UnknownA dispute concerning amounts owed (whether owed from an owner to contractor, a contractor to subcontractor, a subcontractor to supplier, etc.) is routine on a construction project.  Even in these disputes, the party responsible for owing  money may recognize there is an undisputed amount actually owed to the other party, although not the amount the other party claims.  While I am a believer in tendering undisputed funds, sometimes there are clever and strategic ways to tender that money.


For instance, the defense of accord and satisfaction is a defense that the party receiving the money deposited the money in full satisfaction of a disputed claim.  The decision in St. Croix Lane Trust & M.L. Shapiro, Trustee, v. St. Croix at Pelican Marsh Condominium Association, 2014 WL 3882458 (2d DCA 2014), while not a construction dispute, illustrates strategy in tendering money in full satisfaction of a claim and then relying on the defense of accord and satisfaction.  In this case, a condominium association foreclosed on a unit for unpaid assessments.  The unit was sold at a foreclosure sale to a Trust for $100.  The $100 was insufficient to pay the association the amount of its foreclosure judgment so the association sent a letter to the Trust advising that the Trust owed the association unpaid assessments that accrued on the unit prior to the foreclosure sale (in excess of $30,000).   The Trust disputed the amount it owed and thought it owed $840.  In this regard, the Trust sent a letter to the association (through counsel) stating, “[I]n a good faith effort to resolve this matter I have enclosed herewith a check in the amount of $840.00….Be advised and warned, this check is tendered in full and final satisfaction of all claims made against the Trust and the property….”  Despite this letter accompanying the check, the association negotiated the check and then threatened to foreclose a lien it recorded against the Trust’s unit due to the dispute.    The Trust filed a lawsuit seeking declaratory relief whether it owed the association any money. An argument it raised was accord and satisfaction since the association negotiated the $840 check clearly sent in full satisfaction of all claims.


On appeal, the Second District agreed with the Trust that accord and satisfaction applied to discharge the Trust of any more monies owed relating to the dispute.  The Second District relied on Florida Statute s. 673.3111 that provides:


“(1) If a person against whom a claim is asserted proves that that person in good faith tendered an instrument to the claimant as full satisfaction of the claim, that the amount of the claim was unliquidated or subject to a bona fide dispute, and that the claimant obtained payment of the instrument, the following subsections apply.


(2) Unless subsection (3) applies, the claim is discharged if the person against whom the claim is asserted proves that the instrument or an accompanying written communication contained a conspicuous statement to the effect that the instrument was tendered as full satisfaction of the claim.”


Furthermore, Florida case law defines an accord and satisfaction as follows:


 “An accord and satisfaction results as a matter of law when the creditor accepts payment tendered on the expressed condition that its receipt is deemed to be a complete satisfaction of a disputed issue. This court has long held that cashing a check containing language that it is in full payment of the debtor’s obligations creates an accord and satisfaction with regard to the claim for which payment was tendered.”

United Auto Ins. Co. v. Palm Chiropractic Center, Inc., 51 So.3d 506, 509 (Fla. 4th DCA 2010) (internal citation omitted)



If you are trying to devise clever strategy to set up an accord and satisfaction defense, you can send undisputed money with an accompanying letter clearly expressing that the money is in full and final satisfaction of the claim / dispute.  Or, clearly delineate this point on the check.  The recipient should not negotiate the check and should instead return it.  If the money is truly undisputed, the paying party can always re-tender that money to take that undisputed amount off the table without conditioning it as a full settlement of the claim. But, if the check is negotiated, as it was in this case, the party has just set up an accord and satisfaction defense!


Please contact David Adelstein at or (954) 361-4720 if you have questions or would like more information regarding this article. You can follow David Adelstein on Twitter @DavidAdelstein1.



277559bConsultant’s Corner: In addition to providing perspectives and analysis from a lawyer, it is beneficial to hear from industry professionals and consultants. These are the folks that serve as expert witnesses during litigation / trial and consult with owners and contractors preconstruction, during construction, and postconstruction. Consultant’s Corner is dedicated towards hearing from those experienced and respected professionals.



