Condo Associations’ Rights and Remedies Concerning Abandoned and Foreclosed Units

Every so often condo associations must deal with one or more abandoned and foreclosed units within their communities.  Whether the result of owners unable to secure a tenant or lender foreclosure actions, abandoned units can create serious issues for an association such as the growth of hazardous mold, insect infestation and other forms of unit deterioration.  Sometimes a prior owner will leave a unit in an uninhabitable condition or even purposefully destroy parts of the unit, which isn’t discovered until after a foreclosure sale.  Abandoned units in poor condition can lead to damage to the common elements and limited common elements if not timely addressed.  The Florida Condominium Act enables associations to be proactive when these circumstances arise and provides various remedies to associations dealing with these predicaments.  This Blog post will discuss condo associations’ rights and remedies concerning abandoned and foreclosed units in disrepair.

Before taking action, it is important to know what the Florida Statutes consider an abandoned unit.  According to the Florida Condominium Act, a unit is presumed abandoned if it is the subject of a foreclosure action and no tenant appears to have resided in the unit for at least 4 continuous weeks.  Fla. Stat. § 718.111(5)(b)1.  If there is no foreclosure action, a unit is considered abandoned if no tenant appears to have resided in the unit for 2 consecutive months, and the association is unable to contact the owner or determine the whereabouts of the owner after reasonable inquiry.  Id.

If the unit is abandoned, the association may enter for inspection of the unit’s interior and its adjoining common elements.  Id.  However, the association must first provide written notice of its intent to enter the unit by sending the notice via mail or hand delivery to the owner’s address as reflected in the association’s records.  Fla. Stat. § 718.111(5)(b)2.  Two days after this notice has been mailed or hand-delivered, the association may enter the unit.  Id.  This notice may also be delivered by e-mail if the unit owner previously consented to delivery by e-mail.  Id.  In emergency situations, notice is not required and the association can enter immediately.  Id.  The statute does not define what is considered an “emergency” so associations must use their best judgment and discretion.

The Florida Condominium Act grants to associations this irrevocable right and authority to enter and inspect even when declarations are silent.  Fla. Stat. § 718.111(5)(b)1.  Accordingly, an association’s board of directors possesses sole discretion for entering and inspecting abandoned units and for taking the following actions, if needed:

• • repairing the unit or the common elements serving the unit;
  • restoring the unit if mold or other forms of deterioration are present;
  • turning on the utilities for the unit; or
  • otherwise maintaining, preserving, or protecting the unit and adjoining common elements.

Id.

While an association’s ability to act is quite broad when it comes to abandoned units, the fear of what these remedial actions may cost often cause a board of directors to hesitate.  However, recent changes to the Florida Condominium Act alleviate this concern.  The Florida Legislature, in 2014, amended these statutes to allow any expense incurred by an association for entering and repairing abandoned units, pursuant to Section, 718.111(5), Florida Statutes, to be chargeable to the unit owner.  Fla. Stat. § 718.111(5)(b)3.  This equally applies to banks who become unit owners after foreclosure.  These repair expenses are even enforceable as an assessment, which means associations may use their lien authority under Section 718.116, Florida Statutes, to enforce collection of this expense.  Id.

Consequently, if lenders refuse to make the necessary repairs to dilapidated units they gained title to through foreclosure, associations can act for them and charge lenders the expense as an assessment.  If lenders refuse to pay that assessment charge then associations can bring their own foreclosure actions against those lenders.  As an alternative to foreclosure, an association can request a court to appoint a receiver over the abandoned unit for leasing it out for the benefit of the association.  Fla. Stat. § 718.111(5)(b)4.  The rental income can be used to reimburse the association for all costs and expenses of maintaining, preserving and protecting the unit, including any unpaid assessments, interest, late fees and attorneys’ fees.  Id.  To ensure associations protect themselves when taking advantage of these remedies, they will need to maintain in their records all written reports obtained from inspectors and engineers who examined the unit and recommended repairs.  Associations must also save all related invoices and receipts for proving the expenses for the work performed.