The firm’s Helio De La Torre and Lindsey Thurswell Lehr were interviewed during the last few days by reporters from the Daily Business Review, South Florida’s exclusive business daily and official court newspaper, and The Real Deal, one of South Florida’s leading sources for real estate news and analysis. They were asked by the journalists for their insights into the ramifications of a decision last week by the Third District Court of Appeal that has significant implications for the future of condominium terminations in Florida.
The case pitted the Tropicana Condominium Association against the developer of the neighboring Ritz-Carlton Residences in Sunny Isles Beach. The appellate court ruled in favor of the developer, which had ties with a group of five unit owners at the Tropicana, finding that the property’s bylaws required unanimous approval for a sale, despite the 80 percent threshold in the amended condominium termination legislation from 2007. It agreed that the five holdouts’ refusal to sell was enough to block the termination that was favored by the association because the property’s 1983 governing documents predate the legislative amendment and require all unit owners to approve termination.
The Third DCA ruled that the 2007 changes to the Florida statute don’t apply retroactively to condominium declarations from prior to 2007 unless they contain certain language that incorporates amendments to the state’s Condominium Act.
The appellate court said in its ruling that “when referencing Florida’s Condominium Act, the declaration [for Tropicana] did not contain the words ‘as amended from time to time.’ Absent this language in the declaration, changes by the legislature to the Condominium Act subsequent to the effective date of the declaration do not become part of the declaration automatically.”
“The statute seemingly had language that suggested the intent was to make it retroactive,” said law firm partner Helio De La Torre, who has represented condo associations in similar cases centering on termination of associations through votes by unit owners. He is a partner of Coral Gables-based Siegfried Rivera, P.A.
“We had communities where bulk purchasers were coming with 80 percent [of the units] and terminating,” he told The Real Deal, “and the only chance we had to fight them was to make the argument that it shouldn’t have been approved with 80 percent, that we had more than 10 percent opposed. So, under the new statute we could fight them.”
But De La Torre said the ruling in the Tropicana case made that argument less potent: “Now, this court knocks out that argument.”
The ruling will affect attorneys like Lindsey Thurswell Lehr of Siegfried Rivera Hyman Lerner De La Torre Mars & Sobel in Coral Gables.
Although the minority owners triumphed in the Tropicana appeal, Thurswell Lehr said the ruling eliminates a key strategy for others that rely on the law’s prohibition of sales in cases where 10 percent of owners object. In the past, these attorneys pointed to the wording of the legislation to argue it covered all properties in the state.
“The argument we like to make is the termination statute offers this protection,” Thurswell Lehr said. “But now you have an appellate court basically saying that the amended termination statute does not apply retroactively. You are bound by what’s in your declaration.”
Our firm congratulates Helio and Lindsey for sharing their insights into the ramifications of this ruling with the readers of the Daily Business Review and The Real Deal. Click here to read the complete article from the DBR in the newspaper’s website (registration required), and click here to read the article from The Real Deal.