Fraud Alert !


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The Department of Treasury,  Financial Crimes Enforcement Network,  has issued an advisory about a recent rash of  email and hacking schemes that have defrauded businesses and individuals of “billions”  of dollars.  Many of these target parties  to real estate transactions, and businesses holding escrow accounts.

Any email containing wire/ bank account  information should be encrypted / password protected.

Advise your customers to obtain verbal confirmation from your office of  any email purporting to be from you providing them wire instructions.

Advise your employees to obtain verbal confirmation from your payees of their wire information.

If you, or your customers,  have been deceived into wiring funds to a crook,  you are not covered.

Check your account activity regularly for unauthorized transactions.  Your own bank will deny coverage for fraudulent transactions, given half an excuse.

Checks should be kept locked at all times.  You are not covered for use of stolen checks.


Property manager held liable for security deposit forwarded to unresponsive landlord after lease termination


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Tenants entered into a lease and deposited a security deposit with landlord’s property manager.  At the end of the lease, the manager attempted to contact the landlord to gain access to the property to perform an inspection.  When the landlord did not  respond after a week, the property manager terminated their management contract and, the following week, sent the keys and the deposit to the landlord.   Neither the manager nor the landlord ever made a claim against  the deposit.  The landlord cashed the deposit check two months ager the lease ended.  In the meantime, the property manager directed the tenants to contact the landlord directly.  the landlord never responded.  It turned out that the property had been in foreclosure during the entire lease term, and the landlord had consented to a judgment of foreclosure a few days after cashing the security deposit check.

When the tenants did not get their deposit back, they sued the property manager.  The property manager moved to dismiss for failure to name the landlord, who they had transferred the deposit money to.   The court disagreed, ruling that the  property manager was only authorized to transfer the deposit funds  upon a change in either the manager or of the landlord.  As neither had changed, the property manager was responsible for the security deposit.  The court ruled that the property manager had a responsibility to both the landlord and the tenant over the security deposit, as it was the tenant’s money until the landlord had made a claim against it.

STRESS FREE PROPERTY MGMT, INC., vs. JONES,  Circuit Court, 13th Judicial Circuit (Appellate) in and for Hillsborough County.. March 19, 2015 22 Fla. L. Weekly Supp. 1006a

New Landlord Tenant Law – Servicemember applicants must be denied within 7 days or are approved


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Be It Enacted by the Legislature of the State of Florida effective July 1, 2016:
Section 83.683, Florida Statutes, is created to read: 83.683 Rental application by a servicemember.*-

(1) If a landlord requires a prospective tenant to complete a rental application before residing in a rental unit, the landlord must complete processing of a rental application submitted by a prospective tenant who is a servicemember, as defined ins. 250.01, within 7 days after submission and must, within that 7-day period, notify the servicemember in writing of an application approval or denial and, if denied, the reason for denial. Absent a timely denial of the rental application, the landlord must lease the rental unit to the servicemember if all other terms of the application and lease are complied with.

(2) If a condominium association, as defined in chapter 718, a cooperative association, as defined in chapter 719, or a homeowners’ association, as defined in chapter 720, requires a prospective tenant of a condominium unit, cooperative unit, or parcel within the association’s control to complete a rental application before residing in a rental unit or parcel, the association must complete processing of a rental application submitted by a prospective tenant who is a servicemember, as defined ins. 250.01, within 7 days after submission and must, within that 7-day period, notify the servicemember in writing of an application approval or denial and, if denied, the reason for denial. Absent a timely denial of the rental application, the association must allow the unit or parcel owner to lease the rental unit or parcel to the servicemember and the landlord must lease the rental unit or parcel to the servicemember if all other terms of the application and lease are complied with.
(3) The provisions of this section may not be waived or modified by the agreement of the parties under any circumstances.

* “Servicemember” means any person serving as a member of the United States Armed Forces on active duty or state active duty and all members of the Florida National Guard and United States Reserve Forces.

What this means:  This is going to be tough on associations,  especially those that do not meet on a regular basis. Landlords should always conduct a professional screening with non-discriminatory criteria such as are available by clicking here

No breach of duty to disclose not readily observable material defect to buyer absent evidence that seller had actual knowledge of the defect and that it was material.


