STATE OF FLORIDA DEPARTMENT OF BUSINESS AND PROFESSIONAL REGULATION DIVISION OF FLORIDA CONDOMINIUMS, TIMESHARES AND MOBILE HOMES IN RE: PETITION FOR ARBITRATION Caribbean Villas Condominium Homeowners Association, Inc., Petitioner, v. Case No. 2012-01-8638 Unit Owners Voting for Recall, Respondents. / SUMMARY FINAL ORDER Procedural History On April 9, 2012, Debbie Konieczy filed a Recall Arbitration Petition (arbitration case number 2012-01-7771) naming herself and Caribbean Villas Condominium Homeowners Association, Inc. (the Association) as the petitioners and the Unit Owners Voting For Recall and Ivan Porges as the respondents. On April 17, 2012, Ivan Porges filed an arbitration petition in the instant case naming BOD Caribbean Villas CHOA as the respondent. Both petitions involve the same recall dispute. Because the parties were confused as to who was authorized to act as the Association s Board of Directors, by order dated April 23, 2012, the undersigned held that Ivan Porges, Mauddie Andino, Carmen Cruz, Zedy Aroche and Marelent Kahell Porges, would serve as the Association s board of directors, unless the Arbitrator issued an order certifying their recall. The order also directed the Association to file an amended recall petition with the Caribbean Villas Condominium Homeowners Association, Inc. as the petitioner and the Unit Owners Voting For Recall as the 1
respondent. The order further provided that Debbie Konieczy would serve as the Unit Owners representative and that upon filing of the amended petition, case number 2012-01-7771 would be dismissed. On May 4, 2012, the Association filed an amended petition and case number 2012-01-7771 was subsequently dismissed. Findings of Fact 1. Caribbean Villas Condominium Homeowners Association, Inc. is the corporate entity responsible for the operation of the Caribbean Villas Condominium. 2. There are 218 voting interests in the Association. 3. There are a total of seven seats on the Association s board of directors, however, at the time the recall was attempted, two seats were vacant. 4. On March 5, 2012, a written recall agreement was delivered to the Association s bookkeeper at the Association s mailing address. 5. The written recall agreement sought to recall the following members of the Association s board of directors: Ivan Porges, Carmen Cruz, Mauddie Andino, Zedy Aroche, and Marlene Khaleel Porges. Each person received 112 votes in favor of recall. 6. The recall ballots are similar to the form ballot accepted by the Division. 7. The Association s board of directors never held a meeting to consider the recall. Conclusions of Law The undersigned has jurisdiction over the parties and subject matter of this dispute, pursuant to sections 718.112(2)(j)3. and 718.1255, Florida Statutes. In accordance with section 718.112(2)(j)3., Florida Statutes, the unit owners voting in favor of the recall are the respondent in this matter. 2
Recall Vote Section 718.112(2)(j)2., Florida Statutes, provides: If the proposed recall is by an agreement in writing by a majority of all voting interests, the agreement in writing or a copy thereof shall be served on the association by certified mail or by personal service in the manner authorized by chapter 48 and the Florida Rules of Civil Procedure. The board of administration shall duly notice and hold a meeting of the board within 5 full business days after receipt of the agreement in writing. At the meeting, the board shall either certify the written agreement to recall a member or members of the board, in which case such member or members shall be recalled effective immediately and shall turn over to the board within 5 full business days any and all records and property of the association in their possession, or proceed as described in subparagraph 3. The Association has never held a meeting to consider the recall. In paragraph 1 of the Statement of Facts of the initial petition filed in this matter by Mr. Porges, he stated: On Monday, 03/05/2012 at around 12 p.m., illegally executed delivery of recall package: The Package was NOT delivered by certified mail or a registered server, but instead by a van driver. It was delivered to the Association s bookeeper, not to a Director or The Registered Agent. Since the delivery was not done as required by The Florida Statute, The Board of Directors did not react with any sense of urgency, as the FL Statute stipulates the diciplines [sic] required to make the delivery acceptable under law. Rule 61B-23.0028(1)(g) of the Florida Administrative Code, provides, The written agreement or a copy shall be served on the board by certified mail or by personal service. Service on the board after 5:00 p.m. on a business day or on a Saturday, Sunday or legal holiday, as prescribed by Section 110.117, Florida Statutes,shall be deemed effective as of the next business day that is not a Saturday, Sunday, or legal holiday. Service of the written agreement on an officer, association manager, board member or the association s registered agent will be deemed effective service on the association. Service upon an attorney who has represented the association in other legal matters will not be effective on the association unless that attorney is a board member, the association s registered agent, or has otherwise been retained by the association to represent it in the recall proceeding. Personal service shall be effected in accordance with the procedures set out in Chapter 48, Florida Statutes, and the 3
