LEVINE, J.
The issue presented is whether the trial court's reliance on a Florida statute rather than the provisions of the homeowners' association declaration governing the parties in this case unconstitutionally impairs appellant's right to contract. Because the trial court's application of the statute impairs appellant's freedom of contract, we conclude that the court erred in granting summary judgment in favor of appellee
Pudlit 2 Joint Venture, LLP, plaintiff/appellant, appeals the entry of summary judgment and order of final dismissal in its breach of contract and declaratory relief action against Westwood Gardens Homeowners Association, Inc., defendant/appellee. Appellant purchased two properties at foreclosure sales that were located within communities maintained by the association. Subsequent to appellant's purchases of the properties, the association demanded payment for any and all unpaid association assessments, including those that came due prior to appellant's ownership, under threat of a claims lien foreclosure. Appellant paid the past-due assessments for both properties via check remitting that it "paid under protest and with full reservation of all rights and remedies."
Appellant filed suit against the association seeking damages for breach of declaration (count I) and declaratory relief (count II), alleging that any liens for past due assessments were extinguished by the foreclosure judgments pursuant to the terms of the association's Declaration of Covenants, Conditions, and Restrictions. The association cross-moved for summary judgment, arguing that section 720.3085, Florida Statutes (2013), clearly mandates that appellant is jointly and severally liable with the prior owners for all unpaid assessments on the subject properties, thus amending the declaration. Appellant argued that section 720.3085 did not impose liability upon appellant, because the declaration's express terms were not invalidated by the statute or waived by appellant, and imposition of the statute against the declaration's express terms would unconstitutionally impair its contractual rights.
After a hearing, the trial court entered an order denying appellant's summary judgment motion and an order granting the association's cross-motion. After denying appellant's motion for reconsideration, the trial court entered a final order of dismissal of appellant's claims. Appellant timely appealed.
"The standard of review governing a trial court's ruling on a motion for summary judgment posing a pure question of law is de novo." Major League Baseball v. Morsani, 790 So.2d 1071, 1074 (Fla. 2001). Contract construction and statutory interpretation are both questions of law. See Mena v. J.I.L. Constr. Grp. Corp., 79 So.3d 219, 222 (Fla. 4th DCA 2012); E.A.R. v. State, 4 So.3d 614, 629 (Fla.2009).
Harvard ex. rel. J.H. v. Vill. of Palm Springs, 98 So.3d 645, 647 (Fla. 4th DCA 2012) (citations omitted). Further, "[e]very statute must be read as a whole with meaning ascribed to every portion and due regard given to the semantic and contextual interrelationship between its parts." Citizens Prop. Ins. Corp. v. River Manor Condo. Ass'n, 125 So.3d 846, 849 (Fla. 4th DCA 2013) (citation omitted). This principle "applies with equal force in instances where a part of the statute standing alone may appear to be clear and unambiguous." Id. at 850.
"The declaration of condominium, which is the condominium's `constitution,' creates the condominium and `strictly governs the relationships among the condominium unit owners and the condominium association.' A declaration of condominium must be strictly construed."
The statute at issue in this case, section 720.3085, provides:
§ 720.3085(2)(b), Fla. Stat. (2013) (emphasis added). Further, under Chapter 720, "the Legislature recognizes that certain contract rights have been created for the benefit of homeowners' associations and members thereof before the effective date of this act and that ss. 720.301-720.407 are not intended to impair such contract rights." § 720.302(2), Fla. Stat. (2013) (emphasis added).
Significantly, the homeowners' declaration in the present case provides that a subsequent owner of a property within the association will not be liable for payment of any assessments owed by the prior owner. Thus, section 720.3085(2)(b) conflicts with the declaration of the association in the case at bar, which provides:
(emphasis added).
The association's argument that the legislature's enactment of section 720.3085 amended the declaration is without merit. A declaration can be amended according to the procedure outlined within
The only provisions in the declaration providing for automatic amendment based on legislative action are limited to amendments which are "required" by the plain language of the legislation. Nothing in the language of section 720.3085(2)(b) demonstrates that it is "required" to be adopted by Florida homeowners' associations. Thus, the association cannot argue that section 720.3085, as enacted by the Florida legislature, automatically amended the association's declaration.
