Central Florida.

If you have questions about anything discussed in this article or other legal matters, give our office a call at 407-512-4394 or fill out our online contact form to schedule a consultation to discuss your case. We have an office conveniently located at 12301 Lake Underhill Rd, Suite 213, Orlando, FL 32828, as well as offices in Seminole, Osceola and West Orange counties to assist you.

The articles on this blog are for informative purposes only and are no substitute for legal advice or an attorney-client relationship. If you are seeking legal advice, please contact our law firm directly.

 

 

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Why Does a Business Need a Business Law Attorney?

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By Juan Camacho, director of business law services

The Orlando Law Group is committed to serving businesses and working with them to make them successful. In fact, The Orlando Law Group has always been very entrepreneurial with our founder and attorneys owning multiple businesses in a wide range of industries, not just the legal field.

As the firm’s director of business law services, I’m here to guide our clients throughout their business, from the formation of an idea to a successful exit from the company. Just like all of the attorneys at The Orlando Law Group, I look to be a partner in our clients’ businesses, helping owners avoid costly issues before they become a problem.

Indeed, I look to be that first call (before problems strike) and not the last call (after problems strike).

While every business is different, all business law generally lies in four broad categories:

  • Business Formation
  • Business Transactions
  • Business Management
  • Business Transfer

Wherever you are in the lifecycle of your business, The Orlando Law Group is here to help you and provide counsel. But let us take a deeper look at some of the issues you might encounter when a business law attorney is vital.

Business Formation

Have a business idea? Thinking about starting a business? Then reach out to a business law attorney to discuss the right business structure for you.

We talked about business structure in our last article, but let’s go a bit deeper into two of the more common business structures.

Partnerships: Many people have the dream of opening a business with a friend. Perhaps the partnership is with a family member – or a spouse. Forming a partnership is relatively simple – just two or more individuals must agree on the business purpose and how that business achieves that purpose. Although a partnership can be very informal, there are issues that may complicate things. First off, there are a wide range of types of partnerships to consider. Plus, any written partnership agreement (although not required) should clearly outline a significant number of hypothetical situations, like what happens if a partner suddenly dies or there is a divorce. Without a solid legal outline, much larger problems can happen down the road.

Limited Liability Company:  This is one of the more popular types of business structures. Despite being more formal than a partnership, LLCs are relatively easy to start. Registering your business and filing Articles of Incorporation with your respective Department of State may be the minimum requirements, but not the only thing that should be done. A limited liability company should also have an operating agreement and other binding agreements in place. By forming an LLC, owners generally avoid personal liability – meaning you are not on the hook for your business’ liability. There are also tax implications a business owner should consult an accountant about before choosing this structure for their business.

At business formation, in addition to identifying the proper business structure, business owners should look at trademarks and copyrights. And, before talking about a business idea, make sure to have a good non-disclosure agreement for other people to adhere to.

Business Transactions

Everyone gets into business to make money, right?  And at the core of a profitable business are the contracts for services, products and other aspects.

If a business provides a service, does it have proper wording in its contract about the length of the engagement, the renewal process and termination? Is the work product protected or is it the property of the client when the contract ends? Does the contract clearly outline the services provided?

If a business sells a product, does its sales agreements have a warranty or return policies? Does it outline what damage is covered and is there protection against injuries that might arise due to the product?

There is a reason why almost all sales include “terms of agreement.” It’s because the sales contract is essential for a business.

Of course, there are many more aspects to the business transaction realm. Collections, negotiating contracts, failures to perform and much more are handled by a business law attorney.

Business Management

The day-to-day management of the company, particularly with human resources and dealing with employees can be troublesome for many businesses.

If a business does not have an employment contract ready for all employees, it’s essential to start working with a business law attorney today. Similarly, if a business uses independent contractors, having a contract that clearly outlines roles and responsibilities is essential.

Both employees and contractors are often places where lawsuits are prone to arise primarily because the terms of the relationship were not clearly outlined before starting the relationship.

Finally, with the possibility of non-compete clauses ending soon, does the business have a strong non-disclosure agreement so employees and contractors cannot use trade secrets when they leave?

Likewise, what is the contractual relationship with a business’ suppliers and vendors? Does the contract clearly state when payment is due and what happens if the vendor/supplier fails to perform? Is there an internal process for purchase orders? What protections does the business have for a vendor’s collusion with competitors?

A business lawyer is essential for all of these aspects of managing a business.

Business Transfer

All good things must come to an end, right?

A founder’s role in their business will end eventually, but the question will always remain whether the business continues after the initial founder leaves. After all, statistically, only one in four businesses survive past the first generation of owners.

Working with a business lawyer can be a great way to be among the 25 percent who do survive.

Much of the effort happens when a business is started, particularly with partnerships and other forms of business structure. Hopefully, when the business was formed, much of the terms of ending the business were discussed and agreed upon.

If not, a business attorney can help negotiate an exit, whether it is by putting the company in a trust, having a partner buy another one out or any other type of exit.

The key here is to ensure all legal documents are as clearly laid out as possible as ending a relationship can easily be a place where issues can arise.

We are here to help

The Orlando Law Group is celebrating its 15th anniversary this year. During that time, our attorneys and the entire firm have focused on helping business owners throughout Central Florida, particularly those small- and medium-sized businesses that are found throughout our community.

These types of services are what I specifically work through every day, helping business owners prevent problems from happening instead of waiting until they become problems to deal with.

If you think you need assistance, please reach out to me and let us review your unique situation.

Juan Camacho is the director of business law services for The Orlando Law Group. The attorneys at The Orlando Law Group can help business owners in Orlando, Waterford Lakes, Altamonte Springs, Winter Garden, Lake Nona, St. Cloud, Kissimmee, and throughout Central Florida.

If you have questions about anything discussed in this article or other legal matters, give our office a call at 407-512-4394 or fill out our online contact form to schedule a consultation to discuss your case. We have an office conveniently located at 12301 Lake Underhill Rd, Suite 213, Orlando, FL 32828, as well as offices in Seminole, Osceola and West Orange Counties to assist you.

 

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New Rules on Residential Real Estate Start on August 17

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One of the biggest changes to how people buy and sell their homes is taking effect this weekend. That’s when the National Association of REALTORS has told all of its members to start using the settlement terms in the federal court case accusing most real estate brokerages of violating the Sherman Anti-trust Act.

Multiple changes must be implemented by real estate brokers, almost all dealing with compensation and transparency in the compensation of brokers.

The biggest change is in how buyers are compensated, and it is something that anyone looking for a house needs to know.

If a home is closed after August 17, the buyer must pay their agent directly with out-of-pocket costs, eliminating how the buyer and the seller were paid during the closing of the home.

The Orlando Law Group has been following this issue since the beginning with detailed articles found here and here.

While having a personal agent work with you on finding your dream home can be very beneficial, with this ruling, utilizing the services of a proven residential real estate attorney can be a way to offset the costs of buying a home.

The attorneys at The Orlando Law Group understand this type of transaction as we are also licensed real estate agents. We work with local real estate agents and their teams on a wide range of services, including contracts and closings, but also with individuals who need assistance and are here for you.

What is changing?

The good news is that real estate brokers have had plenty of time to adjust. In May, the National Association of REALTORS announced the changes that needed to be made by brokers.

As reported by REALTOR magazine, here’s what needed to be changed:

  • Eliminate and prohibit any requirement of offers of compensation in the MLS between listing brokers or sellers to buyer brokers or other buyer representatives.
  • Retain and define “cooperation” for MLS participation.
  • Eliminate and prohibit MLS participants, subscribers and sellers from making any offers of compensation in the MLS to buyer brokers or other buyer representatives.
  • Require the MLS to eliminate all broker compensation fields and compensation information in the MLS.
  • Require the MLS to not create, facilitate or support any non-MLS mechanism (including by providing listing information to an internet aggregator’s website for such purpose) for participants, subscribers or sellers to make offers of compensation to buyer brokers or other buyer representatives.
  • Prohibit the use of MLS data or data feeds to directly or indirectly establish or maintain a platform of offers of compensation from multiple brokers or other buyer representatives. Such use must result with the MLS terminating the participant’s access to any MLS data and data feeds.
  • Reinforce that MLS participants and subscribers must not, and MLSs must not, enable the ability to filter out or restrict MLS listings that are communicated to customers or clients based on the existence or level of compensation offered to the cooperating broker or the name of a brokerage or agent.
  • Require compensation disclosures to sellers, as well as prospective sellers and buyers.
  • Require MLS participants working with a buyer to enter into a written agreement with the buyer prior to touring a property.

That is a significant number of changes, including the wording of contracts and marketing materials.

Buyer’s Agent Compensation at the Forefront

Historically, a buyer’s agent was compensated by the seller’s agent by splitting commissions between the buyer and the seller. On a $400,000 sale price, this could mean a commission for the seller’s and buyer’s agents of more than $10,000.

For most buyers, this seemed like a good arrangement. The money that was paid to the agent was taken out of the sale proceeds, so the buyer never truly saw any additional costs, other than what was in the sale price.

Now, the buyer will be on the hook for thousands of dollars in addition to the home price. Of course, the offer to buy a house could be lower, but The Orlando Law Group provides a different option.

What are a home buyer’s options now?

As we stated when the settlement was first made, the options seem to be limited now. With the new laws, buyers can:

  • Agree to pay the agent directly for a preset cost,
  • Negotiate with the seller to cover the buyer’s agent fee, similar to credits for closing costs,
  • Hire an experienced real estate attorney, or
  • Try to negotiate the purchase of real estate unrepresented.

We hope that no one tries to negotiate without representation. The process of buying a home should be trusted to a professional and an experienced real estate attorney may be your best bet.

No, a real estate attorney will not scour the internet looking for your perfect home. Most of the buyers we know are already doing that, looking at listing services for homes they like.

A real estate attorney can, however, negotiate the terms of your sale. They can help ensure you are covered for unforeseen circumstances in the sale contract. They can perform all the duties required at closing, that you will be paying for anyway.

The best part? The fees paid to an experienced real estate attorney, like those found at The Orlando Law Group, are a fraction of what would be paid to a real estate agent.

The attorneys at The Orlando Law Group can help homebuyers in Orlando, Waterford Lakes, Altamonte Springs, Winter Garden, Lake Nona, St. Cloud, Kissimmee, and throughout Central Florida.

If you have questions about anything discussed in this article or other legal matters, give our office a call at 407-512-4394 or fill out our online contact form to schedule a consultation to discuss your case. We have an office conveniently located at 12301 Lake Underhill Rd, Suite 213, Orlando, FL 32828, as well as offices in Seminole, Osceola and West Orange counties to assist you.

The articles on this blog are for informative purposes only and are no substitute for legal advice or an attorney-client relationship. If you are seeking legal advice, please contact our law firm directly.

 

 

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Want to Convert to Condos? Better Check the New Laws

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As the commercial real estate market continues to evolve after the pandemic, more and more building owners are looking to convert hotels, offices and other underperforming buildings into residential spaces.

Property owners are finding converting their underperforming property into a revenue stream, especially with the Biden administration pushing these types of conversions, offering billions in low-interest loans for developers to convert offices into residential units.

For some developers, looking at creating a mixed-use facility – instead of a full conversion – might be a creative way to convert an underutilized building.

For instance, an office skyrise may have floors of empty space in this commercial real estate market. However, the floors with office space are providing great revenue, so the property owner wants to keep some of the building as offices.

The owner wants to use some low-interest loans, so a few floors are apartments. Then, to create more revenue, the owner converts the top two floors to condominiums, selling them for a significant amount.

Starting October 1, a new law, HB 1021, covers converting a building into a mixed-use facility with condominiums with specific statutes property owners must follow when recording and selling the condominium units.

Property owners even considering condo conversions need to be prepared now.

The attorneys at The Orlando Law Group represent more than 100 communities and commercial real estate investors in Central Florida. If you live in Orlando, Winter Garden, Altamonte Springs, Kissimmee or anywhere throughout Central Florida, The Orlando Law Group is ready to help you.

What does a property owner have to disclose?  

The new law covers what a property owner must disclose when converting a building partially into a condominium. The law is fairly straightforward and the disclosures must be in the documentation filed with the official records of a building.

They include:

  • What parts of the building are included and not included in the condominium;
  • Who is responsible for maintaining and operating shared parts of the buildings, such as the roof, the windows, elevators, the lobby and more;
  • How much the property owner, tenants and condominium owners will contribute to the operations and maintenance of the shared facilities;
  • Who collects the shared costs of operations and maintenance; and
  • The rights and remedies that are available to enforce payment of the shared expenses.

While those are all to be filed with the local recording agency, the records must be open to inspection by any condominium owner.

Finally, the law ensures that the owner must submit an annual budget for those expenses to the association.

How to determine the costs associated with operations and maintenance

The legislature expanded on the third bullet point and outlined how much each entity – the association and the property owner – would pay to maintain the common areas.

The law is clear that the assessments are based on the following:

  • The area or volume of each portion of the building in relation to the total area or volume of the entire building, exclusive of the shared facilities.
  • The initial estimated market value of each portion of the building in comparison to the total initial estimated market value of the entire building.
  • The extent to which the unit owners are permitted to use various shared facilities.

There were two other parts of this law that applied to the amount each entity pays for operations and maintenance.

First, any owner who is not part of the condominium association, such as someone who owns a separate office condominium, must approve any increases to the expenses of common area operations.

Second, if all parties agree, there can be a unique or alternate method of assessing fees, but any alternate way of collection must be entered into the official documents of the building.

New contract language is required for conversions

While much of the law discussed the structure of the condominium conversion, the statutes now have very specific language in any contract the owner will have with a buyer.

Here’s what is required for any contract to have conspicuously written:

DISCLOSURE SUMMARY

The condominium in which your unit is located is created within a portion of a building or within a multiple parcel building. The common elements of the condominium consist only of the portions of the building submitted to the condominium form of ownership.

Buyer acknowledges all of the following:

(1) the condominium may have minimal common elements.

(2) portions of the building which are not included in the condominium are or will be governed by a separate recorded instrument. Such instrument contains important provisions and rights and is or will be available in public records.

(3) The party that controls the maintenance and operation of the portions of the building which are not included in the condominium determines the budget for the operation and maintenance of such portions. However, the association and unit owners are still responsible for their share of such expenses.

