“We the people”… who hold these truths to be self-evident that all owners that are endowed by the Declarant with certain rights that among these are life, liberty, and pursuit of happiness. Like the Declaration of Independence, the declaration of condominium serves as the governing document which sets forth the rights of the declarant, the association, and the owners of the community. The document is critical to the purchase and sale of a condominium property that the very essence of the Contract itself is voidable by the Buyer under certain circumstances.
The Condominium Rider to the FAR/BAR Residential Contract For Sale and Purchase (“Contract”) provides for the delivery of the governing documents,
1. Current copy of the Declaration of Condominium;
2. Articles of Incorporation of the Association;
3. Bylaws of the Association;
4. Rules and Regulations of the Association;
5. Copy of the most recent year-end financial information; and
6. Frequently asked questions
The Buyer then has three days to review the governing documents and, if they are not agreeable to its terms, can elect to cancel the Contract within that time. Attorneys are often asked when, and under what terms, the Contract would be voidable by the Buyer during the 3-day period.
Section 5(b) of the Condominium Rider provides that the Contract is voidable if the Buyer delivers written notice within “3 days, excluding Saturdays, Sunday, and Legal Holidays, after the date of execution of [the Contract] by the Buyer and receipt by Buyer of the declaration of condominium, articles of incorporation, bylaws, and rules of the association.” Unlike other critical deadlines set forth in the Contract, such as the delivery of the earnest money deposit or survey, this particular provision expressly excludes weekends and holidays. Take, for example, this holiday weekend, if the Contract’s effective date was Friday, July 2nd, the Buyer’s three-day period would not include July 3rd, July 4th, or July 5th as it is a federally observed holiday. The Buyer’s three-day period would begin on Tuesday, July 6th, and expire on Thursday, July 8th, assuming the Buyer received the documents on the effective date. This section also provides that the Contract may be extended by the Buyer for no more than three days after delivery of the governing documents and it would be voidable in that time.
It is also important to keep in mind that this timeframe begins upon receipt of the documents and failure to receive documents could delay closing.
With all that said, what are important issues the Buyer should consider when reviewing the governing documents? Perhaps the most relevant question is how the declaration’s rules and restrictions will affect the Buyer’s ownership of the property. For instance, the declaration may include parking restrictions, the types of pets an owner can have, and rules for guests staying on the property. Further, it may also address how the association can levy special assessments, access the property, or enforce the rules and restrictions. Ultimately, whether or not the foregoing issues are important to a prospective buyer depends on their individual preferences and expectations.
It is important to note that the governing documents are unique to the community and there are several different variables that can affect the applicability of the rules and restrictions. Should you have any questions on the declaration or other governing documents, please reach out to your trusted local real estate attorney.
Happy 4th of July!
Kathryn A. Huynh, Esq. firstname.lastname@example.org
Berlin Patten Ebling, PLLC
This communication is not intended to establish an attorney client relationship, and to the extent anything contained herein could be construed as legal advice or guidance, you are strongly encouraged to consult with your own attorney before relying upon any information contained herein.
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