Summary Judgment on Declaratory Action by ChambersStreet

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									         I THE CIRCUIT COURT OF THE FIRST JUDICIAL CIRCUIT
                I A D FOR WALTO COU TY, FLORIDA
                          CIVIL DIVISIO

JOH P. CARROLL,

       Plaintiff,                                  Case o.: 09CA002021
v.

WATERSOU D BEACH COMMU ITY ASSOCIATIO , I C.,
Florida Corporation
WATERCOLOR COMMU ITY ASSOCIATIO , I C.,
DAVID LILIE THAL, individually and as Director,
MARY JOULE,
SA DRA MATTESO ,
RO ALD VOELKER,
JOH DOE, JA E DOE, and OTHER U K OW
CO SPIRATORS

       Defendants.

____________________________________________/

             PLAI TIFF’S MOTIO FOR SUMMARY JUDGEME T

       COMES NOW Plaintiff JOHN P. CARROLL (hereinafter “Plaintiff”), pursuant

to Florida Rules of Civil Procedure 1.510(a), and moves for Summary Judgment, and as

grounds therefore states:

       1.      This is an action brought pursuant Chapter 86, Florida Statutes, for

judgment declaring that Defendants WaterSound Beach Community Association, Inc.

(WaterSound), Sandra Matteson (Matteson), David Lilienthal (Lilienthal) and Mary

Joule’s (Joule) benefited assessment, related to construction time, is improper, invalid

and non-lienable against the individual lots within WaterSound.

       2.      Plaintiff is Florida Licensed Building Contractor RB0066902 and the sole

personal qualifying agent for Chambers Street Builders, Inc. QB46853 who is the permit

holder for the construction at Lot 24, Phase IV, WaterSound Beach (Lot 24).



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       3.      Plaintiff held and holds equitable title to Lot 24 and rights in his individual

capacity, Chambers Street Builders, Inc. corporate capacity and single member J.M.B.,

LLC capacity at all times relevant to this action.

       4.      Defendant WaterSound is a Florida not for profit corporation and

homeowners association whose Declaration of Covenants, Conditions and Restrictions

(CC&R) have been recorded in Walton County, Florida and encumber Lot 24.

       5.      Defendant Matteson served and serves as vice president and general

manager for WaterSound.

       6.      Defendant Lilienthal served and serves as a Board of Director for

WaterSound.

       7.      Defendant Joule served and serves as construction compliance officer for

WaterSound.

       8.      As of the filing of this motion, none of the Defendants have filed an

answer in this declaratory action.

                                          FACTS

       9.      Venue is proper in this Court as venue has previously been conferred to

this Court in this action, all parties to this action are located in this jurisdiction, the

documents to be construed have been recorded in the Walton County Official Records,

the property that is the subject matter of this action is located in Walton County and the

actions that are the subject matter of this suit occurred in Walton County, Florida.

       10.     WaterSound is a community located within Walton County which is

encumbered by the CC&R’s first recorded in the Official Records of Walton County on

September 10, 2001. (Exhibit A) Those original CC&R’s contain the provision at issue




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which can be found at Section 8.5 which reads:

           8.5    Benefited Assessments

           The Association may levy Benefited Assessments against one or more particular Lots as
follows:

         (a) to cover the costs, including overhead and administrative costs, of providing services
which an Owner requests pursuant to any menu of special services which the Association may offer
(which might include the items identified in Section 7.8) or which the Association otherwise
provides to less than all Owners in accordance with this Declaration or any Supplemental
Declaration. Benefited Assessments for special services may be levied in advance of the provision
of the requested service; and

         (b)   to cover costs incurred in bringing a Lot into compliance with the Governing
Documents, or costs incurred as a consequence of the conduct of the Owner or occupants of the
Lot, their agents, contractors, employees, licensees, invitees, or guests; provided, the Board shall
give the Lot Owner prior written notice and an opportunity for a hearing, in accordance with the
By-Laws, before levying any Benefited Assessment under this subsection.



           11.    WaterSound has recorded additional Covenants, Conditions and

Restrictions into the Official Records of Walton County; however none mention this

benefitted assessment or any similar assessment to the assessment that is the subject of

this declaratory action.

