Get 1 year of free community web site hosting from Community123.com!
Monday, December 06, 2021











HOATalk is a free service of Community123.com:

Easy to use website tools to help your board
Only members have access to all features.
Click here to join HOATalk for Free! Members click here to login and access all features.
Subject: Subdivision, Co-op, Master Association
Prev Next
Please login to post a reply (click Member Login on the menu).
Author Messages
GaryJ5
(New York)

Posts:12


05/27/2021 4:23 PM  
I own a home in a S.W. Florida community that was purchased from the original Grantor and developer by GE Capital Corporation and then sold to a group of homeowners in 2002. The homeowners sold shares or certificates to raise the money for a down payment and received a mortgage. At the time of the sale the park had an HOA authorized by the CCRs. The CCR was dated 1977, and the HOA began in 1981. Upon purchase of the park the a few of the buyers setup 2 Florida non profit corporations under 617 statute. Subdivision and Coop Inc, and then also set up the 2 run by a 3rd corporation as the Master Association. The first 2 were for only the purpose of setting up up the Master Association. The purchase, corporations, master association, all governing documents were all completed without a vote of homeowners or the HOA. The breakdown was 30% of the owners had shares and 70 % did not. The Master Association bylaws and articles of Incorporation gave all the power to just the master association which is 9 people out of close to 700 homes. The only voting rights on who those 9 are is controlled by 30% of the owners. To add to the story 8 months after the purchase the HOA had no way to fund and all monthly fees went to the master association by their rules. The HOA became inactive in the state of Florida. The Master Association has become very powerful collecting all the funding, and all non stock holders pay 65% higher monthly fees more than share holders, and have no say in any park government or operation. The master association in 2003 were told by the state that they had to follow the 719 statute for Coops but never told the Association they had to follow the 720 statute for the subdivision. The subdivision is operated by whatever the MA wants under FL617. To add to the story the MA has expanded to several profitable businesses from RV Park, Wifi, Title and Real Estate, and etc. They have put as we know money in CDs and bank accounts worth a large amount. All their accounting is commingled together and there is no oversight. Which means they have alot of our money to be used on lawyers against all that want to change things. Last year they spent $265,000 on a law firm. That is a true number! Is there anyone who has ever seen this before, or can say why Florida doesn't control these situations? Or is this a legal operation that is a legit corporation. The situation has turned into a mess, with 2 sides ruining the property and home values. Thank you for any feed back.
JohnC46
(South Carolina)

Posts:11665


05/27/2021 7:36 PM  
Gary

This sounds so convoluted that one should get a legal opinion.

That said, I do know of situations in private clubs where a small group of members were the only voting members thus they controlled the majority. Your situation reeks of such.
BillH10
(Texas)

Posts:783


05/27/2021 8:13 PM  
Gary, I gave up after two sentences. Two suggestions:

Please provide a synopsis of the issues. Also, please use paragraphs. Your message as I read it is in 8 point type. It is extremely difficult to follow the the thread of your post without logically arranged thoughts.
AugustinD


Posts:1920


05/28/2021 7:56 AM  
Timeline, as far as I can tell:

-- "CC&Rs" dated 1977.

-- "HOA" "began" in 1981.

-- A group of homeowners "purchased" the "community" in 2002.

-- Circa 2002 the group of homeowners set up two nonprofit corporations.

-- In 2003, the State "told" the "master association" that the master association has to follow FS 719 (the Fl statute for Co-Ops).

-- Circa 2004 the "HOA" became inactive.

-- The "master association" does whatever it wants, subject to FS 617.

-- The "master association" has opened a number of businesses, like RV Park, Wifi, Title and Real Estate, etc.


Commentary:
In my opinion you need to gather more information. I think what would be most telling is obtaining copies of the Articles of Incorporation for the "HOA" begun in 1981 and the two nonprofit corporations established around 2002. Go to http://search.sunbiz.org/Inquiry/CorporationSearch/ByName . Put in the name of each corporation. Print out the information that comes up. Contact the Florida Secretary of State site and ask how to obtain copies of the Articles of Incorporation.

After obtaining the articles of incorporation, please redact identifying information that would identify the co-op, and consider posting the articles of incorporation here.

Per the Florida Secretary of state site, GE Capital and variations on same did a lot of investing in Florida via the establishment of various corporations.

