The New Jersey Condo Blog

Q&A: Unsightly Neighboring Property

07/21/2017 Martin Cabalar
Q. We want to clean up the property next door to our association. The association does not own the property. It's less money to just have it cleaned up compared to getting the current owner to clean it up. We would have permission from the owner. As a board can we approve or do we need to advise all the owners for their input?
A.  There are several variables that need to be resolved to know whether spending the Association’s money is appropriate and lawful in this case.  First, while you state that the adjoining property needs to be “cleaned up,” you do not indicate whether this is a matter of cleaning brush, or whether there might be old cars there, perhaps an old barrel that held an unknown substance, etc.  If there is any chance that there is something like old vehicles, in connection with which you do not know who holds the title, or any materials that might constitute a “hazardous substance” under federal or state law, we would recommend against becoming involved in any way, since the possibility of serious liability is much too great.

Assuming that the issue is limited to cleaning up overgrown vegetation and the association has written permission from the owner to undertake the cleanup that details exactly what the owner is agreeing to allow the association to do, you need to ask two additional questions.  First, do the governing documents permit the Association to expend money for this purpose?  Typically there are two places to look for an answer to this question.  One would be in a provision that refers to the budget and the purpose of the expenses the association can include in the budget.  Secondly, there is usually a section of the bylaws setting forth the duties, powers and authority of the board.  In some instances these are stated permissibly, in other words suggesting that the board has, at a minimum, these powers.  Other times the section of the bylaws is stated in such a manner so as to limit the powers of the board.

Finally, there also needs to be a determination by the board that this is truly an association matter.  Is this to help a small portion of all the unit owners, but does not impact the vast majority of owners?  Is there a board member that is impacted and that is why the board is considering this action?  How much money would actually be spent?  If the amount is relatively nominal given the scope of the association’s budget and it is for the general benefit of the association that suggests one direction, but if it benefits few owners or it were to particularly benefit a member of the board, it suggests a different answer.

There are enough complexities in this issue that we would urge the board to consult with legal counsel before taking action.

07/14/2017 Martin Cabalar

Q&A: Handling Requests for Emotional Support Animals

I live in a 40-unit condo building, which has a NO PET AMENDMENT from 1980. A woman recently purchased a unit and has been seen with a dog that barks all the time. She signed all the disclosure forms that stated “no pets” and had given the Board a note from a nurse practitioner that the dog is an emotional support animal. What can we do?


The Federal Fair Housing Act (42 U.S.C. §§3601-3619) and the regulations promulgated thereunder require “housing providers,” including entities such as condominium associations in New Jersey, to make “reasonable accommodations” to disabled persons in rules, policies, practices or services when such accommodations may be necessary to afford a person with a disability the equal opportunity to use and enjoy a dwelling. New Jersey’s Law Against Discrimination (N.J.S.A.10:5-1 et seq.) similarly requires accommodation of the disabled.  Decisions of federal and state courts in interpreting the Federal Fair Housing Law and New Jersey’s Law Against Discrimination have held that in certain instances housing providers, such as a condominium, must accommodate those with a legitimate physical or emotional disability requiring the support or assistance of an animal.

Notwithstanding, simply providing a note from a nurse practitioner stating that “the dog is an emotional support animal,” does not provide the governing body of a condominium the reasonable opportunity to establish that the resident suffers from a disability defined by law; and, further, requires the physical assistance or emotional support of a dog to reasonably accommodate their disability. Thus, in this instance, it likely would not be unreasonable for the association to request additional information to allow its governing body to evaluate the reasonableness of the request.

For example, the association may reasonably request that the resident provide a certification of a Physician or other qualified Treating Professional certifying: (a) the disability or handicap suffered (b) said disability or handicap meets the standards set forth by the Federal Fair Housing Act; (c) to the major life activities substantially limited by the disability or handicap; (d) whether treatment is available for the disability or handicap; (e) to the description of the accommodation requested; (f) as to whether the accommodation requested alleviates or mitigates the disability or handicap; and, (g) as to whether any alternative accommodations exist. If, upon receipt of such additional information, the association concludes that the resident is disabled under the law and that the physical assistance or emotional support of the identified animal is reasonably necessary to accommodate the disability, then approval of the accommodation is required by law.

