Florida Association News:  Appellate Court Decision Alters 23 Years Of Collection Practices For Condominium Associations

September 22, 2014

In a somewhat surprise decision, the Florida 2nd District Court of Appeal has ruled that, in certain circumstances, associations may not rely upon the provisions of Florida Statutes that relate to the collection of delinquent assessments when an owner makes a payment with a restrictive endorsement.  (A restrictive endorsement is a notation on a check or cover letter that limits the manner in which the funds may be used or applied.)  Chapter 718 of Florida Statutes (for condominiums) was amended in 1991 to provide that payments received by associations are to be applied in a specified manner and expressly notwithstanding any restrictive endorsement placed on the check or cover letter by the paying owner.  This was originally included in the Statute to make certain that an owner that was delinquent could not avoid paying the interest, late fees, attorney’s fees and costs incurred by the association in the collection process by placing a restrictive endorsement on the payment.  This has been routinely followed in condominiums for the past 23 years without issue (and incorporated into Chapter 720 F.S. in 2007 for homeowner associations).  Read more: