Don’t let your control go bye-bye

14 Jun 2022

Given their age, many Florida community associations are (often unknowingly) allowing their covenants to expire. Unfortunately not all such communities choose to use an attorney, or at least one whose procedures include notifying associations in advance that their covenants will expire under the Florida Marketable Record Title Act (“MRTA”). That expiration customarily (but not necessarily) occurs 30 years after the date the Declaration of Covenants was first recorded in the County Public Records. Avoiding this expiration is crucial; covenants cease to be enforceable once they expire, and remain unenforceable until they are “revitalized” through a fairly costly and time-consuming process. Essentially, the association has no covenants to enforce once they expire.

As our readers may be aware, maintenance assessments are levied by enacting a budget, and then calculating each owner’s proportionate share of that budget. Such a budget must be adopted, even if assessments which accrue while (or before) the covenant to pay them become unenforceable until they are revitalized. Once revitalization is accomplished, the association could reinstitute its collection efforts, but only regarding assessments and related charges which came due after that revitalization date; anything accruing earlier remains unenforceable. Likewise, an association’s nonmonetary covenants cease to be enforceable once they expire, and can only be enforced after they are revitalized.

Realizing that paying assessments and complying with nonmonetary covenants is essentially voluntary during this “interim” period, some less scrupulous owners decide not to do so. They cease paying assessments, maintaining their property, or even intentionally undertake construction specifically because they feel it’s allowed during this interim period. Those owners’ view is extremely shortsighted; the need to pay the cost of maintaining and operating the community, does not suddenly disappear when the covenants are not enforceable. Guess how the association must pay for those obiligations (which do survive the covenants expiring): assessments! Likewise, all owners’ property values and relationships with neighbors are likely to diminish when they choose inappropriate actions and conditions on their property. To be clear, the covenants are temporarily unenforceable does not reduce or eliminate the crucial purpose they were enacted to serve.

As with assessments, covenant violations arising before a revitalization is complete may not be enforceable even after revitalization. At that point, a case-by-case evaluation with counsel should be undertaken regarding each violation, to determine how best to proceed. The Board could also consider a “Chattel Shipping” letter once the covenants are again enforceable. Such a letter essentially acknowledges the association’s past inability to pursue covenant violations, and intent to do so going forward. Once issued, the covenants can be enforced going forward, but the letter has no retroactive effect.

It is crucial to ensure your association’s covenants do not expire. Around 25 years after they were originally recorded, a discussion with counsel is highly recommended. The Florida Statutes now provide a fairly straightforward method of avoiding that expiration. If your covenants have expired and are not yet revitalized, it may also be a good time to create collection and nonmonetary covenant enforcement policies, which cam add clarity and uniformity in enforcement once the covenants are revitalized.

Please contact Arlene Ring if you’d like to discuss these matters with Clayton & McCulloh.