Compliance Committee question

BobB31 (Florida)
Posts: 178

Posted:

In our Compliance Procedure Policy (CPP) document, it states:
"The Compliance Committee Hearing will be conducted in accordance with Florida Statutes 720.305"

So I found the statute online and read:
"The role of the committee is limited to determining whether to confirm or reject the fine or suspension levied by the board. If the proposed fine or suspension levied by the board is approved by the committee, the fine payment is due 5 days after the date of the committee meeting at which the fine is approved. The association must provide written notice of such fine or suspension by mail or hand delivery to the parcel owner and, if applicable, to any tenant, licensee, or invitee of the parcel owner."

However, the CPP goes beyond this and states:
THe Committee shall then send a notice to all Owners upon whom a fine was imposed ... regarding whether the fine was approved or disapproved. The Notice shall inform the Owners who are fined that they have 30 days ... "

It seems to me that the statute directs an association officer to provide such notice. Given that none of the committee members may be officers, this task would require access to the mailing addresses of the owners and puts us in the position of acting as officers of the association.

Am I creating a problem where none exists?

AugustinD
Posts: 5,144

Posted:

I gather you think that the line starting with "The association must provide... " and the line starting with "The Committee shall then send... " contradict each other. Under the law of agency, the Committee may and in this case, does, serve as a legal proxy for the HOA.

In my experience what is appropriate is for the Committee to provide the HOA manager with the names and other pertinent information of violators and the fines approved. Then the HOA manager sends out the notices, as an agent of the HOA.

Legally the lack of a "shall" in the statement, "The role of the committee is limited to... " tends to give the role of the committee some leeway.

I appreciate that you are trying to get things right. That is key to the compliance committee's success. As it sounds like you know, your Committee has to be able to point to a page of the governing documents when it imposes yada a fine. Sometimes, things are a bit ambiguous. Whence experience, some legal background, and a touch of case law can help.

BobB31 (Florida)
Posts: 178

Posted:

Great answer. Thanks

JohnC46 (South Carolina)
Posts: 14,265

Posted:

In our HOA, a committee can only notify the BOD of an issue and the BOD will make the final decision. In the case of any infraction, the BOD notifies the MC and the MC sends a notice of infraction under their name. The MC plays the heavy for us.

I say committees serve at the pleasure of the BOD but the BOD has the final say. I also say the BOD can fire any committee and or committee member and replace such with who they want to replace with.

I believe in committees and find them a good training ground for future BOD Members as they show they care by working for the association. That said, only the BOD was elected to oversee the association. Committee members were not.

KerryL1 (California)
Posts: 14,550

Posted:

I think in FL, JohnC, these compliance Committees are requirement, but we'll let an FL person school us on that.

GenoS (Florida)
Posts: 4,276

Posted:

Quote:

Posted By BobB31 on 03/28/2019 7:57 AM
However, the CPP goes beyond this and states:
THe Committee shall then send a notice to all Owners upon whom a fine was imposed ... regarding whether the fine was approved or disapproved. The Notice shall inform the Owners who are fined that they have 30 days ... "

I think the statutory requirement to "...provide written notice of such fine or suspension by mail or hand delivery to the parcel owner..." can be delegated to the committee by the board, if it so desires. I wouldn't want to be on a committee that worked like that. I'd want the board (or the MC) to deliver the final decision to the owner. No one wants to be the bad guy and the more the responsibility for imposing the fine can be spread out the better, I think.

In my HOA the Board wants to hear of the committee's decision ASAP so that one of the officers can send the notification or perhaps delegate that task to the management company. The fine is due and payable 5 days after the committee hearing. The "5 day" time frame is new in the statute as of last year. If the legislature intended 30 days they would have said "30 days" or "within 30 days". I don't think an HOA's governing documents or policies can override that. I like this part of the law. "We'd like to give you 30 days to pay but the law says you have 5 days. Sorry." Having said that, I expect the "5 day" period to be amended one of these years in the not-too-far-off future, but until that's done the time is 5 days.