(4) The allocation between the unit owners and the owners of the portions of the building which are not included in the condominium of the costs to maintain and operate the building can be found in the declaration of condominium or other recorded instrument.

This new statute can be complicated for real estate owners looking to change the usage of their building and maybe consider condominiums as an option for their investment properties.

Just like any real estate transaction, it is important to work with an attorney to ensure compliance with this statute and to have the proper contracts for any sales to condominium owners.

The attorneys at The Orlando Law Group can help association board members and managers in Orlando, Waterford Lakes, Altamonte Springs, Winter Garden, Lake Nona, St. Cloud, Kissimmee, and throughout Central Florida.

If you have questions about anything discussed in this article or other legal matters, give our office a call at 407-512-4394 or fill out our online contact form to schedule a consultation to discuss your case. We have an office conveniently located at 12301 Lake Underhill Rd, Suite 213, Orlando, FL 32828, as well as offices in Seminole, Osceola and West Orange counties to assist you.

The articles on this blog are for informative purposes only and are no substitute for legal advice or an attorney-client relationship. If you are seeking legal advice, please contact our law firm directly.

 

 

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Record Keeping Becomes Even More Critical With New COA Law

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At the beginning of July, HB 1021 became official and with it came multiple new requirements for record retention and record production for condominium associations in Florida.

With it also comes hefty fines and potential criminal charges if not followed.

In the new law, the state aims at two aspects of record retention.

First, the law looks at how to handle financial records after the contract between an association and a community association management company ends.

Second, the law adds new steps for providing records to unit owners. This is where repeatedly withholding records from owners can result in a second-degree misdemeanor.

While the new law seems strict, the reality is that the new law is very specific in how to treat these records making it easy to follow to not be fined or convicted of a crime.

The attorneys at The Orlando Law Group represent more than 100 communities in Central Florida. If you live in Orlando, Winter Garden, Altamonte Springs, Kissimmee or anywhere throughout Central Florida, The Orlando Law Group is ready to help you.

How can directors be convicted of a crime?

For the most part, the records of a condominium association, like homeowners’ associations, should be open for inspection by any unit owner at almost any time. The state statutes are clear on what records are open and the limited exemptions to that rule.

For years, the statutes have been clear that records must be produced within 10 days of the request, or it is assumed the association is willfully ignoring the request. At that time, the association is fined $50 per day and can be liable for attorney fees.

Apparently, there were too many associations accepting this as a cost of doing business.

Under the new law, if an association violates the records law in the manner above twice in 12 months, the association manager or board member is removed from office and charged with a second-degree misdemeanor.

The punishment for a second-degree misdemeanor? Up to 60 days in jail, a $500 penalty and up to six months in probation.

Of course, that is easy to avoid. Simply provide the records of the association when asked.

The new law also allows public records to be on a website or a mobile app. When records are requested, the association can simply instruct an owner to go to the website to find any records, and, as long as the records are current on the website, this allows the association to avoid any fines or criminal charges.

Create a checklist of records to provide to requestors

HB 1201 added a new step for providing records to someone requesting them – a checklist of all records available for inspection that were requested and any records not available for inspection.

When the records are requested, this new checklist must be provided simultaneously to the response and, if provided, the association is presumed to have complied with the requirements of the statute.

The penalties for not providing this checklist are the same as not providing records, including the possibility of criminal charges.

Plus, there is an extra piece to this checklist not included with other records. All associations must maintain the checklists for seven years.

Breaking up is harder to do under the new law

Ending a relationship between a condominium association and its community association management company is never easy, but with the new law, an association management company could lose its license if it doesn’t follow the new statute.

The new law specifically covers financial records and puts a 20-day time limit for both the association and the management company to provide its financial records for a final review, along with the same time limit to return any records to the association.

The first step in the process under the new law is how the request for termination is given. While there is some leeway if the contract specifies how to cancel a contract, the notification must be delivered by certified mail with a return receipt given.

Once that happens, or just a written request for the records is given, the 20-day clock starts and at the end of those 20 days, the records must be returned with no excuses. Simply not returning the records is presumed to violate the new statute.

Starting on day 21, the management company can be fined $1,000 per day, up to $10,000. Plus, the manager who oversaw the community and their company could have their licenses suspended by the state.

The association must also participate, regardless of the circumstance. During that time, the association must also provide access to any records that are needed for the management company to provide the final report.

If it doesn’t provide access to the records, the association management company does not have to provide any financial report for the termination.

What to do now?

As with much of the new law, the most critical action an association can take is to review its procedures for providing records when requested. We also recommend that if an association hasn’t already done so, it should look for ways to put all of its public records online with access provided to any unit owner.

Similarly, it is important to create the template for the checklist that is now required to be provided. It is not a difficult task and one that will save the association headaches later.

The attorneys at The Orlando Law Group can help association board members and managers in Orlando, Waterford Lakes, Altamonte Springs, Winter Garden, Lake Nona, St. Cloud, Kissimmee, and throughout Central Florida.

If you have questions about anything discussed in this article or other legal matters, give our office a call at 407-512-4394 or fill out our online contact form to schedule a consultation to discuss your case. We have an office conveniently located at 12301 Lake Underhill Rd, Suite 213, Orlando, FL 32828, as well as offices in Seminole, Osceola and West Orange counties to assist you.

The articles on this blog are for informative purposes only and are no substitute for legal advice or an attorney-client relationship. If you are seeking legal advice, please contact our law firm directly.

 

 

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Conflicts of Interests Can Be Found in a Wide Net For Association Management Companies

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On July 1, another Florida law took effect that focuses on condominium associations and the management companies that help operate the system. One focus of the new law is to control potential conflicts of interest with community management companies.

For instance, Susie Smith is the community manager for a condominium association and part of her compensation includes shares in her community association firm. One of the associations she manages needs a new insurance company and she recommends her husband’s company, Acme Insurance Company.

In most cases, Sally would disclose the conflict of interest at the onset. Sally would not be involved in the selection of the insurance company and the organization asked for competitive bids from multiple insurance companies.

In that case, it is the decision of the board to pick the best company for the job, regardless of the conflict. But, they made the decision fully aware of the conflict.

But under a new law, if Sally’s grandfather-in-law is a stockholder in Acme Insurance Company – and it is not disclosed to the association, the contract with the community association management company could be terminated instantly and without warning.

It’s a wide net for conflict of interests and one any association management company should take very seriously.

The attorneys at The Orlando Law Group represent more than 100 communities in Central Florida. If you live in Orlando, Winter Garden, Altamonte Springs, Kissimmee or anywhere throughout Central Florida, The Orlando Law Group is ready to help you.

What constitutes a conflict of interest?

It is pretty straightforward what the new law, HB 1021, says is a conflict of interest:

A community association manager or a community association management firm, including directors, officers, and persons with a financial interest in a community association management firm, or a relative of such persons, must disclose to the board of a community association any activity that may reasonably be construed to be a conflict of interest.

In terms of this statute, two actions must take place for the courts to find a conflict of interest.

First, the community association management firm must have a contract with the association. Then, the business entity where an officer, director or anyone else with a financial interest in the firm, including their relatives, has a transaction with the association.

Who is covered by the conflict of interest?

The statute clearly states the conflict of interest is with the directors, officers and any person with a financial interest in the community association management company. This appears to not cover employees of the association, unless they receive compensation based on the financial results of the company, like stock in the company.

It does include “a relative of those persons.”

That is where this will become difficult for any community association management firm as the new statute clearly defines what a relative is considered in this statute: As used in this section, the term “relative” means a relative within the third degree of consanguinity by blood or marriage.

Within the third degree of consanguinity casts a very wide net. It includes grandparents, grandchildren, great-grandparents, great-grandchildren, aunts, uncles, nieces, and nephews of the director and their spouse. For reference, please see this chart.

The thought that a company has a conflict of interest because a niece of a director’s husband has a share of stock in a contracted company can be considered a stretch, but as of July 1, it is the law in Florida.

Does the new law eliminate conflicts of interest?

While the law casts a wide net, it does not eliminate associations from working with companies that may present a conflict of interest with the community association management company.

First of all, if the proposed cost of the contract is more than $2,500, the association must seek out and accept “multiple” bids from other providers. Frankly, it would be a best practice to seek multiple bids or proposals even without a conflict of interest.

However, today, it is now required by statute, although the number of additional bids is not stipulated.

Once the association has decided to move forward with the conflicted company, the association must:

  1. List the contract as an agenda item for the next board meeting
  2. Ensure the disclosures of all conflicts are entered into the minutes of the board meeting
  3. The contract must be approved by two-thirds of the directors present at the meeting.
  4. The conflict is disclosed at the next meeting for all the members of the condo association.
  5. When the contract comes up for renewal, the same steps must be followed again.

If these steps are not followed, the community association management firm’s contract can be canceled immediately and any termination fees, damages or future payments are canceled too. Plus, the contract for the vendor that created the contract can be canceled immediately.

As management firms and associations can have an adversarial relationship, particularly with new board members, not having this addressed with employees could be an easy way to kick out the management company.

What to do now?

For community association management companies, it is imperative the company’s human resources department addresses this with all of the individuals listed in the statute.

For many companies, the number of people who could be impacted by this could be significant. As such, we believe it is best to have any director, officer or anyone with a financial interest sign an affidavit showing there are no conflicts of interest or disclose any that might affect the firm.

The attorneys at The Orlando Law Group can help community management firms with this task in Orlando, Waterford Lakes, Altamonte Springs, Winter Garden, Lake Nona, St. Cloud, Kissimmee, and throughout Central Florida.

If you have questions about anything discussed in this article or other legal matters, give our office a call at 407-512-4394 or fill out our online contact form to schedule a consultation to discuss your case. We have an office conveniently located at 12301 Lake Underhill Rd, Suite 213, Orlando, FL 32828, as well as offices in Seminole, Osceola and West Orange counties to assist you.

The articles on this blog are for informative purposes only and are no substitute for legal advice or an attorney-client relationship. If you are seeking legal advice, please contact our law firm directly.

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Be Very Careful in Responding to Criticism from Condo Owners

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Anyone in association management or volunteers on the board fully understands what it means to deal with “that owner.” They are generally the critics on the sideline, someone who finds fault in anything you do – and works hard to make your life miserable.

Too often in condominium associations, the response is to take a closer look for violations, be stricter on late payments and take small, retaliatory actions against the owner.

Take the case of the Applegate Condos in South Florida, where the unit owners and the board were involved in a nasty lawsuit filled with allegations of retaliation.

There, unit owners repeatedly filed complaints that issues – like cracks in the ceiling and holes in the walls – were not being taken care of. The lawsuit says the association started to tow cars owned by the main complainers, for minor things like having a tire on the white line.

While we hope our clients never get to this point, as of July 1, this type of retaliation by condo associations is clearly illegal with a new law passed this year overseeing condominium associations, HB 1021.

The attorneys at The Orlando Law Group represent more than 100 communities in Central Florida. If you live in Orlando, Winter Garden, Altamonte Springs, Kissimmee or anywhere throughout Central Florida, The Orlando Law Group is ready to help you.

What can a condominium owner do without retaliation?

To be clear, a unit owner must act in good faith with any issues or complaints it has with the condominium association for it to claim the association engaged in retaliatory actions against an owner.

Specifically, the new law says the owner can not complain  “for any improper purposes, such as to harass or to cause unnecessary delay or for frivolous purpose or needless increase in the cost of litigation.”

We’ll get into the issue of interpreting that wording later, but for now, here are all the actions a unit owner can take in good faith and be protected in the new law:

  • “Complain to a governmental agency charged with responsibility for enforcement of a building, housing, or health code of a suspected violation applicable to the condominium;
  • “Organize, encourage or participate in a unit owners’ organization;
  • “Submit information or file a complaint alleging criminal violations or violations of this chapter or the rules of the division;
  • “Exercise any rights under this chapter;
  • “Complain to the association or any of the association’s representatives for the failure to comply with this chapter or chapter 617; or
  • “Make public statements critical of the operation or management of the association.”

Of course, the key here is that any action taken through those avenues is taken in “good faith.” As a unit owner, tt is important to document any actions and work with an attorney to ensure any complaints meet the intent of the law.

Can the association strike back?

If the unit owner acts in good faith in taking any of the actions above, the association must be very careful every step along the way, otherwise, there can be ramifications later.

The new law specifically outlines all of the actions that are prohibited after a complaint is filed. They are:

  • “Fine the owner,
  • “Discriminatorily increase a unit owner’s assessments,
  • “Discriminatorily decrease services to a unit owner, or
  • “Bring or threaten to bring an action for possession or other civil action, including a defamation, libel, slander, or tortious interference action.”

Here is where the issue comes into play. Let’s say the unit owner is significantly behind on dues, but the unit owner claims the association is not taking care of a rodent problem in the condominium.

With evidence of rats, the unit owner files a complaint with the local health department accusing the condominium association of neglect. Now, any action the association takes could be construed as retaliation and could get any enforcement action thrown out by a judge.

That is why it is important to be meticulous in the actions of the association when dealing with unit owners.

The statute leaves a lot of interpretation of actions

The new law certainly provides condominium owners new powers and abilities to push back against its association.

But what constitutes good faith? And what says that a lawsuit was in retaliation for an action by the condominium owner?

Frankly, much of that will need to be interpreted by a court of law.

Let’s play out another scenario using the state statute.

The association struggles to find an affordable contractor to repair a structural flaw in the pool house. It is a dangerous situation and the association had to close the pool house for the safety of its residents.

A unit owner decides to make more than a dozen statements on social media, saying how bad the association board members are at their jobs, accusing them of mismanaging money and calling for them to resign because the pool house has been closed longer than the unit owner deems was necessary.

Turns out, that the unit owner has not paid the special assessment to pay for the pool repairs. Following procedures, the association places a lien on the condominium association, to which the unit owner claims retaliation in a lawsuit.

Was it?

The association could certainly say that more than a dozen social media posts were not in good faith, but there is no statutory definition of where the line between good faith and harassment comes with public statements.

The unit owner could claim the lien was only because they complained on social media, but was it if the same standards were applied to this unit owner as everyone else?

It is confusing and will be up to the courts to try and interpret the intent of both the unit owner and the association

What to do now?

