‘Their goal is to bleed owners dry.’ $34 million victory in Florida HOA lawsuit is rare, experts say

When Martin Kessler moved to the Florida area in 2008, he realized it was a mistake. The 97-year-old had never lived with a homeowners association.

Kessler said that living in an association is not a good experience for a resident. He said the fee he was required to pay was a capitalist's perfect dream of a business. People must join if they like it or not, and they pay all the expenses of the business.

Kessler is one of more than 5,000 people locked in a class action lawsuit against the developer of the community. The residents of Polk County, Florida, were awarded $34.8 million by Circuit Judge Wayne Durden.

The president of the National Homeowners Advocate Group said that the award was the biggest he had ever heard of. Jones' organization helps people fight homeowner associations and lobbies for homeowner protections. We get calls from all over the country, but no one has ever reported a win of that size.

It is hard for residents to win battles with the Homeowners Associations. According to research by analysts at iProperty Management, more than half of the population in Florida is governed by homeowners associations.

With fees that can reach into the thousands of dollars from an estimated 3.5 million homes in the state, homeowners associations can make lawsuits long and costly for residents.

Jan Bergemann is the president of Cyber Citizens for Justice, a homeowner's advocacy group based in DeLand. They will tie it up for a long time.

Free speech issues are raised by the limits on signs that can go up yards. They sometimes tell residents how many cars they can have and sometimes ban basketball goals from yards. A family in Florida was accused of putting up Christmas lights too early and being threatened with a $100 a day fine.

In the early 2000's, Taylor Morrison's company, Avatar, developed several communities in Poinciana. The amenities built by Avatar were pools and clubhouses. When the time came to turn management of the community over to the community development district, they wanted to sell them for $73 million.

There was a problem. The amenities were only worth 25% of the total.

I was against it immediately. Kessler said that it was the most stupid thing he had ever seen.

The future value of the club fee was the basis for the number that was used, according to Carter Andersen of Bush Ross. The lawsuit alleged that the fee was illegal. Residents could have their homes foreclosed upon if they didn't pay their bills.

Taylor Morrison, who has handled the defense in this case, did not return requests for comment.

The $34 million figure is only the beginning, according to Andersen. He estimates that there is at least $27 million in pre-judgment interest and at least $4 million in fees that were not added to the ruling.

The two firms that represented the residents will get between $5 million and $10 million in attorneys' fees. The case was taken on a contingency and the lawyers who fought for it had no retainer from the residents.

Bergemann says it is rare to find attorneys who will take a complicated case without some assurance of payment. If the owners had the money, he said, wins such as Solivita would be very common.

Bergemann says he has spoken to attorneys who want thousands of dollars to get building documents for their clients. He asked who had that.

Jones said that residents face harassment for speaking up because they don't act together. She said that you can't have one or two people taking the brunt of everything.

A lack of government oversight is what Jones says is the problem. She says that many board members cling to their power.

She said that even though they have rules about elections, they won't hold them. The main problem is if you can't get rid of them.

Jones lost her home in Texas because she didn't pay her homeowners association fees. She said that they should be regulated because they take advantage of foreclosures.

Bergemann said that wins like the Solivita case are important because they can create a domino effect and lead to more victories for homeowners around the state.

He said that homeowners have rights but they aren't being enforced.

The win gives hope to people such as Slade Chelbian, a resident of the Bellalago community in Poinciana.

The activity that led to the Solivita suit was the same activity that led to the class-action suit.

This was great news for the fight to stop this type of action. I believe we can win this action in court.

Winning would mean an end to the fee he has been challenging.

He said that the status quo is to pay the developer a mandatory fee forever. That is not fair.