Governor Scott Signs HB 377 Bill

Florida Gov. Rick Scott recently signed the HB 377 bill.

This is a GENERAL BILL by Judiciary Committee ; Civil Justice and Claims Subcommittee ; Leek ; (CO-INTRODUCERS) Renner

The bill provides limitations on Actions other than for the Recovery of Real Property; Specifies date of completion for specified contracts for limitation of action purposes.

Here is the official bill summary from the Florida Senate Judiciary Committee:

Existing s. 95.11(3)(c), F.S., specifies the 4-and 10-year limitations periods or statutes of repose for bringing an action alleging a construction defect or latent construction defect. In some cases, the limitations periods begin on the “date of completion . . . of the contract between the professional engineer, registered architect, or licensed contractor and his or her employer.”

Completion of the contract, according to an appellate court opinion, requires the completion of construction and the submission of the final payment required by the contract. Thus, delays in payments by a customer can extend a contractor’s liability for construction defects.

As a response to the appellate court opinion, the bill defines completion of the contract as the “later of the date of final performance of all the contracted services, or the date that final payment for those services becomes due.” This new definition will prevent a customer’s delay in making a required payment from extending a contractor’s liability for construction defects.

 

Obtaining a Writ of Possession After Foreclosure Sale

writIn the event you have received a certificate of title and become the owner of a foreclosed property, and the previous owner(s) continue to remain in possession, dependent upon the language set forth in the Final Judgment, you will need to file a motion and obtain a writ of possession.

A writ of possession, which is issued by the county clerk and served by the county sheriff, will be required in order to obtain physical possession of the property. Typically, the owner will be given possession of the property 24 hours following the posting of the actual writ of possession on the premises.

 

 

6 Ways to Take Title of Florida Real Estate

© 2016 Florida Realtors®

Sometimes, after the closing, homeowners want to change how they took title to a property by adding a family member or spouse, or by transferring the property to a corporation or trust. Beware that such transfers likely would create unintended tax liabilities. The best time to consider how to take title to property is prior to entering into a contract.

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certificate-of-titleThere are a number of ways to take title to Florida real estate, and each has potential advantages and limitations. Here are common options:

Sole Ownership. Unmarried people, those who are legally divorced and married people who wish to hold the property in their own names may use this form of ownership. However, if a married person takes title in his or her own name and the property benefits from a homestead exemption, Florida homestead laws require the other spouse to sign the deed for the transfer or otherwise formally relinquish rights to the property.

Joint ownership as Tenants in Common. Any number of individuals can hold title under Joint ownership as Tenants in Common with the share of the property, depending on the person’s contributions. Also, in this form of ownership, each owner has the right to sell, lease or bequeath (give away at death) interest in the property to his or her legal heirs.

Joint Tenancy with Right of Survivorship. Under this type of ownership, all joint tenants have equal rights to their share in the property. In addition, due to the right of survivorship, which is not present for Tenants in Common, when a joint tenant dies, his or her share is automatically distributed among the remaining joint tenants. There are no restrictions on the number of persons that can be joint tenants under a Joint Tenancy with Right of Survivorship.

Tenancy by the Entirety. This option is available only to married couples and allows the couple to hold title in the name of both spouses. Both the husband and wife have equal possession rights to the property. When one spouse dies, his or her share is automatically distributed to the surviving spouse.

There are several advantages to Tenancy by the Entirety. First, it protects the asset if, for example, a creditor is pursuing a judgment against one spouse. Second, it offers control over how the property is disposed of. Unlike Joint Tenancy with Right of Survivorship, Tenancy by the Entirety requires both parties to sign a deed transferring any interest in the property. One spouse cannot sell, dispose of or mortgage the other’s one-half interest without consent/signature. Third, one spouse cannot gift his or her interest in the real estate without the consent/signature of the other spouse. This protects the other spouse from unknowingly losing an interest in the property.

Ownership through an entity. Rather than own a property as people, owners may choose to acquire it through a separate legal entity, such as a corporation or a limited liability company. Corporations and limited liability companies can have any number of shareholders or members, but rights to the property of individual shareholders or members will be limited to the face value of the shares or membership interests each person holds. Title to Florida property also may be held in the name of a partnership of two or more persons. Partners would have equal right to possession of their respective share in the property.

Ownership through land trust. Finally, title may be held in the name of a Florida Land Trust, in which the legal title of the property is transferred to a trustee for the benefit of the named beneficiaries. This form of title offers privacy because the deed does not state who the owner is or the amount of the purchase price.