Where an accommodation is required by law, the resident is still required to maintain the animal in accordance with existing rules and regulations; which often include, among other requirements, that residents permit no activity that creates a nuisance or annoyance to other residents. Such rules require the resident to take all actions necessary to prevent the animal from making noise that may unreasonably annoy or disturb the peace of neighboring residents.

Keep in mind that where an accommodation is required to be made by law, the animal is not considered a “pet.” Rather, it is an animal that the resident has claimed is required under the law for the physical assistance or emotional support for the disability that the resident is afflicted with. Therefore, the governing board of a community association should seek the advice of legal counsel before denying the request of a resident for a physical assistance or emotional support animal. The association’s legal counsel is best suited to advise and assist the governing board with implementation of appropriate procedures should the board receive such a request.  


Votación Por Linea - Video

10/18/2016 Martica Miguez Platts

Si usted vive en una comunidad residencial que está dirigida u operada por una asociación, o si usted sirve en la junta directiva de la comunidad, quizás desee obtener la comodidad de votación por línea.   Nuestra firma de abogados acaba de lanzar un breve video de instrucción sobre nuestro producto por línea llamado BPBALLOT.   Dedíquele unos minutos a este video.
La votación por línea le permitirá a su comunidad aumentar la participación de su membrecía a la vez que reducirá la posibilidad de fraude electoral.  Estamos seguros que usted disfrutará y obtendrá beneficios del video.  Si tiene cualquier pregunta, por favor envíenos un correo electrónico a condomundousa@bplegal.como llámenos al 561-820-2870. 

Martica y Marilyn
Sus amigas de CondoMundoUSA

Estudio de Votación y Fraude en las Asociaciones / Community Association Voting and Fraud Survey

06/17/2016 Martica Miguez Platts
CondoMundoUSA les trae el Estudio de Votación y Fraude.  Este estudio tiene el propósito de identificar las preocupaciones relacionadas con el proceso de votación de los miembros de las asociaciones de comunidades.  Los resultados ayudarán a crear materiales educativos y ayudarán a encabezar cambios en las disposiciones legales que gobiernan el método de votación en las comunidades.

Solamente le tomará 5 minutos haga "click" en el idioma que prefiera. 

Español                       Inglés


Martica y Marilyn


CondoMundoUSA has created a survey intended to help identify concerns of community association members related to voting. The results will help create educational materials and help spearhead changes in statutory provisions governing voting in communities.

It should only take 5 minutes, please click on your preferred language.

Spanish                       English

Thank you, 

Martica & Marilyn

The Community Association Law Blog

Going Too Far Down the Rabbit Hole: How Our National Political Discourse Parallels Our Community Association Discourse

06/25/2017 Donna DiMaggio Berger
It's hard right now to turn away from the 24/7 news cycle and its discord, rancor and heated rhetoric. When we spend the majority of our time discussing just 20% of the topics which concern us, we cannot commit time or energy to the other 80% which also demands our attention.  It's not surprising that the same prioritization pressure occurs in private residential communities.  How often has a board or membership meeting been monopolized by the concerns of one very vocal owner?  That owner may very well have legitimate concerns but that still does not justify how some communities seem to be the equivalent of the tail wagging the dog.

We live in a world of increasing oppositions; it's becoming harder to find a middle ground on most topics.  For those of us who work with and live in community associations, the current state of political discourse in America sadly comes as no surprise.  In fact, there are some eerie similarities that reveal a few uncomfortable truths about our society.

Name calling, speaking (and yelling) over others, character assassination, accusations, conspiracy theories, and filibustering are never productive and usually reflect a certain intellectual laziness. Fake news and alternative facts have been employed for decades in some communities where facts matter less than agendas and can be employed equally by both members looking to oust a board as well as boards looking to shut down opposition. the best way to do battle with this problem is to have a membership comprised of people willing to undertake an independent analysis of the situation rather than relying on someone else's version of the truth.  When id doubt, just remember this quote by Daniel Patrick Moynihan: "everyone is entitled to his own opinion, but not his own facts."

Calls to remove leaders are nothing new.  Unfortunately, the recent changes to Florida law will make it less likely that recalled board members will challenge even a questionable recall petition if they must do so by paying for such a challenge out of their own pockets.

Conflicts of interest can erode the trust between an elected official and the people who elected him or her. Just as some members of Congress have filed litigation based on the Emoluments Clause in the U.S. Constitution, a perception that a board member has an undisclosed conflict of interest can lead to dissatisfaction at best and recall and litigation at worst. It's impossible to serve two masters so if you have agreed to serve on your community's board of directors, your decisions must be based on what is best for the community and no longer what is in your best interests.

