RBC Responds to Suggestion to Delay Challenge to WCI Turnover Proposal

The following remarks were delivered at the Unit Owners Committee (UOC) Meeting on June 1, 2016 by RBC Director Barbara Craig.

Those who oppose our challenge of WCI’s turnover plan continually make two points.

1. That it is premature to challenge WCI’s claim to annexation or deadhand control as these have not yet  been exercised.

2. That turnover and annexation/deadhand control issues are separate and thus the latter should not be dealt with in the turnover process.

Basically, this position argues:  “OK, we agree that maybe annexation and dead hand control are wrong or illegal but we should not challenge them now.”  Why?  “Because,” the argument goes, “WCI has not exercised either yet and we should wait until it does.  Challenge now is premature.”

These points are not valid:

The Turnover document filed on the public record by WCI contains claims of both deadhand control and annexation “rights” by WCI in that this document states that up to 2 seats may be added to the Board post turnover and that units not presently within PLCA may be added to these or existing seats.  There is no doubt turnover and deadhand control and annexation are entwined.

I make the following comments to that position, comments based on the legal advice of RBC’s Florida licensed HOA expert attorney.

1. The reason to challenge dead hand control and claimed annexation rights NOW is to get a ruling on the law prior to action by WCI.  Action, that could (inevitably would) involve what the law calls “innocent third parties”.  For example, say WCI annexes Raptor Bay, and begins pre construction sales of apartments promising, in its advertisements, that the apartments would have access to the private PLCA beach on Big Hickory Island or to the PLCA amenities in general?

So, at that point WCI “has acted” so we sue.  But, the case now involves a number of outside actors who bought on a promise of the beach or amenities being part of their deal. A court at this point would have to play a balancing act with three players’ interests involved: PLCA owners, WCI, and Raptor Apartment purchasers.  Courts do not like to punish innocent third parties as a general rule. PLCA could be at a disadvantage.

2. It is a prudent rule of law that a party does not want to put itself in a position of potentially waiving any rights by sitting back and waiting until something happens.  To do so raises the potential of an “estoppel” argument which in effect means, “You did not complain at the time so you cannot complain now.”

3. To FAIL TO ACT right now to challenge the very clear claims WCI has stated in the notice of Turnover filed with the state a couple of weeks ago, is to put PLCA in a position of potentially waiving its right in the future to challenge these claims

4. Moreover, failure to challenge these claims RIGHT NOW  in light of the public, obvious and well known fact that WCI intends to develop Raptor Bay and has clearly stated, on the record, that it can annex and that it can and will provide beach rights to its new properties, could allow WCI to claim that it reasonably could assume that since it filed a public record amending the governing documents without objection from PLCA, that it (WCI and third parties) would be relying on the acceptability of that entire document in going forward with development plans inside and outside of the current Pelican Landing boundaries.

We have in State Law 720.3075 and the Settlement Agreement ample legal means for challenging WCI. Please keep in mind that these legal rights are not self-enforcing and that if we do not act WCI can and will get away with this.  Moreover, failure to challenge this RIGHT NOW puts us at unnecessary risk of being prevented from doing so later and at the risk of complicating the issues to our disadvantage.”

Barbara Hinkson Craig,

Director, Resident’s for a Better Community & Chair, UOC Governance Study Group

UOC/CRC Asks PLCA Board to Hire Outside Attorney to Review Legality of WCI Turnover Proposal 

Following the delivery of Barbara Craig’s opinions, many concerns were expressed and comments were forthcoming from the Voting Representatives/UOC Reps. Clearly the thought process was that it would make sense for the PLCA Board to get an independent legal opinion to clarify the issues. The thoughts were that by not acting, and not taking any action on those issues at this time, the Board may be giving away all of our rights, and the Board may not know it or they might be getting advice from Tom Hart telling them not to worry about it ­­ and that PLCA’s attorney, Tom Hart, might be wrong.

UOC Co­Chair Hill said that she understood PLCA Director John Tomlinson to say at the last Board Meeting that WCI’s turnover plan (on file with Lee County) and identified in Turnover Communication # 19 needed work. Ms. Hill then asked if there is an ability to change the plan? Is there a move forward by the Board to change this plan? Ms. Hill asked the PLCA Board Vice President in attendance, Shirley Whithrington, if she could tell the UOC if the Board is working on that? PLCA Director Withrington then said that “I did tell you that I would not answer questions on this, but I will just say the information that was sent to us, the documents, is not very clear and therefore our lawyers are working with WCI lawyers”. Ms. Withrington then said that “the documents that were filed are very confusing and therefore we asked for clarification. Our lawyers (PLCA Lawyers) are working with WCI for clarification”.

Ascot Alternate UOC Rep Bruce Fennie then stated a motion as follows:

“I move that the UOC ask the Board of Directors to hire an independent attorney to prepare a written legal opinion on the legality of the WCI turnover plan according to our documents, specifically its designation of voting groups along with WCI’s asserted right to annexation of other properties into PLCA and its asserted right to “dead­hand control” both before and following turnover.”

The motion was seconded and passed with one opposed.

Although the blast email from the PLCA with a recap of the May 18th PLCA Board Meeting did not reflect this, during the board meeting multiple residents expressed concerns and requested the board obtain the legal opinion of independent counsel on the legality of the turnover.

Naples News Article Hits at the Need to Act Now

Following is a link to an article published in the Sunday, June 5, 2016, Real Estate section of the Naples News regarding the Board of Director’s duties and the legal defense concepts such as waiver and estoppel. These concepts provide that once you know of a legal right for which you can sue, you have to bring legal action within a timely manner or you will be time barred from having a legal claim because you “sat on your hands” in light of your rights to bring a legal action. You waived your rights and are “stopped” from bringing suit because of your inaction once you were aware of the violations.

Boards who snooze over the summer may lose­­ submitted by attorney Rob Samouce

Read the article by clicking here

If you have difficulty connecting directly to the Naples News article through the above link, simply click on the following link to read a pdf version of this article:RobSamouceBoardswhosnoozeoverthesummermaylose

One thought on “RBC Responds to Suggestion to Delay Challenge to WCI Turnover Proposal

  1. The issue is Ripe! If you know a future right is illegal and wrong you can have that adjudicated now before it is attempted to be exercised . Those with perspective can see it coming. As long as those words allowing future annexation etc., remain unchallenged WCI’S future rights will continue. However, the residents have a right now to remove and terminate WCI’S future rights before it is to late. Future property rights can be terminated now by the courts, especially when the exercise of that future right would adversely affect the residents.

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