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Restrictions in Community Documents Will Be Strictly Construed by Courts

A community association’s declaration of covenants governs the duties and responsibilities between an association and its owners. When interpreting the text of such documents, courts will apply a rule of strict construction that requires a court to apply any unclear or ambiguous language in the manner most favorable to the owner. Strict construction has a long history in the law and has been an important element of how courts enforce the documentary the relationship associations and its members.

This rule was addressed in Cool Spaze, LLC v. Boca View Condominium Association, Inc., 18-2446 (Fla 4th DCA 2020), where a unit owner of a condominium unit in Boca View Condominium Association, Inc. (“Association”) sought to transfer the unit without Association approval to his limited liability company Cool Spaze, LLC (“LLC”). The LLC then sought to lease the unit. The Association denied the lease application citing the lack of approval for the transfer to the LLC. The Association required the purchaser to transfer the unit back to his individual capacity.

The Association’s declaration of condominium stated as follows:

It shall be necessary for the [b]oard of [d]irectors of the [a]ssociation, or its duly authorized officers, agent[s] or committee to approve in writing all leases, subleases, or other occupation of a Unit before lease, sublease or occupation shall be valid and effective … (Emphasis added).

The LLC sued the Association for declaratory relief and to enjoin it from screening and disapproving sales, transfers of title and conveyances of units, arguing the Association’s governing documents did not give the Association such authority and the Association was “wrongfully requiring its approval of the sale or transfer of legal title to the units in the Condominium.” The trial court ruled in favor of the Association ordering the LLC to comply with the obtaining approval to transfer the unit to the LLC’s name. The LLC appealed.

In overturning the trial court’s ruling, the Fourth District Court of Appeal cited long standing Florida law that the declaration “must be strictly construed.” An association may not act in any way not authorized by its governing documents. The Court further held that when faced with competing interpretations, any ambiguity is to be construed against the association as the drafter of the document. Here, the Association’s declaration of condominium did not authorize the Association’s approval of all unit transfers. The declaration of condominium only authorized the Association to approve of leases, subleases, or other occupation of a unit, but did not have authority to approve of unit transfers, title transfers or sales.

This ruling is an important reminder to boards of directors that their governing documents are the source of their authority. If rules are not clearly delineated by the governing documents an association likely lacks that enforcement power. Especially when it comes to restrictions or regulations on sales or leases as Florida law disfavors restraints on owner’s right to alienate property.

Posted in Community Association, Condominium Association, Governing Documents, Homeowners Association
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