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muck_2In early 2005, the Eimans purchased a plot of vacant waterfront land as a potential site for their future home. After they acquired the property the Eimans were told  they had to remove invasive  Brazilian pepper trees from the southern edge of the property and stabilize the land where the trees were removed to prevent erosion before they could obtain a building permit.  To comply with the requirement, the Eimans hired a third party to clear the  trees from the property and stabilize the cleared area with fill dirt. Mr. Eiman visited the property on several occasions during this work. Beyond these improvements, the Eimans never conducted any construction or assessments of any kind to determine the suitability of the property for building.

In 2006, the Sullivans purchased the vacant plot from the Eimans for the express purpose of constructing a  residential home.  The parties utilized a standard vacant land sales contract that indicated the Sullivans purchased the property in an “as is” condition. The contract also provided for a brief period of time during which the Sullivans could conduct any assessment they deemed “appropriate to determine the Property’s suitability for the Buyer’s intended use.”  The Sullivans never performed any such assessments on the property to determine whether it was suitable to build their home. After closing, the Sullivans’ builder performed  a subsurface investigation of the building site revealing  “subsurface conditions consist[ing] of fine sand with organic silt (muck)” at various depths within the proposed building site that would require deep foundations and  piles to support construction of a house.  Notably, the Sullivans’ proposed building site was not the same area that the Eimans had cleared and filled. The Sullivans’ builder increased its initial estimate by $65,000,  to install the necessary pilings .

The Sullivans then filed a complaint against the Eimans and their  real estate broker alleging  that the parties breached their duty under Johnson v Davis  by failing to disclose to the buyers  a fact known to the  sellers and not readily observable,  that materially affected the value of the property.  While the broker prevailed on summary judgment the trial court entered a $65,000 judgment against the Eimans.

On appeal, the court reversed,  finding that the Sullivans failed to present competent, substantial evidence of the existence of a fact that materially affects the value of the property in question and that the Eimans had actual knowledge of that fact.

First, the Sullivans did not plan to build their home on the area filled-in by the Eimans. Consequently, the existence of muck under the filled-in portion of the property cannot be a fact materially affecting the value of the property as alleged in the complaint because it would not actually prohibit or increase the cost of the construction of the home.

Secondly , the Sullivans presented no evidence that the Eimans had actual knowledge of this defect. “[T]o hold the seller liable under Johnson, the buyer must prove the seller’s actual knowledge of an undisclosed material defect.” Jensen v. Bailey, 76 So.3d 980, 983 (Fla. 2d DCA 2011).

The Sullivans presented no evidence that, prior to the removal of the trees from the southern portion of the property, the ground was exposed or the muck was visible. Although Mr. Eiman testified that he visited the property “several times” while it was being cleared and filled, there was no testimony from Mr. Eiman or any other witness that Mr. Eiman observed dark “muck” soil in the area or that he even would have known what the dark soil was if he had observed it. Moreover, even if Mr. Eiman had observed dark soil underneath the area covered by the pepper trees, there would still be no evidence that he knew anything about the subsurface conditions of the area where the Sullivans intended to build their home. As the complaint accuses the Eimans of knowledge of a fact that “would either prohibit the construction of their home or significantly and materially increase the cost for same,” any knowledge of the subsurface conditions of the land outside of the proposed construction site would not be germane to the issue raised in the complaint. Because the Sullivans failed to present any evidence that the Eimans had actual knowledge of the subsurface conditions of the property, the trial court erred in finding the Eimans liable under Johnson.