K. Patrick Whalen (photo) is President and owner of MPlus Property Services LLC, a Community Association and Commercial Property Management Company with offices throughout Florida. Mr. Whalen is a Florida Licensed Community Association Manager and Licensed Real Estate Salesperson who has served as both an expert witness and consultant to developers and community associations from the early planning stages through turnover. Turnover of the association from the developer to the owners is a crucial milestone to associations. Having an experienced property manager that can navigate owners through the process in ensuring the developer provides all applicable funds and documentation (e.g., minutes of the association, financial records, plans and specifications, certificates of occupancy, written warranties, a turnover inspection report, etc. – see Fla.Stat. s. 718.301(4) relating to condominium association) is imperative. Mr. Whalen takes the time to provide his perspective on developer turnover as a property manager.






As a property manager one of the biggest challenges in maintaining a community after developer turnover is identifying sources for materials and supplies provided, such as mailboxes, light fixtures, decorative tiles and other architectural features on or in a commercial building, home or condominium, or common area.


Having managed and transitioned over 200 developer communities since 1989, experience has helped me to learn and understand the importance of keeping meticulous records on personnel and subcontractors working in a particular community or commercial project. While doing so may involve a considerable amount of time, it can also save you or your clients time and money months and years from now when you can go back to those notes and recall important information.


Over the past 25 years of managing community associations, there have been countless examples of the importance of such records, but one example illustrates how the smallest detail can save tens of thousands of dollars: In 2011, I got a call from a developer asking about a homeowners association we managed for them from beginning through turnover. The developer was concerned because they had received a letter from an attorney threatening to sue over rusting mailboxes installed at each home.

Given that the community built-out to over 5,000 homes and estimates to replace the mailboxes were about $30.00 per mailbox, with another $10.00 per mailbox to remove the old one and install the new ones, the tab for this was going to be around $200,000.00.
Sure the developer could think of a number of reasons why they should not or would not have to pay for the mailboxes, they understood that taking such a position would not be popular with their 5,000+ customers.
Just days before committing the funds, the developer recalled a detailed warranty book that we maintained and provided to the association at turnover. They took note of the fact that the book included not just the warranties on common components like the pool pump, paint and roofing for the common area amenities, but also details about decorative fixtures and finishes, like lights, maybe, just maybe, it included something about the mailboxes, even though they were not the maintenance obligation of the Association. It seemed a longshot.
At the time of their call, it had been over 5 years since turnover and the community transitioned to self-management shortly after. The warranty book given to the on-site manager was nowhere to be found. Wanting to help, we turned to our electronic back-ups for any records kept on our server regarding this community. Among the records we found was a spreadsheet on suppliers / manufacturers and details about their own individual warranties and, to our surprise, we even had scanned copies of warranty papers, which included what came inside the mailboxes—a manufactures lifetime warranty.



Without a doubt, the developer would have paid the cost to replace the mailboxes, but instead was able to make a claim with the manufacturer who not only agreed to replace the mailboxes, but also split the cost of the installation, with the other half paid by the developer. This saved our client over $180,000 in parts and labor and again reminded them of what an invaluable service partner we are to them.




For more information on K. Patrick Whalen:


Phone:  1-855-99-MPlus (67587)




Please contact David Adelstein at or (954) 361-4720 if you have questions or would like more information regarding this article. You can follow David Adelstein on Twitter @DavidAdelstein1.


imagesCA3RVZ03Condominium associations hire contractors for capital improvements and repair / restoration work to common elements (painting, balcony/concrete/stucco restoration or repairs, etc.). When a condominium association hires a contractor to provide labor, services, or materials to the condominium, it needs to understand that nonpayment can lead to the contractor liening–recording a construction lien–the condominium units in the condominium.


