Defenses to Condominium Foreclosure Actions in Florida

By Christopher M. Cobb April 13, 2020 Posted in Community Association Law Share

A condominium assessment foreclosure can be an unpleasant experience for a unit owner.  However, there are certain steps a condominium association must take prior to successfully foreclose on a unit.  Failure to take these steps may result in the inability to foreclose on the unit. This article will discuss overcoming unit owner defenses to the foreclosure of the condominium unit. Just like all other lawsuits, the unit owner is entitled to assert defenses. Below is a discussion on the most common.

Statute of Limitations

An action to foreclose a condominium association’s lien must be brought within one year from the date the lien was recorded. See 718.116(5)(b). If a lawsuit is not brought to foreclose the lien within one year, the lien is extinguished. Although the one-year limitation has not been examined by Florida courts, it is likely that strict compliance with the time period is required, as it is with other liens. Most liens are a creature of statute and the requirements of the statute must be followed. An action on the money judgment must be brought within five years. See 95.11(2)(b).  Therefore, the association should calendar the deadlines in order to timely assert claims and protect its rights.

Conditions Precedent – (i.e. Failure to Provide Notice)

The Condominium Act requires strict pre-suit notices. While the practitioner may generally plead compliance with conditions precedent to satisfy pleading requirements, the owner will likely specifically plead the association’s failure to provide the requisite statutory notices. If this pre-suit notice is not given at least 30 days before the foreclosure action is filed, and if the unpaid assessments—including those due after the claim of lien is recorded—are paid before the entry of a final judgment of foreclosure, the association shall not recover attorney’s fees or costs. Additionally, no foreclosure judgment can be rendered if the proper notices were not served to the unit owner.

Selective Enforcement Doctrine

Occasionally a unit owner may claim that not all delinquent owners are being sued and, hence, that an association is selectively enforcing assessments. A condominium association attempting to enforce a covenant or restriction against one violator, while allowing another to continue violating the same restriction, constitutes selective enforcement. See generally White 

Egret Condo., Inc. v. Franklin, 379 So.2d 346 (Fla. 1979). Where a restriction is valid but its enforcement is unequal and arbitrary, the restriction will not be upheld by the court and the association will be estopped from applying the regulation. In Florida, there are two instances in which the defense of selective enforcement is not applicable: (1) to prevent enforcement of a restriction against exterior alterations when the only previous alterations were developer authorized, and (2) where unit owners are notified that existing alterations will not be prosecuted, but that any subsequent violations in non-compliance will be prosecuted. Scarfone v. Culverhouse, 443 So. 2d 122 (Fla. 2nd DCA 1983); Schmidt v. Sherrill, 442 So.2d 963 (Fla. 4th DCA 1983) (court refused defense of selective enforcement because the defendants were first to violate alteration restriction); Chattel Shipping & Inv., Inc. v. Brickell Place Condo. Ass’n, 481 So.2d 29 (Fla. 3d DCA 1985) (board notified unit owners it would not take action with respect to existing balcony enclosures but would henceforth prosecute noncompliance).

In order for this defense to prevail, the unit owner would have to establish that the association encouraged nonpayment, or claim that the owner was lured into nonpayment in reliance on other owners’ nonpayment. As each unit owner has agreed to be bound by the community documents, this will likely be difficult to directly prove. Also, the association is permitted to file lawsuits against owners one at a time to conserve litigation expenses, should that be part of the association collection practice.

Violation of Fair Debt Collection Practices

A person or business attempting to collect a debt must provide notification of same to the debtor.  The first communication must also provide the debtor with specific information regarding the requirement and timing for disputing the validity of a debt. Below is sample language that can be used to satisfy the statutory requirement for all pre-suit demands for payment:

This is an attempt to collect a debt, and any information obtained will be used for that purpose. Unless you dispute the validity of this debt or any portion within 30 days of receipt of this notice, we will assume this debt is valid as stated. If you write and dispute this debt, or any portion of it, within the same 30 days, we will obtain and mail verification of the debt, or a copy of the judgment, whichever is applicable. Upon written request, within the same 30 days, we will provide you with the name and address of the original creditor, if different from the current creditor.

An understanding of the particular defenses asserted by unit owners in condominium assessment foreclosure actions will assist the board and counsel in meeting and defeating these defenses.

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