This new law makes it even more important for associations to be very methodical in every action they take to enforce their covenants and collect fees. There cannot be any emotion or deviation from procedures, or the association risks losing in court.

Today, every condominium association should be looking at its procedures for enforcement and review to make sure those procedures have been followed the same for every unit owner.

Then, it is usually best to allow the association’s lawyers to handle any further action if the unit owner takes any of the steps outlined in the new law. Once that happens, if the association is not meticulous in its actions, it could be creating legal exposure.

The attorneys at The Orlando Law Group can help association board members and managers in Orlando, Waterford Lakes, Altamonte Springs, Winter Garden, Lake Nona, St. Cloud, Kissimmee, and throughout Central Florida.

If you have questions about anything discussed in this article or other legal matters, give our office a call at 407-512-4394 or fill out our online contact form to schedule a consultation to discuss your case. We have an office conveniently located at 12301 Lake Underhill Rd, Suite 213, Orlando, FL 32828, as well as offices in Seminole, Osceola and West Orange counties to assist you.

The articles on this blog are for informative purposes only and are no substitute for legal advice or an attorney-client relationship. If you are seeking legal advice, please contact our law firm directly.

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Small Changes Can Have Big Repercussions

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Throughout HB 1203, which goes into effect on July 1, several very small changes could have large implications on how any association governs itself and its community.

Of course, most association management companies and law firms should be able to guide board members on these small changes – like the attorneys at The Orlando Law Group can.

Still, it is important associations and their volunteer members understand these small changes, which include things like kickbacks, compound interest, handling subpoenas and more.

The attorneys at The Orlando Law Group represent more than 100 communities in Central Florida. If you live in Orlando, Winter Garden, Altamonte Springs, Kissimmee or anywhere throughout Central Florida, The Orlando Law Group is ready to help you.

Kickbacks Now Have Criminal Implications

In most cases, directors and managers of associations would never consider taking a kickback, defined as taking a good or service that benefits the director or manager, or their families, that is not listed in a contract.

In the past, the association could remove a director who took at kickback. But doing so now is now a third-degree felony, punishable with up to five years in prison and/or a $5,000 fine. Plus, convicted felons cannot vote, cannot own a gun, and cannot serve on the HOA board anymore.

It sounds simple, but what happens when your landscape company invites a director to join them at a concert or a Magic game? Many people would not consider that a kickback, but the law would.

The only exception to this rule is “food to be consumed at a business meeting with a value of less than $25 per individual or a service or a good received in connection with trade fairs or education programs.”

The best advice: Don’t take anything from a vendor!

Only simple interest is allowed for past-due assessments

One line in HB 1203 could impact the finances of associations if they were collecting compound interest on late assessments.

Specifically, the law now says, “compound interest may not accrue on assessments and installments on assessments that are not paid when due.”

The legislature reiterated this elsewhere, adding the word “simple” to this line of Florida statute: “If no rate is provided in the declaration or bylaws, simple interest accrues at the rate of 18 percent per year.”

The difference can be substantial. For $100, simple interest charges 18 percent on that $100. After a few interest charges, compound interest would charge interest on $136, whereas simple interest charges 18 percent on the $100 due.

Compound interest can become very costly for a homeowner, very quickly.

Of course, this should be handled by the association’s management company, but directors must understand if they have been charging compound interest and the financial implications of the new law.

First Responders not just law enforcement for parking issues

In another article found here, The Orlando Law Group discussed one of the biggest impacts of the new law – the inability of associations to prevent commercial vehicles.

The law has always said any covenants that restricted commercial vehicles could not apply to law enforcement.

The new law includes all first responders, not just law enforcement. Starting July 1, you can not prevent any type of first responder vehicle.

To be clear, Florida Statutes define first responders as: “a law enforcement officer, a firefighter or an emergency medical technician or paramedic employed by state or local government.” This includes both paid and volunteer first responders.

You must obey subpoenas quickly

If an association thinks they can stonewall law enforcement when they subpoena records, the association needs to think again.

Now it is officially in statute that an association has five business days to provide any information requested through a subpoena issued by law enforcement.

In addition, the association is now required to “assist a law enforcement agency in its investigation to the extent permissible by law.”

The Orlando Law Group would hope that all associations already did this, but now it is required by law starting July 1.

New audit requirements for large associations

Before HB 1203, the types of financial statements required for community associations were based entirely on the revenues of the association, with greater financial reviews required for larger associations.

Specifically, the law required:

  1. An association with total annual revenues of $150,000 or more, but less than $300,000, shall prepare compiled financial statements.
  2. An association with total annual revenues of at least $300,000, but less than $500,000, shall prepare reviewed financial statements.
  3. An association with total annual revenues of $500,000 or more shall prepare audited financial statements.

HB 1203 added a fourth category based on the number of parcels in the community.

Now, regardless of the association’s revenues, if there are 1,000 or more parcels in the community, an association will be required to prepare audited financial statements.

The attorneys at The Orlando Law Group can help association board members and managers in Orlando, Waterford Lakes, Altamonte Springs, Winter Garden, Lake Nona, St. Cloud, Kissimmee, and throughout Central Florida.

If you have questions about anything discussed in this article or other legal matters, give our office a call at 407-512-4394 or fill out our online contact form to schedule a consultation to discuss your case. We have an office conveniently located at 12301 Lake Underhill Rd, Suite 213, Orlando, FL 32828, as well as offices in Seminole, Osceola and West Orange counties to assist you.

The articles on this blog are for informative purposes only and are no substitute for legal advice or an attorney-client relationship. If you are seeking legal advice, please contact our law firm directly.

 

 

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New Procedures for Violation Notices

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Perhaps there is no greater animosity between a homeowner and a community’s association than fines imposed for violating the community’s covenants.

When a homeowner does not edge the grass, pressure wash the driveway, or bring up a garbage can quickly, many homeowners’ associations are quick to threaten and impose a fine.

From the homeowner’s perspective, this often seems like an overreach for what they consider a trivial matter, but the homeowner usually is quick to take care of the situation.

But in those cases where they can’t perform the necessary improvements, there are new safeguards to give homeowners time to fix the situation. If the homeowner refuses to fix the issue, it is now in statute the homeowner will be paying for attorney fees, in addition to any fines imposed by the association.

The attorneys at The Orlando Law Group represent more than 100 communities in Central Florida. If you live in Orlando, Winter Garden, Altamonte Springs, Kissimmee or anywhere throughout Central Florida, The Orlando Law Group is ready to help you.

New timelines for violations

Perhaps the biggest change to the process of fining homeowners over violations of covenants is the timeline now required by Florida statutes.

Before the passage of HB 1203, the association could impose a fine on the homeowner with 14 days’ notice disclosing the fine and sharing information about a hearing about the fine. The fine would be due with a payment due 5 days after the hearing.

Starting on July 1, the association still must provide written notice about the hearing and fine within 14 days, but there are more requirements before the fine is due.

Now, the timeline for a violation looks like this:

  1. 14 days to provide written notice to a homeowner about the fine and the hearing, as was in statute before the law.
  2. The hearing must be held within 90 days of when the notice was sent, with the 90 days being a new requirement.
  3. After that hearing, the statute now says the association has seven days to send notification of the results of the hearing.
  4. Finally, the date the association can start collecting fines and attorney’s fees must now be set 30 days after delivery of the notice of the hearing’s results.

The 30 days is a significant expansion of time for homeowners to pay their fine and fix the issue to avoid a fine. Remember, before July 1, 2024, that period was just five days after the hearing.

Of course, if any of those timelines are not met, the homeowner has a good case to take to court to get the fines removed – and the homeowners’ association would be liable for attorney fees.

Again, this gives extra time for homeowners to fix the violations as the law now specifically says “If a violation has been cured before the hearing or in the manner specified in the written notice required in paragraph (b) or paragraph (d), a fine or suspension may not be imposed.”

Homeowners can avoid fees

There are other ways a homeowner can try to trip up its homeowners’ association into eliminating fines. One of the ways this can be done is by asking for a complete and detailed accounting of the fines that have been accumulating.

The Orlando Law Group wrote a separate article on this issue here, but to summarize, if a homeowner writes and requests a detailed accounting of their fines and the association does not provide it within 15 days, the fines could be waived.

There is a perceived loophole in that new ‘detailed accounting” statute. If the homeowners’ association follows the statutes that pertain to written notices, the fines cannot be waived even if the accounting was not provided within 15 days.

Garbage cans and holiday decorations

The Florida Legislature did address two of the more contentious issues that face homeowners and their associations: Garbage cans and holiday decorations.

There are many stories of aggressive homeowners’ associations sending violation letters because someone put their garbage out early or left their Christmas lights up too long.

The new statutes address both of those issues with specific timelines.

For garbage cans, the association cannot fine a homeowner for having their cans at the curb 24 hours before the garbage is collected or 24 hours after the garbage is collected, giving homeowners a 48-hour window for garbage.

This is a bit ambiguous, however. Does the clock start when the truck enters the community or when it picks up the individual homeowner’s garbage? It will probably be fought in court, but preliminarily, we are looking at a larger time frame based on schedule and prior activity, like Wednesday morning, instead of the exact time.

For holiday decorations and lights, the only way for a homeowners’ association to fine someone for having their decorations up too long is to have an explicit time to remove decorations in their covenants and send a written notification of the violation.

That written notification gives the homeowner one week to take the decorations down or start the violation process.

What to do now?

Every association needs to take a look at its procedures for sending out violation notices, holding hearings and providing records. There are very specific timeframes that must be made and if an association is sloppy or doesn’t have set procedures in place, the repercussions could be significant.

In addition, the association needs to look at what the board documents say about holiday decorations. To enforce compliance with holiday decorations, there must be a specific date after the holiday when the community wants decorations removed.

Finally, the association must ensure every email and address is current for every property owner and any renters or guests in the community. With such detailed statutes for notifications, there will be legal battles over whether a communication was received or not. Having a complete and current list of addresses and emails will help eliminate many of those fights.

The attorneys at The Orlando Law Group can help association board members and managers in Orlando, Waterford Lakes, Altamonte Springs, Winter Garden, Lake Nona, St. Cloud, Kissimmee, and throughout Central Florida.

If you have questions about anything discussed in this article or other legal matters, give our office a call at 407-512-4394 or fill out our online contact form to schedule a consultation to discuss your case. We have an office conveniently located at 12301 Lake Underhill Rd, Suite 213, Orlando, FL 32828, as well as offices in Seminole, Osceola and West Orange counties to assist you.

The articles on this blog are for informative purposes only and are no substitute for legal advice or an attorney-client relationship. If you are seeking legal advice, please contact our law firm directly.

 

 

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Follow the Statutes or HOA Fines are Waived

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One of the primary methods of bringing homeowners into compliance with neighborhood statutes is by fining homeowners for violating the community’s covenants.

Florida Statutes are very clear on how an association can levy fines against a homeowner, which include limits on the number of fines. The statutes also allow for attorney fees to be charged in the collection process.

You could even have a lien placed on your house by the association, creating thousands of dollars of costs to homeowners.

Here is one such case where a homeowner racked up nearly $1,000 in fines – just because he put his yard waste out on the wrong day.

The new law that goes into effect will cost unprepared associations thousands of dollars in assessments if they don’t follow the very specific rules outlined in HB 1203.

The attorneys at The Orlando Law Group represent more than 100 communities in Central Florida. If you live in Orlando, Winter Garden, Altamonte Springs, Kissimmee or anywhere throughout Central Florida, The Orlando Law Group is ready to help you.

What happens today?

Florida Statute 720.305 outlines the laws that apply to associations today.

First, the association can levy a $ 100-a-day fine if a homeowner does not fix the violation, although that fine cannot exceed $1,000 unless the board documents specifically allow for fines over that amount. It can also suspend a homeowner from any community amenities, such as a swimming pool or playground.

If the case is taken to court or collections, the losing party has to pay “reasonable attorney fees and costs” to the winning party.

Furthermore, it is not just the fines or the legal fees. It is also interest on the fines, which there are no statutory caps and is governed by the community documents. Refusal to pay a fine can really start adding up depending on the interest rate.

To fine or suspend a homeowner, the association must provide notice to the homeowner 14 days in advance for a hearing about the violation and the possibility of fines and suspension. Once the committee makes its decision, the homeowner has just five days to pay the fines or it will be delinquent.

There are many more nuances to this procedure, but it has been standard operating procedure for some time.

Provide records timely or the fine is waived

The new law, which takes effect July 1, gives a homeowner with delinquent fines a method to possibly get its fines waived – if the association doesn’t follow statutes.

The first thing a homeowner will do to fight back is to request – in writing – a “detailed accounting” of any amount the homeowner owes the association. The law does not clearly define what a “detailed accounting” should entail, so we believe this means everything that has to do with the fine to be safe.

The danger is that the new law requires those records to be delivered to the homeowner in 15 days. If not, all fines that have been levied against that homeowner that are 30 days past due are waived.

The good news is there are safeguards

One of the common steps homeowners do when they are not satisfied with their association is to file multiple records requests. Many times, this is done simply to see if they can trip up an association into making a mistake.

Thankfully, the legislature saw this as a potential issue and took steps to prevent that from happening here.

The law limits the number of times a homeowner can request the detailed accounting of their fines to once every 90 days.

In addition, the law also says fines can only be waived if they “are more than 30 days past due and for which the association has not given prior written notice of the imposition of the fines.”

That seems to ensure that if the association provides written notices, the issue of fines being waived may not be an issue.

What to do now?

For all associations, procedures to provide a detailed accounting record of any fines must be developed immediately. Hopefully, when a request is submitted on July 1, an association will be prepared to quickly process the request, run a report, and send it to the homeowner.

Also, the association should make every effort to collect the email and physical addresses of all homeowners in the community, especially owners that do not live in the community, like owners of investment properties or Airbnb homes.

This language is not clear on what constitutes written notice. As such, we fully believe legal battles will be had if the association sends written notice to an address that is not used by the owner. The owner could say they were not notified of the fines as they didn’t receive the notice. Of course, the association will say it sent the notice and the fines should remain.

In many cases, it will be up to the judge to decide.

The attorneys at The Orlando Law Group can help association board members and managers in Orlando, Waterford Lakes, Altamonte Springs, Winter Garden, Lake Nona, St. Cloud, Kissimmee, and throughout Central Florida.

