KAREEN LECORPS AND JOHN BAPTISTE v. STAR LAKES ASSOCIATION, INC.

Third District Court of Appeal
State of Florida
Opinion filed May 25, 2022.
Not final until disposition of timely filed motion for rehearing.
________________
No. 3D21-2195
Lower Tribunal No. 21-3058
________________
Kareen Lecorps and John Baptiste,
Appellants,
vs.
Star Lakes Association, Inc.,
Appellee.
An appeal from a non-final order from the Circuit Court for Miami-Dade
County, Beatrice Butchko, Judge.
Law Offices of Shaun M. Zaciewski, P.A., and Shaun M. Zaciewski, for
appellants.
Marshall Dennehey Warner Coleman & Goggin, and Kimberly Kanoff
Berman, and Patrick M. DeLong, and Holly M. Hamilton (Fort Lauderdale),
for appellee.
Before FERNANDEZ, C.J., and EMAS, and MILLER, JJ.
MILLER, J.
Created in the late 1960s, Star Lakes Estates is a residential
multicondominium development operated by a single association. After
Building 12 was partially destroyed by fire, appellee, Star Lakes Association
(the “Association”), determined the available insurance proceeds were
insufficient to defray the projected cost of restoration. The Association then
levied a special assessment upon all unit owners. Appellants, Kareen
Lecorps and John Baptiste, along with a now-deceased unit owner, obtained
a preliminary injunction invalidating the assessment, halting construction,
and mandating the Association convene a membership meeting and
community-wide vote. Approximately three weeks later, the Association
successfully moved to dissolve the injunction. In this appeal, appellants
contend the trial court erred in dissolving the injunction absent an identifiable
change of circumstances and because the Association lacked authority to
impose the assessment.1 Discerning no abuse of discretion, we affirm the
well-reasoned order under review.
BACKGROUND
Star Lakes Estates consists of seventeen residential buildings and two
commercial buildings. Through a separate declaration, each of the
1
We summarily reject the unpreserved claim of error relating to
reconstruction of the interior units.
2
seventeen residential buildings is a condominium, and each unit owner is
subject to the condominium form of ownership. The Association derives its
powers from its articles of incorporation, by-laws, and the governing
documents of the individual condominiums. In May 2000, the by-laws of
each condominium were amended to include the following: “The Star Lakes
Association may operate the following listed condominiums as a single
condominium for the purposes of financial matters, including budgets,
assessments, accounting, record keeping, and similar matters, pursuant to
the authority of Chapter 718.111(6) of the Florida Statutes . . . .”
In late 2017, Building 12 was engulfed by fire. The top floor units were
destroyed, and the lower units sustained significant structural damage,
rendering the building uninhabitable. The Association timely filed an
insurance claim, and the insurer of the building tendered the full policy limits
of approximately $1.49 million. The Association then notified all institutional
Building 12 first mortgagees of the insurance payment, along with the need
for reconstruction and repair. None of the mortgagees responded.
After retaining an engineer and contractor, the Association learned the
insurance proceeds were insufficient to cover the projected construction
costs. Written notice regarding the funding disparity was forwarded to each
of the institutional first mortgagees, and the Association notified Building 12
3
unit owners that it intended to convene a special meeting to consider whether
to abandon construction or levy a special assessment. After discussion, a
majority of voting unit owners voted to rebuild.
The Association subsequently notified all Star Lakes Estates unit
owners of a scheduled discussion and vote on a community-wide special
assessment. The notice detailed a proposed aggregate special assessment
in the amount of $1.25 million, of which $700,000.00 was allocated for
restoring Building 12 and $550,000.00 was earmarked for the completion of
forty-year recertifications, roof replacements, fire alarm installations, and
legal expenses. At the duly convened meeting, the Association’s board of
directors voted 4-1 to impose the special assessment, payable over an
eighteen-month period. Unit owners were then furnished with notices
reflecting the payment terms.
Nearly all unit owners tendered the special assessment, and
construction commenced. Appellants, unit owners in Buildings 21 and 30,
along with a now-deceased unit owner, then filed suit against the
Association, seeking declaratory and injunctive relief, as well as damages
for breach of contract and negligence. As relevant to this appeal, appellants
sought to terminate reconstruction of Building 12, alleging the special
assessment was invalidly passed in violation of the Association’s governing
4
documents. The trial court convened an injunction hearing, at the conclusion
of which it invalidated the assessment, enjoined any further construction, and
ordered the Association to notice another meeting and allow all unit owners
to vote on the assessment. The Association later successfully moved to
dissolve the injunction, and the instant appeal ensued.
STANDARD OF REVIEW
The trial court enjoys broad discretion in dissolving temporary
injunctions, and such action “will not be interfered with by appellate courts
unless there is a clear showing that the [trial judge] abused his [or her]
discretion.” Cunningham v. Dozer, 159 So. 2d 105, 105 (Fla. 3d DCA 1963).
ANALYSIS
The issuance of a preliminary injunction is an extraordinary remedy
that should be granted sparingly. Fla. High Sch. Activities Ass’n v.
