Article Courtesy of The Miami Herald
By Nicholas Nehamas
Published November26 , 2016
A tenant is suing a Miami condo association over its
excessive application and move-in fees, saying they violate state law.
The lawsuit is the first of several class-actions that attorneys say they
plan to file against condo associations over high fees. In June, the Miami
Herald reported that condo boards routinely charge consumers hundreds of
dollars more than state law allows. Florida statute caps the amount condos
can charge to apply and move in at $100 per person.
In a suit filed Friday
in Miami-Dade County Circuit Court, August Lasseter says he
was billed $625 in non-refundable fees when he signed a
lease for a unit at one of the two high-rise towers at
Quantum on the Bay last year. The charges broke down to $100
for a background check, $175 for “administrative review,”
$125 for registration and $225 for move-in.
“I questioned it at the time, but it’s not like you really
have a choice,” said Lasseter, 37, who runs a modeling
agency. “They say you pay it or you don’t move in.”
Attorneys for the board, which was highlighted in the
Herald’s initial story as the condo with the highest fees,
said they had not yet been served and couldn’t comment.
The Florida Condominium Actprohibits condo associations from
charging fees of more than $100 per applicant “in connection
with the sale, mortgage, lease, sublease, or other transfer
of a unit.” (Married couples are considered one person and
children are exempt.)
Such fees are known as “transfer” fees because they concern
the transfer of a unit from one owner or tenant to another.
“It’s shocking that associations are intentionally and
knowingly charging these fees when they are improper even
after the public attention from media coverage,” said Aaron
Resnick, an attorney who is handling the suit. “It’s
black-and-white. The law can’t be any clearer on what you’re
allowed to do and what you’re not allowed to do. ...
Knowledgeable condo associations and property management
companies have been flouting the law for years. It’s a shame
that it will take lawsuits to end this practice.” |
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Quantum on the Bay is the target of a lawsuit from a
tenant.
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Resnick is working with South Florida attorneys Joshua
Spector and Jonathan Feldman to file more suits across the state.
“We’ve identified condo associations from Tallahassee to Jacksonville and
Orlando to Tampa, but Miami is the most prevalent,” he said. “And we’ve
found it’s not just the expensive condos that are doing this, it’s across
the board. The wrong is the same, but the impact is even greater [on poorer
residents].”
Lasseter’s lawsuit says Quantum’s fees also constitute a violation of
Florida’s Deceptive and Unfair Trade Practices Act. It seeks to have Quantum
pay damages and restitution to Lasseter and those who join his claim, and
asks a judge to stop the association from charging more than $100.
Rents at the complex at 1900 N. Bayshore Dr. in Edgewater range from $1,500
for a studio to $4,250 for a three-bedroom penthouse.
A Herald analysis of Realtor data this summer found that nearly half of
condos listed for sale or rent in Miami-Dade County asked more than $100 in
fees. In Broward, 22 percent of condos charged illegally high fees. A search
in November showed roughly the same numbers.
Property management companies argue the law does allow for charges of more
than $100, if the charges come from a third party, not the association. And
they say background checks have grown more expensive since the cap was set
in 1990.
But legal experts consulted by the Herald say the statute is clear and
associations are gouging applicants. The Division of Florida Condominiums,
Timeshares and Mobile Homes confirmed that the $100 transfer cap is meant to
include all non-refundable fees for background checks, registration,
move-in, pets, elevator usage and other charges requested by condo boards
and their representatives.
(The rules don’t apply to homeowners’ associations and rental apartments.)
Background check companies told the Herald they usually charge between $20
and $45 for individual tenant screening, and offer discounts for bulk
commercial accounts from condos.
But international clients can be significantly more expensive, said Robert
Sanchez, vice president of Miami-based United Screening Services. Checks on
people from Russia and Latin America, where many Miami condo buyers come
from, can range as high as $175, Sanchez said.
Even so, “the law is the law,” said Stavros Mitchelides, the Miami Beach
Realtor who first alerted the Herald to the problem of overcharging. “If
state law says the fee can’t exceed $100 for a single person or a married
couple, then you shouldn’t be able to go around the law just to make money
off of applications from everyone else. I find it extremely disturbing.”
The extra charges make it even more difficult for locals to find a home in
South Florida, already one of the nation’s most expensive housing markets.
Mitchelides says he repeatedly told the Miami Association of Realtors about
the problem but never heard back.
After the Herald’s initial story came out, José Pazos, who runs a prominent
South Florida propertymanagement firm, disputed the newspaper’s findings in
a Facebook videoand said he would lobby the Florida Legislature on the
issue.
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