A notice to an owner that a fine is being considered has to be sent 14 days in advance of the committee meeting/hearing so I would hope the board (or whomever) would have prepared a notice of "FINE" or "NO FINE" in advance and have it ready to go on the day the decision is made.

BobB31 (Florida)
Posts: 178

Posted:

Quote:

Posted By GenoS on 03/29/2019 10:54 AM

Posted By BobB31 on 03/28/2019 7:57 AM
However, the CPP goes beyond this and states:
THe Committee shall then send a notice to all Owners upon whom a fine was imposed ... regarding whether the fine was approved or disapproved. The Notice shall inform the Owners who are fined that they have 30 days ... "

I think the statutory requirement to "...provide written notice of such fine or suspension by mail or hand delivery to the parcel owner..." can be delegated to the committee by the board, if it so desires. I wouldn't want to be on a committee that worked like that. I'd want the board (or the MC) to deliver the final decision to the owner. No one wants to be the bad guy and the more the responsibility for imposing the fine can be spread out the better, I think.

In my HOA the Board wants to hear of the committee's decision ASAP so that one of the officers can send the notification or perhaps delegate that task to the management company. The fine is due and payable 5 days after the committee hearing. The "5 day" time frame is new in the statute as of last year. If the legislature intended 30 days they would have said "30 days" or "within 30 days". I don't think an HOA's governing documents or policies can override that. I like this part of the law. "We'd like to give you 30 days to pay but the law says you have 5 days. Sorry." Having said that, I expect the "5 day" period to be amended one of these years in the not-too-far-off future, but until that's done the time is 5 days.

A notice to an owner that a fine is being considered has to be sent 14 days in advance of the committee meeting/hearing so I would hope the board (or whomever) would have prepared a notice of "FINE" or "NO FINE" in advance and have it ready to go on the day the decision is made.

Good points. I had begun to wonder how the committee would be notified of the existence of the fine, etc. The Notice of Decision form which we are supposed to deliver to the finee does specify 30 days to pay which is contrary to the statute.

I'm a bit concerned that the Compliance Procedure Policy mentions nothing about record retention requirements. I would assume the minutes and notice of decision would need to be retained for some period of time, but who stores these records? We are a self-managed HOA (for now - a MC is being considered) so would we simply deliver the documents to the Secretary who would be responsible for storing them? Would these documents be among those that are available for viewing by homeowners on demand? How does it work in your HOA?

GenoS (Florida)
Posts: 4,276

Posted:

I've been thinking about it and the statute says the fine is due and payable 5 days after the committee's decision. Now I'm thinking there may be some leeway in terms of what your collections policy says. For instance, our monthly assessments are due and payable on the 1st of every month, but then there's a 5-day grace period followed by a "friendly reminder" after 10 days and so forth. We don't impose late fees but I suppose, if applicable, that would kick in too after a time. Over 30 days past due we start charging 1.5% per month interest.

So if the fine is due & payable 5 days after the committee's decision I think that's the point where the regular collections policy would take over.

Unfortunately we have no official records retention policy. The committee's decision, in writing, is delivered to the Secretary for inclusion with the rest of the Official Records of the association.

JohnC46 (South Carolina)
Posts: 14,265

Posted:

Quote:

Posted By KerryL1 on 03/28/2019 1:16 PM
I think in FL, JohnC, these compliance Committees are requirement, but we'll let an FL person school us on that.

Who appoints them? If the BOD, then the BOD should be able to remove them and appoint new.

BobB31 (Florida)
Posts: 178

Posted:

Quote:

Posted By JohnC46 on 03/31/2019 9:18 AM

Posted By KerryL1 on 03/28/2019 1:16 PM
I think in FL, JohnC, these compliance Committees are requirement, but we'll let an FL person school us on that.

Who appoints them? If the BOD, then the BOD should be able to remove them and appoint new.

The statute does not cover that but the Policy adopted by our HOA last year does: The BOD appoints the committee members and reserves the right to remove them.