 

 

 

 

Bartram Affirmed by Florida Supreme Court

bank-ownedThe Florida Supreme Court decided Bartram v. US. Bank National Association, and ruled that for mortgages with optional acceleration clauses, Florida’s Statute of Limitations does not bar the re-filing of a foreclosure action that had been previously dismissed.

The Court’s opinion specifically notes its ruling applies whether the previous dismissal was with or without prejudice.

 

 

Resolving Escrow Disputes Starts with this Question

By Margy Grant, © 2016 Florida Realtors®

escrowAs a Realtor, you need to be careful not to provide legal advice if your clients are in an escrow dispute. Instead, encourage them to refer to their contract for instructions on resolving their dispute. Many times, one or both parties will express frustration. Your best practice is to stay in touch with the escrow agent and the other party in the failed contract and continue to update your buyer or seller.

November 7, 2016 — When a real estate transaction fails and there is a dispute over who retains the escrow deposit, there are usually provisions in the purchase contract that provide direction on how to resolve the disagreement. Most importantly, when addressing how a dispute is resolved and who resolves it always starts with the answer to this question: Who is holding the funds?

The Florida Realtors/Florida Bar As-Is Residential Contract for Sale and Purchase is the most common form purchase contract used, according to Form Simplicity statistics. Let’s use it to illustrate how this situation might play out.

The As-Is contract has a section in Paragraph 2 to illustrate who the parties agree will serve as escrow agent — the party that will hold the funds. This will either be the real estate brokerage or an escrow agent, such as a title company or a lawyer. (There is no preclusion who is allowed to hold escrow, so in some rare cases it may be another person or entity.)

Escrow holder is not a licensed broker.

If the escrow agent is a title company, lawyer or someone other than a real estate broker, the dispute is handled as a civil matter initially. The dispute resolution section of the As-Is contract specifies 10 days for the buyer and seller to attempt to resolve the dispute on their own. If that is unsuccessful, the parties are required by contract to submit the dispute to mediation. The contract goes on to explain how the mediation must be handled. Many of these disputes go through a mediation process as part of the small claims process if the deposit in dispute is less than $5,000. If the two parties cannot agree how to divide or handle the escrow deposit, it becomes a legal matter.

When a broker is the escrow agent

If the escrow agent is a licensed Florida broker, Florida law comes into play. Under Florida Statute Chapter 475.25 (1) (d), if a broker “in good faith, entertains doubt as to what person is entitled to the accounting and delivery of the escrowed property, or if conflicting demands have been made upon the licensee for the escrowed property, which property she or he still maintains in her or his escrow or trust account, the licensee shall promptly notify the commission of such doubts or conflicting demands and shall promptly:

a.Request that the commission issue an escrow disbursement order determining who is entitled to the escrowed property;

b.With the consent of all parties, submit the matter to arbitration;

c.By interpleader or otherwise, seek adjudication of the matter by a court; or

d.With the written consent of all parties, submit the matter to mediation. The department may conduct mediation or may contract with public or private entities for mediation services. However, the mediation process must be successfully completed within 90 days following the last demand, or the licensee shall promptly employ one of the other escape procedures contained in this section. Payment for mediation will be as agreed to in writing by the parties.”

Most often, the broker acting as escrow agent will submit the dispute to the Florida Real Estate Commission (FREC) under option “a.” The broker will fill out the paperwork and may request statements from the seller and buyer regarding the dispute. FREC will deliberate and either award the deposit to one party or declare it is unable to determine and advise the broker to take the dispute to interpleader. An interpleader is when the escrow holder files suit asking the court to decide which party has a legal right to the funds.

Many brokers misunderstand the role of the entity holding escrow money. Escrow holders are neutral. They simply agree to hold funds and may only release the money if they feel legally allowed and will not be exposed to risk.

 

 

What is a Nuisance and is it Defined in Your Governing Documents?

A nuisance is generally defined as a person, thing or circumstance which causes inconvenience or annoyance. For some people living in shared ownership communities, there is no escaping a nuisance situation that has risen to a level which impacts the enjoyment of their homes and their community.