Florida Statute s. 718.121(2) maintains: “Labor performed on or materials furnished to the common elements are not the basis for a lien on the common elements, but if authorized by the association, the labor or materials are deemed to be performed or furnished with the express consent of each unit owner and may be the basis for the filing of a lien against all condominium parcels in the proportions for which the owners are liable for common expenses.”


Furthermore, s. 718.121(3) maintains: “If a lien against two or more condominium parcels becomes effective, each owner may relieve his or her condominium parcel of the lien by exercising any of the rights of a property owner under Chapter 713 [Florida’s Lien Law], or by payment of the proportionate amount attributable to his or her condominium parcel. Upon payment, the lienor shall release the lien of record for that condominium parcel.”


Now, what does this mean? First, it means that when an association hires a contractor to perform construction-related work, the work is deemed authorized by all unit owners. Second, it means that because all unit owners are deemed to consent to the work, the contractor, if unpaid, can lien each condominium parcel / unit. Third, it means that the lien against each unit will be in the proportionate amount that the owner is liable for common expenses. And, last, it means that each owner has options to discharge the lien from his/her condominium unit- the owner can pay his/her proportionate share to discharge the lien or the owner can transfer the lien to a bond or other security.


If a contractor is not paid by the association and elects to lien and move forward with a lien foreclosure lawsuit, the contractor is not required to sue each individual owner. Rather, the contractor can simply sue the association since the association is deemed to represent the unit owners’ interests. See Trintec Construction, Inc. v. Countryside Village Condominium Association, Inc., 992 So.2d 277 (Fla. 3d DCA 2008) (finding that unpaid roofing contractor that filed lien foreclosure action against association was not required to join all of the unit owners in the action); Four Jay’s Construction, Inc. v. Marina at the Bluffs Condominium Association, Inc., 846 So.2d 555 (Fla. 4th DCA 2003) (finding that balcony contractor properly sued the association in breach of contract action as a class representative on behalf of the owners).


Contractors that are hired by associations need to understand their lien rights in the event of nonpayment. And, associations that hire contractors need to understand their options in the event they are involved in a payment dispute with a contractor so that owners can be best advised.


Please contact David Adelstein at or (954) 361-4720 if you have questions or would like more information regarding this article. You can follow David Adelstein on Twitter @DavidAdelstein1.



can-stock-photo_csp9881764A benefit to condominium unit owners and their associations is that Florida’s Condominium Act provides for statutory warranties that are extended from developers, the contractor, subcontractors, and suppliers. Fla. Stat. s. 718.203. These statutory warranties allow for direct breach of statutory warranty claims against the responsible party. The statutory warranties included in Florida’s Condominium Act are set forth at the bottom.


In The Port Marina Condominium Association, Inc. v. Roof Services, Inc., 38 Fla. L. Weekly D1876a (Fla. 4th DCA 2013), the Court discussed a breach of statutory warranty claim against a manufacturer compared to a supplier of building materials to a project. Florida’s Condominium Act does not provide a statutory warranty that extends to manufacturers. In this case, the developer hired a roofer to install a roof on boat storage building with a manufacturer guarantee from GAF (manufacturer) for the roofing product called TOPCOAT. After the condominium was turned over to the Association, leaks in the roof of the boat storage building were discovered. The Association was told that the leaks were due to the failure of the TOPCOAT product. A GAF manufacturer’s representative inspected the roof and advised that the product did not fail, rather it was the application of the product by the roofer that failed (which would not be covered by the manufacturer’s warranty, which typically does not cover workmanship).


