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Letter to Governor Scott re: HB 1013/SB 1196

Below is the text of a letter sent today by Alan Becker, Esq., a founding shareholder of the Becker & Poliakoff, asking Governor Scott to veto HB 1013 which wiped out common law implied warranties for common area property.  We are requesting that you join us and ask Governor Scott to veto this legislation. Dear Governor Scott: I am writing to you with regard to the recently passed HB 1013 (companion SB 1196, “the legislation”) which eliminates common law implied warranties as it pertains to common areas of all communities in the state and asking that you veto this legislation. I was a member of the legislature when what is now section 718.203, providing statutory implied warranties for condominiums, was enacted and am a founding member of Becker & Poliakoff, P.A. which represents close to 4,000 community associations in the state of Florida. With that background, I can state that this legislation is absolutely harmful to consumers, will result in...

The Good Faith Exception to Fraudulent Liens

The good faith exception to fraudulent liens does not protect all liens recorded in good faith from being deemed fraudulent. With the holding in Medellin v. MLA Consulting, Inc., it is more important than ever for a lienor to be sure the amounts in its lien are for work that will properly support a lien, or it runs the risk of its lien being deemed fraudulent....

SB 1196 Passes

Unfortunately SB 1196 passed the Senate yesterday. The next step for the bill will be the governor's desk. The only way the bill does not become law at this point is if the governor vetoes it. If he signs it or merely does nothing the bill becomes law and will take effect, by its terms, on July 1, 2012. The negative impact of this legislation will be substantial for Florida homeowner's. However, it is fairly certain that there will be challenges to the legislation. How effective the challenges will be remains to be seen. What impact, if any, the legislation has on the Maronda case pending before the Florida Supreme Court will also be interesting....

SB 1196 moving forward

As noted previously, there are a couple of bills (HB 1013 and SB 1196) pending before the Florida legislature involving HOA warranties which would be devastating for HOAs with common area defects. These bills prohibit implied warranties of fitness and merchantability from applying to streets, roads, sidewalks, drainage areas, utilities, or any other improvements that are not located on or under the lot on which a new home is constructed. In short, the bills will result in homeowners being stuck with shoddy common areas for which they have no recourse. The House version of the bill (HB 1013) has already passed the House of Representatives. The Senate version (SB 1196) had been “stuck” in the Budget Committee. If SB 1196 had remained in Budget, it would have died in committee. However, yesterday SB 1196 was removed from Budget and could be heard by the full Senate this week. Therefore, its VERY IMPORTANT that...

Legislation Would Encourage Public-Private Partnerships

Although P3 projects have already been available in some form in Florida, they have been infrequently used and familiarity with these types of projects among public entities and contractors has been scant. The legislation has increased awareness of the opportunities for P3 projects. But the bills, in their current form, may inadvertently burden the process with well-intentioned, but impractical, requirements....

Public/Private Partnership Bill Gets Facelift, But Still Has Momentum

 Senate Bill 576 on public/private partnership construction was drastically revised, but the core facets of the legislation, opening the door to great public construction opportunities, remains unimpaired. And the bill is gaining momentum as it continues to pass through legislative committees.

The changes in the new bill from the original version include:

 

1) public entities may contract for 3P projects only with legislative approval or if consistent with local government appropriation process as evidenced by approval of the project in the public entity’s work program;

 

2) detailed instructions on public notice, opportunity for competing proposals to be submitted on any 3P project, and the manner of selecting among competing proposals (traditional procurement requirements and bid protests don’t apply here);

 

3) prohibition against the use of state funds unless the project is for a facility owned by the public entity or a facility whose ownership will be conveyed to the public entity;

 

4) the private entity must provide an investment-grade technical study prepared by a nationally recognized expert detailing the finance plan, including required payment & performance bonds plus, in appropriate circumstances, letters of credit and guarantees from parent companies, lenders and equity partners;

 

5) the requirement that the 3P agreement ensure a negotiated portion of revenues from fee-generating projects are returned to the public entity over the life of the agreement; and

 

6) specific provisions addressing the financing of the job, such as the conditions for loans from the public entity for construction, suggestions for innovative finance techniques, and the prohibition against indemnity agreements from the public entity or pledging of security interests in the public entity’s assets.