But is it a condominium? Village of Doral Place Association, Inc., v. Ru4 Real, Inc.

• Author: Hartenstine, J. Michael
• Position: Real Property, Probate and Trust Law

The case of Village of Doral Place Association, Inc., v. RU4 Real, Inc., 22 So. 3d 627 (Fla. 3d DCA 2009), ostensibly concerns the validity of a tax deed conveying title to condominium common elements. In reality, the holding of the Third District Court of Appeal that the tax deed was invalid due to its violation of F.S. [section]718.107, (1) is entirely misplaced due to the court's pervasive confusion of condominiums and subdivisions. This article is intended to address this confusion and to demonstrate that Village of Doral Place Association is not precedent for converting subdivision common areas into condominium common elements.

The case centered on Tract F, a parcel approximately one-half acre in size within the Doral Park Country Club Villas subdivision in Miami-Dade County. (2) In 1986, the subdivision developer constructed a swimming pool on Tract F. (3) In 1998, the developer transferred Tract F to Village of Doral Place Association, Inc.4 Following the association's failure to pay taxes assessed against Tract F, RU (4) Real, Inc., and For Sale by Owner Realty, Inc., purchased Tract F at public sale in 2003 for $57,000 and received a tax deed to Tract F. (5)

The buyers of Tract F erected a fence around Tract F, thereby depriving the subdivision residents from using the pool. The association then commenced litigation against the buyers to invalidate the tax deed and preserve the residents' right to use the swimming pool. The Miami-Dade County property appraiser and tax collector were joined as defendants. (6)

The circuit court ruled that the association's challenge to the tax d eed was barred by the statute of nonclaim provided for in F.S. [section]194. 17 1 (2), (7) and that the tax deed was valid. The circuit court also ruled that existing covenants, restrictions, and easements survived the tax deed pursuant to F.S. [section]197.573, (8) and that Tract F could "only be used as a pool area for the sole benefit of the residents and guests of the Village of Doral Homeowners [sic] Association." (9)

Tax Deed Invalidated

The Third District Court of Appeal held that F.S. [section]194.171(2) was inapplicable because the association was not challenging the tax assessment. Rather, the court said, the "[association's claim is that Tract F is a common element which is prohibited from being sold separately by section 718.107, Florida Statutes." (10)

The buyers claimed that their title under the tax deed was unassailable because, under F.S. [section]65.081(3), (11) the only permitted defense to a quiet title action brought by a grantee under a tax deed is that the former owner paid the taxes prior to issuance of the tax deed. Since the association had not met this requirement, the buyers contended that the association's challenge to the tax deed was barred.

Apparently faced with the conflicting provisions of [section]718.107 (dictating a holding in favor of the as sociation) and subsection 65.081(3) (dictating a holding in favor of the buyers), the court acknowledged its responsibility to "read the Florida Statutes in pari materia and to harmonize the statutes with each o the r whe re ve r po ss ible." (12) The court concluded that [section]718.107 prevailed both because there was "no indication that subsection 65.081(3) overcomes the ban on separate sale of common elements contained in subsection 718.107" and because "statutes will not be construed so as to reach an absurd result." (13)

The court, therefore, invalidated the tax deed and ordered the association to repay the buyers the purchase price plus interest. The buyers were made whole (except litigation costs and fees), the association regained title to Tract F, and the residents again had use of the swimming pool. In Solomonic fashion, justice seemingly was done.

Common Areas or Common Elements--What's in a Name?

Or was it? At what price to statutory construction and real property law principles was the court's holding achieved? A very high price, it turns out. The court's opinion has an internal logic dependent on a fundamental misapprehension of basic legal principles governing communities comprised of both condominium units and subdivision lots.

The court's fundamental error was equating the common areas of a subdivision with the common elements of a condominium. The court acknowledged the county's argument "that there is a distinction between a 'common element' of a condominium and a 'common area,'" (14) but then dismissed the argument as "without merit." (15)

The court correctly noted that a condominium unit is defined under F.S. [section]718.103(27), as "a part of the condominium property which is subject to exclusive ownership." The court further correctly noted that common elements are defined under F.S. [section]718.103(8), as "the portions of the condominium property not included in the units." The court then reasoned that since "Tract F is part of the condominium property which is not subject to exclusive ownership .... Tract F is a common element." (16) The court continued:

It is true that the condominium declaration defines the areas outside the condominium units as "common areas." The declaration does not use the term "common elements." This difference in terminology makes no difference in substance. For purposes of chapter 718, Tract F satisfies the statutory definition. It is a common element which cannot be separately sold. (17)

In stating that the difference in terminology makes no difference in substance, the court could not be more wrong. Common elements of a condominium are completely different from common areas of property that are not part of a condominium. Should the court's view that these terms are interchangeable be adopted by other courts of this state, the law governing homeowner association communities will be swallowed whole by the condominium act, with ensuing uncertainty over the legal rights and obligations of developers, homeowner associations, and lot owners. That is why the court's fundamental misconceptions in Village of Doral Place Association must be explained.

Village of Doral Place Is Not a Condominium

The court's misconceptions are evident at the outset of its opinion. In the second paragraph of the...