           12.    WaterSound created this new class of “monthly benefited assessment”

without following the Condition’s notice, vote or right to hearing. The CC&R’s include

“Bylaws” which were originally annexed and recorded as Exhibit E. (see Exhibit A)

           13.    The “Bylaws” state in pertinent part:

           3.24. Enforcement.

        The Association may impose sanctions for any violation of the Governing Documents.
To the extent the Declaration or Florida law requires an opportunity for a hearing, the Board
shall comply with the following procedures prior to imposition of sanctions:

          (a)      otice. The Board or its delegate shall serve the alleged violator with written
notice describing (i) the nature of the alleged violation; (ii) the proposed sanction to be imposed;
(iii) a period of not less than 15 days within which the alleged violator may present a written
request for a hearing to the Board; and (iv) a statement that the proposed sanction shall be
imposed as contained in the notice unless the alleged violator challenges the violation within the
time period specified in the notice. The Board or Covenants Committee may suspend any
proposed sanction if the violation is cured, or if a diligent effort is made to cure, within the
period during which a hearing may be requested. Such suspension shall not constitute a waiver
of the right to sanction future violations of the same or other provisions and rules by any Person.



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        If a timely request for a hearing is not made, the sanction stated in the notice may be
imposed without the necessity of a hearing; provided, the Association may not impose a fine or
suspend Common Area use rights for any violation other than a failure to pay assessments,
unless the Covenants Committee, by a majority vote, first approves the proposed fine or
suspension.

        14.     3.24 (a) provides, in pertinent part, that the Notice must:

                1) Describe the process for a hearing.
                2) The sanction shall be imposed unless the alleged violator elects the
        hearing.
                3) The Covenants Committee must first approve the fine by a majority
        vote.
        15. The Bylaws specifically describe the Covenants Committee:

        5.2     Covenants Committee.

         The Board shall appoint a Covenants Committee consisting of at least three members. The
Covenants Committee members shall be Members of the Association who are not directors,
officers, or employees of the Association or the spouse, parent, child, brother, or sister of a
director, officer, or employee. Acting in accordance with the provisions of the Declaration, these
By-Laws, and any Board resolutions, the Covenants Committee shall be the Association’s hearing
tribunal and shall conduct all hearings held pursuant to section 3.24. The Board may not impose a
fine without a majority vote of the Covenants Committee.



        16.     WaterSound has no Covenants Committee. What is most legally striking

is the fact that the Covenants Committee cannot be staffed by Directors, Officers or

Employees of the Association or the spouse, parent, child, brother or sister of a Director,

Officer or Employee.

        17.     In the instant case, the WaterSound Board of Directors sent a notice dated

July 29, 2009 stating that “On June 2, 2006, the WaterSound Beach Homeowner’s

Association passed a resolution that allows the Homeowner’s Association to collect a

$1,000 fine per month after the home has been under construction for 16 months.

Beginning July 31, 2009 you will be assessed $1,000 for the month of July and will

continue to be assessed thereafter at the end of the month on a monthly basis…” (Exhibit




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B)

       18.    The June 2, 2006 Board of Directors Meeting was held without setting

forth the Notice that a new assessment would be considered. Additionally, the only

notice of the meeting was posted on the property, rather than sending notice to the

members which is required in order to effectuate new assessments. (Exhibit C, see Proof

of otice)

       19.    During the June 2006 Meeting, under Completion Dates for Single Family

Home Construction, a motion was made for a 16 month completion of a single family

home with a $1,000/month penalty for every month over 16 months. To waive the fee,

the homeowner’s plans and intent must go before the same board for review.

       20.    During the same meeting, Lot 5, Phase I was approved for a 20 month

build-out time by Breaux Construction. That home actually commenced construction on

March 23, 2006, and was completed April 7, 2009, more than 36 months later. No fines

or benefitted assessments were levied. (Exhibit D)

       21.    Peter DeFranco commenced his home with Artisan Builders and

completed same over 24 months later. No fines or benefitted assessments were levied.

(Exhibit E)

       22.    Elizabeth Whitehead commenced her home with BRW Builders and

completed same over 20 months later. No fines or benefitted assessments were levied.

(Exhibit F)

       23.    Brad Zeitlin commenced his home with an unlicensed contractor, Jon

LaPlante, and completed same over 23 months later. No fines or benefitted assessments

were levied. (Exhibit G)




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       24.    David White commenced his home with Consolidated Builders and

completed same over 23 months later. No fines or benefitted assessments were levied.

(Exhibit H)

       25.    Beaches 11 commenced their home with Grand Floridian and completed

same over 21 months later. No fines or benefitted assessments were levied. (Exhibit I)

       26.    Ocean Mist LLC commenced their home with David Lilienthal and

completed same over 21 months later. No fines or benefitted assessments were levied.

