UNITED STATES BANKRUPTCY COURT

SOUTHERN DISTRICT OF FLORIDA

www.flsb.uscourts.gov

In re:

Luis Robert Adam and Gislaine Adam,

Debtors.

/

Case No.: 22-10140-MAM

Chapter 13 

MEMORANDUM OPINION AND ORDER SUSTAINING IN PART AND 

OVERRULING IN PART OBJECTION TO CLAIM (ECF NO. 67)

The Court issues this Opinion today to address issues at the 

intersection of Florida state law and federal bankruptcy law raised by

Debtors' Amended Objection to Claim on Shortened Notice filed as ECF 

No. 67 (the "Objection") and the response at ECF No. 78 (the "Response") 

filed by Creditor Highland House of Palm Beach Condominium 

Mindy A. Mora, Judge

United States Bankruptcy Court

_____________________________________________________________________________

ORDERED in the Southern District of Florida on September 23, 2022.

Case 22-10140-MAM Doc 125 Filed 09/23/22 Page 1 of 19
2

Association, Inc. (the "HOA"). The issues demonstrate the complexity of 

determinations within a bankruptcy case, where state law governs and 

defines property interests but the Bankruptcy Code determines to what 

extent those interests will receive a distribution from the bankruptcy 

estate. 

PROCEDURAL BACKGROUND

The Objection seeks disallowance of $36,558.30 of the HOA’s claim 

(Claim No. 18, the "Claim"), because Debtors believe that this portion of 

the Claim lacks foundation. Debtors initially contended that the Claim's 

documentation did not support post-judgment special assessments and 

did not include copies of board minutes or recorded claims of lien. The 

Response addressed some of those concerns by attaching copies of board 

minutes relating to the Claim.

After reviewing those documents, the Court set an evidentiary 

hearing on May 25, 2022 (the "Evidentiary Hearing"). The parties 

submitted additional testimonial and documentary evidence in support 

of their positions, as well as supplemental post-hearing briefs at ECF 

Nos. 96 and 97. 

Case 22-10140-MAM Doc 125 Filed 09/23/22 Page 2 of 19
3

At the Evidentiary Hearing, the parties narrowed the scope of their 

dispute to Part C of the HOA's Statement of Itemized Interest, Fees, 

Expenses, and Charges (ECF No. 86-1, p. 5-6.). Part C describes $31,000 

in past due monthly maintenance and special assessments plus accrued 

interest of $5,558.30 for a total of $36,558.30 (the "Disputed Amount"). 

Debtors contested the validity of this portion of the Claim despite entry 

of a state court judgment because that judgment (as amended by the state 

court Order and Final Judgment Granting Plaintiff's Motion for 

Attorneys' Fees and Costs to be Incorporated into the Final Judgment, 

docketed in this Bankruptcy Case at ECF Nos. 86-2 and 86-3) did not 

include the Disputed Amount.

At the Evidentiary Hearing and in their post-hearing briefing, the 

parties focused upon whether the Disputed Amount constituted a secured 

claim against the Debtors' real property. Although Debtors did not 

directly concede the correctness of the HOA's calculations of the Disputed 

Amount, they did not dispute the HOA's entitlement to assess any 

portion of the Claim, including the Disputed Amount. Debtors also 

acknowledged the finality of the state court judgment described in Part 

A of the Claim as well as of the state court order itemized in Part B. As a 

Case 22-10140-MAM Doc 125 Filed 09/23/22 Page 3 of 19
4

result, the only question presented to the Court for resolution was 

whether the Disputed Amount constitutes a secured claim against the 

Debtors' real property.

ANALYSIS

To begin its analysis, the Court reviewed Chapter 718 of the Florida 

Statutes (the "Condominium Statutes") and the declaration of 

condominium found as Debtor's Exhibit 4 (the "Declaration") (ECF No. 

