Background
The Murrells entered into a purchase agreement to sell their condominium unit at Las Palmas Condominium Apartments to Betty Farr, a longtime tenant and friend, at a below-market price. All owners at Las Palmas are governed by a Declaration of Condominium that grants existing owners a right of first refusal to purchase units being offered for sale. The Declaration requires selling owners to notify the board in writing with a copy of the purchase agreement, posted at the property, and specifies that existing owners have ten days to exercise their preemptive right by providing notice “effective on the date of mailing or hand-delivery” by certified mail.
When Mr. Hitchens learned of the intended sale to Farr, he contacted Mr. Murrell by phone and text to indicate his intent to purchase the unit. Murrell declined, expressing his preference to sell to Farr. Despite this, the Hitchens timely exercised their right of first refusal by sending written notice via certified mail within the ten-day window. The Murrells then canceled the Farr contract and refused to proceed with the sale to the Hitchens, subsequently listing the unit on the market at a higher price.
The Court’s Holding
The Fifth District reversed the trial court’s judgment and ordered specific performance of the sale to the Hitchens. The appellate court held that the plain language of the Declaration’s Section 17.5.4 made the Hitchens’ notice effective upon mailing, not upon proof of actual receipt by the Murrells. While Florida law generally requires proof of receipt for rights of first refusal, the court recognized that condominium declarations can modify this requirement—and Las Palmas did so explicitly.
The court further held that once the Murrells entered the purchase agreement with Farr, the Hitchens’ preexisting right of first refusal “ripened into an irrevocable option” to purchase the unit. The Murrells’ subsequent cancellation of the Farr contract did not extinguish this option; the Hitchens’ timely exercise of it by certified mail created a binding obligation to sell.
The court also reversed on the deposit issue, finding that the Murrells waived their defense by failing to specifically plead the Hitchens’ alleged failure to pay the $5,000 deposit as required by Florida Civil Procedure Rule 1.120(c). Additionally, even if properly pleaded, the Murrells’ own anticipatory repudiation—Mr. Murrell’s refusal to perform—relieved the Hitchens of their obligation to tender the deposit.
Key Takeaways
- Condominium declarations can modify default Florida law regarding rights of first refusal by specifying that notice becomes effective upon mailing rather than receipt.
- A right of first refusal ripens into an irrevocable option once a seller accepts an offer from a third party, and cancellation of that underlying contract does not extinguish the option holder’s rights.
- Defendants must specifically plead affirmative defenses, including conditions precedent, with precision; failure to do so results in waiver under Florida procedural rules.
- A seller’s anticipatory repudiation of a contract relieves the buyer of performance obligations, including deposit payment.
Why It Matters
This decision provides important clarity on condominium law and contract enforcement. It establishes that condominium associations and their declarants have significant flexibility to tailor the mechanics of preemptive rights in their governing documents, and courts will enforce those specifications according to their plain language. The holding protects purchasers who exercise rights of first refusal by making those rights irrevocable once triggered, preventing sellers from gaming the system by accepting and then rejecting third-party offers.
The decision also reinforces strict pleading requirements in Florida civil procedure, emphasizing that affirmative defenses must be specifically articulated to avoid waiver. For practitioners, it underscores the importance of both drafting condominium declarations with precision and pleading defenses with the required specificity in responsive pleadings.
✉️ Get tomorrow’s cases before your first coffee
Daily Case Law is our free morning digest — the most substantive new decisions, filtered to your jurisdictions and topics, each linking back here for the full analysis.