Florida Appeals Court Decides CC&Rs Trump State Law

guest blog by Deborah Goonan

Florida HOA industry proponents are all abuzz about a recent District Court ruling. The Fourth District Court of Appeals (DCA) has clarified in its decision that if HOA Covenants, Conditions, & Restrictions (CC&Rs) specifically state that a third-party buyer need not be responsible for paying past due assessments, that provision overrides FL state law.

Florida statute currently requires that third-party buyers at foreclosure must pay all past due assessment liens accumulated by prior owners. However, as written, its intent is not to impair contract rights that were in effect prior to the 2007 statute.

In this article (HOA COLLECTIONS…Fourth DCA Decision Slams HOAs In Florida) the owner of an HOA collections business does not appear to be happy with the appellate court’s decision to defer to HOA governing documents in lieu of state law.

Note the double standard at play here. When it comes to CC&R violations, HOA-proponents want the “contract” to prevail. But when it comes to collection of past-due assessments from third party owners, the same folks want state law to override the CC&Rs, thereby impairing the HOA “contract.” In fact, the lower court decided the case in favor of the HOA, citing state law.

In this article written by a FL Attorney, blame and shame is cast upon lenders for “mooching” off of homeowners, and state legislators for creating laws that protect mortgage holders’ financial interest at the expense of homeowners and taxpayers.
But didn’t HOA proponents favor “mooching” off of homeowners when they gloated about NV and DC appeals courts decisions that third-party buyers at HOA foreclosure sales could wipe out mortgage liens? After all, what happens to property values when an $800,000 home sells at auction for little more than $6,000 owed one the HOA lien?

Lots of angles here.

For instance, what exactly are your HOA assessments paying for? Most of it may be for essential infrastructure – roads, storm water systems, private utilities, security, and the like. These are traditional government services, making HOA assessments akin to property taxes. So why is the HOA a corporation and not an official “mini-government” subject to prevailing Constitutional law instead of contract law?

Portions of assessment funds may also be for non-essential amenities. But our current laws treat all of these funds as absolutely essential, and as mandatory obligations. Assessments must be paid No Matter What, or risk lien and foreclosure by your HOA. If HOA fees were truly “contractual” obligations, homeowners would have the power to withhold payment for non-delivery of services, and the HOA would not have the power to foreclose to collect liens.

On the other hand, if HOAs were truly “mini-governments,” then why wouldn’t HOA assessment liens – at least the portion payable for essential services – hold an equal or higher priority than property tax liens?

So many contradictions and double standards, none of which benefit the homeowner.

(link to brief summary of new case law)


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Ward Lucas is a longtime investigative journalist and television news anchor. He has won more than 70 national and regional awards for Excellence in Journalism, Creative Writing and community involvement. His new book, "Neighbors At War: the Creepy Case Against Your Homeowners Association," is now available for purchase. In it, he discusses the American homeowners association movement, from its racist origins, to its transformation into a lucrative money machine for the nation's legal industry. From scams to outright violence to foreclosures and neighborhood collapses across the country, the reader will find this book enormously compelling and a necessary read for every homeowner. Knowledge is self-defense. No homeowner contemplating life in an HOA should neglect reading this book. No HOA board officer should overlook this examination of the pitfalls in HOA management. And no lawyer representing either side in an HOA dispute should gloss over what homeowners are saying or believing about the lawsuit industry.

1 thought on “Florida Appeals Court Decides CC&Rs Trump State Law

  1. robert

    “So many contradictions and double standards, none of which benefit the homeowner.”

    You just described what’s wrong with the H.O.A. system in one sentence.


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