87-4). Section 718.102 of the Condominium Statutes provides that 

"[e]every condominium created and existing in [the state of Florida] shall 

be subject to the provisions of [the] chapter". The breadth of that 

language means that Chapter 718 applies to Debtors' residence, a 

condominium within the state of Florida. If there were any remaining 

doubt as to the applicability of the Condominium Statutes, ample case 

law supports the premise that within Florida, condominiums are 

creatures of statute and are therefore governed by Florida Statutes. 

Tranquil Harbour Development, LLC v. BBT, LLC, 79 So.3d 84, 86 (Fla. 

1st DCA 2012). 

A. Florida Statutes Chapter 718 

Having concluded that Florida Statutes Chapter 718 applies, the 

Case 22-10140-MAM Doc 125 Filed 09/23/22 Page 4 of 19
5

Court next considered the form of and the timing of recordation of the 

Declaration, along with the history of Florida Statute § 718.116(5)(a), 

and any other potentially relevant historical provisions of Chapter 718.1

That analysis required the Court to delve deeply into the various versions 

of Chapter 718 as of and after the recording of the Declaration on 

February 9, 1987. 

1. Current Version: Florida Statutes § 718.116 (2022)

The version of § 718.116(5)(a) presently in effect provides that a 

homeowners' association has a lien on each condominium parcel to secure 

the payment of assessments.2 That lien is effective from and relates back 

to the recording of the original declaration of condominium, except as to 

first mortgages of record. For recorded first mortgages, the lien is only 

1 All references in this Opinion to “§ 718.[#]” are to Chapter 718, Florida Statutes. The Court also 

occasionally refers to Chapter 718 as the “Condominium Statutes”. 

2 Specifically, § 718.116(5)(a) states: 

The association has a lien on each condominium parcel to secure the payment of 

assessments. Except as otherwise provided in subsection (1) and as set forth below, the 

lien is effective from and shall relate back to the recording of the original declaration of 

condominium, or, in the case of lien on a parcel located in a phase condominium, the last 

to occur of the recording of the original declaration or amendment thereto creating the 

parcel. However, as to first mortgages of record, the lien is effective from and after 

recording of a claim of lien in the public records of the county in which the condominium 

parcel is located. Nothing in this subsection shall be construed to bestow upon any lien, 

mortgage, or certified judgment of record on April 1, 1992, including the lien for unpaid 

assessments created herein, a priority which, by law, the lien, mortgage, or judgment did 

not have before that date.

Case 22-10140-MAM Doc 125 Filed 09/23/22 Page 5 of 19
6

effective from and after recording of a claim of lien in the public records 

of the county in which the condominium parcel is located. 

In its current iteration, Chapter 718 states that homeowner 

associations have statutory liens to secure unpaid assessments. Looking 

at the 2022 version of the Condominium Statutes, the combination of 

§ 718.102 and § 718.116 seems to provide the HOA with a secured claim 

by virtue of a statutory lien. But, the Court's analysis did not end there, 

because the language of the Declaration also impacts whether or not the 

Disputed Amount may be treated as a secured claim in this Bankruptcy 

Case. 

2. The Declaration

Based upon the language of the Declaration, Debtors believe that 

Creditors' failure to record a Claim of Lien for the Disputed Amount prior 

to the Petition Date invalidates the secured status of the portion of the 

Claim equal to the Disputed Amount.3

The Declaration is dated January 30, 1987 and was recorded on 

February 9, 1987. Sections (i) through (k) of Article XXVII of the 

3 As a minor point of clarification, the Court notes that Debtors dispute the enforceability of the secured 

status of the Disputed Amount against all parties, not just first mortgage holders. 

Case 22-10140-MAM Doc 125 Filed 09/23/22 Page 6 of 19
7

Declaration provide that (i) the HOA has a lien to secure unpaid 

assessments, (ii) the lien is effective from the date of filing a claim of lien 

in the public records, and (iii) all parties acquiring an interest in the 

property are on notice of the potential existence of this lien.4

With that provision in mind, the question before the Court becomes 

a matter of precedence. Does the 1987 Declaration, which was publicly 

recorded, govern security of the Claim? Or does the current version of 

§ 718.116(5)(a) of Florida Statutes govern? For this answer, the Court 

took extra care to review the entire Declaration because that document 

represents a binding agreement between the HOA and all unit owners, 

including Debtors. Genesis RE Holdings, LLC v. Woodside Estates 

Homeowners Ass'n, Inc., Case No. CACE14-000430(AP), 2015 WL 

5511558, *2-3 (17th Jud. Cir, Broward Cnty. App. May 8, 2015).

