Measures to Collect Fees From Foreclosed Condos

Some condominium associations in South Florida have defied state laws by using every means possible to collect unpaid dues from delinquent landlords or nonpaying owners of foreclosed condos. Condominium associations would even resort to public humiliation which involves posting of lists of delinquent condominium owners.

It used to be that association boards would not even think of asking for a list of delinquent condominium owners who were behind on their payments of association dues. This was because there were not that many delinquent owners.

However, the advent and subsequent growth of the foreclosure crisis across South Florida have forced some associations to post lists of names of delinquent landlords in common areas in an effort to force them to pay their debts.

Under the Florida law, it is forbidden for debt collectors, which include managing and association agents, to use abusive language in order to collect unpaid dues or fees. Neither are they allowed to contact debtors between 9 in the evening and 8 in the morning unless there is an agreement between parties.

Also, debt collectors are not allowed to post lists of names of debtors, to impersonate lawyers and use legal forms or an attorney stationary to collect debts.

Becker and Poliakoff Attorney Lisa Magill said that property managers and community leaders should be aware that under the Florida law, using unfair and abusive strategies to collect debts is strictly prohibited.

Meanwhile, the 3rd District Court of Appeal in Florida ruled that condominium associations have the blanket receivership right, meaning that they are allowed to appoint receivers who will collect rents from tenants of foreclosed units.

The court’s ruling effectively denied a condominium unit owner’s protest against the appointment of receivers because he argued that he was not properly notified.

The plaintiff owns 17 condominiums and has not been paying his association fees for some time even though he continues to collect rents from his units. Foreclosure actions have been filed against the 17 condominium units by the association.

Court-appointed receivers have the authority to bypass delinquent owners of repossessed properties and collect rents directly from tenants instead of having the tenants pay their rents to the owners. The collected funds will be deposited into receivership accounts where they will be divided among creditors.

The blanket receivership is being used by nearly 18 condominium associations in the counties of Broward and Miami-Dade.

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