Just as we have spent an inordinate amount to time on a national discussion concerning the improper use of emails and sloppy email protocol, some directors completely underestimate the trouble a lack of email protocol can cause.  The failure to understand, let alone embrace, best practices when it comes to email protocol which includes safeguarding privileged information and employing language which is designed to achieve a goal not blow it up, can make a small flare-up quickly turn into a full-blown conflagration.

Recently, a new client asked me about what can be done to stop leaks and leakers on their board.  Just how did one roofing vendor reduce his bid to make it lower than the bid that was going to contract?  Leaks on community association boards are often designed to do nothing more than embarrass a board member or officer (or help a vendor friend) but occasionally they cause a lot more damage including an anticipatory breach of contract claim.  When it comes to litigation matters or pursuing insurance claims, closed-loop communications are crucial to the ability to minimize the association's exposure in the former instance and maximize its recovery in the latter circumstance.

Building a proverbial wall can become the turning point in a community. Some directors have very firm ideas about the material improvements they would like to make in their community and how to pay for those improvements, either by special assessment or loan.  Often these ideas are not as wildly popular with the association members as Mr. or Ms. Director would like to believe. It is always best to gauge community sentiment before embarking on costly and potentially divisive projects.

Inevitably, the issue of personality conflicts arises in many communities.  Dealing with personality issues (as exhibited by board members, owners or both) can be one of the toughest problems to solve in a shared ownership community.  It is important to remember that your conflicts involve a "living together" relationship so patience, empathy and updated emergency contacts are some of your best tools when dealing with sensitive behavioral problems.

Finally, the potential for violence is the most disturbing comparison of all between the national stage and our local communities. There have been sporadic reports of violence in community associations over the years.  Two that come to mind include a manger who was shot in the head (but mercifully survived) by a disgruntled former association employee and a board member shot and killed by a fellow director as they argued over association matters.  Violence is never the answer but it does underscore how a 'pressure cooker' situation can blow the lid off any society, micro or macro.

The ability to find some middle ground is sadly disappearing from the national stage and it is, unfortunately, no different in some of our communities but our disgust with our national discourse might just lead us to insist that our association affairs be handled more productively.

"What's in a Name?" Quite a bit, particularly for Association Board Members who have been Defamed.

06/05/2017 Donna DiMaggio Berger
When Shakespeare coined the phrase "the slings and arrows of outrageous fortune" in Hamlet, he probably wasn't envisioning that sentiment could apply centuries later to volunteer board members.  However, the Bard was opining that bad things can happen to a person and, in the present-day context, if you serving on a community association board of directors, those bad things can arrive in the form of defamation:  slander and libel.

Over the years, I've been contacted by far too many board members who recount stories about horrible things which had been said or written about them both during their board service and even years afterwards.  After the tale is told, the next statement is usually, "I want to sue".  This blog post is not about whether or not those harsh words were warranted; it is about whether or not a board member can successfully pursue a defamation claim against his or her detractors. Defamation is a tort which refers to a false statement, either spoken (which is known as slander) or written (which is known as libel) that injures someone's reputation.

Some types of false statements are considered so damaging that they are deemed defamatory on their face (which is known as defamation per se) and thus, do not require the plaintiff to prove the defamatory nature of those statements or the plaintiff's damage. Typical examples of these kinds of statements which are deemed inherently injurious to one's reputation are:

  • Statements that injure another's reputation in his trade, business or profession. For example, if the Board President is a licensed real estate agent and a unit owner alleges that he has cheated other brokers out of their fair share of commissions over the years, his reputation in the real estate industry would be injured;
  • Statements claiming someone has a "loathsome disease";
  • Statements claiming that the person is "unchaste". In one community, a manager was accused of engaging in an extramarital affair with the community's landscaper and thus was the victim of slander per se;
  • Allegations that an individual has been involved in criminal activity.
To state a cause of action for defamation in Florida, a plaintiff must allege the following:

