On June 27, 2020, Florida Governor Ron DeSantis signed House Bill 469 into effect, and it became law on July 1, 2020. The Bill amends Florida Statute §689.01 by removing the requirement that two witnesses must be present for a commercial or residential property lease to be valid. Prior to the amendment of the Statute, each of the parties were required to have two witnesses present when signing a lease for a term of more than one year. The House Bill provides that subscribing witnesses are no longer required to validate instruments conveying or pertaining to a lease of real property.
This requirement was originally in place to prevent fraud or forgery, as witnesses could be asked to verify the legitimacy of leases after the fact in the case of a challenge. However, as Florida and many other jurisdictions trend more heavily in favor of electronic transactions, it has long been a question of whether witnesses are truly necessary. The burden of the witness requirement has only grown through the use of electronic transactions, often adding unnecessary delay to make sure witnesses are available at the same time as the landlord and the tenant.
While this change in the law is small, it is widely welcomed. The removal of the witness requirement improves the speed and efficiency of transactions by making electronic lease signatures much more easily obtainable. This not only has the potential to save time in the execution of leases by allowing a lease to be signed by just the two parties, it also removes one potential pitfall to invalidating a lease.
If you have questions about House Bill 469 or the execution and other requirements for leases in Florida, please contact our real estate law team.
At the beginning of the COVID-19 crisis on April 2, 2020, Governor DeSantis issued Executive Order 20-94, entitled “Mortgage Foreclosure and Eviction Relief” (“EO 20-94”). EO 20-94 provided for a statewide freeze on mortgage foreclosure causes of action and residential evictions based upon the non-payment of rent. As the number of COVID-19 cases has increased in Florida, Governor DeSantis has issued four total extensions to Executive Order 20-94 with the latest one, EO 20-180, being signed on July 29, 2020, and extending the moratorium until September 1, 2020, at midnight.
Up until EO 20-180, there remained some unanswered questions around whether homeowner’s association and condominium association lien foreclosure actions were intended to be covered under the moratorium on mortgage foreclosures established by EO 20-94. Luckily, we’ve now received clarification with this order being specifically tied to the financial impact caused by the pandemic. While the moratorium will continue through August, the moratorium will only relate to “final action at the conclusion of a mortgage foreclosure proceeding under Florida law solely when the proceeding arises from non-payment of a mortgage by a single-family mortgage adversely affected by the COVID-19 emergency;” and to “final action at the conclusion of an eviction proceeding under Florida law solely when the proceeding arises from non-payment of rent by a residential tenant adversely affected by the COVID-19 emergency.”
One could argue that the limitation laid out in EO 20-180 that restricts the moratorium to single-family mortgages shows that was the intention of the previous executive orders as well. You can read Executive Order 20-180 in its entirety here: https://www.flgov.com/wp-content/uploads/orders/2020/EO_20-180.pdf.
For the latest news on COVID-19’s effects on community associations, contact our association law team for more information.
UPDATE: On August 31, 2020 Governor Ron DeSantis extended the moratorium on evictions and foreclosures until 12:01 am on October 1st.
Written by: Lauren Wilmot & Scott Cookson
When it comes to residential property sales, a homebuilder’s obligations regarding the nature and extent of information about a home that must be disclosed varies widely by state. While every state requires some form of property disclosure, homebuilders seeking to finalize a deal and buyers eager to gain information about a prospective home or neighborhood likely want to pay close attention to the laws of their state regarding what information must be specifically disclosed.
Under Florida law, whether a residential property seller has a duty to disclose facts which may affect a buyer’s decision to purchase a home is governed by the Florida Supreme Court case, Johnson v. Davis. 480 So. 2d 625 (Fla. 1985). In Johnson, a residential buyer claimed that serious roof defects, known to the seller, were misrepresented or not disclosed prior to sale. Largely abandoning the common law doctrine caveat emptor, or “buyer beware,” the Court reasoned that a seller should be held liable for failing to disclose a property’s material defects of which he or she has knowledge. The Johnson case became the law in Florida, applicable to all residential property transactions, establishing that where a seller knows information about a home, which is neither readily observable nor known to the buyer, but materially affects the property’s value, such information must be disclosed. Subject to a few exceptions, this duty to disclose material facts has been extended to various forms of physical defects and off-site conditions. Thus, it is important that homebuilders in the state of Florida are aware that they have a duty to disclose facts about home conditions of which they have knowledge and which materially affect a property’s value or desirability, where such facts are either accessible only to the homebuilder or are known by the homebuilder to be outside the reach of the buyer’s diligent attention and observation.
