Condo board failed to document rental ban and now unwanted neighbors are moving in

Live in a home governed by a condominium, co-op or homeowner's association? Have questions about what they can and cannot do? Ryan Poliakoff, an attorney and author based in Boca Raton, has answers. 

Question: I live in a 16-apartment condo run by a homeowner board. About 13 years ago we voted to disallow any renting in our building. We have turned down many people who wanted to rent.

At this point two owners sold, and the new owners rented immediately. Apparently, the board never followed through and followed the procedures to have this put in the bylaws. We now have renters, and I am infuriated. I do not want any renters in this building, and I would like to know what recourse I have with a negligent and fiscally irresponsible board.

We absolutely need to put a prohibition on renting in our bylaws, as voted on. Do we have to start from the beginning now that we have new owners who want to rent and not live here? Signed, L.S.

Dear L.S.,

First, and as a basic matter, we know that amendments prohibiting renting are enforceable — there are cases on point. You would typically want to see such an amendment in the declaration of condominium, which is the document that establishes your substantive rights and obligations, and not the bylaws, which is the document that establishes how the association is governed.

I don’t know if you literally meant that there was a vote to amend your bylaws, or if you were using that word generically to refer to the declaration of condominium, or all of the governing documents together (that’s pretty common with people who are used to cooperatives, because in a cooperative the bylaws are a primary governing document).

What needed to happen 13 years ago was that your declaration needed to be amended, so that certainly required a membership vote. And, that vote could not simply be a show of hands at a board meeting — there are procedures you would need to follow to promulgate the amendment.

Amendments to the declaration are not effective until recorded in the public records.

You say that this was never done, and so it’s true that you do not have the authority to prohibit renting, whatever happened at that time. Now, if perhaps your association kept great records and can prove that a legitimate membership vote was conducted and the rental amendment passed, you could arguably record the amendment now, and start prohibiting renting moving forward. I’m not aware of a deadline in recording properly passed amendments. But it was so long ago those records are likely long gone.

When you file a certificate of amendment the board members who sign the document certify that the amendment was properly passed, and their signature is then notarized. So, unless you can absolutely be sure that the amendment passed, and what the exact language of that amendment was, I think you are going to have to start over from scratch.

The board or your attorney (I strongly suggest your attorney) will need to draft an amendment to the declaration that contains the full text of the new restriction, and that language will need to be mailed out for membership approval (the vote will usually occur at a membership meeting, though some associations allow membership decisions to be made by written consent).

As for anyone currently in the building, unfortunately that’s going to be a problem for you — probably an insurmountable one.

The Condominium Act, at Section 718.110, Fla. Stat. provides that amendments restricting renting, or altering the duration of the rental term, or specifying or limiting the number of times owners are entitled to rent are only applicable to unit owners who consent to the amendment or who acquire title after the “effective date” of the amendment. I cannot imagine your investor owners are going to consent, so you are likely going to have renters in your property for the foreseeable future. New owners will be prohibited from renting, and anyone who approves the amendment would also be prohibited from renting; but not the two owners who are currently renting.

As for the board 13 years ago, you are way past the statute of limitations for bringing a breach of fiduciary duty claim against them — and that’s even assuming they would be liable for such a mistake, which is extremely unlikely (condo board members enjoy broad protections against personal liability).

I can appreciate your anger, but you are either going to have to make the best of things moving forward and tolerate that you may have some renters in your property (which is certainly the norm); or instead sell your unit and move. I know that’s a harsh reality for someone who likely loves their home, but if this is a deal breaker for you, you may have no recourse. Given that this is such a major issue for you, I would recommend you hire an attorney to review any of the records you can find from the time the vote occurred and discuss your options.

Ryan Poliakoff, a partner at Poliakoff Backer, LLP, is a Board Certified specialist in condominium and planned development law. This column is dedicated to the memory of Gary Poliakoff. Ryan Poliakoff and Gary Poliakoff are co-authors of "New Neighborhoods — The Consumer’s Guide to Condominium, Co-Op and HOA Living." Email your questions to condocolumn@gmail.com. Please be sure to include your location.

This article originally appeared on Palm Beach Post: What happens when vote to ban renters in condo is not documented?