  • The defendant published a false statement. The defendant's knowledge that the statement was or was not false is not the crux of the issue; the defendant's intent to publish the statement to a third party is.
  • The statement was made about the plaintiff.
  • The statement was made to a third party. The defendant must communicate the information with an intent to have someone hear or read it.  For example, if the defendant made the statement with the reasonable belief that no one was around to hear it but the statement was overheard by a third party, that is not slander. The defendant must intend to have the statement read or heard by a third party.  In addition, if the besmirched director is the only one who heard or read the statement, that also does not constitute slander or libel.
  • The falsity of the statement caused injury to the plaintiff.
The following are some of the recognized defenses to a defamation suit:

  • Truth is a complete defense to any slander claim.
  • Opinion as a defense depends heavily on the credibility and reputation of the person rendering the opinion.  If a third party would typically rely upon the person's statements, then simply prefacing the defamatory content with an "in my opinion" qualifier will not be sufficient to shield the statement maker from liability.
  • Consent is analogous to truth as an absolute defense. If the statement maker had the subject's consent to publish the statements than that consent will bar a slander action.
  • Poor Reputation is not a complete defense to slander but can be used by the defendant to mitigate his or her damages in a defamation lawsuit by proving that the plaintiff had a bad reputation for the character trait at issue.
Some problems when attempting to pursue a defamation lawsuit include:

  1. It can be difficult to prove that the statements are false.  Statements that a director is a criminal can be easily proven false by submitting a clean criminal background as proof. However, statements that a director tampered with election ballot envelopes is harder to address unless the director can account for every step of the election process.
  2. "She said, he said" situations can result in a stalemate.  It will be necessary to have witnesses come forward when dealing with slander.  Libel is easier because the written material can be produced.
  3. Online defamation can be tricky.  The plaintiff must prove that the defendant was actually the one making the statement(s) and that may require forensic investigation to uncover the identity of a particular online account.
  4. Proving financial damage in a community association setting is not easy.  Community association directors are typically unpaid positions. Unlike an employee who is slandered and subsequently fired as a result of the statements made, what real financial harm does a board member suffer as a result of statements made to ensure that he or she is not re-elected to the Board?  Emotional distress alone is not enough to mount a successful defamation claim.
  5. Directors may be considered limited purpose public figures rather than private figures. My law partner, Howard J. Perl, authored an article published in the Florida Bar's ActionLine periodical discussing the growing body of national case law which is making it harder for association board members to pursue defamation actions.  According to Howard, "to support a claim for defamation, a private figure need only show negligence by the alleged defaming party, while a public figure must show 'actual malice'." Board members can take themselves out of the realm of a private figure and wind up becoming a limited purpose public figure if they become "a key figure in a particular controversy." For example, if a director takes a very aggressive and outspoken approach on a particular capital improvement project in an attempt to gain membership approval for same and a detractor decides to respond by listing all the reasons that director should not receive support for the project including a regurgitation of past transgressions, the director may have to prove that the statements were made with actual malice. To read Howard's full article on this topic please click here:
If you serve on your board and you have been the victim of defamation, speak with an experienced association attorney who can walk you through the steps discussed herein to determine whether or not you have a viable cause of action.

Since I started this post with the Bard, I will end with him:

"Good name in man and woman, dear my lord,
Is the immediate jewel of their souls;
Who steals my purse steals trash; 'tis something, nothing'
'Twas mine, 'tis his, and has been slave to thousands;
But he that filches from me my good name
Robs me of that which not enriches him,
And makes me poor indeed."  William Shakespeare-Othello

Biz Law Today

What Is “Product Hopping” and Why Should You Care?

08/04/2015 Becker & Poliakoff

ThinkstockPhotos-97429646This post was authored by Ann Marie Effingham, an intern for Becker & Poliakoff who is based out of the firm’s Red Bank, New Jersey office.

New Jersey is home to 14 of the world’s 20 largest pharmaceutical companies so when our sister circuit—the Second Circuit Court of Appeals—issued a decision of first impression regarding pharmaceutical patents, we should take notice. To summarize, the state of New York brought an antitrust action against Actavis PLC claiming the manufacturer’s introduction of the once-daily capsule that treats Alzheimer’s disease at the end of the manufacturer’s patent exclusivity period for the twice-daily tablets impeded competition in violation of the Sherman Act. The Southern District of New York granted a preliminary injunction barring Actavis PLC from restricting access to the twice-daily version until after generic competition entered the market, and the Second Circuit Court of Appeals affirmed the injunction.

The Second Circuit Court of Appeals explained that neither product withdrawal nor product improvement alone is anticompetitive. However, when product withdrawal is combined with some other conduct—the overall effect of which coerces consumers and impedes competition—a manufacturer’s actions are anticompetitive under the Sherman Act.

