CS/HB 921

1	A bill to be entitled
2	An act relating to lien claims by homeowners'
3	associations; amending s. 720.3085, F.S.; providing that
4	when authorized by the governing documents, a homeowners'
5	association has a lien on each parcel to secure the
6	payment of assessments and other amounts; providing an
7	exception to first mortgages of record; providing that the
8	act does not bestow upon any lien, mortgage, or certified
9	judgment of record on July 1, 2008, a priority that the
10	lien, mortgage, or judgment did not have before that date;
11	providing for the elements of a valid claim of lien;
12	providing for the content of a recording notice; requiring
13	a parcel owner or the parcel owner's agent or attorney to
14	require the homeowners' association to enforce a recorded
15	claim of lien against his or her parcel; providing
16	procedures for notifying the homeowners' association;
17	requiring that service be made by certified mail, return
18	receipt requested; authorizing the homeowners' association
19	to bring a civil action to foreclose a lien for
20	assessments in the same manner in which a mortgage of real
21	property is foreclosed; providing that the homeowners'
22	association may also bring an action to recover a money
23	judgment for the unpaid assessments without waiving any
24	claim of lien; providing that if a parcel owner remains in
25	possession of the parcel after a foreclosure judgment has
26	been entered, the court may require the parcel owner to
27	pay a reasonable rent for the parcel; providing that the
28	homeowners' association may purchase the parcel at the
29	foreclosure sale and hold, lease, mortgage, or convey the
30	parcel; limiting the liability of a first mortgagee or its
31	successor or assignee as a subsequent holder of the first
32	mortgage who acquires title to a parcel by foreclosure or
33	by deed in lieu of foreclosure for the unpaid assessments
34	that became due before the mortgagee's acquisition of
35	title; providing that the time limitations in the act do
36	not apply if the parcel is subject to a foreclosure action
37	or forced sale of another party; providing for a
38	qualifying offer during the pendency of a foreclosure
39	action; providing procedures for offering and accepting a
40	qualifying offer; requiring that the qualifying offer be
41	in a particular format; providing an effective date.
42
43	Be It Enacted by the Legislature of the State of Florida:
44
45	Section 1.  Section 720.3085, Florida Statutes, is amended
46	to read:
47	720.3085  Payment for assessments; lien claims.--
48	(1)  When authorized by the governing documents, the
49	association has a lien on each parcel to secure the payment of
50	assessments and other amounts provided for by this section.
51	Except as otherwise set forth in this section, the lien is
52	effective from and shall relate back to the date on which the
53	original declaration of the community was recorded. However, as
54	to first mortgages of record, the lien is effective from and
55	after recording of a claim of lien in the public records of the
56	county in which the parcel is located. This subsection does not
57	bestow upon any lien, mortgage, or certified judgment of record
58	on July 1, 2008, including the lien for unpaid assessments
59	created in this section, a priority that, by law, the lien,
60	mortgage, or judgment did not have before July 1, 2008.
61	(a)  To be valid, a claim of lien must state the
62	description of the parcel, the name of the record owner, the
63	name and address of the association, the assessment amount due,
64	and the due date. The claim of lien shall secure all unpaid
65	assessments that are due and that may accrue subsequent to the
66	recording of the claim of lien and before entry of a certificate
67	of title, as well as interest, late charges, and reasonable
68	costs and attorney's fees incurred by the association incident
69	to the collection process. The person making the payment is
70	entitled to a satisfaction of the lien upon payment in full.
71	(b)  By recording a notice in substantially the following
72	form, a parcel owner or the parcel owner's agent or attorney may
73	require the association to enforce a recorded claim of lien
74	against his or her parcel:
75
76	NOTICE OF CONTEST OF LIEN
77
78	TO: (Name and address of association)
79
80	You are notified that the undersigned contests the claim of lien
81	filed by you on _____, (year) , and recorded in Official Records
82	Book _____ at page _____, of the public records of _____ County,
83	Florida, and that the time within which you may file suit to
84	enforce your lien is limited to 90 days following the date of
85	service of this notice. Executed this _____ day of _____,
86	(year).
87
88	Signed: (Owner or Attorney)
89
90	After the notice of contest of lien has been recorded, the clerk
91	of the circuit court shall mail a copy of the recorded notice to
92	the association by certified mail, return receipt requested, at
93	the address shown in the claim of lien or the most recent
94	amendment to it and shall certify to the service on the face of
95	the notice. Service is complete upon mailing. After service, the
96	association has 90 days in which to file an action to enforce
97	the lien and, if the action is not filed within the 90-day
98	period, the lien is void. However, the 90-day period shall be
99	extended for any length of time that the association is
100	prevented from filing its action because of an automatic stay
101	resulting from the filing of a bankruptcy petition by the parcel
102	owner or by any other person claiming an interest in the parcel.
103	(c)  The association may bring an action in its name to
104	foreclose a lien for assessments in the same manner in which a
105	mortgage of real property is foreclosed and may also bring an
106	action to recover a money judgment for the unpaid assessments
107	without waiving any claim of lien. The association is entitled
108	to recover its reasonable attorney's fees incurred in an action
109	to foreclose a lien or an action to recover a money judgment for
110	unpaid assessments.