procedures for service of subpoenas as set out in Rule 1.410(c), Florida Rules of Civil Procedures. Substantial compliance with this rule is required. Fla. Admin. Code R. 61B-23.0028(2). In the instant matter, the Association argues that that the written recall agreement was not properly delivered because it was delivered by a van driver to the Association s bookkeeper at the Association s mailing address. The purpose of requiring the unit owners to serve the association with the written recall agreements is to officially place the board on notice that a recall has been attempted by the unit owners. See Nautilus Condo. Ass n., Inc. v. Unit Owners Voting For Recall, Arb. Case No. 99-2076, Summary Final Order (December 3, 1999). Furthermore, the purpose of service by certified mail or pursuant to chapter 48 of the Florida Rules of Civil Procedure is to provide proof of when the board was served, not to invalidate the actual recall effort. The Beach Condo. Owners Ass n., Inc., Arb. Case No. 92-0273, Order Dismissing Petition (January 22, 1993). Arbitration case law has consistently held that where there is no dispute as to when the association received the recall agreement, the method of delivery is of no significance, as the law only requires formal service in order to determine exactly when the agreements were received. See Aqua Gardens Townhouse Ass n,, Inc. v. Unit Members Voting for Recall, Arb. Case No. 02-5861, Recall Arbitration Summary Final Order (December 24, 2002)(service by hand-delivery deemed adequate); see also, Opal Towers Condo. Ass n., Inc. v. Unit Members Voting for Recall, Arb. Case No. 02-5700, Recall Arbitration Summary Final Order)(December 24, 2002)(service by handdelivery deemed adequate); and Stonebridge Gardens, Section One, Condo. Ass n. v. 4
Unit Owners Voting for Recall, Arb. Case No. 01-4167, Summary Final Order (April 17, 2002) (method of delivery unknown). Substantial, not perfect, compliance with the recall agreement service provisions is required. Additionally, where it is clear that the Association received the written recall agreement, the board may not avoid holding a meeting to consider the recall on the basis that service of the agreement was, in the board s view, flawed. See Oceans Four Condo. Ass n., Inc. v. Unit Owners Voting For Recall, Arb. Case No. 01-3302, Final Order Dismissing Petition and Certifying Recall (June 28, 2001). It is acknowledged in the initial petition that the Association was aware that its bookkeeper received the written recall agreement. Clearly at some point the Association was in possession of the written recall agreement as a copy of the written recall agreement is attached to the initial petition filed by a board member. Also attached to the petition is a letter dated March 23, 2012 from Ivan Porges to Debra Konieczny in which Mr. Porges addresses reasons for rejecting individual ballots. Therefore, the Association is not justified in failing to hold a meeting to consider the recall. 1 The Association also claims that the written recall agreement was delivered while three of the board members were out of the country. This is not a justification for failing to hold a meeting to consider the recall. 2 Where a board fails to hold a meeting on whether to certify written recall agreement served on it, and the recall agreement is facially valid and has been approved by a majority of the voting interests, the recall shall be certified. Section 718.112(2)(j)4., Fla. Stat.; Unit Owners Voting For Recall v. Sunrise Towne Preferred 1 Delivery of the written recall agreement to the bookkeeper might justify a delay in holding the meeting; however, it is not a valid reason to completely ignore the statutory requirement. 2 It should be noted that board members may attend a meeting by telephone conference in accordance with section 718.112(1)(b)5., Florida Statutes. 5