The Actavis PLC case is an example of “product hopping”—whereby a manufacturer introduces a “second-generation” formulation of a drug and removes the previous formula that is nearing the end of its patent lifecycle which then restarts the regulatory approval process for the generic manufacturer. In theory, a manufacturer could keep reformulating its patented product if it can show that continuous improvement in the drug is being made. However, under some circumstances this type of behavior is anti-competitive. Generic manufacturers enter the market at the end of the brand name’s patent lifecycle so when a brand name manufacturer engages in “product hopping” it keeps generic manufacturers from entering the market—which could ultimately lead to a monopolization.

So what does this mean for the biopharmaceutical and medical device industry? The timing and rationale behind product reformulation is key. When product redesign is done simply to coerce consumers and impede competition, it is anticompetitive under the Sherman Act. The Second Circuit Court of Appeals noted that Actavis PLC’s own CEO admitted that the Defendants were “trying to . . . put up barriers or obstacles” to generic competition. Conversely, a large market share that is gleaned from natural growth, development of a superior product while simultaneously giving consumers the option of choice between products, or exceptional business acumen are all justifiable explanations for why a manufacturer may control a significant portion of the market.

A second product hopping case has arisen in the Third Circuit Court of Appeals. There, the Federal Trade Commission (FTC) has filed an amicus brief strongly supporting antitrust causes of action against companies that product hop. Hopefully the Third Circuit can provide more insight as to how to evaluate product hopping cases.

Employers Beware: You May Be Liable to Whistleblowers Without the SEC Ever Getting Involved

07/28/2015 Becker & Poliakoff

ThinkstockPhotos-184747120 (1)This post was authored by Peter Wojcik, an intern for Becker & Poliakoff who is based out of the firm’s New York office.

On June 17, the Second Circuit U.S. Court of Appeals heard oral arguments in Berman v. Neo@Ogilvy, LLC, making it the latest court to venture into the arena of interpreting Dodd-Frank’s whistleblower provision. In Berman, U.S. District Judge Gregory H. Woods of the Southern District of New York held that, before a whistleblower may be protected under Dodd-Frank’s whistleblower anti-retaliation provision, he or she must report securities violations to the SEC. This stands in stark contrast to other district court decisions that have allowed individuals to sue if they only disclosed the violations to their employers.

In Berman, the plaintiff alleged that he was fired after complaining to his employer about seeing transactions that he believed to violate U.S. securities laws, including Sarbanes-Oxley and Dodd-Frank. Never having reported these violations to the SEC, the plaintiff sued his former employer, alleging violations of Dodd-Frank’s whistleblower provision. The provision essentially prohibits an employer from retaliating against a “whistleblower” who:

  • Provides information to the SEC concerning violations of securities laws;
  • Initiates, testifies in, or assists in any investigation or judicial or administrative action of the SEC; or
  • Makes disclosures that are required or protected under the Sarbanes-Oxley Act and any other law, rule, or regulation subject to the SEC’s jurisdiction.

However, the provision also defines a “whistleblower” as “any individual who provides . . . information relating to a violation of the securities laws to the Commission . . . .” The plaintiff in Berman argued that he was entitled to protection because, although subsections (i) and (ii) protect disclosures to the SEC, subsection (iii) includes disclosures to supervisors. Judge Woods remained unpersuaded. In dismissing the plaintiff’s claim, Judge Woods noted that the provision’s language was clear: In order to be a “whistleblower” under the Act, the individual must provide the information “to the Commission,” i.e., the SEC.

District courts that have allowed Dodd-Frank whistleblower protection for individuals who report violations to their employers have essentially followed the plaintiff’s reasoning. Despite the plain language definition of a “whistleblower” under the statue, they have held that subsection (iii) is a narrow exception to the definition and encompasses protection for individuals who report to supervisors.

The Second Circuit is expected to hand down its decision later this year. Although the Fifth Circuit is the only circuit to already decide the issue (holding that whistleblowers must report violations to the SEC in order to sue), district courts across the U.S. are in disagreement. Regardless of how the court in one’s jurisdiction rules, however, the law is still subject to change. If courts continue to disagree, it is likely that the Supreme Court will take up the issue in the future. Until the High Court decides the issue, employers must be aware of the fact that they may be subject to liability under Dodd-Frank’s whistleblower provision once their employees report violations internally.