EIMAN, v.  SULLIVAN District Court of Appeal of Florida, Second District. No. 2D13–4553.  Decided: May 22, 2015

Motion to determine rent based on  failure to repair


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In an eviction for non-payment of rent, the tenant defended with a motion to determine rent.  The motion to determine rent was not based on an allegation that the amount claimed by the landlord was incorrect,  but upon the landlord’s failure to maintain the premises.    The court noted that in order for the tenant to challenge the amount of rent due because of landlord’s failure to maintain the premises,  the tenant must first have sent the landlord a seven day notice.   The notice must be in writing, giving the landlord seven days to cure.  Landlords may rely on written notice of complaints of a specific nature, but must then act within seven days to accomplish compliance with the statute.    The tenant is required to  issue a seven day notice in order to commence a process wherein the tenant may withhold rent payments.   The tenant ,may not take matters into his own hands and resort to the self-help of unilaterally withholding rent payments without property notice.  Determining that a reduction in rent registry payments could be permitted where no statutory seven day notice was delivered merely delays the necessary inevitable frustration of the tenant’s defense as well as underlying basis for such a reduction.  Thus the tenant was ordered to deposit the full amount of the rent into the court registry.

Lee v. Schweizer , 7 Fla L. Weekly Supp 750a, County Court Sarasota 2000]

HUD issues new guidelines on tenant screening


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HUDOn April 4, 2016,  the United States Department of Housing and Urban Development Office of General Counsel  issued a “guidance”  effective immediately on permissible housing applicant selection criteria.   This “guidance”  declares what selection criteria will be deemed discriminatory under the Fair Housing Act.   Based on their study of arrest and incarceration rates of blacks and latinos  being disproportionate to their percentage of the general population,  it will now be deemed discriminatory to use arrest records as a criteria for denial of a rental applications.  Convictions, however, may be used as a selection criteria  if  the landlord takes into account the “nature and severity”  of the offense,  and the length of time since the conviction.   HUD recommends that landlords perform an “individualized assessment of relevant mitigating information”  such as the “facts or circumstances surrounding the criminal conduct; the age of the individual at the time of the offense; evidence that the individual has maintained a good tenant history … and evidence of rehabilitation efforts.”

HUD stated that the Fair Housing Act does not prohibit denial of housing based on a conviction for the illegal manufacture or distribution of controlled substances.

Landlords should  update their screening procedures to  disregard the following
1. Arrests
2. Misdemeanor convictions
3. Any adjudication that is other than guilty, such as adjudication withheld, nolle prosse
4. Convictions for possession of drugs or drug paraphernalia.
5. General felony convictions over ten years old ( you should particularize offenses that directly relate to the safety of the leased premises and other tenants)

Click here to read the entire HUD Guidance Statement.

Comments from attorneys and landlords are encouraged.

Waiver by failure to promptly reject untimely tender of rent


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This Collier County case made three novel rulings:

Defective Posting: May not post 3 day notice until ascertained tenant is absent

The property manager testified she served a 3 day notice  by folding it and placing it in the tenant’s door.  The tenant denied receiving the notice.   The court ruled that while Florida law permits the three day notice to be served to the tenant by leaving a copy of the notice at the residence,  it may be posted only if the tenant is absent from the premises.  Without evidence evidence that the property  manager attempted to determine if the tenant was absent from the premises prior to posting the three day notice,  the posting is defective notice.

Bailment: Rent in possession of landlord, and stolen, is landlord’s loss, not tenant’s.

The three day notice  included $348.00, which represented the tenant’s money orders that were stolen during a theft at the landlord’s office.  That theft occurred while the money orders were in the possession of the landlord.  The court ruled that the fund stolen from the landlord  should not have been counted as rent on the three day notice.


Waiver occurred when the landlord accepted money orders paid by the tenant  (See §83.56(5), Fla. Stat).  Although the landlord ultimately returned the money orders to the tenant, the landlord held them too long. By not returning the payments to the tenant promptly, the landlord is deemed to have accepted them, even if the payments were not credited to the account. See, Belkin v. Robinson, 38 Fla. Supp.2d 188 (Broward 1989). By accepting rent while knowing of a noncompliance, the landlord waived whatever right he otherwise had to evict, pursuant to §83.56(5), Fla. Stat.

HARMONY SHORES MHP, LLC,  vs. OAKLEY, Collier County  Case No. 2015-CC-001599. December 17, 2015. Online Reference: FLWSUPP 2308HARM

Any allegation of ownership by tenant in an eviction action requires an evidentiary hearing.