Thus, the question in this case becomes whether application of section 720.3085(2)(b) unconstitutionally impairs appellant's contractual rights under the association's declaration which absolves appellant of such liability. As previously stated, section 720.3085(2)(b) was "not intended to impair [] contract rights" which were "created for the benefit of homeowners' associations and members thereof before the effective date" of the statute. See § 720.302(2), Fla. Stat. (2013).
Similar to the federal constitutional contract clause, the Florida Constitution prohibits
Joseph Story, A Familiar Exposition of the Constitution of the United States § 244, at 197 (Regnery Gateway, Inc. 1986) (1859).
"An impairment occurs, ... when a contract is made worse or is diminished in quantity, value, excellence or strength." Lawnwood Med. Ctr., Inc. v. Seeger, 959 So.2d 1222, 1224 (Fla. 1st DCA 2007). "In this state, it is a `well-accepted principle that virtually no degree of contract impairment is tolerable.'" Coral Lakes Cmty. Ass'n v. Busey Bank, N.A., 30 So.3d 579, 584 (Fla. 2d DCA 2010) (quoting Pomponio v. Claridge of Pompano Condo., Inc., 378 So.2d 774, 780 (Fla.1979)). A third-party beneficiary to a contract possesses the same constitutional right against the impairment of that contract as the parties to the contract. See id. (citing Greenacre Props., Inc. v. Rao, 933 So.2d 19, 23 (Fla. 2d DCA 2006) (explaining that to enforce rights under a declaration, "[a] third party must establish that the contract either expressly creates rights for them as a third party or that the provisions of the contract primarily and directly benefit the third party or a class of persons of which the third party is a member")).
In Coral Lakes, the bank instituted a foreclosure action against the homeowners, adding the HOA as a defendant because of a lien for accrued unpaid assessments. The HOA, relying upon section 720.3085, claimed that if the bank purchased the mortgaged premises at a foreclosure sale, then it would be jointly and severally liable with the previous owner to pay the past due assessments. 30 So.3d at 582. The bank argued that it was an intended third-party beneficiary of the HOA's declaration which provided that neither it nor a third-party purchaser at a foreclosure sale would be liable for past due assessments.
On appeal, the Second District agreed with the trial court's analysis, finding that first mortgagees, like the bank, "although not parties to the Declaration that is the contract between the HOA and its members,
Here, the declaration provides that "[t]he personal obligation for delinquent assessments shall not pass to his successors in title unless expressly assumed by them" and "[s]ale or transfer of any Lot... pursuant to ... foreclosure ... shall extinguish the lien of such assessments as to payments thereof which become due prior to such sale or transfer." Thus, the declaration "expressly creates rights" for successors in title to properties within the association, like appellant, and the declaration provisions "primarily and directly benefit" successors in title. Rao, 933 So.2d at 23. Accordingly, appellant, a successor in title, is clearly an intended third party beneficiary and holder of vested rights in the declaration. See id.; Coral Lakes, 30 So.3d at 584. Further, "the Declaration's plain and unambiguous language ... absolves [appellant], as [successor through a foreclosure sale], from liability for any assessments accruing before it acquires the parcel." Coral Lakes, 30 So.3d at 583-84. Such "a reasonable unambiguous restriction will be enforced according to the intent of the parties as expressed by the clear and ordinary meaning of its terms." Shields, 872 So.2d at 1005-06 (citation omitted).
In summary, the trial court's reliance on section 720.3085(2)(b) rather than the provisions of the declaration violated appellant's right against the impairment of contract, where appellant was a third-party beneficiary of the declaration. Based on the plain, unambiguous language of the declaration, absolving a successor in title from any liability for assessments that accrued prior to the successor's acquisition of title, appellant was not liable for the unpaid assessments demanded by the association. For these reasons, we reverse the summary judgment entered in favor of the association and remand for entry of summary judgment in favor of appellant.
Reversed and remanded with directions.
MAY and CIKLIN, JJ., concur.
Coral Lakes, 30 So.3d at 581.