The Association filed a complaint against the manufacturer (and others) for breach of the statutory warranties. The manufacturer moved to dismiss because Florida’s Condominium Act does not allow for a breach of a statutory warranty claim against a manufacturer. As it relates to a claim against a supplier, the Court explained:


The essential elements of a cause of action under this statutory provision against a supplier are: (1) the defendant is a supplier of materials to a condominium; (2) the materials failed to conform to the generally accepted standards of merchantability applicable to goods of that kind, or the materials failed to conform to the requirements specified in the contract; and (3) the failure of the goods to conform was a proximate cause of the plaintiff’s damages. See Leisure Resorts, 654 So.2d at 914. “Supplier” and “manufacturer” are not defined in Chapter 718, Florida Statutes. Black’s Law Dictionary defines “supplier” as “a person engaged, directly or indirectly, in the business of making a product available to consumers,” and “manufacturer” as “a person or entity engaged in producing or assembling new products.” Black’s Law Dictionary (9th ed. 2009).


The Port Marina Condominium, supra.


Whether the Association could properly assert a claim against GAF (manufacturer of TOPCOAT) is based on whether GAF was a supplier or manufacturer for purposes of the condominium project. The Court noted that the distinction would be whether GAF furnished, sold, or delivered anything to the entities involved in construction, i.e., “‘was in the business of making the product available to consumers,’” as opposed to merely “‘producing or assembling’” the product that Best Roofing, a roofing contractor [that applied the product], not a consumer, then purchased and used for the roofing project.” The Port Marina, supra.


The distinction between a supplier and manufacturer is not always clear as a manufacturer can be a supplier with respect to a given product. Typically, one would think of GAF as a roofing manufacturer where its materials are likely sold through distributors or retailers (e.g., supply companies). Where the supply company could certainly be a supplier if it sold products directly for purposes of the project, the manufacturer should not constitute a supplier.


In this case the Court allowed the Association to amend its Complaint to clarify that GAF was a supplier and not a manufacturer in order to survive a motion to dismiss. It is uncertain whether the Association pursued a claim against the manufacturer for breach of an express warranty. In particular, if the Association has an argument that the manufacturer breached the express warranty for TOPCOAT that was assigned or extended to it (oftentimes these manufacturer warranties state they are assignable or extended to the end user), then perhaps a breach of express warranty claim could have been asserted against it. While there could have been hurdles with this claim because privity of contract is generally required to assert a breach of express or implied warranty claim, this privity of contract requirement could have been negated if there was an assignable warranty.


Understanding the statutory warranties is important for Associations and condominium unit owners because it is a benefit that should be realized. Equally important is the manner in which allegations are pled in a complaint in order to survive any motions to dismiss and get the potentially responsible parties to the table.


Fla. Stat. s. 718.203

(1) The developer shall be deemed to have granted to the purchaser of each unit an implied warranty of fitness and merchantability for the purposes or uses intended as follows:

(a) As to each unit, a warranty for 3 years commencing with the completion of the building containing the unit.

(b) As to the personal property that is transferred with, or appurtenant to, each unit, a warranty which is for the same period as that provided by the manufacturer of the personal property, commencing with the date of closing of the purchase or the date of possession of the unit, whichever is earlier.

(c) As to all other improvements for the use of unit owners, a 3-year warranty commencing with the date of completion of the improvements.

(d) As to all other personal property for the use of unit owners, a warranty which shall be the same as that provided by the manufacturer of the personal property.

(e) As to the roof and structural components of a building or other improvements and as to mechanical, electrical, and plumbing elements serving improvements or a building, except mechanical elements serving only one unit, a warranty for a period beginning with the completion of construction of each building or improvement and continuing for 3 years thereafter or 1 year after owners other than the developer obtain control of the association, whichever occurs last, but in no event more than 5 years.

(f) As to all other property which is conveyed with a unit, a warranty to the initial purchaser of each unit for a period of 1 year from the date of closing of the purchase or the date of possession, whichever occurs first.

(2) The contractor, and all subcontractors and suppliers, grant to the developer and to the purchaser of each unit implied warranties of fitness as to the work performed or materials supplied by them as follows:

(a) For a period of 3 years from the date of completion of construction of a building or improvement, a warranty as to the roof and structural components of the building or improvement and mechanical and plumbing elements serving a building or an improvement, except mechanical elements serving only one unit.