Notably, a homebuilder’s duty to disclose material facts affecting a residential property is not all-encompassing. By enactment of state statute, Florida has exempted certain property conditions which, though likely to affect the value of a property, are nonetheless excluded from mandatory disclosure. Specifically, a Florida seller has no duty to disclose that a residential property was the site of a homicide, suicide, or death or that the prior occupant of the property was infected with human immunodeficiency virus (HIV) or diagnosed with acquired immune deficiency syndrome (AIDS) (see Fla. Stat. §689.25(1)(2)). While these “psychological conditions,” unrelated to the physical condition of the home, have been specifically exempted, disclosure of other forms of information, such as the presence of registered sexual offenders in a home’s vicinity, has not yet been definitively addressed. Though Florida Courts have not offered any express guidance, a homebuilder concerned about whether or not it has a duty to disclose such information may potentially be protected from doing so under Florida case law dealing with disclosure of information contained within the public record.
In Nelson v. Wiggs, the Third District Court of Appeal held that enactment of housing code regulations, and availability of those regulations in the public record, was sufficient to place information regarding a property’s possible flood risk within the diligent attention of any buyer. 699 So. 2d 258 (Fla. 3d DCA 1997). Finding that such information was readily observable and within a buyer’s diligent attention, the court consequently determined the residential property’s seller had no duty to disclose. Like the county regulations in Nelson, information regarding the physical residences of registered sexual offenders and predators in the state is made publicly available by the Florida Department of Law Enforcement (FDLE) (see Fla. Stat. §§944.606, 775.21). Florida Statutes detailing procedures for dissemination of such registry information note that the systems serve to ensure public access; moreover, the expressed legislative intent of Florida Sexual Predators Act, which requires a sexual offender’s registration, is community notification to ensure that “accurate information be maintained and accessible” to the public (see Fla. Stat. §§943.043, 775.21(3)). Given the ease with which information from Florida’s sexual offender registry can be found, including the proximity of a sexual offender to any given residential property, whether or not a sexual offender lives within a neighborhood may likely be considered public information within the reach and diligent attention of any buyer. Therefore, as in Nelson, the existence of a public record, albeit one that details the location of Florida’s registered sexual offenders as opposed to housing regulations, may likely discharge a homebuilder from any resulting duty to disclose that a sexual offender resides within a property’s vicinity.
Moreover, while Florida has not directly addressed the issue, either statutorily or through existing case law, several other states who have specifically considered the question have determined a seller is without a duty to disclose that a sex offender’s residence is nearby. Specifically, in Glazer v. LoPreste, the Supreme Court of New York Appellate Division held that the presence of a sex offender in the neighborhood was neither peculiarly within the knowledge of the seller nor unlikely to be discovered by a purchaser exercising due care, such that no claim against the seller existed for failing to disclose the information. Additionally, in Arizona, where a couple brought suit alleging they had unwittingly purchased a home located next door to a registered sex offender, the Arizona Court of Appeals held that any claim against the seller was precluded by an Arizona statute preventing civil action against a transferor or lessor of real property who failed to disclose a transferred property was in the vicinity of a sex offender. In other states which statutorily require some disclosure, such as California, a seller of residential property only need notify the buyer that a state sex offender registry exists, with no accompanying duty to provide any additional information. Similarly, in Michigan, Connecticut, Alaska and Washington, the only required disclosure is that public information pertaining to sex offenders exists, such that buyers then have the ability and duty to investigate such information further.
