January 2001 MEMORANDUM TO CLIENTSCORPORATE PROCEDURE: NEW YEAR=S RESOLUTIONS A new year brings many promises of change and renewed activity. Despite best intentions, some promises may not be fulfilled by year=s end. Nevertheless, the new year is a cue for certain legal requirements that community associations must follow. A few of these requirements are as follows: Annual Report and Fee. The Florida Business Corporation Act and the Florida Not For Profit Corporation Act require all corporations, condominium, cooperative, homeowners or other associations, to file an annual report and pay an annual fee. By the middle of January corporate mailboxes will be flooded with multi-colored Annual Report form packets from the Florida Department of State, Division of Corporations. Frequently changes must be made, so note the careful instructions for making changes on the second, reverse page of the form. The form must be timely filed in Tallahassee. Last year=s fees were $200.00 for For Profit and $61.25 for Not For Profit Corporations. The Annual Report form allows a new registered agent designation. Florida law requires all corporations to have a registered agent for the receipt of certain legal papers; thus, frequently counsel is designated. This is a particularly good time for post-turnover and associations that changed counsel to update their registered agent designation because this is the one form where a no-charge change is allowed. Note that a new registered agent must sign the form so please allow for appropriate mailing and completion time. Fees. Condominium associations are required to pay a per unit fee. The Department of Professional and Business Regulations, Division of Land Sales should be sending notices after the beginning of the year. Last year the fee was $4.00 per unit. While cooperative associations also must pay the fee, homeowner associations are exempt because homeowner=s associations are not regulated by the Division of Land Sales. Updates. New AQuestion and Answer Sheets@ must be annually updated. Florida law requires condominium and cooperative associations to have the information available for owners and potential purchasers. Failure to have up-to-date information is not only a statutory Atechnical@ violation but also may subject an association to significant liability involving claims over undisclosed information. Records. As end-of-year records are being boxed, there always is the question of how long must records be kept. Different Florida Statutes provide different criteria for the different types of associations. For example, '718.111(12) contains over a dozen subparts concerning the time of certain types of records that are required to be kept by condominium associations. Similar provisions apply to cooperative associations as specified in '719.104. Laws regulating homeowners= association records are found in '720.303(4). The statutes provide minimum time periods for keeping records. For example, normally proxies and other election items must be kept for at least one year. Most financial records and minutes must be kept for at least seven years. While minutes theoretically may be destroyed after seven years, it is generally suggested that associations keep minutes indefinitely to ensure an accurate historical record. Other laws and claim considerations may justify longer holding periods. CONTRACTS: DUELING PAPERS What happens when businesses, including community associations, try to play one upmanship with different purchase order and contract forms? Frequently an order will be made either on pre-printed form or in some other type of document, including e-mail, that includes certain terms and conditions in addition to a general description of goods and prices. Invariably, the seller will utilize a form that has different terms and conditions. Usually and quite thankfully repeat business means that there have been no problems with performance and thus few persons if anyone have looked at the Afine print.@ This sequence has been referred to as Alike ships on a foggy sea.@ Unfortunately, when there are disputes over the terms and conditions then the collision can be loud, painful and costly. This was the situation that was reported in the decision of Dependable Component Supply, Inc. v. Pace Electronics, Inc., 25 Fla. Law Weekly D2728 (Fla. 4th DCA, Nov. 29, 2000). Dependable alleged that Pace delivered unacceptable goods. The dispute became a lawsuit. The question on appeal was whether the agreement required the suit to be heard in Broward or Orange County, Florida. Instructive for community associations was the Court=s approach to the problem. Initially, the Court reviewed the plain meaning of the contract language. The contract was composed of the buyer=s purchase order form and the seller=s invoice form. The terms for the types of goods and price were similar; thus, the parties did have a contract. The Court noted a material variance concerning how allegedly unacceptable goods would be handled and disputes in that regard. The provisions of Florida=s version of the Uniform Commercial Code were reviewed. In particular, in this regard, '676.207(1), Fla. Stat., provides as follows:
Thus, the invoice though having different venue terms was held to be an acceptance pursuant to Florida law. The difficultly arose because the seller=s invoice contained terms on the reverse side of the paper. In this regard, the same Uniform Commercial Code provision in paragraph 2, '676.207(2), Fla. Stat., provides:
Because both papers contained different provisions on where lawsuits need to be filed, and because neither party agreed in writing to the others provisions the Court was left to enforce the terms that were not in conflict. The lesson from this scenario is to read the fine print. Particularly note provisions on the reverse side of contracts. To the extent that there is a specific intent by one party or the other, that should be stated clearly and specifically stated in the contract documents. FIRM NEWS In observance of National and Court holidays, the firm=s offices will be closed on Monday, January 1 and Monday January 15, 2001. Please also note that taking advantage of school closing many staff members will be out of the office during the first week in January. Your patience and understanding during this time will be appreciated. Our staff wishes everyone a healthy, peaceful and prosperous New Year!
This information is provided for public information purposes only and is provided without obligation or fee. It is distributed to the firm's association clients to provide a general notice of recent legal changes. This information is not to be considered as legal advice. The changes in the law may not have been reviewed by Florida courts and may be subject to further challenge. Before taking any action you are urged to consult with counsel to ensure that your legal rights are protected. 8 2000 by Gelfand & Arpe, P.A. F:\WP51\CLIENTLT\UPDATE00.09.wpd |