(Exhibit J)

       27.    Atlantic Realty commenced their home with an unknown contractor and

completed same over 18 months later. No fines or benefitted assessments were levied.

(Exhibit K)

       28.    Lucca Properties, LLC commenced their home with Consolidated Builders

and completed same over 17 months later. No fines or benefitted assessments were

levied. (Exhibit L)

       29.    Daniel Mickelson commenced his home with Daniel Cole and completed

same over 16 months later. No fines or benefitted assessments were levied. (Exhibit M)

       30.    The St. Joe Paper Company commenced their home with David Franklin

and completed same over 29 months later. No fines or benefitted assessments were

levied. (Exhibit N)

       31.    The St. Joe Paper Company commenced their home with David Franklin

and completed same over 28 months later. No fines or benefitted assessments were

levied. (Exhibit O)

       32.    The St. Joe Paper Company commenced their home with Pat Groeniger




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and completed same over 15 months later. No fines or benefitted assessments were

levied. (Exhibit P)

       33.     The St. Joe Paper Company commenced their home with David Franklin

and completed same over 24 months later. No fines or benefitted assessments were

levied. (Exhibit Q)

       34.     Matt Savoie commenced his home with Davis Dunn and completed same

over 21 months later. No fines or benefitted assessments were levied. (Exhibit R)

       35.     Emerald Coast Homes commenced their own home and completed same

over 40 months later. No fines or benefitted assessments were levied. (Exhibit S)

       36.     Billy Geffon commenced his home with Ray Jackson and completed same

over 23 months later. No fines or benefitted assessments were levied. (Exhibit T)

       37.     Board of Director Jack Luchese’s home was built by Monte Hewett in

over 20 months. No fines or benefitted assessments were levied. (Exhibit U)

       38.     Board of Director David Lilienthal’s son built the C & A Exploration

residence in over 22 months. No fines or benefitted assessments were levied. (Exhibit

V)

       39.     Plaintiff Carroll commenced his home and was notified by the Board of

Directors 4 months later that the building must be torn down. The Board “purportedly”

stopped construction because the building was built to tall. (Exhibit W)

       40.     16 months after Plaintiff’s commencement, the Board of Directors began

levying “benefitted assessments” “purportedly” because construction was not complete.

To date, the Board of Directors has levied $10,000.00 in “benefitted assessments” against

Plaintiff. (Exhibit X)




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       41.      Plaintiff attempted to dispute the decision of the Board of Directors, and

immediately sought information from WaterSound accordingly. (Exhibit Y)

       42.      Clearly the Board of Directors has engaged in selective enforcement of a

policy that is unclear. (Exhibit Y)

       43.      This issue has also presented itself in Walton County Court. Judge Green

heard testimony from WaterSound on this compliance issue. Plaintiff claimed an interest

in a $5,000.00 deposit.      During direct examination Plaintiff asked Tracy Regan,

WaterSound DRB Coordinator, “Q: What happened to that $5,000 deposit when the

property was sold off? A: That house was not finished or constructed in a timely

manner, and therefore their deposit was forfeited.       They lost their entire deposit.”

(Exhibit Z-1)

       44.      What neither Plaintiff or Judge Green knew at that time, was that

WaterSound’s Tracy Regan would later return to the office and prepare an internal

document instructing the accounting department to move that $5,000 from the deposit

escrow account over to income account 0439. (Exhibit Z2)

       45.      This is a perfect example of the arbitrary nature of WaterSound’s

management with regard to this “benefitted assessment” issue at bar. That home was

transferred by Plaintiff’s customers 4 months prior to the start of the enforcement of this

“benefitted assessment”. It was not listed for the “benefitted assessment” and was never

authorized to be assessed. (Exhibit Z3)

       46.      Further, the “Pre-Construction Check List” signed by Plaintiff on

September 10, 2007, contracted a (1) time, $500 fine if construction was not complete

within 15 months. (Exhibit Z4)




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        47.      Finally, on that same residence, 3 months prior to WaterSound’s first

“benefitted assessment” for construction over 15 months, Davis Dunn placed $2,500 with

Tracy Regan and WaterSound for construction compliance. (Exhibit Z5)

                                          ARGUME T

        48.      Plaintiff is entitled to Summary Judgment, because there is no genuine

issue of material fact that Section 8.5 of the CC&R’s defines benefited assessments

clearly differently from the “benefited assessment” WaterSound wishes to exert against

its members:

         (b)     to cover costs incurred in bringing a Lot into compliance with the Governing
Documents, or costs incurred as a consequence of the conduct of the Owner or occupants of the
Lot, their agents, contractors, employees, licensees, invitees, or guests; provided, the Board shall
give the Lot Owner prior written notice and an opportunity for a hearing, in accordance with the
By-Laws, before levying any Benefited Assessment under this subsection.