3. Impact of Kaufman Upon Interpretation of the Declaration

Article I of the Declaration adopts Chapter 718 of the Florida 

Statutes in the form in which that chapter existed at the date of the 

drafting and recordation of the Declaration, which was in 1987. It does 

not specifically state that later amendments to Chapter 718 (if any) 

4 Relevant excerpts from the Declaration are quoted in the analysis that follows this section. 

Case 22-10140-MAM Doc 125 Filed 09/23/22 Page 7 of 19
8

should be adopted by reference. This omission led the Court down a very 

long road of research and analysis summarized neatly by the holding in 

Kaufman v. Shere, 347 So.2d 627 (Fla. 3d DCA 1977), which in turn was 

based upon the seminal Florida Supreme Court case of Fleeman v. Case, 

342 So.2d 815 (Fla. 1977). 

In Kaufman, the parties contested the applicability of the thencurrent Condominium Statutes to their dispute. Id. at 628. The Kaufman

Court looked at the relevant declaration of condominium, carefully

parsing the language of that document. Id. The declaration in Kaufman

stated that it incorporated by reference provisions of the Condominium 

Statutes as they might be amended “from time to time." Id. (internal 

quotation marks omitted). The Kaufman court found the inclusion of this 

precise language, that is, the Condominium Statutes as they might be 

amended “from time to time," to be dispositive, and concluded that the 

then-current version of the Condominium Statutes applied. Id. 

The keywords "as [...] amended from time to time" have since 

become the metric in Florida for determining which version of the 

Condominium Statutes applies to a disputed matter involving a 

declaration of condominium. If the declaration incorporates the 

Case 22-10140-MAM Doc 125 Filed 09/23/22 Page 8 of 19
9

Condominium Statutes as amended "from time to time", then the most 

current version of the Condominium Statutes applies. In the absence of 

this language, the situation becomes more opaque. And that is the exact 

predicament that the parties presented the Court. 

B. Analysis of the Plain Language of the Declaration

To determine which version of the Florida Statutes to apply, the 

Court reviewed the entire the Declaration. Article I of the Declaration 

provides as follows:

The provisions of the Florida Condominium Act, Chapter 718, 

including all definitions therein contained, as amended, as of 

the date of filing this Declaration, are adopted herein by 

express reference and shall govern this CONDOMINIUM and 

the rights, duties and responsibilities of the CONDOMINIUM 

UNIT OWNERS thereof, except where permissive variances 

therefrom appear in this Declaration and the BYLAWS and 

ARTICLES OF INCORPORATION OF HIGHLAND HOUSE 

CONDOMINIUM ASSOCIATION, INC. (emphasis added).

Article I does not contain the Kaufman clause adopting the 

Condominium Statutes as they might be amended “from time to time". 

This is a strong indication that the current version of Florida Statutes 

does not apply, but the Court delved deeper. 

The Court next inspected the remainder of the Declaration, the 

Articles of Incorporation, and the Bylaws to determine two things: first, 

Case 22-10140-MAM Doc 125 Filed 09/23/22 Page 9 of 19
10

whether another portion of the Declaration permitted retroactive 

application of the current form of the Condominium Statutes, and second, 

whether the Articles of Incorporation, the Bylaws, or any amendment to 

either of those documents permitted retroactive application. This 

analysis required close reading of the Declaration, Articles of 

Incorporation, and Bylaws. 