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Petitioner had been living in a house for over five years under a lease-option  contract which had expired four years ago under which he  claimed to have made a $6000 deposit toward the purchase as well as many improvements.  Respondent filed an eviction for non-payment of rent, to which petitioner responded with a motion to determine rent and a motion to dismiss based on a claim of ownership under the lease option..  The county court granted the eviction without hearing.  Petitioners appealed (which was treated as a petition for a writ of certiori,  as non-final orders from County Court are not directly appealable to Circuit Court).

The Circuit Court reversed, citing Florida Statutes 83.42 Exclusions from application of part. — This part does not apply to:

(2) Occupancy under a contract of sale of a dwelling unit or the property of which it is a part in which the buyer has paid at least 12 months’ rent or in which the buyer has paid at least 1 month’s rent and a deposit of at least 5 percent of the purchase price of the property.

Where a tenant makes a claim of ownership in a landlord’s action for possession, a court errs by ordering an eviction or by ordering rent to be deposited with the court registry without holding a hearing on the tenant’s assertion.  Even though the lease option had expired on its face in 2010,  the court ruled that real estate contracts, under certain circumstances, may be subject to oral modification or extension, as was alleged here.  Therefore the County Court erred by not holding an evidentiary hearing on the claim of ownership.

MORGAN v. HEWITT,  Circuit Court, 9th Judicial Circuit (Appellate) in and for Orange County.  Appeal from the County Court for Orange County. August 20, 2015.  Online Reference: FLWSUPP 2307MORG

Companion dogs


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pit bull service animal

Tenant filed a request under the Fair Housing Act for his condominium  to make an accommodation to him to own a Pitt Bull Terrier as a companion animal based on his disability.  The condominium refused based on its no pets policy and the fact that Miami-Dade County bans the ownership of Pit Bull Terriers.

In denying the condominium’s motion for summary judgment against the tenant, the District Court found that changing a no pets policy for an emotional support animal was a reasonable accommodation under the FHA. The court also found that enforcing the county ordinance would violate the FHA by permitting a discriminatory housing practice.

The court noted that emotional support animals do not require task specific training. Particularly, the rule states:”emotional support animals provide very private functions for persons with mental and emotional disabilities. Specifically, emotional support animals by their very nature, and without training, may relieve depression and anxiety, and help reduce stress-induced pain in persons with certain medical conditions affected by stress.”

The court also noted that any threat posed by the Pitt Bull  was also entitled to reasonable accommodation by the Condominium.

Warren v. Delvesta Towers Condominium Association 49 F.Supp.3d 1082 (S.D. Fla. 2014).   Click here to read the full opinion

Where attorney represented tenant in suit for refund of security deposit on wholly contingent basis, contingency risk multiplier of 1.5 is appropriate


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The County Court of Volusha County issued a ruling  detailing the twelve factors to be considered in determining a contingency risk multiplier.

Tenant’s attorney was on a contingency fee basis in suing for the recovery of a security deposit.   The tenant prevailed, obtaining the return of the entire security deposit.

The court stated that the claim for security deposit was a contract case.  Pursuant to Standard Guar. Ins. Co. v. Quanstrom, 555 So.2d 828 (Fla. 1990); Meli Inv. Corp. v. O.R., 621 So.2d 676, (Fla. 3d DCA, 1993) and Progressive Exp. Ins. Co. v. Schultz, 948 So.2d 1027 (Fla. App. 2007) [32 Fla. L. Weekly D548b], a contract case falls into Quanstrom’s Category II. The Florida Supreme Court has adopted twelve factors that should be considered when determining a reasonable fee: The Court considers those factors and found as follows:

i) Time and Labor Required

The Court found that 40.6 hours was reasonable and necessary.

ii) Novelty and difficulty of the questions

The Court found  that the issues presented in this case were relatively novel and difficult, and required a thorough understanding of not only landlord tenant law but the unlicensed practice of law and the limitations of property managers enacted by the Florida Supreme Court when representing landlords and the related Florida case law.

