Does a developer have to do what they promised at closing?

All the co-owners of the parcel pay a percentage of the taxes, insurance, utilities and maintenance so it is critical that all the co-owners common area property dimensions and “percentages” are clear at closing. A plat map that clearly outlines all of the parts of the property that are common areas for use by the proposed homes and the elements of the property and the limited common elements that the board can make you change to conform to their idea of the specific community:
• Sidewalks, curbs, staircases and landings
• Yards, trees, fencing and flower beds
• The exterior of the home and all decorative structures
• Ponds, fountains and drainage
• Pools and pool accessories
• Dumpsters, compactors and trash receptacles
• Mailbox areas and signage
• Parking areas, entrances, exits and roadways
The only part of the property considered a partially private element is the interior of the home because the exterior, roof, lanai, pool and driveways are limited common elements because the co-owner must conform to the community rules regarding those areas.

HOA Officers and Board members are the fiduciaries of everything visible. A fiduciary is a person who holds a position of authority and trust with respect to another person or entity. This means that the board members must act prudently, must exercise ordinary care, must exercise sound business judgment in the operation of a community association.

On the other hand, an individual co-owner in the association is not a fiduciary and may act in his or her own self-interest but if that interest is adverse to the association rules, the co-owner may be taken to court or fined.

Does a developer have a feduciary resposability to provide the common area to an association as promised? Yes, but will they do it without the co-owner having to pay an attorney and take them to court?

Summary Questions for the Board to Consider
a. Have you reviewed the legal sufficiency of the governing documents?
b. Have you reviewed the insurance policy to determine whether there is sufficient coverage and whether coverage is consistent with requirements of governing documents and statutes? c. Have you reviewed the budget line items to determine whether adjustments are necessary (amounts as well as line items)?
d. Have you obtained/reviewed a reserve study to determine whether it meets the needs of the community?
e. Have you inspected the common areas before “accepting” them from the declarant (if appropriate)?
f. Have you engaged an expert to review the plans and specifications for the project and make a physical inspection of the project to determine whether the plans and specifications were followed in the construction of the project, and whether any construction defects exist through poor workmanship or defective materials?
g. Do you have deeds for all common areas conveying ownership to the association?
h. Have you reviewed all enforcement actions taken by the declarant or any violations which the declarant failed to enforce to determine whether any enforcement actions need to be filed by the association?
i. Have you reviewed your properties for compliance with the Fair Housing Amendments Act (FHAA) accessibility requirements? (For reverse or regular mortgage availability)
j. Have board members been provided with copies of all contracts, governing documents, contact information, budge, reserve, etc.?
k. Have board members received an “orientation” to the operation of the community and their fiduciary responsibilities?
l. Do you understand the relationships/interplay between the association and the districts and sub/master associations, if any.
m. Do you have contact information for any master or sub associations and/or special districts n. Do you have copies of marketing materials used by the developer and/or builder in selling condos within the community.
18. Communication is the Key to Successful Transition. The key to a successful transition from declarant to owner control of a community association is communication between the declarant and the owners. The goal of the communication with the owners should be to educate the owners about the role and operation of the association and to establish trust between the declarant and the owners.

Back to the question: Does a developer have a feduciary resposability to provide the common area to an association as promised? Yes, but will they do it without the co-owner having to pay an attorney and take them to court?

So. What are the particular elements of a "fiduciary" relationship and do they apply to a Developer/Purchaser scenario? Those are: the duty of loyalty, the duty of care and the duty of obedience (to the law and to scope of authority). While these fiduciary duties are mandated by every state law governing corporations and their boards, the Developer is bound by its own corporate mission and constrained by its investors. Developer has a contractual duty to build according to the promises and specifications entered into with the county. Developer has a contractual duty to develop the property as represented to the public. Developer has a primary fiduciary duty to its investors. Developer has a tangential and limited fiduciary duty to the Purchaser. This duty is similar to the one between a real estate sales agent who is showing their clients' property to a potential buyer. They cannot lie but they do not need to tell the whole truth to the 3rd party, the buyer. Their fiduciary and contractual duty is loyalty to their client.

The obligations of the Developer to the Purchaser are in the Documents given to the purchaser before purchasing. I have found that generally ALL the questions can be answered by a thorough and thoughtful reading of the documents and the law and purchasers typically do not read their documents. However, not all Developers do what they promise and so the Owner has a problem that is not well regulated, especially in Florida and one's only remedy is an expensive, prolonged lawsuit.

IMO, "fiduciary obligation" is a stretch to apply to a Developer. Generally, the Developer has ultimate self-interest in getting in/getting out of a project as profitably as possible. They are not acting on behalf of and in trust for someone else in the sense that an elected board "represents the interests of owners. They are acting for themselves and their investors and their fiduciary responsibility is more properly embedded in the investor realm. Purchasing property from a Developer is a potentially adverse "arms-length" transaction.

Purchasers must remove the rose-colored glasses when dealing with Developers especially. Developers are self-interested, very good at what they do and how they market, they are not known for having "scruples" and they are well protected by the power influence they have with legislature and the cadre of attorneys who shield them. Owner-purchasers who engage with Developers will likely not experience a good outcome unless behavior is found to be egregiously criminal.

IMO, a Developer-purchase should be a short-term investment. Buy pre-construction promotional pricing, enjoy the artificially low assessment fee and turn it over while you are in a honeymoon phase with a naive, wide-eyed board and before infrastructure gets old and needs major repairs.

Now that the purchase is done and the realities emerge, the first and best self-help thing to do is to read and comprehend the recorded documents. Then read the statutes for your association type. Explore the resources on the internet. Then, hire an attorney if more reality orientation is needed.

Oops:Sorry Gwenn

Elaine ... The problem you have is what the Developer did took place 8 years ago. Most likely any Statute of Limitations is long past and this should have been addressed years ago at turnover. One of the longest limitations in most laws is Criminal Racketeering and it generally runs only for 10 years.

What does your HOA have that is considered common area and subject to assessments?

The method I used to get my last developer to transfer the common property to the association was telling the developer they could not charge assessments. LOL ... I told them they could not assess for property the association did not own. YEP ... they fixed that snafu.

Thank you Janet,Tim, and Gwen,

I spent 3 hours with my attorney this afternoon and he recommended contacting the Title Insurance company from the original closing documents (1) first and see what that does because it is Insurance for this kind of situation. Any additional documentation, even if this doesn't work will be additional evidence in court.
He also mentioned what Tim said as a later option. With enough documentation I can get the entire association involved and hopefully it will help. Just additional leg work that I hadn't even thought of.
We all get Title Insurance when we close and never think about what it is used for

BTW ... also sounds like you have a smart attorney who looks outside the box.