Condo questions: To avoid possible issues board's should have counsel review contracts

Editor’s note: Attorneys at Goede, DeBoest & Cross respond to questions about Florida community association law. With offices in Naples, Fort Myers, Coral Gables, and Boca Raton, the firm represents community associations throughout Florida and focuses on condominium and homeowner association law, real estate law, litigation, estate planning and business law.

Q: I participated in the "How to Run a Board Meeting Effectively" seminar several weeks ago, that you put on and I had a quick question. A statement was made that any time there is a quorum of the board, that the formalities of a board meeting must be adhered too. However, my question is, if the formalities of the board are established, could there still be restrictions set forth based on the quorum being titled as a "workshop?" Meaning, the "meeting" was titled as a "workshop," but there is a quorum. Are there restrictions as to what the board can do? Can the quorum of the board still set motions and vote, or no because it's a "workshop"? I would tend to think that formalities of the board works both ways, with the latter being a "good faith" objective rather than hard requirement (i.e. no motions/voting during workshops).

-- A.P., Boca Raton

A: Thank you for attending the seminar. You pose an excellent question. The statutes do not address what you can or cannot do at a “workshop” and the point of my discussion was regardless of what you call the meeting if a quorum of the board is in attendance it must be noticed like a board meeting with owners allowed to attend except under two limited exceptions. However, I believe that if it is titled a workshop that implies that no board decisions will be made, and I believe that is the correct position to take. The board decisions should be made at properly noticed meeting called a “board meeting” and generally require a published agenda for the action items.

Q: I would be interested to know what you think is the biggest avoidable mistake board’s make on a regular basis?

-- S.A., Treasure Coast

A: That is an easy one. The biggest and most common easily avoidable mistake is for the Association to enter into a contract before allowing the Association’s legal counsel to review the contract and suggest changes. Then when a problem arises and the Association wants to get of the contract or promises are not being met by the vendor the Board finally seeks the advice of the Association attorney. I promise you that reviewing contracts with the attorney and making changes before the contract is signed costs much less money than having the attorney try to resolve the problems of a bad contract. It is the classic penny wise and pound-foolish scenario. Most standard vendor contracts can be reviewed and revised in a couple of hours or less which is far less time than it typically takes to resolve issues with a bad contract.

Q: I have been told by some people that any vendor contract can be cancelled by a community association with 30 days notice. Is this true?

-- D.F., Stuart

A: No but for some reason this is a common misconception I run across from time to time. I think it may arise from the right to cancel laws or “cooling off period” some of the consumer protection laws provide for. These do not apply to community associations and their contracts with their common vendors. So, unless the particular contract itself specifically provides for a right to cancel with 30 days notice, no such right exists in the law. This is an important provision that lawyers look for when reviewing a vendor contract. Also, the language of the right to cancel clause is very particular so what may appear to you to be a 30 day right to cancel for any reason or no reason at all may not actually be just that. There is a big difference in a right to cancel “without cause” versus a right to cancel “with cause." You should discuss this and other aspects of all vendor contracts with your association legal counsel before signing the contract.

Richard D. DeBoest, Esq., is Partner of the Law Firm Goede, DeBoest & Cross. Visit www.gadclaw.com or to ask questions about your issues for future columns, send your inquiry to: question@gadclaw.com. The information provided herein is for informational purposes only and should not be construed as legal advice. The publication of this article does not create an attorney-client relationship between the reader and Goede, DeBoest & Cross, or any of our attorneys. Readers should not act or refrain from acting based upon the information contained in this article without first contacting an attorney, if you have questions about any of the issues raised herein. The hiring of an attorney is a decision that should not be based solely on advertisements or this column.

This article originally appeared on Treasure Coast Newspapers: It's worth it for board to have counsel review vendor contracts