Lake Forest Master Community Ass'n v. Orlando Lake Forest Joint Venture

10 So. 3d 1187, 2009 Fla. App. LEXIS 7464, 2009 WL 1639564
CourtDistrict Court of Appeal of Florida
DecidedJune 10, 2009
Docket5D08-2096
StatusPublished
Cited by5 cases

This text of 10 So. 3d 1187 (Lake Forest Master Community Ass'n v. Orlando Lake Forest Joint Venture) is published on Counsel Stack Legal Research, covering District Court of Appeal of Florida primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Lake Forest Master Community Ass'n v. Orlando Lake Forest Joint Venture, 10 So. 3d 1187, 2009 Fla. App. LEXIS 7464, 2009 WL 1639564 (Fla. Ct. App. 2009).

Opinion

REVISED OPINION

GRIFFIN, J.

Appellant, Lake Forest Master Community Association,. Inc. [“Association”], seeks review of a summary final judgment in its lawsuit against the developer 1 of its subdivision, based on alleged construction defects in improvements located in Association’s common areas. 2 The summary judgment was predicated on Association’s purported failure to give proper notice, according to Florida law, 3 and Association’s governing documents of the meeting at which authorization to bring suit was obtained.

Association filed its lawsuit on June 29, 2007. The complaint, as amended, included counts for breach of implied warranty, defective construction, and building code violations and sought damages in excess of $4 million. Developer answered, denied any construction defects existed at the time of turnover and raised numerous defenses. After discovery, Developer filed a motion for summary judgment based on its contention that Association failed to meet the statutory condition precedent of approval by a majority of Association’s voting interests, as required by section 720.303(1), Florida Statutes because the meeting where approval was given had not been properly noticed. After a hearing, the trial court entered summary final judgment in favor of Developer, concluding that proper “notice was not given to all residents of the [Association] entitled to vote.”

ASSOCIATION’S ACTIONS BEFORE COMMENCING THIS LITIGATION

Section 720.303(1), Florida Statutes, requires that “before commencing litigation against any party in the name of the association involving amounts in controversy in excess of $100,000, the association must obtain the affirmative approval of the majority of voting interests at a meeting of the membership at which a quorum has been attained.” 4 The notice of Association’s January 9, 2007, annual meeting, mailed out to each lot owner on December 22, 2006, identified the location of the meeting — the Lake Forrest Community Clubhouse — and the time — 7:00 p.m. The *1190 notice included the following statement: “The purpose of the annual meeting is to discuss the recent and future affairs and plans for the association and to fill three (3) vacancies on the Board of Directors.” Along with the notice, Association mailed lot owners a general proxy for those unable to attend, sample ballots for election of Board and Architectural Review Committee [“ARC”] members and the 2007 Association budget.

According to Association documents, a quorum is thirty percent of the membership, or at least 220 lot members. There was a quorum for the January 9th annual meeting with attendance in person and by proxy totaling 290 lot owners. The election to fill vacancies on the Board of Directors was held at the meeting, but the election of ARC members could not be conducted because Association’s governing documents require that a majority of all lot owners, which is 367 owners, attend and vote for ARC members. The minutes of the January 9, 2007, annual meeting reported: “The membership agreed to recess the meeting and to reconvene the meeting on February 13, 2007 for the purpose of obtaining additional proxies to vote for candidates for the ARC.” According to the deposition testimony of Association’s secretary, Terry Copper, who was present at the meeting, prepared the minutes, and recalled that Association president announced at the close of the meeting that the annual meeting would reconvene on February 13, at 7:00, at the clubhouse. 5

In the interim, a Board meeting was conducted on February 7, 2007. According to the minutes of this Board meeting, the reconvened annual meeting on February 13 would be called to order and once a quorum was established, an election for the ARC would be conducted. The annual meeting would then be adjourned and “will reconvene once again on March 13, 2007 for the purpose of asking residents to vote on pursuing discussions or further action with the developer for alleged deficiencies.”

The reconvened annual meeting took place as scheduled on February 13, 2007. More than 367 lot owners attended, either in person or by proxy, and the election for the ARC was conducted. According to the minutes of this reconvened annual meeting, the president announced at the conclusion that:

This Annual Meeting will be reconvened on March 13, 2007 at 7:00 p.m. at the clubhouse for the purpose of allowing residents to vote for or against the Association pursuing remedy of deficiencies left by the developer, NTS. If NTS will not remedy the deficiencies, or arbitrate in good faith, the Lake Forest Master Community Association will authorize its attorney to initiate legal action.

Prior to the March 13, 2007, reconvened annual meeting, Association prepared a “Notice of Continuation of Member Meeting and Summary of Pending Developer Issues” [“Continuation Notice”] to inform lot owners about the vote. This Continuation Notice was not mailed under separate cover to lot owners, but was mailed together with the March 2007 newsletter to lot owners on the newsletter mailing list. It was also posted at the Lake Forest clubhouse bulletin board.

The reconvened annual meeting was called to order on March 13, 2007, and a quorum was established. Developer’s attorney attended this meeting and revoked the prior general proxies given by Devel *1191 oper on behalf of Association’s secretary. Developer submitted new proxies, listing their counsel as Developer’s proxy holder.

According to the minutes of this meeting, there was a discussion of the construction defects issue and whether Association should file a legal claim against Developer. A motion was made and seconded for approval to file a legal action against Developer, if necessary. The motion passed 255 to 35, with Developer casting its eleven votes against the motion. Suit was filed two months later.

WAS DEVELOPER ENTITLED TO SUMMARY JUDGMENT BASED ON ITS CLAIM OF DEFECTIVE NOTICE?

Association urges on appeal that the summary judgment in favor of Developer was wrong because: (1) the notice afforded was proper under Florida law and Association’s governing documents, (2) genuine issues of material fact preclude summary judgment, and (3) Developer waived its right to contest the validity of the annual meeting by appearing at and actively participating in all three meetings. 6

Section 720.306, Florida Statutes, governs meetings of homeowner’s associations, including matters relating to quorums, notice, the right to speak, adjournment, proxy voting, and elections. In pertinent part, the statute provides:

(2) Annual meeting. — The association shall hold a meeting of its members annually for the transaction of any and all proper business at a time, date, and place stated in, or fixed in accordance with, the bylaws....
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(4) Content of notice.

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Bluebook (online)
10 So. 3d 1187, 2009 Fla. App. LEXIS 7464, 2009 WL 1639564, Counsel Stack Legal Research, https://law.counselstack.com/opinion/lake-forest-master-community-assn-v-orlando-lake-forest-joint-venture-fladistctapp-2009.