CONDO CORNER
Agency Revisits Term Limit Issue by Joseph Adams
In 2017, the Florida Legislature passed a law which stated that condominium directors could not serve more than 4 consecutive 2-year terms, essentially creating an 8-year term limit.
The obvious immediate question was whether this law would be applied retroactively (reach back to prior years of service to determine if a director was “termed out”) or whether the law would only be applied prospectively (meaning that you would not count previous terms in calculating the 8-year term limit). The law itself did not say one way or the other whether it was intended to be retroactive.
A long-established rule of Florida law is that if the Legislature does not specifically state that a law is intended to be retroactive, it is prospective only. Because the 2017 law was not stated to be retroactive, most attorneys who practice in this field of law advised their clients not to count time on the board before July 1, 2017, against the term limit calculation.
Condominiums in Florida are subject to extensive government regulation, primarily through the Division of Florida Condominiums, Timeshares and Mobile Homes (commonly referred to as the Division) which is under the umbrella of the Florida Department of Business and Professional Regulation (which is most commonly referred to as DBPR).
The Division’s jurisdiction includes approval of disclosure documents created for new condominium developments, education of condominium unit owners and board members, the staffing of an Ombudsman’s office, the staffing of an arbitration program, and enforcement of violations of the statute against developers and to a more limited degree, unit owner controlled condominium associations. The Division also has certain authority delegated to it by the Florida Condominium Act to make administrative rules that dictate how condominium associations operate.
The Division is not empowered to “interpret” the law in the same manner courts do, nor issue general pronouncements of law except through its rulemaking authority and in a more limited manner, through the issuance of rulings called declaratory statements. However, the Division’s “position” on the law (how they will interpret it in exercising their powers and duties) is an important factor. Based on all reports I have seen and heard, the Division’s position on the 2017 law was consistent with the bulk of the legal community’s position, the statute was not retroactive.
The law was amended in 2018 to close the loophole caused by the fact that one-year terms were not covered by the previous statute. As with its predecessor version, most assumed the law would not be considered retroactive. To the surprise of many, in September of 2018, the Division issued a declaratory statement stating that the law would be retroactively applied, meaning pre-2018 years of service would be counted against the 8-year term limit.
Legally speaking, a declaratory statement is merely an advisory opinion to a regulated person or entity as to how the statute applies to that party in their particular set of circumstances. These decisions are not “case law” like when an appeals court interprets the law. Appeals courts rulings are generally “the law.” However, the 2018 declaratory statement caused most attorneys to advise their clients that since election disputes are heard primarily by the Division, the association would most likely face a ruling that the law was retroactive.
Recently, a new Division Director, Boyd McAdams was appointed. Director McAdams has advised the legal community, through the applicable committee of the Florida Bar, that the previous Director’s application of the law in that limited circumstance (the declaratory statement) is not reflective of agency policy on the issue. I am given to understand that the Division’s position on the law is that only terms beginning on or after July 1, 2018, will be counted toward the 8-year term limit in the statute.
While the “correct” interpretation of the law is a matter only a court can decide, I think the Division’s present policy is the legally correct interpretation and give kudos to Director McAdams for tackling this tough issue in a straightforward manner early in his tenure.