Subsection (i) of Article XXVII grants the HOA a lien for unpaid 

assessments. The language is unequivocal. Subsection (j) places all 

parties on notice as to the existence of the lien. Subsection (k) states that 

"[t]he lien shall be effective from the date of filing of a claim of lien in the 

Public Records of Palm Beach County, Florida ...". Subsection (k) does 

not provide for automatic perfection via statutory imposition of a lien, as 

is permitted under the current version of § 718.116 of the Condominium 

Statutes. Instead, subsection (k) provides that the lien must be recorded 

in order to be "effective".5

5 The Declaration language (with irrelevant portions excerpted) is as follows: 

(i) Recognizing that the necessity for providing proper operation and management at the 

[condominium] entails the continuing payment of costs and expenses therefor ... 

ASSOCIATION is hereby granted a lien upon such PRIVATE DWELLING ... which lien shall 

secure and does secure the moneys due for all assessments ....

(j) All persons ... [are] placed on notice of the lien rights granted to ASSOCIATION ....

Case 22-10140-MAM Doc 125 Filed 09/23/22 Page 10 of 19
11

Because Article XXVII is inconsistent with the current version of 

§ 718.116 of the Condominium Statutes, the Court took care to review 

any other provisions of the Declaration that might incorporate the 

present version of the Condominium Statutes or permit amendments 

that would lead to such incorporation. 

Article XXX governs amendments to the Declaration. The 

Declaration requires that amendments occur via a majority vote and be 

recorded in the Public Records.6 The parties did not provide the Court 

with a publicly recorded copy of an amended version of the Declaration. 

As a result, the Court concludes that the original Declaration remains 

the operative document. 

The Court also reviewed the Articles of Incorporation and Bylaws 

for potential amendments. As with the Declaration, the copies of those 

documents provided to the Court did not reflect any amendment or 

revisions that impacted Article XXVII of the Declaration.7

(k) The lien herein shall be effective from the date of filing of a claim of lien in the Public Records 

of Palm Beach County, Florida ..... 

Debtors Exhibit 4 (ECF No. 87-4), pdf pp. 15-16. 

6 Id. at pdf pp. 18-19.

7 Id. at pdf pp. 26-41. 

Case 22-10140-MAM Doc 125 Filed 09/23/22 Page 11 of 19
12

C. Comparison of Historical Statutes with Present Day Version

Interpretation of the Declaration led the Court to another 

important query: what did the Condominium Statutes provide at the date 

of recordation of the Declaration? Did they require an HOA lien to be 

recorded in order to be effective? To answer this question, the Court 

consulted the version of § 718.116 in effect as of February 9,1987.

Section 718.116 (1987) provided that any lien, including an HOA 

lien, had to be recorded to be effective. Specifically, § 718.116(4)(a) (1987) 

stated as follows: 

The association has a lien on each condominium parcel for any 

unpaid assessments with interest and for reasonable attorney's 

fees incurred by the association which are incident to the 

collection of the assessment or enforcement of the lien. The lien 

is effective from and after the recording of a claim of lien 

in the public records in the county in which the 

condominium parcel is located which states the description 

of the condominium parcel, the name of the record owner, the 

amount due, and the due dates. (emphasis added)

This language shows that, on the date of recordation of the 

Declaration, the Condominium Statutes contemplated recordation of a 

typical HOA lien for assessments. 

Although this question is a thorny one in many ways, the Court 

concludes that the intent of the Declaration drafters was creation of a set 

Case 22-10140-MAM Doc 125 Filed 09/23/22 Page 12 of 19
13

of documents consistent with the then-existing Florida Statutes. This 

intent is the only logical harmonization of Articles I and XXVII of the 

Declaration and the 1987 version of the Condominium Statutes. The 

language of Article XXVII and the 1987 version of Florida Statute 

§ 718.116 is virtually identical. Recordation of a claim of lien in favor of 

an HOA appears to have been mandated at the time to be "effective" or, 

in bankruptcy parlance, enforceable as a secured claim against a 

condominium parcel. 

Several legal theories support the Court’s conclusion that the 

HOA’s lien still must be recorded to be effective against Debtors despite 

intervening amendment(s) to the Condominium Statutes. The Court will 

outline them below. 

