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A Guide to Avoid Criminal Charges as a Condominium Director in Florida

Posted by Jane F. Bolin, Esq. | Jul 19, 2017 | 0 Comments

2017 new legislative changes

Yeah. This a bit tongue and cheek, but the fact of the matter is that Florida law governing condominiums has changed. Earlier this year, the Miami-Dade Grand Jury filed a report about the status of condominium association governance and the ability of the Division of Condominiums, Timeshares and Mobile Homes to regulate the boards and management companies. I wrote an article published in the Florida Community Association Journal about the potential impact of the recommendations of that report. Mostly, my concern is the chilling effect on owners who might think twice about volunteering for the board with these new criminal penalties. After a few renditions of the original bill, HB 1237 was signed by the Governor and is effective July 1, 2017. Now that we have the law in place, I'll explain how easy it is avoid jail time. 

I'm going to explain what you need to know, but I find it's always best to start with the foundation. Florida law, before these changes, had provisions that outline a board member and manager's fiduciary responsibilities. 718.111 states that all officers and directors have a fiduciary relationship to the unit owners. No officer, director, or manager may solicit, offer to accept, or accept anything of value for their benefit or their family's benefit, from any person providing or proposing to sell services or goods to the association. The change effective July 1 is that the word ‘kickback' was added here. It's really a clarification – making it crystal clear that you can't be bribed in any form or fashion, or solicit any kind of beneficial arrangement. COMMON SENSE! If you do… you may be subject to a civil and now a criminal penalty! Don't worry. The exception here is trade show or educations programs, and the stuff vendors give you when you are participating in them.

The Condominium Act also references 617.0830 of the not-for-profit portion of Florida Statutes and states that all of the officers, directors, and agents (property managers), shall act in good faith, with the care an ordinarily prudent person in a like position would exercise under similar circumstances, and in a manner he or she reasonably believes to be in the best interest of the association. Okay. This sounds pretty reasonable, and in fact it is. The statute goes on to state that a breach of this standard would be a violation of criminal code, a transaction where a benefit was derived either directly or indirectly, or a reckless act in bath faith with malicious purpose and with disregard of human rights, safety, or property! Again, pretty clear. A board member will be in breach of his or her fiduciary duty if their actions amount to a crime, or a kickback situation, or complete disregard for human rights, safety, or property.

The major changes this legislative session come right after this section and mirror what the Miami Dade Grand Jury report suggested:

1. The forgery of a ballot or a voting certificate. If you do this, it will be a third degree felony.

2. If you steal or embezzle funds, you will be charged with a felony! The degree of felony depends on how much you steal.

3. The destruction or refusing to allow inspection of official records is considered tampering with evidence and is punishable as felony in the third degree or the obstruction of justice!

4 . If you are charged by information or indictment, you will lose your board director position and it will be filled by the remaining board members by appointment.

And good news. The law is clear that anyone with a pending criminal charge may not be appointed or elected to office, and cannot have access to official records except by court order. So, just as a quick aside, is anyone else wondering when pending criminal charges meant you were guilty? I thought every person is presumed innocent until proven guilty? I suspect we'll have lots of bills to fix this current legislation. Why do I say that? A criminal charge could be driving too fast or not having proof of insurance. This is TERRIBLE legislative drafting.

So how do you avoid criminal penalties? This is a two-part answer. The first part is easy. Do the right thing! Don't steal. Don't forge signatures. The second part requires you understand the system and process of the association or your management company in regard to official records and how records are kept. The first thing to identify is: Where the records are kept? If they are digital, on what servers? Who has access to them? Are there backups? If you are encountering the request for official records, the association only has 10 days to respond. Who gets those requests? Who is ultimately (and I mean 100%) responsible for making sure a response is sent in 10 days? You need to get curious about how the systems work, and if you find there isn't a system, then this is your opportunity to get that cleaned up. After all, you don't want to have any chance of being charged with tampering with evidence or the destruction of justice.

If you have questions about this article, contact me [email protected].

About the Author

Jane F. Bolin, Esq.

Founding Member, Managing Partner


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