Condo. Ass n., Inc., Arb. Case No.01-2864, Summary Final Order (May 15, 2001). The Association in the instant matter has failed to hold a meeting to consider whether to certify the recall. The written recall agreement is facially valid and contains enough recall votes 3 to recall all of the above named board members. Therefore, the recall will be certified. Replacement Board Member Vote Because a majority of the members of the board of directors are being recalled, the vacancies created by the recall are to be filled by the replacement board members elected by the written recall agreement. Fla. Admin. Code R. 61B-23.0028(3)(b)4. The written recall agreement recalls five board members. However, it lists six replacement board members. Furthermore, each replacement member received 112 votes. The recall vote and replacement votes are severable events. Fla. Admin. Code R. 61B-23.008(c). Therefore, any issues involving the replacement board member vote will not affect the validity of the recall vote. However, before the current board members may be removed, replacement board members must be chosen. In the instant case there are more replacement board members than vacancies created by the recall. Each replacement board member has received an equal number of votes. The undersigned finds it most expeditious to direct the Unit Owners representative to determine whether one of the replacement candidates is willing to withdraw and to file notice of who is willing to do so. The recalled board members will 3 Section 718.112(2)(j), Florida Statutes, provides that a any board member may be recalled with or without cause by the vote or agreement in writing of a majority of voting interests. 6
be removed and the remaining replacement board members will be seated effective the date such notice is filed. 4 Should none of the replacement board members be willing to withdraw, then the Unit Owners Representative will be required to conduct a vote of the unit owners who voted in favor of the recall. Such vote shall only include the replacement board members named in the written recall agreement. The voters must be instructed to vote for no more than five replacement board members. The recalled board members will be deemed removed upon the filing of the election results with the arbitrator at which time recalled board members will be immediately removed and the elected replacement board members will be seated. Based upon the foregoing, it is ORDERED: 1. The recall of Ivan Porges, Carmen Cruz, Mauddie Andino, Zedy Aroche, and Marlene Khaleel Porges, is certified. 2. On or before June 22, 2012, Respondent shall do either of the following: a. Debbie Konieczny, Unit Owners Representative, shall determine whether one of the replacement board members named in the written recall agreement is willing to withdraw his or her candidacy and shall file notice with the arbitrator as to who is willing to do so. The recalled board members will be removed and the remaining replacement board members will be seated for the remainder of the term of vacant seats effective the date such notice is filed with the arbitrator without further order from the arbitrator. The recalled board members shall turn over any Association records or property in their possession within five days of the filing of the notice. 4 Filed means the date the notice is received by the arbitrator. 7
b. Should none of the replacement board members be willing to withdraw, then the Unit Owners Representative shall conduct a vote of the unit owners who voted in favor of the recall as directed above. The recalled board members will be deemed removed effective upon the filing of the election results with the arbitrator at which time recalled board members will be immediately removed and the elected replacement board members will be seated for the remainder of the terms of the vacant seats without further order by the arbitrator. The removed board members shall turn over any Association records or property in their possession within five days of the filing of notice. 3. Should Respondent fail to timely comply with the requirement to choose replacement board members, Respondent shall be deemed to have abandoned the recall effort and the current board members will stay in place. Florida. DONE AND ORDERED this 12 th day of June, 2012, at Tallahassee, Leon County, James W. Earl, Arbitrator Department of Business and Professional Regulation Arbitration Section 1940 North Monroe Street Tallahassee, Florida 32399-1029 Telephone: 850.414.6867 Facsimile: 850.487.0870 8
Certificate of Service I hereby certify that a true and correct copy of the foregoing final order has been sent by U.S. Mail and email to the following persons on this 12 th day of June, 2012: Ivan Porges Carribean Villas Condominium Homeowners Ass n, Inc. 322 Broadway Kissimmee, FL 34741 ivanporges@gmail.com Debbie Konieczny 2143 Caribbean Drive N Kissimmee, FL 34741 HBoat@cfl.rr.com James W. Earl, Arbitrator 9