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Community Association Remedies When Tenants Ignore Rent Demands

After the crash of the real estate market and the subsequent foreclosure crisis, many homeowners who found themselves with properties under water capitalized on the ability to rent those properties while not paying their mortgage or community assessments.  Florida’s legislature responded by adopting Florida Statute §718.116(11), Florida Statute §719.108(10), and Florida Statute §720.3085(8) giving community associations the power to intercept rental payments from tenants leasing properties from owners who were delinquent in payment of assessments.

These statutes authorized community associations to send demand letters to a delinquent owner’s tenant demanding payment of the rent directly to the association.  If the tenant refused, the association was authorized to evict the tenant under Florida Statutes Ch. 83 as if it were the landlord.  To get around the laws, many owners created de facto tenants – a tenant without an official lease. This may be a relative, friend or other person occupying the property without a formal lease agreement.  Without a lease, knowledge of who is occupying a property, or what the rental obligation is, if any, community associations will have a difficult time enforcing their rights under Chapter 83.  If the community association cannot establish a tenancy exists an eviction may fail.

A case in point is the Miami-Dade County case of Cecil Tavares v. Villa Doral Master Association.  In this case the unit owner, Tavares, conveyed his property via a quit claim deed to a new owner. Meanwhile, Tavares stayed in the property. The new owner did not pay the association fees and the association attempted to collect rents from Tavares.

Eventually, the association filed an eviction proceeding against Tavares. The court ruled in favor of the association, but Tavares filed an appeal with the Miami-Dade County Circuit Court Appellate Division. The Appellate Division remanded the case back to the county court for further findings since it did not find any language within the quit claim deed that there was a legal tenancy between the new owner and Tavares. The appellate court’s instructions included that the lower court would need to find that Tavares was a tenant under the statutes, or that the case could be transferred to civil court for ejectment proceedings.

According to the ruling in the Tavares matter, if the relationship between an owner and a person living in the owner’s unit does not form a legal tenancy, the de facto tenant must be ejected instead of evicted.  However, it is unclear what legal authority a community association has to pursue an ejectment since, unlike an eviction, a claim of title to the property is an essential element for ejectment and an association has no claim to title.  In similar cases, community associations may need to pursue alternative collection strategies.

This reinforces the need for community associations to have legal counsel who carefully reviews each account to develop individualized legal strategies, but also has the broad and diverse practice experience to effectively employ different strategies.  Employing a legally flawed remedy not only wastes time and legal fees, but could also expose the association to liability for the owner’s/tenant’s legal fees.

Posted in Community Association
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