(b) For a period of 1 year after completion of all construction, a warranty as to all other improvements and materials.


Please contact David Adelstein at or (954) 361-4720 if you have questions or would like more information regarding this article. You can follow David Adelstein on Twitter @DavidAdelstein1.


untitledThe Florida Supreme Court’s decision in Maronda Homes, Inc. of Florida v. Lakeview Reserve Homeowner’s Association, Inc., 38 Fla. L. Weekly S573a (Fla. 2013) has been a long awaited decision for both homeowners associations and home builders.


This case started when a homeowners association sued the home builder of the residential subdivision for common law breach of implied warranties of fitness and merchantability (also known as the warranty of habitability in the residential context) due to construction defects. The association asserted that infrastructure, particularly as it pertained to the storm water drainage system, was defective and was causing substantial flooding and other damage (e.g., severe soil erosion, damage to roadways, etc.).


The trial court entered summary judgment for the home builder finding that common law implied warranties do not extend to infrastructure, private roadways, drainage systems, retention ponds, or other common locations in a subdivision because these structures (or construction improvements) do not immediately support the homes.


On appeal, the Fifth District reversed the trial court holding that the common law implied warranties are applicable to the facts of the case. The Fifth District maintained that the common law implied warranties “have application to improvements to real property that not only support residences in a structural sense, but also apply to improvements which provide ‘essential services’ for the habitability of homes.” Maronda Homes, supra. Essential services for the habitability of homes include “roads for ingress and egress, drainage systems to divert flooding, retention ponds to correct water flow damage, and underground pipes (whether they be storm water or sanitary sewer pipes) which are necessary for living accommodations.” Id. In other words, the Fifth District held that the common law implied warranties apply to structures / construction improvements in a subdivision that immediately support the homes in the form of essential services. Id.


After the Fifth District’s holding, the Florida Legislature enacted Florida Statute s. 553.835 which it intended to apply retroactively (meaning the homeowners association would have no claims against the home builder in Maronda). This statute was enacted as a reaction to the Fifth District’s ruling to apply common law implied warranties to improvements that support the homes in a subdivision. This statute provided:


There is no cause of action in law or equity to a purchaser of a home or to a homeowners association based upon the doctrine or theory of implied warranty of fitness and merchantability or habitability for damages to offsite improvements.”


Offsite improvements were defined in the statute as follows:


“(a) The street, road, driveway, sidewalk, drainage, utilities, or any other improvement or structure that is not located on or under the lot on which a new home is constructed, excluding such improvements that are shared by and part of the overall structure of two or more separately owned homes that are adjoined or attached whereby such improvements affect the fitness and merchantability or habitability of one or more of the adjoining structures; and

(b) The street, road, driveway, sidewalk, drainage, utilities, or any other improvement or structure that is located on or under the lot but that does not immediately and directly support the fitness and merchantability of the home itself.”


Based on this new statute, the Florida Supreme Court needed to determine (a) whether the statute applied retroactively and (b) if it did not apply retroactively, do the common law implied warranties apply to structures / construction improvements in a subdivision that immediately support the homes in the form of essential services.


The Florida Supreme Court, agreeing with the homeowners association, held that (a) the statute did not apply retroactively, and (b) the Fifth District’s ruling was correct with their “essential services” test or standard to “determine whether a defect in an improvement beyond the actual confines of a home impacts the habitability and residential use of the home.” Maronda Homes, supra.


However, what the Florida Supreme Court importantly touched upon was the enforceability or constitutionality of Florida Statute s. 553.835 moving forward. Under this new statute, if the homeowners in Maronda sued today, its common law implied warranty claims would be barred by virtue of this statute (since its claims were asserted after the enactment of the statute).