111	(d)  If the parcel owner remains in possession of the
112	parcel after a foreclosure judgment has been entered, the court
113	may require the parcel owner to pay a reasonable rent for the
114	parcel. If the parcel is rented or leased during the pendency of
115	the foreclosure action, the association is entitled to the
116	appointment of a receiver to collect the rent. The expenses of
117	the receiver must be paid by the party who does not prevail in
118	the foreclosure action.
119	(e)  The association may purchase the parcel at the
120	foreclosure sale and hold, lease, mortgage, or convey the
121	parcel.
122	(2)(a)(1)  A parcel owner, regardless of how his or her
123	title to property has been acquired, including by purchase at a
124	foreclosure sale or by deed in lieu of foreclosure, is liable
125	for all assessments that come due while he or she is the parcel
126	owner. The parcel owner's liability for assessments may not be
127	avoided by waiver or suspension of the use or enjoyment of any
128	common area or by abandonment of the parcel upon which the
129	assessments are made.
130	(b)(2)  A parcel owner is jointly and severally liable with
131	the previous parcel owner for all unpaid assessments that came
132	due up to the time of transfer of title. This liability is
133	without prejudice to any right the present parcel owner may have
134	to recover any amounts paid by the present owner from the
135	previous owner.
136	(c)  Notwithstanding anything to the contrary contained in
137	this section, the liability of a first mortgagee, or its
138	successor or assignee as a subsequent holder of the first
139	mortgage who acquires title to a parcel by foreclosure or by
140	deed in lieu of foreclosure for the unpaid assessments that
141	became due before the mortgagee's acquisition of title, shall be
142	the lesser of:
143	1.  The parcel's unpaid common expenses and regular
144	periodic or special assessments that accrued or came due during
145	the 12 months immediately preceding the acquisition of title and
146	for which payment in full has not been received by the
147	association; or
148	2.  One percent of the original mortgage debt.
149
150	The limitations on first mortgagee liability provided by this
151	paragraph apply only if the first mortgagee filed suit against
152	the parcel owner and initially joined the association as a
153	defendant in the mortgagee foreclosure action. Joinder of the
154	association is not required if, on the date the complaint is
155	filed, the association was dissolved or did not maintain an
156	office or agent for service of process at a location that was
157	known to or reasonably discoverable by the mortgagee.
158	(3)  Assessments and installments on assessments that are
159	not paid when due bear interest from the due date until paid at
160	the rate provided in the declaration of covenants or the bylaws
161	of the association, which rate may not exceed the rate allowed
162	by law. If no rate is provided in the declaration or bylaws,
163	interest accrues at the rate of 18 percent per year.
164	(a)  If the declaration or bylaws so provide, the
165	association may also charge an administrative late fee in an
166	amount not to exceed the greater of $25 or 5 percent of the
167	amount of each installment that is paid past the due date.
168	(b)  Any payment received by an association and accepted
169	shall be applied first to any interest accrued, then to any
170	administrative late fee, then to any costs and reasonable
171	attorney's fees incurred in collection, and then to the
172	delinquent assessment. This paragraph applies notwithstanding
173	any restrictive endorsement, designation, or instruction placed
174	on or accompanying a payment. A late fee is not subject to the
175	provisions of chapter 687 and is not a fine.
176	(4)  A homeowners' association may not file a record claim
177	of lien against a parcel for unpaid assessments unless a written
178	notice or demand for past due assessments as well as any other
179	amounts owed to the association pursuant to its governing
180	documents has been made by the association. The written notice
181	or demand must:
182	(a)  Provide the owner with 45 days following the date the
183	notice is deposited in the mail to make payment for all amounts
184	due, including, but not limited to, any attorney's fees and
185	actual costs associated with the preparation and delivery of the
186	written demand.
187	(b)  Be sent by registered or certified mail, return
188	receipt requested, and by first-class United States mail to the
189	parcel owner at his or her last address as reflected in the
190	records of the association, if the address is within the United
191	States, and to the parcel owner subject to the demand at the
192	address of the parcel if the owner's address as reflected in the
193	records of the association is not the parcel address. If the
194	address reflected in the records is outside the United States,
195	then sending the notice to that address and to the parcel
196	address by first-class United States mail is sufficient.
197	(5)  The association may bring an action in its name to
198	foreclose a lien for unpaid assessments secured by a lien in the
199	same manner that a mortgage of real property is foreclosed and
200	may also bring an action to recover a money judgment for the
201	unpaid assessments without waiving any claim of lien. The Such
202	action to foreclose the lien may not be brought until 45 days
203	after the parcel owner has been provided notice of the
204	association's intent to foreclose and collect the unpaid amount.
205	The notice must be given in the manner provided in paragraph
206	(4)(b) and the notice may not be provided until the passage of
207	the 45 days required in paragraph (4)(a).
208	(a)  The association may recover any interest, late
209	charges, costs, and reasonable attorney's fees incurred in a
210	lien foreclosure action or in an action to recover a money
211	judgment for the unpaid assessments.