Ultimately, in the state of Florida, a homebuilder need not disclose the residence of a sex offender nearby; however, more express guidance may await legislative action or a suit directly challenging the issue. While proximity to a known sex offender may be considered to materially affect property values, the existence of a public registry suggests that, like Nelson v. Wiggs, the presence of a sex offender in the neighborhood is not a matter exclusively known to the seller, rather it is information contained in a public record within the buyer’s diligent attention. For a buyer, this means that consulting FDLE’s sexual offender registry may be a prudent step towards finalizing any residential property transaction. In practice, homebuilders should consider including the website information for the FDLE’s sexual offender registry in their standard set of community disclosure documents. It is worth noting that while a homebuilder may not have a duty to disclose the proximity of sexual offenders in a neighborhood, where a homebuilder or sales associate undertakes to disclose some facts, the homebuilder must disclose the whole truth and any fraudulent statements or misrepresentations could run the risk of subjecting the homebuilder to suit. Homebuilder sales associates may be well advised that where they find themselves questioned by a buyer, the safest course of action is to point the buyer in the direction of the FDLE registry, thereby enabling the buyer to learn for themselves the proximity of a sexual offender to their prospective home.
If you have questions about your standard disclosure documents or disclosure obligations as a homebuilder selling residential property, please contact one of Shuffield, Lowman & Wilson, P.A.’s homebuilder practice group real estate attorneys.
On Monday, June 15, the Supreme Court ruled in a landmark decision that protections under Title VII of the Civil Rights Act of 1964 (“Title VII”) extend to protect gay and transgender employees from discrimination. The decision—Bostock v. Clayton County, Georgia—is a consolidation of three cases in which employees were terminated by their employers on the basis of their sexual orientation or transgender stereotyping. Title VII prohibits employment discrimination based on race, color, religion, sex and national origin. However, what constitutes discrimination on the basis of sex has been strenuously debated in courts nationwide, with lower courts regularly holding that Title VII’s protections did not extend to individuals who experienced adverse employment action merely because they were gay or transgender. Courts are now faced with a new Title VII frontier.
In the opinion written by Justice Gorsuch, the Supreme Court held that Title VII is violated by firing an individual for being homosexual or transgender. Justice Gorsuch, who is widely known for his textualist approach in statutory interpretation, wrote: “when an employer fires a person for traits or actions that the employer would not have questioned in members of a different sex, then sex plays a necessary and undisguisable role in the decision, which is exactly what Title VII forbids.” He further wrote that it is impossible to discriminate against a person for being homosexual or transgender without discriminating against that individual based on sex. Notably, Title VII maintains a statutory “but for” cause standard. Thus, if a plaintiff can show that but for their gender identity or sexual orientation they would not have been fired, they have a valid claim under the extension of the statute.
The Court reached its decision by a margin of 6-3, with Justice Gorsuch and Chief Justice Roberts, two conservative members, siding with the four liberal members of the Court. The two dissenting opinions, written by Justice Alito and Justice Kavanaugh, argued that the textual reasoning was misapplied and that drafters of Title VII did not contemplate discrimination based on sexual orientation or gender identity, making the extension of Title VII to cover these individuals a job better suited for the legislation.
Prior to this decision, half of the States—including Florida—did not have laws that prohibit discrimination based on sexual orientation and gender identity. However, Orlando is one of the few municipalities with ordinances that already made it unlawful for an employer to discriminate against an employer for sexual orientation and gender identity. See Section 57.14 of the City Code of Ordinances. Thus, Orlando employers could already face claims of discrimination based on sexual orientation and gender identity under these ordinances. With the Supreme Court’s decision, federal law has caught up to Orlando’s ordinances and Title VII expanded federal protection to these employees as well. Although this decision is narrowly tailored, making it unclear as to how far Title VII will extend in other contexts, many employees across the country are now protected from discrimination based on their gender identity and sexual orientation at the hands of their employers as a result of this decision.
The impact of the Bostock decision has broad implications for employers. Although many Florida employers already have policies in place that prohibit discrimination on the basis of sexual orientation or gender identity, there is no longer any doubt that private employers with more than 15 employees may face legal liability under Title VII if an employee is subjected to harassment or discrimination due to the employee’s sexual orientation or gender identity. Employers should revise and expand their policies, handbooks, and training programs to incorporate specific provisions prohibiting discrimination and harassment against gay and transgender employees.
If you would like to confirm your organization’s policies comply with Title VII’s newly expanded protections or would like assistance in forming and implementing new Title VII training programs, please contact Shuffield, Lowman & Wilson, P.A., for your labor & employment law needs.