If you have questions about anything discussed in this article or other legal matters, give our office a call at 407-512-4394 or fill out our online contact form to schedule a consultation to discuss your case. We have an office conveniently located at 12301 Lake Underhill Rd, Suite 213, Orlando, FL 32828, as well as offices in Seminole, Osceola and West Orange counties to assist you.

The articles on this blog are for informative purposes only and are no substitute for legal advice or an attorney-client relationship. If you are seeking legal advice, please contact our law firm directly.

 

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New Training Requirements for HOA Board Members

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For years, it was relatively simple to become a board member of your homeowners’ association. In most cases, you raised your hand, went through an election and you served your community. There was often no competition because serving on an association board is a significant time commitment.

Rarely does an association board member join with years of experience managing associations. These are volunteer positions held by all types of people from all walks of life.

For training, the state required board members to read over board documents and sign an affidavit to say this was accomplished.

Classes were available, but not required. Frankly, for most associations, the volunteer board members relied on professional assistance from a professional community association manager and/or a law firm with association experience.

Not any longer. There are new requirements for volunteer board members that require very specific training and continuing education with HB 1203, which takes effect on July 1, 2024.

The attorneys at The Orlando Law Group represent more than 100 communities in Central Florida. If you live in Orlando, Winter Garden, Altamonte Springs, Kissimmee or anywhere throughout Central Florida, The Orlando Law Group is ready to help you.

How much training does a board member need?

With this new law, all board members of an association in Florida will be required to take an approved training course specifically tailored to association management. These classes have been available for some time, only now they are required.

They don’t take long – only about 90 minutes or so – but cover very specific topics listed in the new law. Specifically, the class must include “training relating to financial literacy and transparency, recordkeeping, levying of fines, and notice and meeting requirements.”

That class is required to be taken every four years as well.

But that’s not all.

If you are a board member of an association with fewer than 2,500 houses, you are now required to take four hours of continuing education every year. If you are a board member of an association with more than 2,500 homes, you are required to take eight hours.

What does continuing education for board members involve?

Unlike the board member training, there is very little information available about what is required to be taught in those continuing education classes.

Currently, the law only says the Department of Business & Professional Regulation will
“adopt rules to implement and administer the educational curriculum and continuing education requirements.”

We assume the continuing education classes will be similar to those attended by community association managers and cover items similar to the courses required for new board members.

The Orlando Law Group has provided those types of courses for many years and will be offering them for board members as well.

What happens if we don’t take the classes?

The Florida Legislature is very specific. Any board member who hasn’t filed his or her certificate with the department within 90 days of being elected or appointed is suspended from the board.

Plus, the homeowners’ association must keep the certificates on file for up to five years.

The law was not clear as to an existing board member’s need to take the new board member classes. However, we are advising all board members to take the classes as soon as possible and not risk being suspended.

The attorneys at The Orlando Law Group can help association board members and managers in Orlando, Waterford Lakes, Altamonte Springs, Winter Garden, Lake Nona, St. Cloud, Kissimmee, and throughout Central Florida.

If you have questions about anything discussed in this article or other legal matters, give our office a call at 407-512-4394 or fill out our online contact form to schedule a consultation to discuss your case. We have an office conveniently located at 12301 Lake Underhill Rd, Suite 213, Orlando, FL 32828, as well as offices in Seminole, Osceola and West Orange counties to assist you.

The articles on this blog are for informative purposes only and are no substitute for legal advice or an attorney-client relationship. If you are seeking legal advice, please contact our law firm directly.

 

 

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New Rules for Architectural Review Boards

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It is certainly no secret the architectural review board of a homeowners’ association can often be a center of disagreement for communities.

A simple search finds endless stories about a homeowner in dispute with the association over a decision of the ARB.

Here is a perfect example of one in Bradenton over a fence. There, the fence that was built did not match the sketch provided to the board. The neighbors complained because the new fence blocked their view of a retention pond.

That case went all the way to the district court of appeals, which ruled the fence would stay – a costly fight for the homeowner and the association.

The new HOA law which takes effect on July 1, works to improve the process of approvals and denials from a community’s architectural review boards, adding new statutes that give homeowners more transparency on their applications and more freedom to make changes to their homes.

The attorneys at The Orlando Law Group represent more than 100 communities in Central Florida. If you live in Orlando, Winter Garden, Altamonte Springs, Kissimmee or anywhere throughout Central Florida, The Orlando Law Group is ready to help you.

Equity in Treatment

Anyone who lives in a community with an association probably knows about the architectural review board. Usually made up of community members, this board makes judgment calls on improvements requested to be made by homeowners.

This often includes things like the color of paint on the house, new fences, outside renovations and anything else that can be seen from the street or common area.

It seems like most people would do this regardless, but the state statute now specifically says the architectural review board must make decisions the same for all homeowners.

This is important because of human emotions that play into the decisions we all make. Perhaps a new ARB member has a personal dislike of a particular color or is friends with someone trying to do something unique to their house. The new law takes subjectivity out of the equation.

Clotheslines, gardens, HVAC and interiors

One of the biggest changes to laws governing associations is limiting what the association can govern to only changes that can be seen from the road.

Last session, the legislature made it a law that associations can not regulate the things that couldn’t be seen from the parcel’s “frontage or an adjacent parcel.” The statute included artificial turf, boats, recreational vehicles and flags.

This session, those items were expanded to include clotheslines and vegetable gardens In addition, the statute was changed to allow an HOA to regulate those items if they can be seen from “an adjacent common area or a community golf course.”

Along those same lines, associations are prohibited by law from restricting changes to the interior of the home, as long as it is not visible from those same areas. Frankly, this could cause issues, particularly with garage changes.

Many homeowners convert garages into extra bedrooms or other spaces, like a music room. The question will be settled in courts as to whether limited visibility – like when a garage door is open – is included.

Finally, the association is now prohibited from forcing a homeowner to make changes to the air conditioning system in a house, as long as it is not visible and is similar to the existing system.

Required follow up

Finally, there should be no doubt about why a request was denied by an architectural review board per the state law.

If an ARB denies a request, the association “must provide written notice to the parcel owner stating with specificity the rule or covenant on which the association or committee relied when denying the request or application and the specific aspect or part of the proposed improvement that does not conform to such rule or covenant.”

Of course, this should be easy, but it could be the start of a legal battle if not performed correctly. It’s best if the association’s legal team sends the notice to ensure there is no ambiguity on why the request was denied.

What to do now?

Remember, this law takes effect on July 1. Every association should review its covenants and bylaws to ensure they are compliant with the new regulations. If there are any covenants that cover items in the backyard or interior of the house, they should be taken out or made clearer.

In addition, associations should develop procedures that ensure equity in all decisions made by the ARB, along with the procedures for sending out written notices for any denial of ARB applications.

The attorneys at The Orlando Law Group can help association board members and managers in Orlando, Waterford Lakes, Altamonte Springs, Winter Garden, Lake Nona, St. Cloud, Kissimmee, and throughout Central Florida.

If you have questions about anything discussed in this article or other legal matters, give our office a call at 407-512-4394 or fill out our online contact form to schedule a consultation to discuss your case. We have an office conveniently located at 12301 Lake Underhill Rd, Suite 213, Orlando, FL 32828, as well as offices in Seminole, Osceola and West Orange counties to assist you.

The articles on this blog are for informative purposes only and are no substitute for legal advice or an attorney-client relationship. If you are seeking legal advice, please contact our law firm directly.

 

 

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disaster-loan

It’s Time to Update Your HOA Website

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One of the key elements of the new Florida law regulating homeowners’ associations is transparency in association records.

There are new criminal penalties for board members and associations who willfully refuse to provide official records.

There are new rules that eliminate fines if records aren’t provided.

HOAs have to respond within five days to a subpoena for records.

Board members are now required to have formal training on record keeping too!

In all, there are 70 references to records in the new law.

One of the biggest changes in record keeping now that HB1203 is law is a requirement to ensure nearly all of an association’s records are available online by January 1, 2025. That is only in six months – so associations must act fast to be in compliance.

The attorneys at The Orlando Law Group represent more than 100 communities in Central Florida If you live in Orlando, Winter Garden, Altamonte Springs, Kissimmee or anywhere throughout Central Florida, The Orlando Law Group is ready to help you.

What do I need to put on our website?

This law is the first time the state’s statutes have listed exactly what needs to be on a website and how it needs to be listed. It’s a long list – nearly 10 percent of the bill’s text was devoted to this topic – three pages of items required.

Here is everything that is required:

  • The articles of incorporation of the association.
  • The recorded bylaws of the association and any amendments.
  • The declaration of covenants and any amendments.
  • The current rules of the association.
  • A list of all current contracts or documents to which the association is a party.
  • A list of bids received by the association within the past year.
  • The annual budget and any proposed budget being considered at the annual meeting.
  • The financial report any monthly income or expense statement.
  • The association’s current insurance policies.
  • The certification of each director.
  • All contracts or transactions in which a director of an association has a financial interest.
  • Any contract or document regarding a conflict of interest or possible conflict of interest.
  • Notice of any scheduled meeting of members and the agenda for the meeting at least 14 days before such meeting.
  • Notice of any board meeting, the agenda, and any other document required for such meeting.

Many of these documents have very specific instructions on what needs to be available.

For instance, the notice for public meetings “must be posted in plain view on the homepage of the website or application, or on a separate subpage of the website or application labeled “Notices” which is conspicuously visible and linked from the homepage.

“The association shall also post on its website or application any document to be considered and voted on by the members during the meeting or any document listed on the meeting agenda at least 7 days before the meeting at which such document or information within the document will be considered.”

Frankly, there are many places where a homeowners’ association could inadvertently violate the new law.

What are the rules for this new statute?

Not only did the statute say what was required to be available, but it also provided relatively clear direction on how they needed to be displayed.

For the most part, these websites must have a “subpage, web portal, or other protected electronic location that is inaccessible to the general public and accessible only to parcel owners and employees of the association.”

It is required that every homeowner – on request – must be provided a password and user name to access the documents.

In addition, the statute says the association needs to redact non-public information and be careful about putting exempt information on the web portal. However, unless it was an intentional disregard for the law, an association is not liable for disclosing exempt information on the portal. (Exempt information can be found here)

What do we need to do now?

The law is clear. By January 1, 2025, all homeowners’ associations with more than 100 parcels will need to have this program live.

If a community does not have a website, using Facebook perhaps, the community will need to find a web developer as soon as possible to help build a basic website for the community.

If a community has a website, they will need to work with their web developer to ensure they comply and can develop a password-protected section on the website.

Finally, there are a lot of legal nuances and references to multiple statutes in the section. An attorney must review all of the documents to ensure they meet the new statute.

The attorneys at The Orlando Law Group can help association board members and managers in Orlando, Waterford Lakes, Altamonte Springs, Winter Garden, Lake Nona, St. Cloud, Kissimmee, and throughout Central Florida.

If you have questions about anything discussed in this article or other legal matters, give our office a call at 407-512-4394 or fill out our online contact form to schedule a consultation to discuss your case. We have an office conveniently located at 12301 Lake Underhill Rd, Suite 213, Orlando, FL 32828, as well as offices in Seminole, Osceola and West Orange counties to assist you.

The articles on this blog are for informative purposes only and are no substitute for legal advice or an attorney-client relationship. If you are seeking legal advice, please contact our law firm directly.

 

 

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Denying Records May End With You In Jail

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With the governor signing HB 1203, all homeowners’ associations must review their process for providing the community public records homeowners are entitled to receive.

Not doing so – and not clearly understanding the new law – could give board members criminal records, including the possibility of a third-degree felony.

To be clear, those new criminal penalties are tied to a willful and intentional effort to harm the association or resident, but it’s best to follow the law in all cases and not leave a director’s actions to be interpreted by law enforcement and the courts.

The attorneys at The Orlando Law Group represent more than 100 communities in Central Florida. If you live in Orlando, Winter Garden, Altamonte Springs, Kissimmee or anywhere throughout Central Florida, The Orlando Law Group is ready to help you.

How have records been treated in the past?

When it comes to public records of a homeowners’ association, there were no reductions of standards in the new bill. As it was at the beginning of the year, all official records of the association are to be available for inspection by any parcel owner in the community.

The list of what constitutes an “official record” and what is exempt from that designation is significant. The Orlando Law Group wrote an entire article specifically outlining all of the official records.

It is extensive and still applies today.

What also applies is the timeline for delivering those records to a parcel owner. When someone requests an official record of the association, communities are required to provide such records to the homeowner within 10 days of a written request.

If you don’t produce the records in 10 days, the homeowner is eligible for any damages created by the delay, but at a minimum $50 per day after the 10th day, up to $500.

How will I be criminally charged?

In South Florida, there is a long-running court case over condo association records. The association has been fined more than $300,000 by various state and federal courts. You can read all about Boca View which we used as an example on record laws for associations.

While that one is extreme, there are cases throughout Florida where an association tried to stall releasing records or just not providing records.

With the new law, criminal charges now revolve around the intent of the association in denying or delaying the records and was there an intent to harm the homeowner requesting the records.

Put it this way, let’s say a homeowner has made multiple records requests or asked in a way a director perceived as a being a jerk. The director wants to get a little revenge, so she holds back on the records and doesn’t send them for a couple of weeks.

Guess what? The director could be found guilty of a second-degree misdemeanor, with a fine of $500 and up to 60 days in jail starting June 1.

Now, let’s say the homeowner has been calling that director all sorts of names on Facebook, just being the worst keyboard warrior. The homeowner has rallied all of her neighbors against the director and now the director wants even more revenge, deleting the records that the homeowner wanted.

Unfortunately, the director is now open to prosecution on a first-degree misdemeanor, which includes a $1,000 fine and up to one year in jail.

The final way a director can be charged criminally is if the director refuses to provide records to keep another crime from being discovered. Of course, there are probably other things that will put that director in jail, but just trying to cover up a crime through destroying records is now a third-degree felony, with up to five years in prison.

What can be done to avoid these new charges?

For the most part, homeowners’ associations have been operating within the law – even the new one – and understand why it is important to provide those official records to homeowners.

Of course, emotions can take hold for anyone, even the most seasoned association managers, and mistakes can happen.