Construction Law Authority

Becker & Poliakoff Wins Multi-Million Dollar Jury Verdict In Landmark Construction Case

06/05/2017 Becker & Poliakofff


Media Contacts:
Kris Conesa or Andi Phillips
Roar Media or
(305) 975-5934 or (305) 401-5098

Jury Finds Subsidiary of National Developer Hovnanian Enterprises Inc. Liable for Breach of Contract and Violation of the New Jersey Consumer Fraud Act

MORRISTOWN, NJ & FORT LAUDERDALE, Fla. – June 5, 2017 – Becker & Poliakoff secured a landmark $9 million-plus jury verdict Thursday against a subsidiary of Hovnanian Enterprises, Inc. (NYSE: HOV). The award includes punitive (treble) damages for violation of the New Jersey Consumer Fraud Act and also entitles the plaintiff to recover attorneys’ fees, costs and prejudgment interest. The jury found that Hovnanian Enterprises used the subsidiary as an instrument to commit a fraud or injustice on purchasers of condominium units. The ultimate recovery against all parties, including the project architect and geotechnical engineer, could exceed $20 million.

After a six-week trial in New Jersey Superior Court (Docket No. HUD-L-2560-13), the jury agreed that Hovnanian, after learning that the condominium building was being improperly constructed with plywood flooring in violation of the building code, chose to nevertheless continue construction. Hovnanian then sought to reclassify the building type. The jury agreed with the plaintiff’s position that the reclassification was never approved by governmental authorities. The units were then sold without disclosing the code violations or the lack of approval to the buyers. The claim arose out of construction problems with the six-story, 132-unit residential and commercial building in Port Imperial, West New York, NJ.

Matthew Meyers, a Shareholder in Becker & Poliakoff’s Morristown office, represented the homeowners and initiated the suit against Hovnanian. “Hovnanian knew that the use of combustible materials in the flooring was in violation of the building code, and instead of fixing the mistake, attempted to change the building’s classification. They then sold units knowing that the change in classification had never been approved. They continued to arrogantly defend their conduct at trial but the jury would have none of it. Hopefully, after this verdict, Hovnanian will get the message.”

“A key point making this landmark case particularly unique is that the parent company, Hovnanian Enterprises, was found to have used its shell subsidiary to perpetrate an injustice on the condominium unit buyers,” said Becker & Poliakoff shareholder John Cottle, who was first chair/lead trial counsel in the case representing the homeowners. “This is a rare instance in which the ‘corporate veil’ was pierced, and we expect the result of this will be that Hovnanian Enterprises will ultimately be held responsible for the judgment.”

In addition to Cottle, the Becker & Poliakoff trial team from Florida included: Perry M. Adair, Miami managing shareholder and a board-certified construction law attorney; and Sanjay Kurian, a shareholder and board-certified construction law attorney. The New Jersey team included Vincenzo Mogavero, a shareholder and litigation Chair and Martin Cabalar, in addition to Mr. Meyers.

About Becker & Poliakoff
Becker & Poliakoff, with headquarters in Fort Lauderdale, Fla., is a multi-practice commercial law firm with attorneys, lobbyists and other professionals at offices across the United States. More information is available at

Inside The Nation’s Varying Contractor Licensing Rules — And How They Impact Business

05/26/2017 Becker & Poliakofff

Construction Dive Magazine

This article originally appeared in Construction Dive Magazine, May, 2017, Reprinted with Permission.

Lee Weintraub, Florida Construction Defect AttorneyIn an effort to safeguard their residents against fraud and the chaos that can result from unprofessional behavior or lack of experience and knowledge, most states have some kind licensing procedure in place for professions like lawyers, physicians and real estate agents.

However, when it comes to construction contractors — who practice in an industry that is full of life and death scenarios — there is little state-to-state licensing uniformity.

How do these regulations vary across the U.S., and is there any indication that a strict regulatory scheme results in a higher level of professionalism and quality among contractors?

How licensing rules vary

“We see both extremes where it’s extremely difficult to get a license, and then on the opposite side where anyone with a hammer and pickup truck can be a contractor,” said Chuck Taylor, director of operations for Chicago- area Englewood Construction.

