Fair Housing:

Florida Law Claims Do Not Go Directly to Court

By Michael J. Gelfand, Esq. / Published April 2017

Did you know that your Florida community is covered by more than one set of Fair Housing laws? There is a Florida version that is similar to, but not exactly the same as, the Federal Fair Housing Act. Some municipalities and counties also have their own Fair Housing ordinances. In addition to differing duties imposed upon community associations, there are different claim processes.

So what happens when a resident files a lawsuit claiming violations of not just the Federal, but also of the Florida Fair Housing Act? One of the first questions may be, “Was a claim first filed with the Florida Commission on Human Relations (FCHR)?” In an interesting decision in favor of housing providers such as associations, the Florida Fair Housing Act claims are likely to be dismissed if no claim was filed first with the FCHR!

In what may have appeared to be a “standard” fair housing dispute, the gloves came off just before the holidays in a Florida appellate court decision that may cost the FCHR, the Florida agency charged with enforcing Fair Housing laws, $600,000 per year! The court ruled that that Florida Fair Housing Act requires a private claimant to engage in a statutory conciliation process directed by the FCHR before filing a civil action under the statute.

In Housing Opportunities Project v. SPV Realty, LC, No. 3D15-1132 (Fla. 3rd DCA, December 21, 2016), Housing Opportunities Project (HOPE) filed a second lawsuit against SPV, the owner of a rental apartment building, in state court alleging that SPV breached all of the promises it made after settling the first lawsuit, which HOPE filed in federal court. In suit two, unlike suit one, HOPE claimed that SPV’s rental practices violated the Florida Fair Housing Act because SPV provided false and inaccurate information to potential rental applicants. The trial court dismissed the complaint as a result of HOPE’s failure to first engage a mandatory FCHR conciliation process before filing suit.

The Florida appellate court agreed with the trial court, concluding as a matter of law that the Florida Fair Housing Act requires a private claimant to exhaust its administrative remedies before filing a civil action under the Act. The court began its analysis noting that if a statute is “plain and unambiguous,” the courts will not depart from the “plain and natural language employed by the Legislature.” Section 736.34 of the Florida Fair Housing Act provides:

(4) If, within 180 days after a complaint is filed with the commission or within 180 days after expiration of any period of reference under subsection (3), the commission has been unable to obtain voluntary compliance with SS. 760.20–70.37, the person aggrieved may commence a civil action in any appropriate court against the respondent named in the complaint or petition for an administrative determination pursuant to s. 760.35 to enforce the rights granted or protected by ss. 760.20–760.37.

The court’s opinion held that the Act has just one meaning: It prohibits a private citizen or entity from pursuing a Florida Fair Housing Act civil violation without first filing a complaint with the FCHR and allowing the FCHR an opportunity to resolve the dispute informally.

The appellate court rejected the suggestion that the Florida Legislature intended the Act to “duplicate the federal cause of action,” noting that there has been no legislative statement indicating that intent. Since 2012, the FCHR sought to amend the Act to incorporate verbatim the Federal Fair Housing

Act. The Legislature’s lack of action led HUD to threaten to cut off funding in the amount of $600,000. Nonetheless, the court stated, “We feel no compunction to do for the Commission or any advocacy group what the Legislature itself will not do.”

This decision is potentially far reaching for Florida community associations, beyond just Florida Fair Housing issues. Frequently, claims are brought alleging both federal and Florida violations. This decision may force Florida claims to be dropped when administrative remedies are not exhausted.

Assessments: Associations Must Properly Budget for Legal Expenses

What happens if an association discovers it has not properly budgeted for legal expenses or other line items? Can the budget be amended to cover the additional expenses? Maybe not!

This was the dilemma faced by the Shores of Panama Association when the association realized it did not budget enough money to cover one-time legal and engineering expenses. In Shores of Panama Resort Community Association, Inc., v. Shores of Panama, LLC, 41 Fla. L. Weekly D 2458 (Fla. 1st DCA, November 2, 2016), the association sent owners notice of a special meeting to adopt an amended budget increasing the annual budget originally set for legal fees to cover one-time legal and engineering expenses for litigation over construction defects. The 2015 budget had provided for $200,000 of legal fees. The board voted to adopt an amended budget adding an additional $525,000.

Owners unhappy with the additional assessments sought a temporary injunction, arguing that the assessments were “special assessments” which required a different approval process. The trial court agreed and temporarily enjoined the collection of the assessments for the one-time expenses.

The Florida appellate court affirmed the decision of the trial court. The court noted that the association identified the increased assessment as “non-reoccurring costs” for which the association created two new separate categories identified as non-reoccurring expenses.” Therefore, the assessments were “special assessments” which required a different approval process than the amended budget process used by the association.

Associations should budget for anticipated expenses correctly so that they have the money when needed. In particular, budgeting for legal expenses may also act as an effective deterrent to those owners thinking of suing the association, because the association will have the resources to defend against claims.

Michael J. Gelfand, Esq.

Senior Partner of Gelfand & Arpe, P.A.

Michael J. Gelfand, the Senior Partner of Gelfand & Arpe, P.A., emphasizes a community association law practice, counseling associations and owners how to set legitimate goals and effectively achieve those goals. Gelfand is a Florida Bar Board-Certified Real Estate Lawyer, Certified Circuit and County Civil Court Mediator, Homeowners Association Mediator, an Arbitrator, and Parliamentarian. He is the Chair of the Real Property Division of the Florida Bar’s Real Property, Probate, & Trust Law Section, and a Fellow of the American College of Real Estate Lawyers. Contact him at michael@flcaj.com or (561) 655-6224.