That’s why it is essential to review an association’s policies to provide records of the association to all homeowners.

In addition, there are a significant number of new requirements in the law that require homeowners’ associations to have official records on an association website. These records can be password protected, but it is a good practice to put as many records as possible on the association’s website.

That way, when someone requests the budget or financial reports, a simple response to review them on the website will keep associations from violating the new law.

The attorneys at The Orlando Law Group can help association board members and managers in Orlando, Waterford Lakes, Altamonte Springs, Winter Garden, Lake Nona, St. Cloud, Kissimmee, and throughout Central Florida.

If you have questions about anything discussed in this article or other legal matters, give our office a call at 407-512-4394 or fill out our online contact form to schedule a consultation to discuss your case. We have an office conveniently located at 12301 Lake Underhill Rd, Suite 213, Orlando, FL 32828, as well as offices in Seminole, Osceola and West Orange counties to assist you.

The articles on this blog are for informative purposes only and are no substitute for legal advice or an attorney-client relationship. If you are seeking legal advice, please contact our law firm directly.

 

 

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Your Work Vehicle Can Now Be Parked in Your Driveway

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One of the most contentious aspects of managing a community has been over cars and trucks parked out front of a home wrapped with a company’s logo and marketing.

In many homeowners’ association documents, these types of vehicles have not been permitted. The thought was that most homeowners did not want what could be construed as a billboard facing their home every night.

Of course, this put tremendous hardship on many homeowners. After all, they have spent hundreds of thousands of dollars on their house, but because they drive a company vehicle, they have been required to park it in their garage or offsite.

Starting July 1, however, all of those restrictions that limit work vehicles are largely invalid due to a new law that passed the Florida Legislature this year. There are some exceptions to the law, so it’s important to work with your association attorney to make sure you are in compliance.

The attorneys at The Orlando Law Group represent more than 100 communities in Central Florida. If you live in Orlando, Winter Garden, Altamonte Springs, Kissimmee or anywhere throughout Central Florida, The Orlando Law Group is ready to help you.

What Does the New Law Specifically Say?

The new law is clear. Associations cannot limit the right of a property owner to park a work vehicle in the driveway in nearly any shape or form.

Here’s what the law now says:

A property owner or a tenant, a guest, or an invitee of the property owner from parking his or her personal vehicle, including a pickup truck, in the property owner’s driveway, or in any other area at which the property owner or the property owner’s tenant, guest, or invitee has a right to park as governed by state, county, and municipal regulations.

The homeowners’ association documents, including declarations of covenants, articles of incorporation, or bylaws, may not prohibit, regardless of any official insignia or visible designation, a property owner or a tenant, a guest, or an invitee of the property owner from parking his or her work vehicle, which is not a commercial motor vehicle as defined in s. 320.01(25), in the property owner’s driveway,

It is best to do a review now of all association documents to ensure they are in compliance with the law.

Are There Exceptions?

Much like any new law, some interpretations will need to be worked out in the courts.

However, one of the obvious exemptions is that commercial motor vehicles are still not allowed, the definition of which is very specific in Florida statutes 320.01(25).

“Commercial motor vehicle” means any vehicle which is not owned or operated by a governmental entity, which uses special fuel or motor fuel on the public highways, and which has a gross vehicle weight of 26,001 pounds or more, or has three or more axles regardless of weight, or is used in combination when the weight of such combination exceeds 26,001 pounds gross vehicle weight.

That type of vehicle includes things like small semi-trucks, garbage trucks, city buses and everything bigger.

It doesn’t include the biggest SUV, which weighs only 6,000 pounds. It doesn’t include school buses or rack trucks. So, if your neighbor wants to park his refurbished school bus he uses for work in his driveway, he now can.

One of the items that may be determined by the court is politically wrapped cars and trucks. There are ways to prohibit political signs in a community, but does this make a Donald Trump or Joe Biden-wrapped vehicle allowed? Does the candidate for the school board get to wrap their car with their campaign markings?

The new statute isn’t clear and there may be an opportunity to still prohibit those types of vehicles. After all, the new law says you have a right to park a personal vehicle anywhere allowed by law, but then it says the HOA can’t prohibit a “work vehicle” not any vehicle.

In today’s contentious politics that have shown to divide neighbors and friends, this will be a topic for the courts to decide this election year.

In addition, there is nothing to say you can’t restrict what is on the vehicle. For instance, many work vehicles have ladders or other equipment attached to the vehicle. The new law does not prevent HOAs from limiting what can be left on the work vehicle.

As you can see, this is not an easy case filled with a lot of opinions and emotions. It’s critical to work with your attorney today to update all of your associations’ documents to match the new laws.

The attorneys at The Orlando Law Group can help association board members and managers in Orlando, Waterford Lakes, Altamonte Springs, Winter Garden, Lake Nona, St. Cloud, Kissimmee, and throughout Central Florida.

If you have questions about anything discussed in this article or other legal matters, give our office a call at 407-512-4394 or fill out our online contact form to schedule a consultation to discuss your case. We have an office conveniently located at 12301 Lake Underhill Rd, Suite 213, Orlando, FL 32828, as well as offices in Seminole, Osceola and West Orange counties to assist you.

The articles on this blog are for informative purposes only and are no substitute for legal advice or an attorney-client relationship. If you are seeking legal advice, please contact our law firm directly.

 

 

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Put Away the Debit Card for Association Purchases

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Let’s face it, homeowners’ associations are a fertile ground for thieves and people who exploit the trust given to them. After all, depending on the size of a community, thousands and thousands of dollars are sent from homeowners to the association to cover costs.

Associations must take the time to ensure their financial safeguards are in place to try and prevent fraud.

One aspect of financial safeguards is now required by law. In this legislative session, a new law now makes it illegal to use debit cards for homeowners’ association purchases. While most directors and association managers would not think about using a debit card for fraudulent purchases, a few bad players have taken that ability away.

Take this case in Leesburg featured by the Florida Association of Community Associations. There, a board member was accused of stealing $3,000 in association expenses. He claimed his wallet was stolen, but video evidence proved otherwise.

And last year, an association manager in Alabama was charged with stealing $40,000 from the association.

Those are only two of many examples of this type of abuse.

The attorneys at The Orlando Law Group represent more than 100 communities in Central Florida. If you live in Orlando, Winter Garden, Altamonte Springs, Kissimmee or anywhere throughout Central Florida, The Orlando Law Group is ready to help you.

What Does the New Law Specifically Say?

Often times in the legal world, there are ways to interpret statutes differently. It is the American system of checks and balances where the legislature writes the law, the executive approves the law and the courts interpret the law.

There shouldn’t be any need for interpretation on this one as HB 1203 states:

An association and its officers, directors, employees, and agents may not use a debit card issued in the name of the association, or billed directly to the association, for the payment of any association expenses.

The new law also says that if a debit card is used for any expense that is not approved by the board, in the minutes of the board meeting, or in the budget, the person who uses the debit card could be convicted of a felony!

Frankly, it’s surprising it has taken this long to pass legislation like this.

After a rash of debit card fraud in condominium associations, the state outlawed the use of debit cards by those associations. This legislation makes it illegal for all associations to use debit cards.

What Do We Do Now?

In a nutshell, stop using debit cards by July 1, 2024.

Many associations have moved to one of the many online programs that help you pay bills, such as Gusto, Bill.com or Melio. Each of those programs provides a safe and simple way to pay the association’s bills.

Of course, you can still do things the traditional way – write a check. And, if you would like to charge expenses, you can still do that through a traditional credit card, although that method can still expose the association for losses.

The important thing to do is have our firm review all financial safeguards that can be legally used to prevent fraud and theft. One thing is assured, a person intent on stealing from your association will find a loophole.

It’s our job to help make that tougher.

The attorneys at The Orlando Law Group can help association board members and managers in Orlando, Waterford Lakes, Altamonte Springs, Winter Garden, Lake Nona, St. Cloud, Kissimmee, and throughout Central Florida.

If you have questions about anything discussed in this article or other legal matters, give our office a call at 407-512-4394 or fill out our online contact form to schedule a consultation to discuss your case. We have an office conveniently located at 12301 Lake Underhill Rd, Suite 213, Orlando, FL 32828, as well as offices in Seminole, Osceola and West Orange counties to assist you.

The articles on this blog are for informative purposes only and are no substitute for legal advice or an attorney-client relationship. If you are seeking legal advice, please contact our law firm directly.

 

 

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The HOA Can’t Prevent a Permanent Generator or Fuel Tank Now.

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Have you seen the news about this year’s hurricane season? Nearly all of the hurricane forecasts are predicting a very active season, one that could set records.

Of course, it only takes one to hit your house to cause significant issues. Anyone who lived in Florida in 2004 knows how disruptive an active hurricane season can be, even if you are miles from the coast.

Over the past few years, we’ve seen a tremendous amount of damage from hurricanes large and small and in areas across the state.

As such, one of the key issues the Florida Legislature has looked at over the years is making Florida more resilient to hurricanes and providing the resources to return to normal life more quickly.

One of those bills, HB 293, focused on homeowners’ associations and specifically says homeowners associations cannot prevent any homeowner from making changes to its property if it is preparing for a hurricane.

While passed with good intentions, this bill could create many issues regarding how these improvements are allowed for associations and homeowners, meaning all associations should act immediately to ensure they are in compliance with the law with clear guidelines.

The bill was signed on May 29, and took effect immediately!

The attorneys at The Orlando Law Group represent more than 100 communities in Central Florida. If you live in Orlando, Winter Garden, Altamonte Springs, Kissimmee or anywhere throughout Central Florida, The Orlando Law Group is ready to help you.

What Does the New Law Specifically Say?

Compared to other bills passed – like the association reform bill HB 1203 – the hurricane preparation bill for associations is only a couple of pages long and gets to the point quickly.

Again, it says that an association cannot prevent a homeowner from making hurricane improvements. Those include:

  • Roof systems that meet ASCE 7-22 standards,
  • Permanent fixed storm shutters,
  • Roll-down track storm shutters,
  • Impact-resistant windows and doors,
  • Polycarbonate panels,
  • Reinforced garage doors,
  • Erosion controls,
  • Exterior fixed generators, and
  • Fuel storage tanks.

There is also one overreaching line to allow for items not thought of during bill drafting: “Other hurricane protection products used to preserve and protect the structures or improvements on a parcel governed by the association.”

That leaves the door open for a lot of changes to get around prohibitions in an association’s covenants and just another reason all associations need to act quickly.

What Can Associations Do To Maintain Community Standards

To be clear, the new law does not mean someone can put a 5,000-gallon fuel tank on the front lawn of their Lake Nona mansion – unless the homeowners’ association doesn’t take action.

Thankfully, the legislature gives the association the ability to regulate these improvements.

It is very clear in the new statutes: “The board or committee may require a parcel owner to adhere to an existing unified building scheme regarding the external appearance of the structure or other improvement on the parcel.”

Of course, if you don’t have those schemes in writing and delivered to all homeowners, it may be tough to regulate.

It also says the homeowner still needs to file an application with the association to put in the hurricane resilience items. However, the association cannot deny the application, if it applies to the community standards.

If association documents do not have standards for these items, it will be time to rewrite and change your association documents to set community standards for anything that might be considered preparation for a hurricane.

For instance, an association can require hurricane shutters to be a particular color or design. An association can require an external fuel tank and permanent generator to be installed where they can’t be seen from the road.

It’s a heavy task to complete in a short time, so it is critical to reach out to your association attorney soon.

The law requires homeowners’ associations to act now!

These changes must be done by every homeowners’ association in Florida, although it does not give a date they need to be done.

Specifically, the new law states:

The board or any architectural, construction improvement, or other such similar committee of an association must adopt hurricane protection specifications for each structure or other improvement on a parcel governed by the association. The specifications may include the color and style of hurricane protection products and any other factor deemed relevant by the board. All specifications adopted by the board must comply with the applicable building code.

One thing to take note of is that it doesn’t just include setting standards for the homes in the community. It required hurricane specifications for each “structure or other improvement” covered by the association.

That could include the clubhouse, the community playground, any fencing and even the little library a volunteer put up to encourage reading.

It won’t be an easy lift for any association. And, again, it is for every association in Florida, regardless of whether it was formed in 2024 or 1974.

The attorneys at The Orlando Law Group can help association board members and managers in Orlando, Waterford Lakes, Altamonte Springs, Winter Garden, Lake Nona, St. Cloud, Kissimmee, and throughout Central Florida.

 

If you have questions about anything discussed in this article or other legal matters, give our office a call at 407-512-4394 or fill out our online contact form to schedule a consultation to discuss your case. We have an office conveniently located at 12301 Lake Underhill Rd, Suite 213, Orlando, FL 32828, as well as offices in Seminole, Osceola and West Orange counties to assist you.

The articles on this blog are for informative purposes only and are no substitute for legal advice or an attorney-client relationship. If you are seeking legal advice, please contact our law firm directly.

 

 

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Understanding Defective Liability Product Claims

Hurricane Season is Here. Are You Ready For Insurance Claims?

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Over the past few years, the Florida Legislature has made significant changes to property insurance rules, often impacting how you can fight your insurance company.

The goal of these rules was to stop the massive increases in property insurance we all have seen recently. It is still up to debate as to whether these new rules will have the desired effect, but what it certainly does is reinforce that you need to be prepared in advance for any claims you might have related to hurricanes.

It is more difficult than ever to fight your insurance company. 

As many people know, damage during a hurricane is different than damage during a strong afternoon thunderstorm or a winter hail storm. There are special coverages, special deductibles and more. This also does not include flood insurance, which can also be a significant issue during hurricanes. 

The current forecast for Florida is a very active hurricane season and all parts of Florida can receive damage from a tropical system, so it is critical that you take action now – before the storm is close – to make sure you are prepared to get the largest payout possible for your hurricane damage. 

The attorneys at The Orlando Law Group have a long history of working with clients on their hurricane, windstorm and flood claims that come with a hurricane strike. If you live in Orlando, Winter Garden, Altamonte Springs, Kissimmee or anywhere throughout Central Florida, The Orlando Law Group is ready to help you.

Check Your Coverages

Perhaps the most important part of being able to recover from hurricane damage is to make sure you have the proper coverage for your property and your possessions.

It is confusing to figure that out.