Taylor’s assessment of the licensing landscape isn’t an exaggeration.
Florida and California, for example, license a plethora of trades from pool maintenance technicians to drywall hangers to bridge builders. Along with extensive business and trade knowledge testing, both states have strict financial requirements, which include providing information about the person qualifying the applying company — the one who takes the required exams and assumes financial and professional liability for the its construction operations — other stakeholders and as the business itself.

California also requires a license bond, and Florida mandates that those qualifying a company have a minimum FICO score of 660. Both states also collect applicant fingerprints and run background checks.

Lee Weintraub, chair of the public private partnership practice at Becker & Poliakoff in Florida, said mother nature is partly to blame for the aggressive licensing agendas in these two states.

“My understanding … is that it’s because they are two of the biggest natural disaster zones,” he said. “They get earthquakes, and we get hurricanes.” And with extreme weather events come the predatory contractors who take the money and run, so the rationale behind the first laws was to protect consumers.

From those beginnings, he said, the scope of those licensing regulations grew into what the industry has today — a lot of licensed trades.

On the other end of the spectrum are states like Texas and Illinois, Englewood Construction’s home state. Neither has a state-level contractor licensing system, with the exception of trades that are considered tied to public safety like roofing, fire protection, asbestos and electrical.

In a sector where exceptions are the rule, from state to state, there isn’t one agency that is responsible for that type of licensing, either. It could be a state fire marshal’s office, a public health agency or a financial services office.

But the differences aren’t limited to states. Cities like Chicago and New York also have contractor registration and licensing programs of their own to fill in the gaps that state regulatory agencies leave behind. Even a state with far-reaching state licensing requirements like Florida still has county-level licensing for trades not covered by state law or for those who perform work in only one county.

In the case of, for example, a drywall contractor who only performs work in Pinellas County, FL, they can take an exam and get licensed locally, but, because there is an equivalent state-level license, they must still register with the state and meet the same financial requirements as a state contractor.

The impact of stricter requirements

The leaves the question: How do these rules impact contractors?

Taylor and Weintraub both said the extensive financial and application requirements of licensing systems, like there are in Florida and California, help weed out those financially unprepared to run a construction business.

Regarding the argument that such strict contractor regulations saddle contractors with too much paperwork and associated expense, Weintraub said, “There’s no merit to the argument that it makes it worse for contractors. There are some restrictions that aren’t onerous like putting a license number on a truck … but there’s no burden I see at all on your ability to run your company.”

There are some local requirements, however, that Weintraub said could be considered more fundraising-minded.

For example, Florida licensed contractors are authorized to perform work freely throughout the state, but counties and municipalities still take a bite of the apple by levying registration fees or other charges, even if the contractor’s base of operations is in another part of the state.

Englewood does work all over the country, and strict licensing requirements, he said, sometime seem like a purposeful barrier to entry.

For example, in Arkansas, one of the pieces of paperwork required with
a general contractor’s license application is an audited or reviewed financial statement, which can be a pricey proposition for a company the size of Englewood, as many accounting firms calculate their fees for this service based on company revenue. This is something that could derail a company’s plans to enter the market, Englewood said, but it’s difficult to ascribe motive.

New York doesn’t have a major state licensing program either, according to John Patrick Curran, partner at Sive, Paget & Riesel. Contractors, he said, are licensed at the local level, with the exception of those working in the field of asbestos abatement.

In New York City, Curran said, along with some other cities, only contractor registration is required, but that’s primarily for practical safety reasons.

Registration assures the contractor has adequate insurance and complies with Department of Buildings rules.

For example, the DOB requires that projects between 10 and 14 stories have a Site Safety Coordinator on the job and that a Site Safety Manager must be present during construction on projects 15 stories and higher or more than 100,000 square feet. The DOB licenses both categories of safety personnel.

“It’s more of a safety thing than anything else,” Curran said of the contractor registration requirement.

Where quality comes into play

What about an impact on quality?

“Does the fact that you carry a license have any impact on your qualifications? I don’t think so,” said Andru Ramker, president of Hawkeye Construction of South Florida. His company performs work in many states where licensing requirements vary, and he doesn’t believe there’s a difference in skill level.

The primary reason for that, he said, is that the licensee is not usually the one performing the work, at least in commercial applications. Instead, there are layers of employees, subcontractors and independent contractors completing the actual construction. Quality control, he said, often comes down to whether supervisors have the training necessary to recognize if a crew is capable of doing the work.

Ramker added, however, that a positive license history can send a message to customers. “Where it would have an impact is that if a client comes to you and wants to select you, they have the ability to check and see your license is in good standing,” he said.

