Condo Line

Owners rent units, shun involvement

 

CAMquestion@cfl.rr.com

Q. We are a “seasonable” condominium mainly of Canadians, Europeans and South Americans. Many owners rent their units so that at times we have only 40 percent of the units occupied by owners. To properly conduct business of the association and elections, our mailings will not generate return proxies and ballots. Our owners do not become involved as the seasonable owners use the units as vacation homes. Our Canadian owners say that they have a web page and vote on the web. Is there any reason that we cannot vote by computer?

Y.C., Seminole

It may be acceptable to send proxies on the web, but not ballots; however, proxies must be prepared by an attorney as well as the meeting notice and information. Proxies should be signed and dated, thus an email proxy should not work. Maybe a PDF file, an attachment copy, or fax with the signature could work. I would seek guidance from your attorney to determine the correct procedures. However, statute FS 718.112 is clear that the election ballot must be returned directly to the condominium.

Your problem with the lack of support by absentee members is not unusual. The result is that too much work is placed on the few directors who serve. Try to communicate this problem to members and ask for their support. Directors have a right to engage management and other professionals to assist them in the responsibilities of financial matters, operations and maintenance. I suggest that you make it clear to the members that these professionals will be hired, resulting in higher maintenance fees. If members will not support or volunteer, then they must pay for others to do the work.

Q. At the annual condominium meeting, the agenda contained a new business item to transfer any excess funds to next year’s budget. I stood and made a motion to transfer $50,000 to reserves rather than to the next year’s budget. The manager interrupted to say that the motion was out of order because it was not an agenda item. Since the agenda is set by the board, how can they deny a member from standing and making a motion that is not an agenda item?

H.F., Naples

A notice of the meeting is sent 60 days before the meeting. If a member wants to add an agenda item, he or she should send a letter to the board with that request . The board has an option to deny the request. But if a member has a petition signed by 10 percent or more of the owners, the board would be obligated to place the item on the agenda. Such requests must be within a time limit to allow a second mailing. The motion on the agenda is somewhat a housekeeping item that is a required movement of funds for legal purposes involving IRS rules. I assume that the motion was to avoid tax payment requirements. Understand that budgets are an estimate of expected expenses; you should have expenses under or over the estimated budget line items. I am sure that the agenda motion did not designate the exact amount because it would not be known until the end-of-year financial report is issued. Thus, if the condominium only had $25,000 excess, how could it transfer $50,000?

Q. When I purchased my cooperative unit, I had to buy title insurance. I never received a deed but a stock certificate for ownership. Is there a need for title insurance?

S.F., Largo

Title insurance is a one-time purchase when you buy a property. It protects you if someone makes a past claim on the property. Most mortgage companies will require you to purchase title insurance to protect them. Thus, there are usually two title insurance policies. While title companies and attorneys will check the title when you buy, it may be possible that an unknown claim can be missed. For example, say in years past a wife and husband were in a contested divorce. Unknown to the wife, the husband purchased the property where your cooperative was built. He used his name and his wife’s name to record the deed. After the divorce, he forged his wife’s name and sold the property. Along came the IRS and made a claim against the ex-wife for her failure to pay the taxes on the sale. She may have a legitimate claim to all the property and the cooperative. While there is a time limit on her claim, more than likely she can take title to the property. That is the reason you need title insurance.

Write to Condo Line, Richard White, 6039 Cypress Gardens Blvd., #201, Winter Haven, FL 33884-4115, or e-mail CAMquestion@cfl.rr.com. Include name and city.

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