D. The Declaration Is a Binding Agreement

A condominium declaration is a binding agreement between the 

association and unit owners. Genesis RE Holdings, 2015 WL 5511558, at 

*2-3. Parties on both sides have a right to rely upon the plain language 

of the agreement, as do third parties who might be impacted by any 

alteration in material terms. Id. at *3. Because the right to contract 

stems from the Florida Constitution, overcoming contractual provisions

Case 22-10140-MAM Doc 125 Filed 09/23/22 Page 13 of 19
14

in a condominium declaration requires one of three things: (1) an 

amendment consistent with the terms of the governing document, 

(2) language in a statutory subsection (or its legislative history) clearly 

indicating that the legislature intended retroactive application of that 

subsection, or (3) strong policy concerns regarding the public welfare that 

override the sanctity of individual rights to contract. See Genesis RE 

Holdings, 2015 WL 5511558, at *2-4 (declining to impair contractual 

rights described in declaration); Fleeman, 342 So.2d at 817-18 (“Statutes 

are presumed to be prospective in application unless the Legislature 

manifests an intention to the contrary.”); Pomponio v. Claridge of 

Pompano Condominium, Inc., 378 So.2d 774,779-781 (Fla. 1980)

(discussing sanctity of freedom to contract balanced against societal 

welfare). The HOA has not presented the Court with support for any of 

these alternatives. 

1. No Amendments to Declaration

The Court observes that the HOA never amended the Declaration 

to opt into later revisions to Chapter 718. The HOA had approximately

twenty years to signal its desire to adopt legislative modifications to the 

Condominium Statutes imposing a statutory lien for unpaid 

Case 22-10140-MAM Doc 125 Filed 09/23/22 Page 14 of 19
15

assessments. Absent express modification to the Declaration, the Court 

must construe that document as being governed by the laws existing as 

of its recordation date. This conclusion is consistent with Florida case law 

requiring strict interpretation of existing condominium documents and 

the general constitutional prohibition against any impairment to the 

freedom of parties to contract for a legal bargain. Tranquil Harbour, 79 

So.3d at 86 (“Because a condominium is strictly a creature of statute, the 

language of the statutes in effect on the date of the declaration of 

condominium ‘is as controlling as if engrafted onto’ a contract governing 

its purchase and sale.”); Pundit 2 Joint Venture, LLP v. Westwood 

Gardens Homeowners Ass'n, Inc. 169 So.3d 145, 147-48 (Fla. 4th DCA 

2015); Cohn v. Grand Condominium Ass'n, Inc., 62 So.3d 1120, 1121-22 

(Fla. 2011); FLA. CONST., Art. I, § 10. 

This interpretation likewise acknowledges that the Declaration is a 

covenant running with the land that applies to subsequent owners of a 

condominium parcel. Montoya v. Alliance Cas., LLC (In re Montoya), Adv. 

Proc. No. 6:17-ap-00115-CCJ, 2019 WL 10734239, *4 (Bankr. M.D. Fla. 

2019); Genesis RE Holdings, 2015 WL 5511558, at *2; Ero Props., Inc. v. 

Cone, 418 So.2d 434, 435 (Fla. 3d DCA 1982). 

Case 22-10140-MAM Doc 125 Filed 09/23/22 Page 15 of 19
16

2. Absence of Statutory Language 

The language of the Declaration is not sufficiently ambiguous for 

the Court to overlook the most logical likely intent of the drafters and the 

identical language of the Condominium Statutes at that time. The Court 

could, however, potentially apply the current (2022) version of 

§ 718.116(5)(a) if the language of the present-day statute or its legislative 

history clearly provide for retroactive application. Beacon Hill 

Homeowners Ass’n v. Colfin Ah-Florida 7, LLC, 221 So.3d 710, 713 (Fla. 

3d DCA 2017) (citing U.S. v. Forest Hill Gardens E. Condo Ass’n, 990 F.

Supp. 2d 1344, 1349 (S.D. Fla. 2014)).