        49.      The terms of a Declaration of Covenants, Conditions and Restrictions

constitute expressions of an agreement, and are properly construed according to

principles of contract construction. Providence Square Association, Inc., v. Biancardi,

507 So. 2d 1366, 1370 (Fla. 1987). Under basic principles of contract construction, a

party is bound by, and a court is powerless to rewrite, the clear and unambiguous terms of

a voluntary contract. Medical Center Health Plan v. Brick, 572 So. 2d 548, 552 (Fla.

1DCA 1990).

        50.      Section 6.5 of the CC&R’s is titled “Amendment” and reads:

         (c)       Validity and Effective Date of Amendments.     Amendments to these By-Laws
shall become effective upon recordation unless a later effective date is specified therein. Any
procedural challenge to an amendment must be made within six months of its recordation, or such
amendment shall be presumed to have been validly adopted. In no event shall a change of
conditions or circumstances operate to amend any provisions of the By-Laws.



        51.      It is undisputed that there have been no recorded amendments made to the



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CC&R’s which would legitimize the “benefited assessment” at issue.

       52.     Plaintiff also contends that WaterSound’s enforcement action should be

barred by the doctrine of selective enforcement. Selective enforcement is based on the

premise of discretionary treatment and arbitrary and capricious enforcement of a rule or

regulation.   Chattel Shipping and Investment Co. v. Brickell Place Condominium

Association, Inc. 481 So. 2d 29, 30 (Fla. 3d DCA 1985)(citing the Florida Supreme

Court’s opinion in White Egret Condominium, Inc. v. Franklin, 379 So. 2d 346, 352 (Fla.

1979)). Selected enforcement occurs where the Board of an Association is shown to have

failed to enforce the condominium documents in other similar violations, and where the

unequal enforcement of the rules warrants the conclusion that the board’s actions are

discriminatory, unfair, or unequal and prohibit the association from enforcing the

restriction in the present dispute. Oceanside Plaza Condominium Association, Inc. v.

Salussolia, Arb. Case No. 96-0384. Paragraphs 20 through 39 are material.

       53.     To bring Lot 24 into “compliance” would mean that WaterSound is

building the residence at Lot 24. It is undisputed that WaterSound has not attempted to

bring Lot 24 into compliance by completing the construction at Lot 24.

       54.     In the CC&R’s, “Benefited” assessments can only be levied to cover costs

incurred; they are not coercive or punitive in nature.

       55.     Over Plaintiff’s objections, WaterSound continues to encumber Lot 24

with expanding “monthly benefited assessments” which have now reached $10,000.00.

       56.     In conclusion, under the plain language of the CC&R’s WaterSound is not

entitled to assess perpetual “benefitted assessments” such as these against Lot 24 or any

other property within the community.




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       WHEREFORE, Plaintiff requests this Court grant Summary Judgment in its favor

and issue an order declaring that:

       57.     WaterSound does not have the legal right to assess the “monthly benefited

assessment” described herein.

       58.     In accordance with F.S. 86.061, allow Plaintiff to request supplemental

relief, by Motion, after the Court grants Declaratory Judgement.

       59.     Grant such other further relief as may be just and proper.



                                                     _____________________________
                                                     John P. Carroll
                                                     Box 613524
                                                     WaterSound, FL 32461
                                                     Tel: (850)231-5616
                                                     Fax: (850)622-5618
                                                     AAbsolute@aol.com



       I HEREBY CERTIFY that a copy of the foregoing has been furnished to
CHRISTOPHER L. GEORGE, ESQ. PO Box 1034, 56 Saint Joseph St., Mobile, AL.
36633-1034, attorney for Defendants, by regular email and regular mail this 20th day of
March, 2010.


                                                     _____________________________
                                                     John P. Carroll
                                                     Box 613524
                                                     WaterSound, FL 32461
                                                     Tel: (850)231-5616
                                                     Fax: (850)622-5618
                                                     AAbsolute@aol.com




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