For instance, the Florida Chief Financial Officer, which regulates insurance companies, put out a 12-page booklet just about how the hurricane deductible on insurance works. 

Even that is not an easy read. For instance, here is what that guide says to make sure the insurance company is correctly applying a deductible:

To determine if the company is applying the correct amount for the hurricane deductible, you need to know the following:

  • The effective date of your policy.
  • The amount of Coverage A (Dwelling Coverage) that is listed on your policy’s declarations page.
  • The hurricane deductible percentage that is listed on your policy’s declarations page.
  • Does the declarations page disclose the possibility that the Inflation Guard Endorsement may cause the hurricane deductible to be higher than indicated?
  • If yes, what is the percentage of the Inflation Guard that is listed on your policy’s declarations page?

Sounds easy, right?

That’s why we suggest your review is with an attorney at The Orlando Law Group. There are so many ways insurance companies will find a way to get out of paying your claim, that it is important to eliminate those loopholes as quickly as possible.

And remember, you cannot make any changes to a policy as a storm approaches your home. You must do this long before the first storm is here. To be adequately prepared, you need to come in as soon as possible. 

The earliest a hurricane has hit Florida officially was June 9. Don’t wait until the height of hurricane season for this review.

Perform an inventory of your property and possessions!

Another one of the key aspects of protecting your home and possessions is to have a complete inventory of all your possessions and your property.

At a very minimum, you will need to take a video of your house, both inside and outside. This shows the property before it was affected by a hurricane and gives you physical evidence of most of your possessions. 

For some things, you are going to want to take a step further to provide evidence of your possessions, particularly your valuables. 

Let’s say you have a set of quilts that have been passed down to you through generations. They are stored in a closet, safe and secure as a few were made in the 1800s by your great, great grandmother. 

It’s very valuable, but you never took the time to appraise them. Unfortunately, a flood caused by a hurricane ruined the quilts. Without any sort of value attached to them before the storm, they could be classified as blankets, valued at only a couple of dollars.

Without taking the time to work on your inventory, you could be faced with a loss of thousands of dollars for your most prized possessions. But, with documentation, your claim will be much easier to process and lower the cost of fighting for a fair payment from insurance.

Safe storage of documents is essential

All of the prework that you have done before a hurricane will be for nothing if you don’t keep your documents safe. That doesn’t include keeping the video on your phone or on your hard drive.

In today’s world, storing your files in an online storage system can be productive. Something like Google Drive or Microsoft SharePoint can be good tools to keep your documents in an environment that is protected from a storm.

But, as we know, depending on the track and severity of the storm, there may be widespread paths of power outages that make accessing documents on a server difficult. Plus, what happens if your computers and tablets are destroyed in the storm? Again, this makes it more difficult to access.

That’s why we recommend a waterproof safe to hold all of your important documents, including your insurance policies, your videos and your appraisals. While this might be difficult to access if there is severe damage to your home, it will be there for you even if you do not have access to the internet.

Of course, as your attorney, we can help keep digital files of your legal documentation after we review the information. While we’re in your neighborhood and could experience similar damage to our offices, we’ve structured our storage system to be as secure and as accessible as possible. 

The important thing is to reach out to us before the storm comes and let us help you prepare for any hurricane claim that might arise. 

The attorneys at The Orlando Law Group can help property owners in Orlando, Waterford Lakes, Altamonte Springs, Winter Garden, Lake Nona, St. Cloud, Kissimmee, and throughout Central Florida.

If you have questions about anything discussed in this article or other legal matters, give our office a call at 407-512-4394 or fill out our online contact form to schedule a consultation to discuss your case. We have an office conveniently located at 12301 Lake Underhill Rd, Suite 213, Orlando, FL 32828, as well as offices in Seminole, Osceola and West Orange counties to assist you.

The articles on this blog are for informative purposes only and are no substitute for legal advice or an attorney-client relationship. If you are seeking legal advice, please contact our law firm directly.

 

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Car accident

The damage is done. Now what?

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When you go to Fort Myers Beach, the scars of Hurricane Ian are unmistakable. Lots are abandoned, hotels are missing walls and the few houses there, look brand new. Hurricane Ian hit Fort Myers and Sanibel Island in 2022, yet many buildings and homes are still abandoned waiting on repairs.

There is often a lack of workers who can provide the construction services needed for repairs. But, too often, it is because the insurance company is slow to process claims, or the amount of the claim is in dispute. 

As your attorney, our goal is to ensure that insurance companies provide a fair and just payout for your claim as quickly as possible. Of course, it is not easy with insurance companies doing everything they can to do the exact opposite. 

For that reason, it is critical to take the right steps following an incident that will require a claim from your property insurance company. 

The attorneys at The Orlando Law Group have a long history of working with clients on their hurricane, windstorm and flood claims. If you live in Orlando, Winter Garden, Altamonte Springs, Kissimmee or anywhere throughout Central Florida, The Orlando Law Group is ready to help you.

The first step is to make sure you are safe

The safety of you and your family should always be the top priority after an incident requiring an insurance claim. As such, the very first step is to call emergency services to take care of any immediate medical issues.

Once everyone is deemed safe, it is time to document the damage to your property as much as possible. Take photographs and video of the damage – albeit making sure you can safely do so, avoiding any power lines or other potential dangers. Get close-ups of the damage and show broken or ruined furniture, valuables and other damage.

Do not start cleaning up until after the insurance claim has been filed and you have documented the damage. 

With that information, reach out to your insurance company to let them know you will need to file a claim. At this time, you’ll want to reach out to The Orlando Law Group so they can start the process of protecting your interests in a legal fight with your insurance company.

Our attorneys hope it won’t be a fight, but the sooner you can let us know one may be coming, the better we can be prepared to help you fight. 

Need a new place to live?

At this point, you will need to decide if your property is habitable and if there is anything that can be done to make it so you can live in it.

Remember, most insurance companies provide for living expenses if your home cannot be lived in at all. In some cases, they will provide an upfront sum to help you find temporary housing and other essential needs.

Even if they don’t, you’ll need to make sure you document every expense you have to spend on living expenses. This includes hotel receipts and restaurant receipts. If you lease a temporary rental house, make sure to have a copy of the rental agreement. If you need clothing, medicines or other essentials, document what you need and the costs of getting the essentials.

Almost all of this can be reimbursed by the insurance company – but only if you have documentation of all of your expenses.

Make small repairs to your property

At this point, it is OK for you to start making some temporary repairs to your property. For instance, if the only damage to your home is a hole in the roof, put a tarp over the hole to prevent further damage. 

If there is a tree blocking egress to the property, you can cut it down, although tree removal is only included in insurance if it lands on a car or a structure. 

Of course, make sure you perform all repairs safely and only if you feel comfortable using the equipment needed – like a chainsaw.

Your situation may need to hire professional help. Often times the insurance company will have a list of companies, but if you feel you need help, let us know and we can figure out what would be covered under your policy in advance.

That said, we recommend finding appraisals for what you think is damaged, that way you have an understanding of how much insurance should be paying you for the repairs. Also, with estimates performed soon after the damage, you might be able to shorten the time between filing your claim and returning to a normal life. 

Timing is important, but it is also important to be sure

In Florida, there is a statute of limitations of two years to file a property insurance claim, and that has decreased in recent years. We highly recommend not waiting until the end of your statute of limitations. The sooner you can file, the quicker we can resolve your claim.

That said, you also want to make sure your claim covers all the damage. If you miss something in a claim – for instance a leak in a roof that doesn’t show up immediately – it will be very difficult to refile and get payment for that damage.

Just remember to not accept a settlement offer from your insurance company without a review from an attorney. The insurance companies understand you are desperate to return to a normal life and will often try to take advantage of that urgency. 

You do not want to take a lower settlement because you feel impatient to return home.

The attorneys at The Orlando Law Group can help property owners in Orlando, Waterford Lakes, Altamonte Springs, Winter Garden, Lake Nona, St. Cloud, Kissimmee, and throughout Central Florida.

If you have questions about anything discussed in this article or other legal matters, give our office a call at 407-512-4394 or fill out our online contact form to schedule a consultation to discuss your case. We have an office conveniently located at 12301 Lake Underhill Rd, Suite 213, Orlando, FL 32828, as well as offices in Seminole, Osceola and West Orange counties to assist you.

The articles on this blog are for informative purposes only and are no substitute for legal advice or an attorney-client relationship. If you are seeking legal advice, please contact our law firm directly.

 

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orlando creditor claims in probate lawyer

All the Insurance Lies Coming After a Claim

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All too often, people trust their insurance company. After all, for years, you have been making a large monthly payment to a “trusted” name in insurance with no issues or claims. You assume that when you need them, they will be there to help you and make your life normal.

When you need to make a claim, you call the insurance company. They are friendly. They ask if you are injured. They ask to record your conversation – just for record keeping. They assure you everything will be alright.

Did you spot the lie they made to you?

They are not recording your story just for record keeping. They are recording your story to use it in the claims process, to ensure your story is straight and doesn’t change over time.

In most cases, this is not damaging as most insurance claims are not complicated. But, if you were in a heightened state of emotions after an incident requiring a claim, you may not have all the facts correct, or there may be circumstances that you were unaware of at the time.

It is the best practice to ask for them not to record your first conversation. They will say it is required – but it is not. Don’t fall for their mistruths. 

The attorneys at The Orlando Law Group have a long history of working with clients on their property insurance claims. If you live in Orlando, Winter Garden, Altamonte Springs, Kissimmee or anywhere throughout Central Florida, The Orlando Law Group is ready to help you.

Remember, insurance companies are not your friend

Insurance companies are some of the most profitable businesses in the United States. For instance, Progressive’s group of insurance companies had a profit of just over $3 billion in 2023. Geico had pre-tax profits of nearly $4 billion in 2023.

You might look at that and think they have plenty of money to cover your $200,000 claim for damage to your house.

However, insurance companies did not get to this point of profits by giving out large claims as much as possible. Instead, they would like to pay as little as possible and they play off the fact that most people do not understand the process, are emotional after an incident, and want to return to life as soon as possible.

There are tricks we have seen repeatedly from insurance companies, like saying they require a recorded call. It is important to make sure you do not fall for their trap.

They say you don’t need to talk to an attorney

Make no mistake. Your insurance company does not want you bringing on The Orlando Law Group to fight on your behalf. 

While technically you don’t need an attorney, the goal of the insurance company is to not talk to someone who has experience in these types of claims. They want to prey on the fact that most people do not know what to look for.

But the attorneys at The Orlando Law Group know this is coming. Several of our attorneys started practicing law representing insurance companies and other businesses looking to avoid paying consumers who make claims.

We’ve seen all the tricks coming and know how to counter their arguments on your behalf. They will do anything possible to not pay your claim. 

Insurance companies know how to play on your emotions

Anyone who has filed a claim for property or car insurance knows it is a stressful time. Maybe you can’t live in your house after the damage. Maybe you do not have transportation to get to your job. Maybe your clothes were all ruined in a flood. 

Damage requiring an insurance claim is the first step in regaining your former life and you want it back as quickly as possible.

That’s why insurance companies will offer a small settlement hoping you will want something to start over. 

Don’t take it. 

This first settlement offer is almost always much lower than where they are going to end up, but they know most people will jump at the first settlement offer and after that is accepted, there is no recourse if the payment is too small or future damage is found later – even the very next day.

Finding any way to get out of paying

An insurance company will look for any way to get out of paying you what you deserve. They will look for liability issues that you may have not known of. They could look at past damage and say the current incident did not cause the damage. They will review the fine print – knowing you did not – and pull out all the loopholes. 

One of the newer ways to avoid paying a claim is to look at your social media posts to find any images or posts of you doing something that counters your claim – like trying a TikTok dance after saying you could not walk without a cane.

Most certainly, they will go through all recordings of their conversation looking for any sort of discrepancy that might say you are not telling the truth.

All of this is why you need to have an attorney represent you for property insurance claims. Without that experience, you are at a disadvantage against the experts at the insurance companies. 

The attorneys at The Orlando Law Group can help property owners in Orlando, Waterford Lakes, Altamonte Springs, Winter Garden, Lake Nona, St. Cloud, Kissimmee, and throughout Central Florida.

If you have questions about anything discussed in this article or other legal matters, give our office a call at 407-512-4394 or fill out our online contact form to schedule a consultation to discuss your case. We have an office conveniently located at 12301 Lake Underhill Rd, Suite 213, Orlando, FL 32828, as well as offices in Seminole, Osceola and West Orange counties to assist you.

The articles on this blog are for informative purposes only and are no substitute for legal advice or an attorney-client relationship. If you are seeking legal advice, please contact our law firm directly.

 

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Are Impact Fees Going Away?

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One of the key mechanisms governments use to finance their road improvements, their sewer maintenance and new schools is through impact fees. Every time someone approaches the local government to build a new building, they pay an impact fee, designed to cover the increased costs created by the new building.

This month, however, the United States Supreme Court developed two rules key to impact fees that must apply to all impact fees to avoid tripping the Fifth Amendment of the U.S. Constitution.

Those two rules, established through earlier case law, first state any restrictions on permitting, like impact fees, must be essential to the government’s purpose. Second, the rules state impact fees must be proportionate to the impact it looks to offset.

What this means for impact fees, local governments and developers is still to be determined, most likely through a significant number of lawsuits.

If you think you may have paid an impact fee that doesn’t meet those two rules, reach out to us immediately. The attorneys at The Orlando Law Group can review your case to ensure those two rules are met and provide counsel on the next steps.

Why did the Supreme Court rule on impact fees?

Ask any developer about impact fees, and they will most likely say they are too high and are a money grab by local governments.

For instance, if you want to build a 2,000-square-foot home in an unincorporated Orange County suburb, you will be forced to pay nearly $25,000 to acquire a permit.

Most people do not pay these fees directly as they are paid by a developer before the new house is built. But, the cost of that house at its first sale increased by $25,000 to cover the impact fees.

Local governments are key to pointing out that significant restrictions on tax collections have limited revenue. For instance, homeowners receive significant tax deductions on their primary home and values are locked in at three percent increases every year, regardless of actual increase.

Plus, elected officials rarely raise any taxes. The federal gas tax has been locked in at 18 cents a gallon for decades and doesn’t come close to paying for highway repairs, much less new highways to accommodate growth.