Kartenovich, 749 So. 2d 1290, 1291 (Fla. 3d DCA 2000). Consequently, to
obtain a temporary injunction, the moving party must establish: (1) a
substantial likelihood of success on the merits; (2) the unavailability of an
adequate remedy at law; (3) the likelihood of irreparable harm absent an
injunction; and (4) that the injunction will serve the public interest. Quirch
Foods LLC v. Broce, 314 So. 3d 327, 338 (Fla. 3d DCA 2020).
5
Here, appellants’ challenge to the special assessment is two-fold.
First, they contend the Association was required to fund the outstanding
restoration efforts by levying a special assessment upon only those unit
owners in Building 12. Second, they alternatively assert that a community-
wide vote was a prerequisite to levying the assessment upon all unit owners.
We are not so persuaded.
Crucial to the resolution of these issues are two autonomous, yet
convergent, sources of law. The first is Florida’s “Condominium Act” (the
“Act”) codified in chapter 718, Florida Statutes (2022), and the second is the
governing condominium documents.
Every condominium in Florida is created pursuant to chapter 718 of the
Florida Statutes. § 718.102, Fla. Stat. “As condominium ownership is
created only by statute, [legislative] acts also regulate the operation of
condominiums.” IconBrickell Condo. No. Three Ass’n, Inc. v. New Media
Consulting, LLC, 310 So. 3d 477, 480 (Fla. 3d DCA 2020). In this vein, a
declaration of condominium and by-laws must conform to the Act, and to the
extent that they conflict therewith, the statute will prevail. Winkelman v. Toll,
661 So. 2d 102, 105 (Fla. 4th DCA 1995).
It is well-settled law that “[a] condominium association has the power
to make and collect assessments, and to lease, maintain, repair, and replace
6
the common elements.” Ocean Trail Unit Owners Ass’n, Inc. v. Mead, 650
So. 2d 4, 7 (Fla. 1994) (citing § 718.111(4), Fla. Stat.). In accord with this
principle, an association may levy a special assessment upon unit owners to
pay for common expenses. § 718.115(2), Fla. Stat. “Common expenses”
are statutorily defined to include “the expenses of the operation,
maintenance, repair, replacement, or protection of the common elements
and association property, [and the] costs of carrying out the powers and
duties of the association.” § 718.115(1)(a), Fla. Stat. Property insurance
deductibles and damages in excess of available insurance coverage also
constitute common expenses. § 718.111(11)(j), Fla. Stat. In this regard,
section 718.111(11), Florida Statutes, entitled “Insurance,” reads:
In order to protect the safety, health, and welfare of the people
of the State of Florida and to ensure consistency in the provision
of insurance coverage to condominiums and their unit owners,
this subsection applies to every residential condominium in the
state, regardless of the date of its declaration of condominium. It
is the intent of the Legislature to encourage lower or stable
insurance premiums for associations described in this
subsection.
Consistent with this stated goal, the Act mitigates the risk associated with
underinsuring the condominium property by additionally providing for the
following:
Any portion of the condominium property that must be insured by
the association against property loss pursuant to paragraph (f)
which is damaged by an insurable event shall be reconstructed,
7
repaired, or replaced as necessary by the association as a
common expense. . . . All property insurance deductibles and
other damages in excess of property insurance coverage under
the property insurance policies maintained by the association are
a common expense of the condominium . . . .
§ 718.111(11)(j), Fla. Stat.
Against this body of authority, it is evident that the Association was
entitled to specially assess those expenses necessary to restore “the
common elements and association property.” § 718.115(1)(a), Fla. Stat.
Such expenses necessarily involve the “maintenance, repair, replacement,
or protection” of the elements and property. Id.; see § 718.111(11)(j), Fla.
Stat.
Appellants rely upon a discrete provision in the Building 12 Declaration
for the proposition that such expenses are properly levied only upon unit
owners in the damaged building. Specifically, appellants contend that by
notifying the institutional first mortgagees of the intent to rebuild, the
Association triggered a requirement that it “immediately levy” a special
assessment “against each unit” in Building 12. The provision upon which
they rely reads as follows:
In the event institutional first mortgagees unanimously agree to
have the insurance proceeds applied to reconstruction but the
insurance proceeds are not sufficient to repair and replace all of
the improvements within the common elements and within the
units, a membership meeting shall be held to determine whether
or not to abandon the condominium project or to levy a uniform
8
special assessment against each unit and the owners thereof as
their interests appear, to obtain the necessary funds to repair and
restore the improvements within the common elements and the
units. In the event the majority of the voting members vote in
favor of the special assessments, the Association shall
immediately levy such assessment and the funds received shall
be delivered to the escrow agent and disbursed as provided
above . . . .
Reading the Declaration alone, this interpretation is plausible. The provision,
however, cannot be read in isolation. Instead, we must consider the
evidence of record and the relevant provisions of the Act.
The undeveloped record reflects no indication the “institutional first
mortgagees unanimously agree[d] to have the insurance proceeds applied
to reconstruction.” The notices did not seek consent, and, assuming receipt,
the mortgagees were silent.