If you have ever suffered through a nuisance scenario, you may understand how hard it can be at times to achieve consensus on whether or not the activity in question is an actionable nuisance. Is that television really being played at a blaring decibel level or is the neighbor just particularly sensitive or, worse, looking for a new angle in a personal fight?

noisy-neighbors-tips-for-keeping-the-peace

In a community association setting, nuisances can come in many forms, including:

– Loud, consistent noise either in the form of music, yelling, use of electronic devices or failure to properly soundproof flooring in a multifamily building

– Pets-barking, defecating, biting, and running around off-leash

– Secondhand smoke-spilling into neighboring units, balconies and common areas

– Odors from cooking, chemicals and other sources

– Hoarding-creating conditions for insect and rodent infestation into neighboring units and common areas

– Domestic violence-frequent arrival of emergency services and police at all hours

– Visually unappealing property condition-one example would be an overflowing dumpster sitting in front of a house undergoing renovations for months

– Short-term rentals

A general nuisance provision is standard in most developer-drafted documents. However, it is rare to find a nuisance restriction that is fully fleshed-out; one which clearly defines the various conditions or behaviors which constitute a nuisance in that particular communities and which can therefore be more readily abated by enforcement efforts. When confronted with a nuisance, the starting point is to find out what is driving the behavior or condition and identify the quickest way to resolve the problem. Sometimes the behavior is driven by a mental illness and other times it is a deliberate attempt to annoy.

If an owner is unwilling to cure the nuisance activity, the association’s options may include fining, suspension of common area use rights and pursuing a Court Order to force the behavior or activity to stop. All enforcement will be easier if the activity or behavior is clearly identified in your governing documents as being a nuisance rather than having to debate the issue.

Owner doesn’t send association documents. Is deal dead?

Question: A seller has contracted to sell his home in a community governed by a mandatory homeowners’ association. Shortly before closing, the buyer cancels the deal, saying the seller failed to provide homeowners’ association documents as required by law. Is the seller required to provide the documents?

Answer: No. While a non-developer seller of a condominium is required to provide a set list of association documents, the same is not true of a seller of a property subject to a homeowners’ association. The buyer is only entitled to receive a Homeowner’s Association Summary Disclosure per Florida Statute 720.401. The summary disclosure requires the seller to inform the buyer of any assessments the homeowners’ association charges, as well as any land use fee, but does not require any actual association documents to be provided.

© Florida Realtors®

Real Property Law – Riparian Rights

waterfrontAs most will agree owning property on the water in Florida is a very popular, advantageous, and expensive proposition.  Therefore, owning waterfront property comes with its pros and cons and a potential buyer should be knowledgeable about the legal concept of riparian rights.  Riparian rights include the rights of ingress, egress, docking, boating, bathing, fishing and even the right to an unobstructed view of the water. Such rights inure to the owner of the upland; however, the actual land covered by the water is not owned by the upland owner.
Note: Kistemaker Business Law Group provides concentrated legal services in Real Property law.  If you have any questions,  please do not hesitate ask.

If a Brokerage Closes, What Happens to a Listing?

soldReal estate brokerages are bought and sold often and even closed at times, creating uncertainty.What if there are active listings — what happens then and what rights does a realtor have to retain the listing upon sale of the brokerage?

Upon sale, assets and liabilities — which includes listing contracts — are usually sold with it. If sales associates choose not to join the new firm, their listings will not automatically go with them. This would require negotiation with the new brokerage owner.

However, if a sales associate had previously negotiated their independent contractor agreements to allow them to take their listings with them when they leave, the former brokerage could assign their listings to their new broker. Generally, the sales associates would pay some fee to exercise this provision.

Closing a brokerage and the corporation require advance planning. Many times, a broker will keep the brokerage open until all transactions in progress are final, and then assign any active listings to a new firm, possibly for a negotiated fee or referral. Communication is key throughout this process between the broker and the associates and any significant questions to be raised with the broker or associate attorney.

In the event a broker unexpectedly passes away, the company has the legal right to appoint a temporary broker who can operate the business for up to 60 days without being named as an officer or director on the corporation’s documents. This appointment must occur within 14 days of the vacancy of the broker.

 

What Happens if Your Rental Home Faces Foreclosure?

foreclosure noticeQuestion: If a tenant receives a notice of the homeowner’s foreclosure do they need to vacate and if so, when?

If there was an actual judgment of foreclosure entered against the homeowner, the tenants may have to leave — and according to new federal law, it may be sooner than expected.

Previously, a federal court grated a temporary provision that allowed tenants up to 90 days to move after a rental home was foreclosed. However, that provision expired at the end of 2014. Under current state law, the purchaser named in the certificate of title following foreclosure can provide a 30-day notice of termination. Assuming this notice complies with statutory requirements, the tenants then have to vacate the property by the termination date and pay any rent due for the time they remain in occupancy.

To protect yourself from being stuck with this dilemma, you should always ask your listing agent or the homeowner directly about the status of the property. Is the owner current on his mortgage? If not, have foreclosure proceedings started? Making an informed decision before signing a rental agreement will help a renter avoid this difficult scenario.

 

 

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