In Ramker’s case, he has been a licensed general contractor in Florida since 1979, and that demonstrated longevity, he said, can give clients assurance that he’s not going anywhere until the job is done.

“From the standpoint of [many] of us who have a license,” Ramker said, “we have it for all the right reasons and are proud to carry it.”

Florida Condo & HOA Law Blog

Review of New Legislation Continues – Part 3

07/17/2017 Joseph Adams

Today’s column is the third installment of our annual review of community association legislation. In the first two installments, we covered the requirements for “estoppel certificates.” Today, we will look at House Bill 1237, which contains some significant changes. HB 1237 only applies to condominium associations.

Term Limits: A board member may not serve more than four consecutive 2-year terms, unless approved by an affirmative vote of two-thirds of the total voting interests of the association or unless there are not enough eligible candidates to fill the vacancies on the board at the time of the vacancy.

Debit Cards: An association and its officers, directors, employees, and agents may not use a debit card issued in the name of the association, or billed directly to the association, for the payment of any association expense.

Suspension of Voting Rights: Voting rights may only be suspended if the delinquent amount is more than $1,000 and more than 90 days delinquent. Proof of such monetary obligation must be provided to the unit owner or member 30 days before such suspension can take effect.

Official Records/Websites: The renter of a unit now has the right to inspect and copy the association’s bylaws and rules. By July 1, 2018, an association with 150 or more units shall post digital copies of some of its official records on its website. Websites must be operational on or before July 1, 2018.

Recalls: The statute no longer requires the Board to “certify” or “not certify” the recall, but still appears to permit the Board to file a petition for recall arbitration challenging the recall. The statute still requires the Board to hold a meeting within 5 full business days after receipt of a written recall agreement (or within 5 full business days after adjournment of a recall meeting).

Criminal Penalties: An officer, director, or manager may not solicit, offer to accept, or accept any thing or service of value or kickback for which consideration has not been provided for his or her own benefit or that of his or her immediate family. If this provision is violated, it could result in criminal penalties. Forgery of a ballot envelope or voting certificate used in an election is punishable as a crime. The theft or embezzlement of funds of a condominium association is punishable as a crime. The destruction of or the refusal to allow inspection or copying of an official record in furtherance of any crime is punishable as tampering with physical evidence or as obstruction of justice. An officer or director charged with a related crime must be removed from office.

Financial Reports: Associations with fewer than 50 units must now prepare a financial statement based on its total annual revenues (not just a report of cash receipts and expenditures). A unit owner may provide written notice to the division of the association’s failure to deliver a copy of the most recent financial report within 5 business days after submission of a written request to the association for a copy of such report. An association that fails to comply with the procedures set forth in the statute may not waive the financial reporting requirement provided in the statute.

Associations must provide an annual report to the Department of Business and Professional Realtors containing the names of all of the financial institutions with which it maintains accounts. A copy of such report may be obtained from the Department upon written request of any association member.

Next week we will continue our review of new laws for 2017, including significant charges to conflict of interest rules contained in the HB 1237.

Joe Adams is an attorney with Becker & Poliakoff, P.A., Fort Myers. Send questions to Joe Adams by e-mail to Past editions may be viewed at

The post Review of New Legislation Continues – Part 3 appeared first on Florida Condo & HOA Law Blog.

Condominium Documents Should be Kept Current

07/10/2017 Joseph Adams

Question: I recently purchased a condominium unit and was given a copy of the condominium documents. The documents I was given are over 40 years old. When I asked the association about this, I was told that the documents had never been updated. Don’t condominium documents have to be updated from time to time? Would 40-year-old documents still be valid? (N.R. via e-mail)

Answer: It is not legally necessary to update or amend condominium documents. However, most condominium associations find it desirable to amend and update the condominium documents from time to time to assist in the operation of the association, and to comply with current standards.Homeowners’ association documents may be affected by the operation of the Marketable Record Title Act, which is Chapter 712, Florida Statutes. The provisions of Chapter 712 can operate to extinguish certain documents that are 30 years or more old. It is prudent for all types of associations to periodically review the community’s governing documents with an attorney. While your condominium documents are probably not invalid, I suspect they are completely out of sync with modern drafting practices and statutory provisions.

The post Condominium Documents Should be Kept Current appeared first on Florida Condo & HOA Law Blog.