An important portion of the Florida Supreme Court’s opinion provides:


“Article I, section 21 of the Florida Constitution declares the right to access the courts, stating that ‘The courts shall be open to every person for redress of any injury, and justice shall be administered without sale, denial or delay. In Kluger v. White, 281 So.2d 1, 3-4 (Fla. 1973), this Court interpreted the meaning of the phrase ‘redress of any injury.’ It held that where a cause of action exists under the statutory or common law of Florida, the Florida Legislature may not abolish that action unless it provides a reasonable alternative for redress of injuries, or demonstrates an overpowering public necessity for its abrogation and no other means by which to meet that necessity.”


Here, Lakeview Reserve [association] contends that section 553.835 violates article 1, section 21, because it abolishes the cause of action for breach of the implied warranties and fails to provide a reasonable alternative or demonstrate an overpowering public necessity for that abrogation. Maronda Homes…allege that although section 553.835 curtails the cause of action for breach of the implied warranties, it preserves other viable remedies that may exist in tort, contract, or by statute, such as negligence, misrepresentation, and rescission.


Section 553.835 violates the right of access to courts because it attempts to abolish the common law cause of action for breach of the implied warranties for certain injuries to property. In section 553.835(4), the Legislature establishes its intent to abolish some implied warranties by expressly limiting a cause of action for their breach by eliminating “offsite improvements for that action’s scope, even if such improvements impact the on-site habitability of the home….The statute even provides that the purpose of the law is to place limitations on the applicability of the doctrine or theory of implied warranty of fitness and merchantability, and to reject the decision by the Fifth District Court of Appeal in the Maronda case. This is a clear violation of separation of powers because the Legislature does not sit as a supervising appellate court over our district courts of appeal.”


Based on this portion of the decision, a homeowners association that has potential claims for “offsite improvements” after the enactment of s. 553.835 may still have these common law implied warranty claims based on an argument that the statute violates constitutional rights. If the statute is determined to violate constitutional rights by trying to abrogate common law implied warranties, the association will still have to satisfy the “essential services” standard set forth by the Fifth District and approved by the Florida Supreme Court in Maronda.


Please contact David Adelstein at or (954) 361-4720 if you have questions or would like more information regarding this article. You can follow David Adelstein on Twitter @DavidAdelstein1.


UnknownStatutory implied warranties are a valuable tool for condominium associations (as well as purchasers of units) of newly formed condominiums.  The warranties provide the association with direct claims to assert against the developer, the general contractor, subcontractors, and even suppliers, if there is defect with the condominium.  The specifics of the implied warranties, and the timing as to when these statutory warranty claims must be brought, can be found in Florida’s Condominium Act, specifically Fla. Stat. s. 718.203.


Recently, in Harbor Landing Condominium Owners Association, Inc. v. Harbor Landing, L.L.C., 2012 WL 254971 (Fla. 1st DCA 2012), a condominium association initiated a lawsuit that included a breach of the statutory implied warranty claims provided for in Fla. Stat. s. 718.203.  The association sued, amongst other entities, the manufacturers of coating that was applied on the exterior railings.  The association argued that the statutory implied warranties extended to the manufacturer because the manufacturer was a supplier (and a statutory implied warranty claim extended to suppliers).  While there are certainly situations whereby a manufacturer could also be a supplier, in this case, the manufacturer of the coating did not supply the exterior railings.  Rather, a separate entity supplied the railings.  For this reason, the court said that the statutory implied warranties could not extend to the manufacturer of the coating applied to the railings (since a different entity supplied the railings). This ruling simply means that the association could bring the statutory warranty claim against the supplier of the railings, just not the manufacturer of the coating.


The relevance of this case is that if there are defects with a condominium, particularly a recently built condominium, it is important for the association (or unit owner) to seek legal counsel to best preserve rights in seeking recourse based on the defects.  This includes the appropriate entities to sue as well as the arguments / claims to include against the entities based on the asserted defects.




Please contact David Adelstein at or (954) 361-4720 if you have questions or would like more information regarding this article. You can follow David Adelstein on Twitter @DavidAdelstein1.