As a unit owner in a condominium association, you are obligated to pay assessments to the Association for the common expenses incurred to operate and maintain the Association property. When a unit owner fails to pay the assessments, the Association may sue to collect the amount due. Florida statute provides the unpaid assessments shall bear interest from the due date until paid at the interest rate provided by the Declaration of Condominium. See Florida Statute 718.116(3). It is not uncommon for the Declaration of Condominium to provide for interest at the highest rate allowed by law (which is 18%).
But what happens if the litigation is prolonged? Interest is accruing each day. In the recent First Equitable Realty III, Ltd. v. Grandview Palace Condominum Association, the association prevailed and the defendant was ordered to pay the unpaid assessments to the association, plus unpaid interest in accordance with Florida Statutes and the Declaration of Condominium. The total unpaid interest due the association was over $50,000. The Court, however, for “equitable considerations” reduced the amount of interest the defendant was required to pay the association to just under $15,000. I am certain the defendant was pleased with this $35,000 reduction.
On appeal, the appellate court reversed the prior decision stating the trial court lacked discretion to award anything less because the statute expressly provided for entitlement to interest for a specified duration and at a specified rate in claims for unpaid assessments. In fact, courts have held that notwithstanding the claimant being responsible for excessive delays in collections, the trial courts do not have authority to reduce the interest award based upon equitable considerations.