Background
Eagle Palms Homeowners Association obtained a 2014 foreclosure judgment against townhome owners who had failed to pay assessments. Before the delayed foreclosure sale occurred in August 2015, Barry Haught paid the owners $1,000 for the property and obtained a quitclaim deed conveying it to Hollagher Group, LLC, as trustee of a land trust. Haught and his business partners leased the townhome but did not pay past-due or accruing assessments.
The Association later sued Haught and related entities for the unpaid assessments and asserted fraud-based claims. After a bench trial, the circuit court awarded the Association $30,502.44 and held Haught and Whitburn, LLC, jointly and severally liable. They argued that the Declaration permitted the Association either to sue for assessments or to foreclose its lien, but not both, and that the earlier foreclosure therefore barred the damages action.
The Court’s Holding
The Second District affirmed. The majority held that section 720.3085(1)(c), Florida Statutes (2016), authorizes a homeowners’ association both to foreclose an assessment lien and to seek a money judgment for unpaid assessments. Reading the Declaration as a whole, the court concluded that it did not contractually prohibit the Association from exercising both remedies.
The court reasoned that the Declaration created both a continuing lien and a personal obligation to pay assessments, referred to the Association’s “Remedies” in the plural, and broadly authorized enforcement through proceedings at law or in equity. Although one provision said the Association could bring an action against the personally obligated owner “or” foreclose the lien, the majority declined to read that sentence in isolation as requiring an election of remedies. Judge Atkinson dissented, concluding that “or” required the Association to choose one remedy and that the damages judgment should be reversed.
Key Takeaways
- Florida law permits an HOA to pursue a money judgment for unpaid assessments without relinquishing its lien-foreclosure remedy.
- The Declaration, viewed in its entirety, did not limit the Association to either foreclosure or a damages action.
- Successor owners may be jointly and severally liable for assessments that became due before they acquired the property.
Why It Matters
The decision confirms that a prior assessment-lien foreclosure does not necessarily prevent a Florida HOA from later pursuing liable owners for unpaid assessments. Any contractual limitation on those statutory remedies must be determined from the governing declaration as a whole, rather than from an isolated use of the word “or.”
The dissent highlights a significant drafting issue for community-association documents: language listing remedies in the disjunctive may prompt disagreement over whether the remedies are cumulative or mutually exclusive.