Unfortunately for the HOA, the statute does not contain any such 

language, nor did the HOA provide the Court with any legislative history 

explicitly demonstrating the necessity of retroactive application.8 This 

Court declines to infer legislative intent where it does not exist. Fleeman, 

342 So.2d at 817-18. 

3. Absence of Policy Arguments

The final possibility for an alternative interpretation requires 

8 Although this task was beyond the scope of the arguments presented by the HOA, the Court 

undertook its own legislative history research. This research did not uncover any written statement 

demonstrating legislative intent for retroactive application of § 718.166(5)(a) (2022). 

Case 22-10140-MAM Doc 125 Filed 09/23/22 Page 16 of 19
17

overcoming a very large hurdle. The Florida Supreme Court has 

acknowledged that, in rare instances, public welfare concerns may 

outweigh constitutional protections for contractual obligations. 

Pomponio, 378 So.2d at 779-780; FLA. CONST., Art. I, § 10. This option, 

however, is a high mountain to climb, and the HOA has not provided the 

Court with any steps supporting the journey. Although the Court could 

formulate vague hypothetical theories based upon common knowledge 

regarding the maintenance of condominium associations generally, it 

would be inappropriate for the Court to invent policy arguments in favor 

of the HOA where none were presented.9

E. Burden of Proof

Having viewed the entire situation as academically as possible, the 

Court is left with one final consideration: which party bore the burden of 

proof regarding the Claim and the Objection? 

Initially, the Claim was entitled to prima facia validity. In re 

Dorway, No. 07-21140-AJC, 2008 WL 5111882, at *2 (Bankr. S.D. Fla. 

July 14, 2008). After Debtors objected, however, the burden of proof 

9 The Court acknowledges that the HOA presented arguments pertinent to the precise situation 

involving the units at the condominium complex. These arguments, however, did not encompass the 

welfare of all condominium owners or all HOAs. 

Case 22-10140-MAM Doc 125 Filed 09/23/22 Page 17 of 19
18

shifted to the HOA to overcome Debtors’ objection. Id. The evidence 

presented failed to do so. As noted above, the HOA did not supply the 

Court with an amended form of Declaration that was publicly recorded 

prior to the filing of this bankruptcy case. The HOA also failed to provide 

the Court with any legal authority supporting retroactive application of 

§ 718.116(5)(a) (2022) or any overarching policy concerns impacting the 

public welfare. The HOA has thus failed to overcome its burden of proof 

regarding the secured status of the portion of the Claim equal to the 

Disputed Amount. 

CONCLUSION

After reviewing the entire Declaration, the full record of all 

documents filed in support of and in opposition to the secured status of 

the Disputed Amount portion of the Claim, applicable Florida Statutes, 

legislative history, and extensive case law regarding all possible avenues 

of interpretation, the Court determines that the Objection has merit. 

Chapter 718 (1987) and the Declaration required the HOA to record 

a Claim of Lien in order for its asserted lien to become effective. Absent 

recordation, the HOA is left with what the Court can only describe as an 

"unperfected" claim with respect to the Disputed Amount. 

Case 22-10140-MAM Doc 125 Filed 09/23/22 Page 18 of 19
19

Because the lien was not perfected with respect to the Disputed 

Amount, operation of Bankruptcy Code § 544 renders the Disputed 

Amount ($36,558.30) unsecured.10 The Court determines, and the 

Debtors have already conceded, that the balance of the Claim in the 

amount of $76,649.76 should be allowed as a secured claim against the 

Debtors' real property.

Accordingly, the Court ORDERS that:

1. The Objection is SUSTAINED in part and OVERRULED in part. 

2. The HOA holds an allowed secured claim in the amount of 

$76,649.76 and an allowed unsecured claim in the amount of 

$36,558.30. 

###

Copy furnished to: 

Mary Jo Rivero, Esq., Attorney for Debtors

Attorney for Debtors is directed to serve this Memorandum Opinion and Order upon 

all interested parties in compliance with all applicable rules. 

10 As noted in the procedural background of this Opinion, the parties agree that the balance of the 

Claim is secured pursuant to entry of a final state court order. 

Case 22-10140-MAM Doc 125 Filed 09/23/22 Page 19 of 19