For the most part, local governments have argued the Fifth Amendment doesn’t apply to actions by legislative bodies, like school boards or city councils. But one couple who paid nearly $25,000 in impact fees to build a home in California sued for a refund. Courts in California agreed the “legislative body” that enacted the fee was not impacted by the Fifth Amendment.

In a unanimous decision, the U.S. Supreme Court overruled those courts, saying all government actions are covered by the Fifth Amendment.

However, it did not say if the California impact fees were improper taking of property by the government. It left that to local governments and courts.

That also left a lot of confusion on what comes next.

The only thing we know is more lawsuits are coming

While the ruling is being lauded by real estate and home builder groups, there really is nothing in the Supreme Court ruling that says impact fees must be reduced or eliminated.

There’s nothing that provides a mathematical equation that outlines what an impact fee range should be.

The only thing the court’s ruling does is say that all impact fees must be judged based on the two established rules.

We believe there will be very few governments who willingly say they were overcharging impact fees. It should be assumed each government believes the impact fees they charge pay for an essential government service and cover the approximate cost of the impact of the development.

What we think will happen will be a significant number of lawsuits filed against local governments forcing them to justify the amount of impact fees it charges.

Should I Sue to Recoup Fees?

As is the answer with most cases of law, maybe.

There are a lot of questions with this ruling. Maybe a developer who recently paid impact fees should strongly consider it, but how long are developers impacted? That’s to be determined.

Could an HOA sue to recoup impact fees on behalf of its homeowners? Maybe.

Could an individual who had impact fees passed on into the purchase of a new home sue? Maybe.

What about someone who was charged an impact fee on a remodel, even though the same number of people will be living in their house? Maybe.

The key is to allow one of the real estate attorneys at The Orlando Law Group to review your circumstance to see if there is a case we can make that you were overcharged based on the rules that now apply to all impact fees.

The attorneys at The Orlando Law Group can help businesses and individuals with all types of real estate issues in Orlando, Waterford Lakes, Altamonte Springs, Winter Garden, Lake Nona, St. Cloud, Kissimmee, and Central Florida.

If you have questions about anything discussed in this article or other legal matters, give our office a call at 407-512-4394 or fill out our online contact form to schedule a consultation to discuss your case. We have an office conveniently located at 12301 Lake Underhill Rd, Suite 213, Orlando, FL 32828, as well as offices in Seminole, Osceola and West Orange counties to assist you.

The articles on this blog are for informative purposes only and are no substitute for legal advice or an attorney-client relationship. If you are seeking legal advice, please contact our law firm directly.

 

 

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Poof! Just Like That, Non-competes are Gone!

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For nearly one in five workers in the United States, leaving their job just became a lot easier as the Federal Trade Commission issued its final rule banning all non-compete contracts.

This means that by the end of the summer, nearly all employees who are subject to a non-compete contract right now will be free to work wherever they want, even in competing firms they were barred from.

According to their release, the FTC estimates this “will lead to new business formation growing by 2.7% per year, resulting in more than 8,500 additional new businesses created each year.”

Furthermore, the FTC says it will increase wages “by an additional $524 per year, and it is expected to lower health care costs by up to $194 billion over the next decade.”

Finally, the FTC says: “The final rule is expected to help drive innovation, leading to an estimated average increase of 17,000 to 29,000 more patents each year for the next 10 years under the final rule.”

The Orlando Law Group wrote about the possible impacts of this rule in November warning businesses this may be a possibility. Now, businesses must prepare to take action over the next few months.

The attorneys at The Orlando Law Group can help your business prepare and work through any issues this new rule may cause.

What is a non-compete contract?

As we wrote in November, in most cases, the non-compete contract is presented as part of the employment package at the time of the person being hired.

Under the non-compete contract, an employee is not able to work for a competitor for a specified period, many times several years. If the employee decides to work for a competitor, they will be required to pay back any severance and, perhaps, damages.

Too often, it was not a negotiated contract, but something that was required – basically a “sign this if you want to work here.”

And since the employee has very little negotiation power at that point, the non-compete contract is often valid regardless of how the employment is terminated – even if the worker is laid off or fired!

Federal government says non-competes are bad for the economy.

In a nutshell, the Federal Trade Commission says non-compete contracts are an “unfair method of competition” and are in violation of Section 5 of the Federal Trade Commission Act.

That act says anything that affects consumers in the following ways is not permitted, specifically something that:

  • causes or is likely to cause substantial injury to consumers,
  • cannot be reasonably avoided by consumers, and
  • is not outweighed by countervailing benefits to consumers or to competition.

In dealing with non-competes, the Federal Trade Commission says it will increase the wages in the United States by $300 billion and give employment freedom to more than 30 million Americans.

In addition, the government maintains that by eliminating non-compete contracts, prices will decrease because there will be more competition.

“The freedom to change jobs is core to economic liberty and to a competitive, thriving economy,” said FTC Chair Lina M. Khan in the release announcing the rulemaking process in November. “Noncompetes block workers from freely switching jobs, depriving them of higher wages and better working conditions, and depriving businesses of a talent pool that they need to build and expand.

“By ending this practice, the FTC’s proposed rule would promote greater dynamism, innovation, and healthy competition,” she added.

What should businesses do today?

Now that the rule is final, it is time for businesses to take action.

First, businesses need to review their non-disclosure agreements to ensure they are extensive without any loopholes. The FTC did not eliminate non-disclosure agreements. They encouraged them.

In other words, the employee can work for a competitor, but it can not share your secrets to that new employer.

Then, you need to categorize all trade secrets, those things that make your product or service unique and all the reasons why. Those should be protected by a non-disclosure agreement as well.

Finally, any business with non-compete contracts must notify all employees covered by them that they will not be enforced by the beginning of September.

There is one exception, however.

Senior-level executives who have a non-compete contract will have those agreements continue through their agreed-upon terms, but they cannot be renewed and new ones cannot be entered into.

It is estimated that less than one percent of all non-disclosure agreements are for senior-level executives, those individuals making more than $151,164.

As such, the only protection a business would have from an employee taking their trade secrets to a competitor is by having a non-disclosure agreement.

The attorneys at The Orlando Law Group can help businesses with these types of contracts in Orlando, Waterford Lakes, Altamonte Springs, Winter Garden, Lake Nona, St. Cloud, Kissimmee, and Central Florida.

 

If you have questions about anything discussed in this article or other legal matters, give our office a call at 407-512-4394 or fill out our online contact form to schedule a consultation to discuss your case. We have an office conveniently located at 12301 Lake Underhill Rd, Suite 213, Orlando, FL 32828, as well as offices in Seminole, Osceola and West Orange counties to assist you.

The articles on this blog are for informative purposes only and are no substitute for legal advice or an attorney-client relationship. If you are seeking legal advice, please contact our law firm directly.

 

 

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With Court Settlement, Look to an Attorney for Buyers Representation

Several months ago, we wrote about the potential impact of the lawsuit against the National Association of REALTORS. At that time, the federal court in Missouri ruled the organization and most real estate brokerages violated the Sherman Anti-trust Act.

At that time, we cautioned that a final ruling was still a long way from concluding with appeals and other court mechanisms.

However, as has been widely reported, the case was settled last week with national implications for the real estate industry. As attorneys, we’re looking to see the full settlement case to fully understand all the implications as a result.

We’re also cautioning our clients that the settlement has not been approved by the courts and still could change. That won’t take place until May.

But one thing seems clear, the way home buyers will utilize agents for representation will change as the costs of their services have shifted from the proceeds of the sale to the buyer themselves.

While having a personal agent work with you on finding your dream home can be very beneficial, with this ruling, utilizing the services of a proven residential real estate attorney can be a way to offset the costs of buying a home.

The attorneys at The Orlando Law Group understand this type of transaction as we are also licensed real estate agents. We work with local real estate agents and their teams on a wide range of services, including contracts and closings, but also with individuals who need assistance and are here for you.

A Recap: The Basics of the Class Action Suit

As we reported in November, back in 2019, a group of people who sold homes in Missouri sued the National Association of REALTORS® and the real estate companies, saying the group has agreed to “adopt, promote, and implement anticompetitive rules through the association’s governance.”

By having an association that prevents members from allowing their associates to compete with one another for commissions, and by agreeing to follow and enforce these anticompetitive rules, the National Association of REALTORS® acted to further its implementation and enforcement.

The main arguments from the plaintiffs included:

  1. The MLS is controlled by local associations, and access to the MLS is conditioned on brokers agreeing to follow all mandatory rules set forth by the National Association of REALTORS®.
  2. The National Association of REALTORS®’ policies restrain competition in the real estate market. This restraint forces the sellers to pay the buyer’s agent commission that, in a competitive market and were it not for the association’s anticompetitive restraint, would, or could, be paid by the buyer.
  3. The “Adversary Commission Rule” which is a policy of the National Association of REALTORS®, effectively requires the seller to predesignate a commission for the buyer’s agent, and further limits the ability to negotiate that commission amount.
  4. Since the MLS requires the seller to list a commission percentage, this provides the buyer’s agents the opportunities to selectively show clients properties the agent deems to be” worth their time.” This places sellers who choose to pay less in commission in a disadvantageous position, as the buyer’s agent usually gives priority to showing homes that pay a higher commission, and selling brokers are incentivized to provide a higher buyer broker commission to comply with NAR’s mandatory rule.
  5. Failure to abide by the MLS and association rules can lead to expulsion from the National Association of REALTORS® and access to the MLS, which restricts real estate agents who are not REALTORS® from listing properties on the centralized database.

Overall, the plaintiffs argued if these rules didn’t exist, buyers and sellers would be free to negotiate amongst themselves regarding the amount of commission paid. This would make the market more competitive and would likely drive down the prices paid to agents to lower commissions.

Additionally, it would cease the requirement that the seller pay the buyer’s agent’s commission.

Essentially, the association’s policies contribute to fixed commission prices, regardless of the individual factors of each sale at levels that would not exist in a competitive marketplace.

How is a buyer’s agent compensated?

Historically, a buyer’s agent was compensated by the seller’s agent by splitting commissions between the buyer and the seller. On a $400,000 sale price, this could mean a commission for the seller’s and buyer’s agents of more than $10,000.

For most buyers, this seemed like a good arrangement. The money that was paid to the agent was taken out of the sale proceeds, so the buyer never truly saw any additional costs, other than what was in the sale price.

However, this part of the settlement focused on one of the issues listed above.

Since the MLS requires the seller to list a commission percentage, this provides the buyer’s agents the opportunities to selectively show clients properties the agent deems to be” worth their time.” This places sellers who choose to pay less in commission in a disadvantageous position, as the buyer’s agent usually gives priority to showing homes that pay a higher commission, and selling brokers are incentivized to provide a higher buyer broker commission to comply with NAR’s mandatory rule.

Basically, the lawsuit alleged that buyers’ agents were motivated by higher commissions and not for the best interest of the buyer. That’s a severe allegation and the real estate agents we know and work with were always looking for their buyer’s best interests.

If the settlement is approved, however, the buyer will now be on the hook for thousands of dollars in addition to the home price. Of course, the offer to buy a house could be lower, but The Orlando Law Group provides a different option.

What are a home buyer’s options now?

For most buyers, the options seem to be limited now. We think buyers can:

  • Agree to pay the agent directly for a preset cost,
  • Negotiate with the seller to cover the buyer’s agent fee, similar to credits for closing costs,
  • Hire an experienced real estate attorney, or
  • Try to negotiate the purchase of real estate unrepresented.

We hope that no one tries to negotiate without representation. The process of buying a home should be trusted to a professional and an experienced real estate attorney may be your best bet.

No, a real estate attorney will not scour the internet looking for your perfect home. Most of the buyers we know are already doing that, looking at listing services for homes they like.

A real estate attorney can, however, negotiate the terms of your sale. They can help ensure you are covered for unforeseen circumstances in the sale contract. They can perform all the duties required at closing, that you will be paying for anyway.

The best part? The fees paid to an experienced real estate attorney, like those found at The Orlando Law Group, are a fraction of what would be paid to a real estate agent.

The attorneys at The Orlando Law Group can help homebuyers in Orlando, Waterford Lakes, Altamonte Springs, Winter Garden, Lake Nona, St. Cloud, Kissimmee, and throughout Central Florida.

If you have questions about anything discussed in this article or other legal matters, give our office a call at 407-512-4394 or fill out our online contact form to schedule a consultation to discuss your case. We have an office conveniently located at 12301 Lake Underhill Rd, Suite 213, Orlando, FL 32828, as well as offices in Seminole, Osceola and West Orange counties to assist you.

The articles on this blog are for informative purposes only and are no substitute for legal advice or an attorney-client relationship. If you are seeking legal advice, please contact our law firm directly.

 

 

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You Still Need to File Your BOI in 2024

Last year, The Orlando Law Group shared the need for your business to file your Beneficial Ownership Information with the federal government this year. It is part of the Corporate Transparency Act that was passed in 2020 but just became effective on January 1.

As you might have seen, earlier this month, a federal court in Alabama declared the government overreached its constitutional authority by requesting this information.

While we are monitoring the court battles, at this time we are still recommending all business owners continue as if the filings are still required.  

The attorneys at The Orlando Law Group can help businesses determine if they are required to file their Beneficial Ownership Information and file all the required documents for you.

What is the Beneficial Ownership Information?

As a recap of the issue, privately owned small businesses, for the most part, do not have to file any sort of public disclosures in the way that companies listed on a stock exchange must do every quarter.

Unfortunately, too many criminals are using fake companies for money laundering and other crimes. It is very difficult to track criminal activity without a subpoena.


That is why, in 2021, the federal government passed the Corporate Transparency Act, hoping to provide more tools for law enforcement to find terrorists, money laundering, counterfeiting and more.

Yes, just like how we take off our shoes at the airport because of an act of terrorism, law-abiding small businesses will now have to file additional information with the government because of criminals. 

Who is required to file Beneficial Ownership Information today? 

If you are a small business with fewer than 20 employees and annual revenues of less than $5 million, you most likely will need to file. 

There are 21 specific exemptions, like companies in the investment and financial realms. Most organizations who file as a 501(c) with the IRS are exempt. And large businesses are exempt.

