Miami Beach Case Sets Precedent for Banks When Dealing with Condo and Homeowner Associations

A recent case ruling against Citibank for violating the procedural due process rights of a North Miami Beach condominium association sheds light on the ongoing struggle between lenders and condominium associations being played out in courts throughout Florida.

In Jade Winds Association v. Citibank, Florida’s Third District Court of Appeals found that the bank failed to properly notify the condo association of a hearing to cancel a foreclosure sale, and the bank could face sanctions as a result.

“Due to the high volume of foreclosure matters pending, lenders often need additional time to comply with governmental requirements and their own internal policies before they are ready to actually take a property to sale,” says Ronald B. Cohn, a partner at Arnstein & Lehr (Tampa, Fla.), whose practice focuses on lender representation in commercial litigation, foreclosure and bankruptcy matters. “Associations, on the other hand, are desperately trying to stop the bleeding that occurs when numerous units are not generating the assessments necessary to maintain the project.”

Out of necessity, associations have become very alert to lender delays and quite adept at finding the means to push cases through that lenders might otherwise prefer be on a slower track, Mr. Cohn adds.

Mr. Cohn is available for interviews to discuss the potential impact of this case and others like it on Florida’s foreclosure process for both lenders and associations. [05/17/2011]