That said, the idea as I understand it, is not to simply put a curb on tyrannical boards, it is also to help the board by providing evidence that a fine they wish to levy might be unenforceable, or might lead to expensive legal challenge.

So a committee that willy-nilly rejects fines without reason should expect itself to be replaced. And a committee that routinely ignores arguments presented by homeowners to simply allow all fines should also find itself under scrutiny, especially if a homeowner successfully challenges a fine in court leading to HOA costs that could have been avoided if the committee had simply done its job.

If a BOD fired me for simply doing the job their documents enjoined me to do, I would contemplate happily going back to my life as a private citizen and letting the HOA go to the hell its hypocrisy and inability to live up to its documents will ultimately consign them to.

GenoS (Florida)
Posts: 4,276

Posted:

The statute does cover it, FS 720.305(2)(a) says...

"... an opportunity for a hearing before a committee of at least three members appointed by the board who are not officers, directors, or employees of the association..."

The BoD appoints the committee members. I don't think the statute contemplates helping the board to understand that a fine may be unenforceable at all. The statute is pretty clear and the language was amended last year.

"The role of the committee is limited to determining whether to confirm or reject the fine or suspension levied by the board."

To me that's black & white. The committee does not need to explain itself or its decisions. If it wants to, it can I suppose, but there's no need for it.

It's a weird thing, these fining committees. If a committee upholds a fine against John but rejects one against Suzy for the exact same violation with similar evidence, would the fined owner have the defense of "selective enforcement"? What if the board simply cannot find enough volunteers to be on a fining committee at some point during the year but not, presumably, at others? There are a lot of "what ifs" that are not clearly answered in the statute.

JohnC46 (South Carolina)
Posts: 14,265

Posted:

Quote:

Posted By BobB31 on 03/31/2019 10:02 AM

Posted By JohnC46 on 03/31/2019 9:18 AM

Posted By KerryL1 on 03/28/2019 1:16 PM
I think in FL, JohnC, these compliance Committees are requirement, but we'll let an FL person school us on that.

Who appoints them? If the BOD, then the BOD should be able to remove them and appoint new.

The statute does not cover that but the Policy adopted by our HOA last year does: The BOD appoints the committee members and reserves the right to remove them.

That said, the idea as I understand it, is not to simply put a curb on tyrannical boards, it is also to help the board by providing evidence that a fine they wish to levy might be unenforceable, or might lead to expensive legal challenge.

So a committee that willy-nilly rejects fines without reason should expect itself to be replaced. And a committee that routinely ignores arguments presented by homeowners to simply allow all fines should also find itself under scrutiny, especially if a homeowner successfully challenges a fine in court leading to HOA costs that could have been avoided if the committee had simply done its job.

If a BOD fired me for simply doing the job their documents enjoined me to do, I would contemplate happily going back to my life as a private citizen and letting the HOA go to the hell its hypocrisy and inability to live up to its documents will ultimately consign them to.

Either that or run for the BOD and clean the hypocrisy and inability out. Your choice.

JohnC46 (South Carolina)
Posts: 14,265

Posted:

Quote:

Posted By GenoS on 03/31/2019 3:05 PM
The statute does cover it, FS 720.305(2)(a) says...

"... an opportunity for a hearing before a committee of at least three members appointed by the board who are not officers, directors, or employees of the association..."

The BoD appoints the committee members. I don't think the statute contemplates helping the board to understand that a fine may be unenforceable at all. The statute is pretty clear and the language was amended last year.

"The role of the committee is limited to determining whether to confirm or reject the fine or suspension levied by the board."

To me that's black & white. The committee does not need to explain itself or its decisions. If it wants to, it can I suppose, but there's no need for it.

It's a weird thing, these fining committees. If a committee upholds a fine against John but rejects one against Suzy for the exact same violation with similar evidence, would the fined owner have the defense of "selective enforcement"? What if the board simply cannot find enough volunteers to be on a fining committee at some point during the year but not, presumably, at others? There are a lot of "what ifs" that are not clearly answered in the statute.

A whole lot of "what ifs". Sounds like the FL Legislators......