Deteriorating Buildings and Injured Contractors

By Michael J. Gelfand, Esq. / Published January 2022

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void Another Surfside/Champlain Towers South Tragedy Report of the Condominium Life Safety Advisory Task Force: Redefining or Returning to a Rational Standard of Care? 

     Florida condominium and cooperative associations, especially those administering buildings three stories or higher, should take careful note of the report just issued by the Condominium Life Safety Advisory Task Force created by the Florida Bar’s Real Property Probate and Trust Law Section’s Condominium and Planned Development Committee.

     The report provides recommendations to Florida’s governor, legislature, and community associations to help avoid the tragedy of another collapse. Each recommendation is broken down into bite-sized morsels, easily comprehended. Each recommendation is supported by findings and supporting explanations. The Task Force fulfilled its mandate to address systemic issues that can lead to structural tragedies in other condominiums and cooperatives, as well as to avoid the significant financial issues when work is delayed too long.

     The Task Force’s deadline was deliberately short, in essence 90 days from formation shortly after the tragic condominium collapse. Why so short? This was to allow recommendations to be delivered and digested by legislative committees before committees started meetings later this month. The timeline required the Task Force to be intensely focused, with frequent meetings hearing presentations and receiving submissions from experts in the field, including engineers, accountants, governmental officials, and those involved in management, insurance, and related matters.

     Florida associations of all types will take particular note of recommendations regarding physical inspections and reserve funding. Instead of just waiting for components to break or malfunction, Florida condominium and cooperative associations with structures over three stories should undertake regular inspections, generally every five years. Condominium components to be inspected have been long identified in the Condominium Act for developer turnover reports. The Task Force recommends that waterproofing be an additional inspection area and that required developer reports include maintenance recommendations. Subject associations that have not obtained reports should have a December 31, 2024, deadline to complete their first report.

     Recommendations are worthless without funding, as we all know! Lack of reserve funding frequently has been an excuse to delay necessary repairs, thus the recommendation to mandate reserves for these same cooperative and condominium associations is included. For each statutorily mandated reserve component, these associations should maintain 50% of the mandated reserve amount. For the remainder that is underfunded or not funded, these associations are suggested to maintain ready access to sufficient funds, such as through a preapproved line of credit. Barriers to borrowing are also addressed.

     The report also urges greater transparency of decision making and distribution of information. To this end, condominium and cooperative associations administering 100 units or more or which have revenues in excess of $150,000 should maintain a website for owners and prospective unit purchasers that includes significant governance documents, including the latest structural inspection report. Seeking to clarify the current website law to reduce practical problems, website updates are not to be continuous, but quarterly. Inspection reports must be made available to owners similarly to providing access to financial statements.

     The report continues with other suggestions including municipal and engineer liability, engineer qualifications, and manager duties. These are just as important as reports and funding but are requirements placed on non-associations.

     This report is the first significant recommendations to the legislature concerning Florida community association governance in nearly two decades. Since the creation of statutory condominiums in the 1960s, there has been a significant learning curve; however, regarding deteriorating buildings, both engineering and financing issues have been topics seemingly too scary for elected officials and regulators—perceived and of concern but rarely talked about.

     The firm is proud that one of the six appointed task force members is our Michael J. Gelfand. The report is available on the firm’s website at www.GELFANDARPE.com. Click on the firm website “Resources” tab to access the report. If you have any questions with reference to the report, please do not hesitate to contact Mr. Gelfand or another Gelfand & Arpe attorney.

Injured Contractor Barred from Workers’ Compensation Benefits: Raising Liability for Associations? 

     What happens when a worker for a contractor is injured while working for an association? Will they be entitled to workers’ compensation benefits? It may depend on whether there was a classification as an independent contractor or as an employee of the association. If not, will the worker be able to bring a claim against an association or management company?

     Recently, a Florida appellate court ruled that a worker injured installing a cable line for Kable-link Communications was not entitled to workers’ compensation benefits because the worker was classified as an “independent contractor” and not an “employee.” The facts in Cabrera v. Kablelink Communications, LLC, 46 Fla. L. Weekly D 2204 (Fla. 1st DCA, October 6, 2021), indicate that the worker’s agreement with the company confirmed that the parties considered the worker to be an independent contractor and not an employee of the company.

     Nonetheless, the worker filed a claim for workers’ compensation benefits from the company after he sustained an injury. The judge of compensation claims found that the worker did not qualify for benefits because the worker was an independent contractor.

     The Florida appellate court agreed with the decision of the judge of compensation claims. The court pointed out that an independent contractor can be considered an “employee” but only if he or she is engaged in the construction industry. Here, the court determined that there was no evidence proving that the worker, who was injured while laying cable, was engaged in the construction industry at the time of the accident.

     As this case highlights, it is not always easy to determine whether a worker is an independent contractor or an employee. Associations commonly hire workers for a variety of things, such as lawn service, pest services, and building maintenance. The place to start is having a good provision in your contract identifying the contractor’s status and duties to obtain insurance.

     Good administration does not stop with the signing of a contract. Effective implementation is necessary. Good administration requires actually obtaining a physical certificate of insurance for each contractor, sub-contractor, and materialman, to start. Because of reports of rampant forgery of certificates, a call to the issuing broker to confirm the certificate is frequently recommended. Also, make certain that the certificate is actually read, comparing the terms to your contract’s requirements. Otherwise, when there is no insurance, an injured worker may make a claim against the property owner/association. By having their own insurance, someone injured will not have to obtain benefits through the association’s workers’ compensation but can obtain benefits through their own insurer.

Michael J. Gelfand, Esq.

Senior Partner of Gelfand & Arpe, P.A.

     Michael J. Gelfand, Esq., 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 dual Florida Bar Board Certified lawyer in Condominium and Planned Development Law and in Real Estate Law, Certified Circuit and County Civil Court Mediator, Homeowners Association Mediator, an Arbitrator, and Parliamentarian. He is a past 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 ga@gelfandarpe.com or (561) 655-6224.