212	(b)  The time limitations in this subsection do not apply
213	if the parcel is subject to a foreclosure action or forced sale
214	of another party, or if an owner of the parcel is a debtor in a
215	bankruptcy proceeding The association may purchase the parcel at
216	the foreclosure sale and hold, lease, mortgage, or convey the
217	parcel.
218	(6)  If after service of a summons on a complaint to
219	foreclose a lien the parcel is not the subject of a mortgage
220	foreclosure or a notice of tax certificate sale, or the parcel
221	owner is not a debtor in bankruptcy proceedings, or the trial of
222	or trial docket for the lien foreclosure action is not set to
223	begin within 30 days, the parcel owner may serve and file with
224	the court a qualifying offer at any time before the entry of a
225	foreclosure judgment. For purposes of this subsection, the term
226	"qualifying offer" means a written offer to pay all amounts
227	secured by the lien of the association plus amounts interest
228	accruing during the pendency of the offer at the rate of
229	interest provided in this section. The parcel owner may make
230	only one qualifying offer during the pendency of a foreclosure
231	action. If a parcel becomes the subject of a mortgage
232	foreclosure or a notice of tax certificate sale while a
233	qualifying offer is pending, the qualifying offer becomes
234	voidable at the election of the association. If the parcel owner
235	becomes a debtor in bankruptcy proceedings while a qualifying
236	offer is pending, the qualifying offer becomes void.
237	(a)  The parcel owner shall deliver a copy of the filed
238	qualifying offer to the association's attorney by hand delivery,
239	obtaining a written receipt, or by certified mail, return
240	receipt requested.
241	(b)  The parcel owner's filing of the qualifying offer with
242	the court stays the foreclosure action for the period stated in
243	the qualifying offer, which may not exceed 60 days following the
244	date of service of the qualifying offer and no sooner than 30
245	days before the date of trial, arbitration, or the beginning of
246	the trial docket, whichever occurs first, to permit the parcel
247	owner to pay the qualifying offer to the association plus any
248	amounts interest accruing during the pendency of the offer.
249	(c)  The qualifying offer of the parcel owner must be in
250	writing, be signed by all owners the owner of the parcel and the
251	spouse of any the owner if the spouse resides in or otherwise
252	claims holds a homestead interest in the parcel, be acknowledged
253	by a notary public, and be in substantially the following form:
254	state the total amount due the association, state that the total
255	amount due the association is secured by the lien of the
256	association, state that the association is entitled to foreclose
257	the lien and obtain a foreclosure judgment for the total amount
258	due if the parcel owner breaches the qualifying offer, state
259	that the parcel owner will not endanger the priority of the lien
260	of the association or the amounts secured by the lien, and state
261	the actual date or dates the association will receive the total
262	amount due from the parcel owner.
263
264	QUALIFYING OFFER
265	AUTOMATIC STAY INVOKED PURSUANT TO F.S. 720.3085
266
267	I/We, [Name(s) of Parcel Owner(s)], admit the following:
268	1.  The total amount due the association is secured by the
269	lien of the association.
270	2.  The association is entitled to foreclose its claim of
271	lien and obtain a foreclosure judgment for the total amount due
272	if I/we breach this qualifying offer by failing to pay the
273	amount due by the date specified in this qualifying offer.
274	3.  I/We will not permit the priority of the lien of the
275	association or the amounts secured by the lien to be endangered.
276	4.  I/We hereby affirm that the date(s) by which the
277	association will receive $ [specify amount] as the total amount
278	due is [specify date, no later than 60 days after the date of
279	service of the qualifying offer and at least 30 days before the
280	trial or arbitration date], in the following amounts and dates:
281	5.  I/We hereby confirm that I/we have requested and have
282	received from the homeowners' association a breakdown and total
283	of all sums due the association and that the amount offered
284	above is equal to or greater than the total amount provided by
285	the association.
286	6.  This qualifying offer operates as a stay to all
287	portions of the foreclosure action which seek to collect unpaid
288	assessments as provided in s. 720.3085, Florida Statutes.
289
290	Signed: (Signatures of all parcel owners and spouses, if any)
291
292	Sworn to and subscribed this (date) day of (month), (year),
293	before the undersigned authority.
294
295	Notary Public: (Signature of notary public)
296
297	If the parcel owner makes a qualifying offer under this
298	subsection, the association may not add the cost of any legal
299	fees incurred by the association within the period of the stay
300	other than costs acquired in defense of a mortgage foreclosure
301	action concerning the parcel, a bankruptcy proceeding in which
302	the parcel owner is a debtor, or in response to filings by a
303	party other than the association in the lien foreclosure action
304	of the association.
305	(7)(d)  If the parcel owner breaches the qualifying offer,
306	the stay shall be vacated and the association may proceed in its
307	action to obtain a foreclosure judgment against the parcel and
308	the parcel owners for the amount in the qualifying offer and any
309	amounts accruing after the date of the qualifying offer.
310	Section 2.  This act shall take effect July 1, 2008.

CODING: Words stricken are deletions; words underlined are additions.