For businesses that have multiple LLCs, such as a real estate firm that owns multiple properties or a restaurant group with each location a separate entity, this could mean filing a separate Beneficial Ownership Information for each one! 

If you have to file each LLC with SunBiz or any other Secretary of State, then each LLC needs to file separate Beneficial Ownership Information.

How does the court ruling impact these businesses? 

Remember, there are many steps in the process of determining if a law passed by Congress and signed by the President is constitutional. In some cases, it takes years to move through the court system and can eventually be decided by the U.S. Supreme Court.

National Small Business Association, et al. v. Janet Yellen, et al. was filed in November 2022 in federal court. It took until March for the court to issue an opinion on the law.

While it sounds like a relief for everyone, the opinion was quite narrow, only granting relief to named plaintiffs and members of the National Small Business Association. According to news reports, there are 65,000 member businesses covered under their membership with the association. 

Chances are that your business is not one of them. 

After all, there are more than 30 million small businesses in the United States according to the U.S. Small Business Administration. And you can’t join now and be included in the court case.

Even if you are a member of the association, you should still prepare your Beneficial Ownership Information as the federal government plans to appeal the decision. That means the injunction providing relief could be overturned at any time.

What happens if a business does not report?

Remember from our first article on this issue, that the penalties for not filing are harsh. According to the federal government:

“The willful failure to report complete or updated beneficial ownership information to FinCEN, or the willful provision of or attempt to provide false or fraudulent beneficial ownership information may result in a civil or criminal penalties, including civil penalties of up to $500 for each day that the violation continues, or criminal penalties including imprisonment for up to two years and/or a fine of up to $10,000. Senior officers of an entity that fails to file a required BOI report may be held accountable for that failure.”

Keep in mind, that this is not like filing with the State of Florida, where the fine is relatively small for not filing. This is an effort of the Financial Crimes Enforcement Network division of the United States Treasury. 

These are the people who spend every moment looking for criminals breaking the law to protect us. 

While the federal government says, “willful failure,” that term could apply to your actions if you “forget” to file or do not realize you need to file. It is still to be determined how that will be treated. 

It is certainly not something any business would want to be the test case for. Plus, pay attention to that last line of the government’s warning that says senior officers of the company can be held personally accountable for a failure to file.

The attorneys at The Orlando Law Group can help your businesses prepare for this requirement as we understand business and represent clients in business law and more in Orlando, Waterford Lakes, Altamonte Springs, Winter Garden, Lake Nona, St. Cloud, Kissimmee, and throughout Central Florida.

If you have questions about anything discussed in this article or other legal matters, give our office a call at 407-512-4394 or fill out our online contact form to schedule a consultation to discuss your case. We have an office conveniently located at 12301 Lake Underhill Rd, Suite 213, Orlando, FL 32828, as well as offices in Seminole, Osceola and West Orange counties to assist you.

The articles on this blog are for informative purposes only and are no substitute for legal advice or an attorney-client relationship. If you are seeking legal advice, please contact our law firm directly.

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Prepare for Any Possible Defense When Evicting Commercial Clients

A year ago, one of West Palm Beach’s most iconic restaurants closed after its landlord evicted the owners of the 80-year-old restaurant.

Of course, the owners of Ta-Boo did not walk away from the Lake Worth location quietly. For instance, the restaurant owner filed a motion to dismiss because the landlord had missed a deadline to file a response in the case.

While Ta-Boo was unsuccessful, it’s just indicative that business owners will do what they can to remain open if they see a future for their business.

There are many, many ways a commercial tenant can try and defend your desire to evict them and find a more financially stable tenant.

The attorneys at The Orlando Law Group can help you protect your investment in commercial real estate. We have seen many of the defenses tenants try to employ to stay in their property and will work to end the process as quickly as possible with your interests protected.

What is the most common way to defend an eviction?

In many cases, tenants will combat evictions using the legal process itself. For instance, Ta-Boo said the owner missed a deadline to file a response.

Florida statutes are clear on timelines for commercial eviction cases. A landlord must give three days’ notice for an eviction because of failure to pay rent. A landlord must give 15 days’ notice for an eviction because of another reason unless otherwise specified in the lease.

Upon receipt of the appropriate notice, the tenant has the opportunity to cure the default or otherwise to surrender the premises to the landlord. There are also other legal maneuvers to delay an eviction. For instance, the tenant may file a motion to determine rent to get the court to issue an opinion on the actual amount of rent owed.

It is critical the owner of a commercial property follow all the steps in the process, including any required notices.

While straightforward, the legal maneuvers used can stop an eviction process, which is why it is best to use an attorney experienced in commercial evictions to handle your case.

What else can be a defense in a commercial lease eviction?

There are many ways a tenant can defend a commercial lease, so it is important to document the reasons why a property owner plans to evict its tenant.

A popular defense in any eviction, including commercial evictions, is to blame the landlord for the problems. This can be a variety of things, including some that may not have been tried.

A few of the more popular ones are:

  • Renting to a competitor: Many leases have an “exclusive use” section, saying the landlord will not rent space in a center to a competing company.
  • Not providing basic maintenance: Any lease should have a description of what is included in the lease. If the landlord agrees to cover pest control and there is a rat infestation, it could be used as a defense. Even a landlord not mowing the grass could be a defense if landscaping is part of the lease agreement. It is important to note that the tenant is also required to provide statutory notice to the landlord if the landlord is failing to perform under the terms of the lease.
  • The eviction was retaliation for another action: If the tenant feels they are being evicted because they complained or just because the landlord doesn’t like them, it can be a defense.
  • The right to quiet enjoyment was breached: Any tenant expects to be able to operate their business without interruptions. So, if the landlord puts a dance studio next to an art gallery, causing the art to continually fall from the walls because of the vibrations created by music, the art gallery could use that as a defense.
  • Taking actions outside of the courts: Sometimes, landlords take actions against tenants, like changing the locks on the property and shutting off the utilities. Landlords, in most cases, cannot resort to “self-help.” Self-help may result in a dismissal of the eviction, and may even lead to damages in favor of the tenant and against the landlord.

The reality is there are many reasons an eviction can be blocked in the courts – even the slightest misstep can cost thousands of dollars. Even just one single typo.

A good example is this document from the Lawyers Committee for Civil Rights. While it pertains to California eviction laws, it’s important to see how many defenses could be used in an eviction case.

It contains four pages, consisting of nearly three dozen technicalities to use in eviction cases. Again, not all apply in Florida law, but many of them do.

How can you counter these defenses?

The best way to ensure the eviction of a tenant is resolved quickly and to your satisfaction is to take steps before you file.

Probably the most critical step is to document everything that happens along the way. Keep records of the tenant’s complaints and how you worked to resolve those complaints. Put in writing all demands you send for rent payments and keep track of any payments given.

Of course, you should understand the terms of the lease. There are often many specific clauses in the contract that can allow you to terminate the lease, but it also may have clauses protecting your tenant.

Plus, if you understand what is required of you as the landlord, you can properly document how you met those requirements. Keep records of when you set rat traps or fixed the air conditioning. Show how you notified the dance studio they needed to reduce the bass in their music to protect the art gallery.

The more you document the issues with the tenant, the smoother your eviction will be.

Finally, it is important you work with an attorney well-versed in commercial evictions to follow all the details and fine points associated with eviction law.

The attorneys at The Orlando Law Group can help commercial property owners with evictions and other tenant issues in Orlando, Waterford Lakes, Altamonte Springs, Winter Garden, Lake Nona, St. Cloud, Kissimmee, and throughout Central Florida.

If you have questions about anything discussed in this article or other legal matters, give our office a call at 407-512-4394 or fill out our online contact form to schedule a consultation to discuss your case. We have an office conveniently located at 12301 Lake Underhill Rd, Suite 213, Orlando, FL 32828, as well as offices in Seminole, Osceola and West Orange counties to assist you.

The articles on this blog are for informative purposes only and are no substitute for legal advice or an attorney-client relationship. If you are seeking legal advice, please contact our law firm directly.

 

 

 

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The Terms of the Lease are Essential in Commercial Evictions

There is an interesting case of a commercial eviction brewing in South Florida that showcases how important it is to clearly understand the provisions in your lease.

In November, a family-owned bakery sued its landlord, a national company that purchased the property recently, claiming its landlord had fraudulently evicted the company and effectively shut down the business.

It comes from the developer’s desire to renovate the property. In this case, the landlord had an engineering report performed on the property and the report came back that the building was unsafe for occupation.

This triggered the eviction.

In the case, found here, the landlord specifically pointed to two clauses in the lease as justification of the eviction.

Those clauses were:

  • Use of Premises: Tenants shall only use the Premises for the Permitted Uses. Tenants will not use or permit the use of the Premises or any part thereof for any other purpose or for any unlawful purpose and will not do or permit any act or thing which would materially impair the value or usefulness of the Premises or any part thereof, or which would constitute a public or private nuisance or waster or which would be a nuisance or annoyance or damage to Landlord or Landlord’s other tenants, or which would invalidate any policies of insurance or increase the premiums thereof, now or hereafter written on the building and/or Premises. Tenant represents to Landlord that the Permitted Uses conforms with the Applicable Zoning, and Tenant’s obligation to pay Rent under this Lease is not contingent upon the Permitted Use conforming to the Applicable Zoning or other laws, regulations or ordinances governing the use of the Premises. Tenant shall maintain at its sole cost and expense any and all licenses, permits and approvals by all authorities having jurisdiction over the operation of Tenant’s business at the Premises.
  • Tenants Obligations. Tenant shall, at its expense, throughout the term of this Lease, take good care of the Premises, the fixtures and appurtenances therein and Tenant’s Property. Landlord acknowledges that at the time of Tenant’s taking possession of the premises, there exists certain cracking in slab under and around the non-operating freezer. Landlord agrees to hold Tenant harmless from any and all damages related to this condition absent personal injury to the Tenant or their employees, agents or assigns, caused either directly or indirectly by the cracked slab described herein. Accordingly, the Tenant will take every reasonable measure including the posting of signage to prevent any further damage to both person and property.

It’s interesting that neither of those clauses specifically mentions how the landlord has the right to evict if the building is determined to be unsafe. As it’s not clearly stated, the tenant of the space may have a defense against the landlord.

And the bakery is using another section of the lease as its defense, claiming that if the building is unsafe for occupation, it is the landlord who broke the lease.

  • Landlord’s Obligations. Landlord agrees to repair and maintain the property, to maintain said property in good order and condition, including painting the exterior of the building on an as needed basis to be determined by Landlord. Specifically, the landlord will maintain the roof, including the awning, in good order and condition and repair said leaks in the building.

As you can see with these specific clauses in the lease contract, when it comes to commercial leases, the wording of the lease is extremely important.

The attorneys at The Orlando Law Group can help you protect your investment in commercial real estate. Our firm clearly understands how your lease should be written to allow for any capacity.

The lease is key to everything

This case in South Florida is unique with a lot of different angles for the bakery to use in a lawsuit.

While much of the dispute is over lease terms, the bakery is claiming the engineering report declaring the building uninhabitable was flawed and paid for a different engineering report with different results.

But, getting into the lease terms being important, one of the key parts of the bakery’s case is the lease expressly says the tenants would have right of first refusal on any sale of the property the bakery was operating out of.

Specifically, the lawsuit cites this clause:

  • Right of First Refusal. Tenant acknowledges and understands that Landlord may list the Premises for sale at any time, including during the duration of the Lease Term. During the Lease Term, Tenant has the right to match any purchase offers submitted to and accepted by Landlord from a third party. Landlord shall notify all prospective purchasers of Tenant’s right of first refusal. Landlord’s acceptance of any purchase offers submitted by a third party shall be subject to Tenant’s right of first refusal. Within three (3) business days of Landlord’s receipt of a purchase offer which Landlord intends to accept, Landlord shall notify Tenant in writing of the price and terms of the purchase offer. Tenant shall have five (5) business days from the date of receipt of Landlord’s, notice to submit to Landlord a written purchase offer which matches the price and terms of the third party offer. If Landlord timely receives a written purchase offer from Tenant which matches the price and terms of the third party offer, Landlord shall proceed with the sale of the Premises to Tenant. However, should Landlord not timely receive a written purchase offer from Tenant which matches the price and terms of the third party offer, Landlord shall be free to sell the property to the third party at the same price and terms only.

According to the suit, the company that owned the building when the bakery signed the lease did not give the right of first refusal on only its property, rather giving the right of first refusal on a larger deal that included other properties.

While the lease did not have a specific clause saying what happened if the building was uninhabitable, it did have specific instructions on what happens in the event of a sale.

It will be up to the courts to determine whether the lease was followed, but if that clause was not followed, there could be significant issues for the landlord.

What can be put into a commercial lease?

As a lease is a contract between two private parties, anything could be negotiated into a lease. However, most leases are very similar and include clauses that cover the following and more:

  • Lease payments
  • Maintenance
  • Insurance
  • Use of the property
  • Utilities
  • Quiet enjoyment

In one case The Orlando Law Group worked with a landlord whose Tenant failed to report the presence of mold in a rented space. The tenant’s inaction violated the lease terms and induced further mold growth.  Since this was in breach of the lease terms specifically dealing with mold, the judge quickly ruled in favor of our clients and restored possession to the Landlord.

Best to ensure your leases have the right covenants

While you hope you never have to evict a tenant, it is prudent to write your lease agreements to cover most issues that can be brought up if the relationship must end.

There are a lot of issues in the bakery case with a lease that may not have been as specific as was needed. While it’s impossible to see the future on every issue that might come up, working with attorneys at The Orlando Law Group can help you be prepared.

The attorneys at The Orlando Law Group can help commercial property owners with evictions and other tenant issues in Orlando, Waterford Lakes, Altamonte Springs, Winter Garden, Lake Nona, St. Cloud, Kissimmee, and throughout Central Florida.

If you have questions about anything discussed in this article or other legal matters, give our office a call at 407-512-4394 or fill out our online contact form to schedule a consultation to discuss your case. We have an office conveniently located at 12301 Lake Underhill Rd, Suite 213, Orlando, FL 32828, as well as offices in Seminole, Osceola and West Orange counties to assist you.

The articles on this blog are for informative purposes only and are no substitute for legal advice or an attorney-client relationship. If you are seeking legal advice, please contact our law firm directly.

 

 

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