In the life of every community association, there is a time at which the control of the association is transferred from the developer to the owners. Typically, this occurs when a certain percentage of units within a community are sold. The transition itself, however, is an evolving process that follows several stages and series of events. From a community's inception, the developer is responsible for creating the association and the initiation of the association's operations and governance. However, during the transition process, it is the unit owners and their elected board that has the responsibility to work with the developer to ensure the transition is a smooth one.
Experience shows that through the combined efforts of the developer and owners, a transition can be mutually beneficial to both parties. The developer gets closer to closing out their project and is made aware of construction, legal, financial, and other related issues. During this period, they are given the opportunity to resolve these issues. This can help avoid costly lawsuits, which may be brought on by the new association, for construction defects or other negligent matters thereby preserving their good standing in the community. The owners, on the other hand, benefit by obtaining the necessary information pertaining to the community, learning about the community operations, and having constructions, legal, and financial issues resolved. By working together, understanding the process, and having an appreciation for the benefits that a successful transition can bring, both parties can work well together for the gradual transfer of control. The end result is a successful community, tribute to the developer, and a sound investment for each of the unit owners.
The key to a smooth transition from developer to owner control is getting involved, learning the process, and hiring competent professionals to assist in a successful turnover. If the transition has been thorough and adequately executed, repairs for construction defects can be resolved by the development team. This is provided they have been made aware of them. The transition period is a time when the association has and opportunity to uncover any potentially large and costly construction defects, and a crucial time for and association to retain the serves of qualified professionals to uncover them. In fact, the Florida Senate has adopted statue #558 “Construction Defects” which pertains specifically to Constructions defects and outlines how owners (i.e. associations) must first notify the responsible parties of the construction defects prior to filing any legal action.
Design, specifications, surveying, planning, supervision, observation of constructions, or construction, repair, alteration, or remodeling of a dwelling any appurtenance to the dwelling, or the real property to which the dwelling or appurtenance is affixed resulting from:
 |
-
Defective material, products, or components used in the construction or remodeling;
-
A violation of the applicable codes in effect at the time of construction or remodeling which gives rise to a cause of action pursuant to s. 553.84;
-
A failure of the design of swelling to meet the applicable professional standards of care at the time of governmental approval; or
-
A failure to construct or remodel a dwelling in accordance with accepted trade standards for good and workmanlike construction at the time of constructions.
|
Once the defect has been identified, the statue affords the responsible parties the opportunity to resolve the claim without further legal process. Furthermore, there are strict deadlines and procedures under Florida law which must be followed to protect the association's interests in construction defect claim. And although the process of complying with the requirements of the 558 statue is best handled though the association's professional legal counsel, specific identification of construction defects by a licensed professional engineering firm is crucial.
To assist with the identification of alleged construction defects, associations have turned to professional engineering firms who specialize in building inspection and forensic engineering to construct property condition assessments. These assessments are usually referred to as “Developer Transition Studies” or “Turnover Studies.” These studies are typically tailored to an association's specific requirements and are fee based depending on the size, magnitude, and level of detail. These studies should include a review of the construction plans, project manuals, and specifications; review of condominium documents; research of permits and certificates of occupancies; coupled with comprehensive field assessment of the common property prepared in a report citing each construction defect identified.
Once the report has been prepared, it can be included with other owner supplied documents to form the basis of notifying the developer. Often, the developer does not find such a document adversarial. Most developers welcome these reports as a way of finalizing the closing of the project and satisfying their legal obligations. It is important to realize that the developer typically has warranties with their contractors to resolve these issues; therefore, it is mutually beneficial to them to have these defects identified. Items that are documented to be deficient are then repaired at no charge to the association.
Steven J. Mainardi, PE, RS, is a licensed Professional Engineer and Principal of Delta Engineering & Inspection, Inc., in Sarasota , Fl.
