Florida Senate - 2017 SB 1520
By Senator Latvala
16-01125-17 20171520__
1 A bill to be entitled
2 An act relating to condominium terminations; amending
3 s. 718.117, F.S.; revising the default procedure for
4 the optional termination of a condominium; requiring a
5 plan of termination to be approved by at least 90
6 percent of the total voting interests of the
7 condominium; prohibiting a plan of termination from
8 proceeding if 5 percent or more of the total voting
9 interests reject the plan; revising the period during
10 which a subsequent plan of termination is prohibited
11 from being considered after a rejection; revising
12 applicability; revising the requirement on who must be
13 paid fair market value for his or her unit after
14 rejecting a plan of termination; revising the written
15 disclosures that are required to be provided before a
16 plan of termination is presented; providing an
17 effective date.
18
19 Be It Enacted by the Legislature of the State of Florida:
20
21 Section 1. Subsection (3) of section 718.117, Florida
22 Statutes, is amended to read:
23 718.117 Termination of condominium.—
24 (3) OPTIONAL TERMINATION.—Except as provided in subsection
25 (2) or unless the declaration provides for a lower percentage,
26 the condominium form of ownership may be terminated for all or a
27 portion of the condominium property pursuant to a plan of
28 termination approved by at least 90 80 percent of the total
29 voting interests of the condominium. If 5 10 percent or more of
30 the total voting interests of the condominium have rejected the
31 plan of termination by negative vote or by providing written
32 objections, the plan of termination may not proceed.
33 (a) The termination of the condominium form of ownership is
34 subject to the following conditions:
35 1. The total voting interests of the condominium must
36 include all voting interests for the purpose of considering a
37 plan of termination. A voting interest of the condominium may
38 not be suspended for any reason when voting on termination
39 pursuant to this subsection.
40 2. If 5 10 percent or more of the total voting interests of
41 the condominium reject a plan of termination, a subsequent plan
42 of termination pursuant to this subsection may not be considered
43 for 24 18 months after the date of the rejection.
44 (b) This subsection does not apply to any condominium
45 created pursuant to part VI of this chapter until 10 5 years
46 after the recording of the declaration of condominium, unless
47 there is no objection to the plan of termination.
48 (c) For purposes of this subsection, the term “bulk owner”
49 means the single holder of such voting interests or an owner
50 together with a related entity or entities that would be
51 considered an insider, as defined in s. 726.102, holding such
52 voting interests. If the condominium association is a
53 residential association proposed for termination pursuant to
54 this section and, at the time of recording the plan of
55 termination, at least 80 percent of the total voting interests
56 are owned by a bulk owner, the plan of termination is subject to
57 the following conditions and limitations:
58 1. If the former condominium units are offered for lease to
59 the public after the termination, each unit owner in occupancy
60 immediately before the date of recording of the plan of
61 termination may lease his or her former unit and remain in
62 possession of the unit for 12 months after the effective date of
63 the termination on the same terms as similar unit types within
64 the property are being offered to the public. In order to obtain
65 a lease and exercise the right to retain exclusive possession of
66 the unit owner’s former unit, the unit owner must make a written
67 request to the termination trustee to rent the former unit
68 within 90 days after the date the plan of termination is
69 recorded. Any unit owner who fails to timely make such written
70 request and sign a lease within 15 days after being presented
71 with a lease is deemed to have waived his or her right to retain
72 possession of his or her former unit and shall be required to
73 vacate the former unit upon the effective date of the
74 termination, unless otherwise provided in the plan of
75 termination.
76 2. Any former unit owner whose unit was granted homestead
77 exemption status by the applicable county property appraiser as
78 of the date of the recording of the plan of termination shall be
79 paid a relocation payment in an amount equal to 1 percent of the
80 termination proceeds allocated to the owner’s former unit. Any
81 relocation payment payable under this subparagraph shall be paid
82 by the single entity or related entities owning at least 80
83 percent of the total voting interests. Such relocation payment
84 shall be in addition to the termination proceeds for such
85 owner’s former unit and shall be paid no later than 10 days
86 after the former unit owner vacates his or her former unit.
87 3. For their respective units, all unit owners other than
88 the bulk owner must be compensated at least 100 percent of the
89 fair market value of their units. The fair market value shall be
90 determined as of a date that is no earlier than 90 days before
91 the date that the plan of termination is recorded and shall be
92 determined by an independent appraiser selected by the
93 termination trustee. For a person an original purchaser from the
94 developer who rejects the plan of termination and whose unit was
95 granted homestead exemption status by the applicable county
96 property appraiser, or was an owner-occupied operating business,
97 as of the date that the plan of termination is recorded and who
98 is current in payment of both assessments and other monetary
99 obligations to the association and any mortgage encumbering the
100 unit as of the date the plan of termination is recorded, the
101 fair market value for the unit owner rejecting the plan shall be
102 at least the original purchase price paid for the unit. For
103 purposes of this subparagraph, the term “fair market value”
104 means the price of a unit that a seller is willing to accept and
105 a buyer is willing to pay on the open market in an arms-length
106 transaction based on similar units sold in other condominiums,
107 including units sold in bulk purchases but excluding units sold
108 at wholesale or distressed prices. The purchase price of units
109 acquired in bulk following a bankruptcy or foreclosure shall not
110 be considered for purposes of determining fair market value.
111 4. The plan of termination must provide for payment of a
112 first mortgage encumbering a unit to the extent necessary to
113 satisfy the lien, but the payment may not exceed the unit’s
114 share of the proceeds of termination under the plan. If the unit
115 owner is current in payment of both assessments and other
116 monetary obligations to the association and any mortgage
117 encumbering the unit as of the date the plan of termination is
118 recorded, the receipt by the holder of the unit’s share of the
119 proceeds of termination under the plan or the outstanding
120 balance of the mortgage, whichever is less, shall be deemed to
121 have satisfied the first mortgage in full.
122 5. Before a plan of termination is presented to the unit
123 owners for consideration pursuant to this paragraph, the plan
124 must include the following written disclosures in a sworn
125 statement:
126 a. The identity of any person or entity that owns or
127 controls 25 50 percent or more of the units in the condominium
128 and, if the units are owned by an artificial entity or entities,
129 a disclosure of the natural person or persons who, directly or
130 indirectly, manage or control the entity or entities and the
131 natural person or persons who, directly or indirectly, own or
132 control 10 20 percent or more of the artificial entity or
133 entities that constitute the bulk owner.
134 b. The units acquired by any bulk owner, the date each unit
135 was acquired, and the total amount of compensation paid to each
136 prior unit owner by the bulk owner, regardless of whether
137 attributed to the purchase price of the unit.
138 c. The relationship of any board member to the bulk owner
139 or any person or entity affiliated with the bulk owner subject
140 to disclosure pursuant to this subparagraph.
141 (d) If the members of the board of administration are
142 elected by the bulk owner, unit owners other than the bulk owner
143 may elect at least one-third of the members of the board of
144 administration before the approval of any plan of termination.
145 Section 2. This act shall take effect July 1, 2017.