Often
times, condominium associations amend their documents in an
attempt to prevent an owner from owning more than one
condominium unit. The question is, can that legally be
done?
The case
of Tropicana Condominium Ass'n, Inc. v. Tropical
Condominium, LLC, 208 So.3d 755, 759 (Fla.App. 3 Dist.,
2016) truly lays out many tests that courts must follow.
The court
held that The Condominium Act allows a Declaration to
establish restrictions on the transfer of units. §
718.104(5), Fla. Stat. (2013). Courts have acknowledged that
condominium associations may impose restrictions on unit
owners' ability to transfer their units, either by lease or
sale. Woodside Vill. Condo. Ass'n, Inc. v. Jahren,
806 So.2d 452 (Fla.2002); White Egret Condo., Inc. v.
Franklin, 379 So.2d 346 (Fla.1979). Due to the
uniqueness of condominium living, condominium associations
have a degree of control over the ownership of units and,
concomitantly, individual owners tolerate a degree of
intrusion into their property ownership. Hidden Harbour
Estates, Inc. v. Norman, 309 So.2d 180 (Fla. 4th DCA
1975). While a restriction on alienation of a conminium
might be permissible, it still must be reasonable. Id. at
182; Seagate Condo. Ass'n, Inc. v. Duffy, 330 So.2d
484, 486 (Fla. 4th DCA 1976) (“The test which our courts
have adopted and applied with respect to restraints on
alienation and use is reasonableness.”). Properly enacted
condominium Declaration restrictions are presumed valid, and
the challenger of such restrictions has the burden to
establish arbitrariness, unreasonableness or violation of
law. Woodside Vill. Condo. Ass'n, Inc., 806 So.2d at 457.
The court
continued by stating that in terms of the amendment limiting
ownership to only two units, the court disagreed with the
trial court's determination that the owner met its burden of
establishing that the ownership restriction is unreasonable.
The record reflects that the majority of unit owners
approved the restriction after a fellow owner, who owned six
units in the building, allowed all six units to go into
foreclosure. Given the relatively small size of
Tropicana—forty-eight units—multiple foreclosures caused by
a single owner's financial circumstances, could have a
significant, detrimental financial impact on the
Association.
An
additional and important consideration in our evaluation of
the Association's limit of not more than two units per owner
is whether such a restriction impedes the improvement or
marketability of a property. Aquarian Found., Inc. v. Sholom
House, Inc., 448 So.2d 1166, 1168 (Fla. 3d DCA 1984) (citing
Iglehart v. Phillips, 383 So.2d 610 (Fla.1980)).
Again,
given the relatively small size of the Tropicana
Condominium, in an area of Sunny Isles Beach that in recent
decades has seen abundant development of large condominium
buildings, the restriction will have a negligible effect on
marketability. Tropicana unit owners are free to sell their
units to the public at large (subject to the ordinary
condominium association approval process), and are excluded
only from selling to a tiny, almost inappreciable class of
persons who already own two Tropicana units.
Before
you rush to make the amendment, suppose the unit is bought
in the name of the other spouse, a different corporation or
LLC, a child? That’s when enforcement gets confusing.