If subjecting the community to FS 719 is correct, then by my reading of FS 720.302, FS 720 does not apply.

Note this definition from FS 719:
“Cooperative” means that form of ownership of real property wherein legal title is vested in a corporation or other entity and the beneficial use is evidenced by an ownership interest in the association and a lease or other muniment of title or possession granted by the association as the owner of all the cooperative property." See http://www.leg.state.fl.us/statutes/index.cfm?App_mode=Display_Statute&URL=0700-0799/0719/0719.htmlI believe I recall reading here about a Florida Mobile Home Park that over the decades went through a lot of machinations with its corporate structuring. Foreign (Canadian) investment companies were involved.

GaryJ5, by any chance do you have a written lease for the land on which you reside in this co-op?

For any dispute you have with the co-op, consider the following:
719.1255 Alternative resolution of disputes.—The Division of Florida Condominiums, Timeshares, and Mobile Homes of the Department of Business and Professional Regulation shall provide for alternative dispute resolution in accordance with s. 718.1255.

GaryJ5, I think whatever information you turn up will be useful only as preparation for a meeting with an attorney. But if you really think something wrong is going on, then this preparation is probably a good investment of time.
AugustinD


Posts:1920


05/28/2021 8:47 AM  
Posted By GaryJ5 on 05/27/2021 4:23 PM
I own a home in a S.W. Florida community that was purchased from the original Grantor and developer by GE Capital Corporation and then sold to a group of homeowners in 2002. The homeowners sold shares or certificates to raise the money for a down payment and received a mortgage. ... [snip] The purchase, corporations, master association, all governing documents were all completed without a vote of homeowners or the HOA.
I am betting that the underlying land of the homes in this community was initially owned entirely by a corporation. The underlying land is still owned entirely by a corporation. The corporation has shareholders.

From https://www.reddit.com/r/RealEstate/comments/9brt98/is_there_such_a_thing_as_a_mobile_home_park_where/:

"Is there such a thing as a mobile home park where the residents own the park?
Each resident would own their mobile home and a share of the park, or might own their own lot in the park and pay HOA fees for maintenance of the common areas. How common is that?

Yes, they’re called resident owned. They’re very popular where I am in Florida. They do this when a developer comes in and tries to buy the land, the residents mortgage the property and split the land cost to save their homes.

Co-ops."

To me, around 2002 it sounds like a group of savvy homeowners (about nine altogether? along with the 30% of other homeowners who bought shares in the corporation?) decided to take control of their destiny. They made the land (on which all 700 or so homes sit in this community) their personal investment. This minority owns the land on which your home sits. They can raise the rent on the land. They're landlords. I do not see anything illegal here, so far.
Please login to post a reply (click Member Login on the menu).
Forums > Homeowner Association > HOA Discussions > Subdivision, Co-op, Master Association



Only members have access to all features.
Click here to join HOATalk for Free! Members click here to login and access all features.







General Legal Notice:  The content of forum messages are from the posting member and have not been reviewed nor endorsed by HOATalk.com.  Messages posted by HOATalk or other members are for informational purposes only, are not legal or professional advice and do not constitute an attorney-client relationship.  Readers should not act upon this information without seeking professional counsel.  HOATalk is not a licensed attorney, CPA, tax advisor, financial advisor or any other licensed professional.  HOATalk accepts ads from sponsors but does not verify sponsor qualifications nor endorse/guarantee any sponsor's product or service.
Legal Notice For Messages Posted by Sponsoring Attorneys: This message has been prepared by the sponsoring attorney for informational purposes only and does not constitute legal advice. This information is not intended to create, and receipt of it does not constitute an attorney-client relationship. Readers of HOATalk.com should not act on this information without seeking professional counsel. Please do not send any sponsoring attorney confidential information unless you speak with the sponsoring attorney or an attorney from the sponsoring attorney’s firm and get authorization to send that information to them. If you wish to initiate possible representation, please contact an attorney in the firm of the sponsoring attorney. Sponsoring attorneys that post messages here are licensed to practice law in a specific state or states as indicated in their message signature or sponsor’s profile page. (NOTE: A ‘sponsoring attorney’ is an attorney that is a HOATalk.com official sponsor and is identified as such in the posted message or on our sponsor page.)

Copyright HOA Talk.com, A Service of Community123 LLC ( Homeowners Association Discussions )   Terms Of Use  Privacy Statement