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THE OTHER WAY TO TERMINATE A CONDOMINIUM
By
Eric Glazer, Esq.
Published August 12, 2024
Last week in my blog, I discussed how developers attempt to buy
enough units in order to vote to Terminate the condominium. By
doing so, the developer files a plan of termination, and buys up
all the units. We also spoke about the fact that in some
condominiums, a vote of 100% of the owners may be required in
order to terminate and the developer may be prevented from
terminating the condominium even if there is only one unit owner
who won’t agree to the termination.
Well, as the saying goes, there is more than one way to skin a
cat. (Strange and sick phrase when you think about it.)
Here’s what typically happens……… The developer purchases enough
units so that the developer controls a majority of The Board of
Directors. The developer then takes the position that the
property is just in miserable shape. In order to bring the
property into shape, it requires massive special assessments.
That’s where the remaining unit owners typically break. They
can’t afford these new massive special assessments. The owners
should make sure that the developer is paying the special
assessment as well. Ask for access to records.
The developer can also claim that the property is simply in
total disrepair and rely on the following statute: 718.117
(2) TERMINATION BECAUSE OF ECONOMIC WASTE OR
IMPOSSIBILITY.—
(a) Notwithstanding any provision in the declaration, the
condominium form of ownership of a property may be terminated by
a plan of termination approved by the lesser of the lowest
percentage of voting interests necessary to amend the
declaration or as otherwise provided in the declaration for
approval of termination if:
1. The total estimated cost of construction or repairs necessary
to construct the intended improvements or restore the
improvements to their former condition or bring them into
compliance with applicable laws or regulations exceeds the
combined fair market value of the units in the condominium after
completion of the construction or repairs; or
2. It becomes impossible to operate or reconstruct a condominium
to its prior physical configuration because of land use laws or
regulations.
So, if those few holdouts don’t agree to sell, the developer can
try plan B. In order to get there, the developer has incentive
to keep the common elements is disarray. Of course, those
persons on the Board who are deliberately keeping the property
in disarray can be sued for breaching their fiduciary duty to
the owners. That is……if the owners have enough money to fight
back.
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About
HOA & Condo Blog
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Eric Glazer graduated
from the University of Miami School of Law in 1992 after
receiving a B.A. from NYU. He has practiced community
association law for three decades and is the owner of
Glazer and Sachs, P.A. a five attorney law firm with
offices in Fort Lauderdale and Orlando.
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Eric is Board Certified by The Florida Bar in
Condominium and Planned Development Law.
Since 2009, Eric
has been the host of Condo Craze and HOAs, a weekly one-hour
radio show airing at 11 a.m. each Sunday on 850 WFTL. Recently,
he moved the show to YouTube, transforming it into a more
dynamic and interactive experience. This move not only allows
viewers to engage in live chats with Eric and other participants
but also enables a broader audience to access free advice,
making valuable insights more widely available.
See:
www.condocrazeandhoas.com.
Eric is the first attorney in the State of
Florida that designed a course that certifies condominium and
HOA residents as eligible to serve on a Board of Directors and
has now certified more than 20,000 Floridians all across the
state. He is certified as a Circuit Court Mediator by The
Florida Supreme Court and has mediated dozens of disputes
between associations and unit owners. Eric also devotes
significant time to advancing legislation in the best interest
of Florida community association members.
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