On June 18, 2020, ShuffieldLowman attorneys Clay Roesch and Alex Douglas will be presenting webinars as a part of the Florida Law Update 2020 live audio webcast. This seminar will provide 2020 updates for following topics: Business and Litigation Law, Labor and Employment Law, Animal Law, Elder Law, Estate Planning, Family Law, Criminal Law and Real Property Law.
Clay will be presenting a Business & Litigation Law Update, and Alex will be co-presenting on two topics, Elder Law and Estate Planning Updates. This webcast is a Continuing Legal Education (CLE) course for the Florida Bar and will take place from 8:00 AM to 4:25 PM. There is a $240 registration fee for the course, which provides 8 CLE credits. For further information and registration details, visit: bit.ly/FL_LawUpdate_20.
Congress passed the Paycheck Protection Program Flexibility Act of 2020 on June 3, 2020, and President Trump signed it into law on June 5, 2020. The Act made some key revisions to the Paycheck Protection Program (PPP) as well as provided further clarity for issues surrounding the forgiveness portion of the loan. Below are some of the significant amendments that businesses who applied and received PPP loans should now review and take into consideration.
1. While the CARES Act originally granted borrowers only eight weeks to spend the PPP Loan money, this new Act now gives borrowers 24 weeks from when the loan proceeds are received to use the funds and still qualify for forgiveness.
2. The CARES Act originally mandated that at least 75% of the PPP loan funds had to be used towards employee payroll in order for the loan to be forgiven. This new Act has reduced that to 60%. This means that businesses can now use 40% of the loan towards non-payroll expenses and still be eligible for forgiveness. This change was perhaps the most significant as it will make many more businesses (especially those who have not yet been able to hire back employees) eligible for loan forgiveness. Keep in mind, this means that businesses will now have 24 weeks to spend the funds on qualifying rent, utilities and mortgage payments on up to 40% of their PPP loan.
3. For loans that are not forgiven, borrowers now have a minimum of five years to repay the loan – up from the previous two years.
4. Borrowers now have until December 31, 2020 to get their “full-time equivalent” (FTE) employee count back to what it was in the reference period in order to avoid a reduction in the amount of the loan being forgiven. The original deadline was June 30, 2020.
5. The Act allows for two new exceptions for borrowers to achieve full PPP loan forgiveness even if they don’t fully restore their workforce. Borrowers were already allowed to exclude employees who turned down good-faith offers to be rehired at the same hours and wages as before the pandemic. The PPPFA adds that an employer can be exempt from the loan forgiveness reduction related to workforce restaffing if they can document that they:
- Are unable to find and hire similarly qualified employees for unfilled positions on or before December 31, 2020; or
- Are unable to restore business operations to the levels they were at on Feb. 15, 2020, due to COVID-19-related operating restrictions.
6. Under the new law, businesses can defer payment of the employer portion of the Social Security taxes until 2022 (50 percent to be paid in 2021 and the remainder in 2022), regardless of when the loan is forgiven.
7. Payments under the previous guidelines were set to be due after 6 months. Now payments are no longer due until the forgiveness amount is determined and remitted to the lender.
Although many of these changes eased some of the burdens borrowers felt, there are also some major issues that are awaiting clarification. These include:
- Forgiveness Calculation: Will businesses still be eligible for loan forgiveness if their payroll costs fall under 60% of the loan? Under the previous rule, if a company’s payroll expenses were less than 75% of the loan, they could still receive loan forgiveness, but the amount forgiven would be prorated. The way the new law is written, it is unclear whether loan forgiveness would be available for anyone whose payroll costs fall below 60% of the total loan.
- Compensation Limitations: Under the previous law, there was a cap for compensation for any employee making over $100,000. (The cap was $15,384 for the 8-week covered period). The question now is if the provision that increases the covered period to 24 weeks also allows for the salary of employees over $100,000 to be calculated at the 24-week period as well.
ShuffieldLowman’s Corporate Law and Banking & Finance teams are continuing to monitor the changes to the Paycheck Protection Program, and how these new laws will affect Central Florida businesses, banks, and lenders. To speak to an attorney, fill out our contact form.