Further, although ordinarily, as appellants correctly argue, “[t]he
common expenses of a condominium within a multicondominium are the
common expenses directly attributable to the operation of that
condominium,” there is an exception applicable to certain condominiums
created prior to 1977. 10 Fla. Jur. 2d Condominiums § 76 (2022). In 1998,
the Florida Legislature amended section 718.111(6), Florida Statutes, to
permit the consolidated financial operations of two or more residential
condominiums created before January 1, 1977. Expressly included among
the authorized consolidated operations are “budgets, assessments,
9
accounting, recordkeeping, and similar matters.” § 718.111(6), Fla. Stat. In
the event two or more condominiums choose to consolidate their operations
in accord with this statutory prerogative, notwithstanding other provisions of
the Act, “common expenses for residential condominiums in such a project
being operated by a single association may be [proportionally] assessed
against all unit owners in such project.” Id. (emphasis added).
In the instant case, following turnover, the individual buildings located
within the Star Lakes Estates community opted to consolidate their financial
operations and vest governing authority in the Association. The legal effect
of this merger is clear. There is only one governing entity. The Association
is authorized to operate the seventeen buildings as a single condominium
for financial purposes, including levying assessments. Consequently, the
Association is permitted to make and collect assessments for common
expenses from all unit owners, as though each maintains ownership in a
single condominium.
Moreover, recognizing the need for affordable premiums and the risk
attendant to underinsuring common property, our legislature has recognized
that an association may, at times, prioritize the former over the latter. In such
circumstances, an insurable event encumbers an association with the duty
to assess any excess restoration costs as common expenses. See §§
10
718.111(4), (11)(j), Fla. Stat. Where condominiums have agreed to
consolidated financial operations, limiting collection of the special
assessment from the owners of units in a singularly damaged building would
yield a reduced premium windfall for all other unit owners, while
concomitantly allowing them to avoid any risk associated with underinsuring
the property. The Act carefully guards against this result.
Appellants alternatively argue the assessment was invalid because the
Association failed to convene a vote of all unit owners, as opposed to board
members. A well-developed body of decisional authority holds that an
association need not conduct a vote of unit owners before levying
assessments for urgently needed repairs to the common elements. See
Farrington v. Casa Solana Condo. Ass’n, Inc., 517 So. 2d 70, 72 (Fla. 3d
DCA 1987); Cottrell v. Thornton, 449 So. 2d 1291, 1292 (Fla. 2d DCA 1984).
No provision of the Act suggests otherwise. Instead, all that is required is a
properly noticed meeting declaring the amount of the proposed assessment
and its intended purpose. See § 718.112(2)(c)1., Fla. Stat.
This procedure is consistent with the Association’s by-laws, which
provide, in relevant part:
At all meetings of the Board, a majority of the Directors shall be
necessary and sufficient to constitute a quorum for the
transaction of business, and the act of a majority of the Directors
present at any meeting at which there is a quorum shall be the
11
act of the Board of Directors, except as may be otherwise
specifically provided for by statute or by the Certificate of
Incorporation or by these By-Laws.
Indeed, a procedure to the contrary would presuppose that unit owners are
incentivized to vote for the collective good, rather than in their own financial
interests. This is precisely why there is a board of a directors with a fiduciary
duty to all unit owners.
Here, it is scarcely debatable the repairs were urgently needed in the
aftermath of the fire. Thus, as the notice preceding the board vote reflected
that portion of the special assessment that would be allocated to the
reconstruction of the damaged building and the special assessment
garnered a majority vote, the Association conformed with the requirements
of law. See § 718.112(2)(c)1. Fla. Stat.
In conclusion, declining to exalt form over substance, we reject the
contention that absent a change in circumstances, the trial court was
constrained by its prior ruling. It is axiomatic that the trial court retains
inherent authority to reconsider any of its nonfinal rulings prior to entry of the
final judgment or another order terminating the action. See Silvestrone v.
Edell, 721 So. 2d 1173, 1175 (Fla. 1998). Rigid adherence to the proposition
that a party moving to dissolve a temporary injunction has the burden to
prove some change of circumstances that justifies dissolution would render
12
a trial court impotent to correct clear error. See Planned Parenthood of
Greater Orlando, Inc. v. MMB Props., 211 So. 3d 918, 920 (Fla. 2017).
Here, in a commendable concession, the trial court found “there was
clear legal error and a misapprehension of facts on its part when it granted”
appellants’ motion for temporary injunction, “thereby leading the [c]ourt to
erroneously determine that [appellants] have a substantial likelihood of
success on the merits of the underlying action.” By the time the court
rendered this ruling, all but seventeen of the nearly four hundred unit owners
had paid the assessment, and the restoration was eighty-percent complete.
Under these circumstances, we conclude there was a sufficient basis in both
law and fact for dissolution, and allowing the injunction to stand would have
been “incompatible with equity principles.” MMB Props., 211 So. 3d at 925.
Accordingly, we affirm in all respects.
Affirmed.
13