iii) The skill requisite to perform the legal services properly

The Court found that this case involved a thorough understanding of laws related to residential Tenant’s rights and the proper handling of a Tenant’s security deposit by a property manager, and that without such knowledge, the Plaintiff’s attorney would not have been able to obtain a favorable outcome for the Plaintiff. The Court found that while there are thousands of attorneys in the local market, there are only a handful who have the necessary knowledge and expertise to effectively represent a tenant in a landlord tenant dispute, and who regularly represents tenants in state court matters.

iv) The preclusion of other employment

Plaintiff’s counsel contends that he was slightly precluded from other employment.

v) Customary Fee in the Community

The Court found that the market rate for the hourly fees charged in the greater Central Florida area including Orange County, Seminole County and Volusia County by lawyers of comparable skill, experience and reputation performing similar services as those performed by Plaintiff’s counsel is $350.00 to $425.00 per hour.

vi) Whether the fee is fixed or continent

The Court found that the Plaintiff’s attorney’s fee in this case was wholly contingent.

vii) Time limitations imposed by the client or the circumstances

The Court found that the client imposed some time limitations for a speedy return of her deposit.

viii) Amount involved and results obtained

The amount involved the return of the tenant’s own funds which were returned in full to the Plaintiff.

ix) The experience, reputation, and ability of the attorney

The Court found that the Plaintiff’s attorney has over 15 years of experience in civil litigation in Tenant defense and consumer issues relating to tenants, and has sufficient ability to effectively handle landlord tenant disputes and legal matters.

x) The “undesirability” of the case

The Court found that tenant’s rights cases are generally undesirable cases to prosecute on behalf of the tenants.

xi) The nature and length of the professional relationship with the client

The Court found that this is the only case in which the Attorney had represented the tenant

xii) Awards in similar cases

The Court found that the proposed award of fees is not unreasonable in relation to similar cases, the complexity of this case, and the time during which the litigation was pending. For example, in Lancelot At Winter Park, LLC, vs. Bruce MacDonald And Francis MacDonald, 15 Fla. L. Weekly Supp. 822b, (Orange County Court, 9th Judicial Circuit, 2008), the Court awarded a multiplier of 2.0 to a prevailing tenant. Similarly in a more recent case the Court awarded a multiplier of 2.0 to a prevailing tenant. Florante S Banez, vs. Elizabeth T Banez & Florence T Banez, 20 Fla. L. Weekly Supp. 513a, (Orange County Court, 9th Judicial Circuit, 2013).

It is the intent of the Florida Legislature that consumers be encouraged to retain competent legal counsel to protect their rights as tenants not only for their direct benefit, but for the indirect benefit of all consumers/tenants.


The Court found that it is appropriate to award a risk enhancement multiplier. The Court found that the Plaintiff’s attorney represented the Plaintiff on a contingency fee basis, and that the Plaintiff’s attorney’s compensation was wholly dependent on the outcome of the case. The Court found that it would have been difficult, if not impossible, for the Plaintiff to find proper legal representation in this case without the use of a contingency contract and the application of a fee multiplier. Attorneys of similar skill and experience as that of the Plaintiff’s attorney will not accept a case such as this one without the possibility of a multiplier. The Court found that the Plaintiff’s attorney was unable to mitigate the risk of nonpayment for services rendered and costs incurred on behalf of the Plaintiff if the Plaintiff did not prevail because the Plaintiff could not afford to pay an attorney to represent her.

THE COURT having made the foregoing findings of fact and conclusions of law, and having heard and considered arguments of counsel, and being duly advised in the premises, awards an attorney fee to the Plaintiff’s attorney, to be computed as follows:

Hours reasonably expended by Plaintiff’s attorney are 38.6 hours.

Reasonable hourly rate is $300.00 dollars.

Lodestar $11,580.00 dollars

ENHANCEMENT (Contingency Risk Factor):

Success more likely than not at outset (1 to 1.5)

Likelihood of Success approximately even at outset (1.5 to 2.0)

Success unlikely at outset (2.0 to 2.5)

Enhanced Value (1.5) x (lodestar) $11,580 dollars

Plus Cost of 11.55

FINAL JUDGMENT is hereby entered against the landlord  in the total sum of $17,381. 55