(June 2025)
BACKGROUND FOR THIS COMMUNICATION
Recently, on social media, several homeowners referenced litigation involving the Solivita community (an age 55+ neighborhood) located in Kissimmee, Florida. (See case decision located at https://caselaw.findlaw.com/court/dis-crt-app-flo-six-dis/2318562.html)
In 2017, certain homeowners of the Solivita community filed a class action lawsuit against the developer, alleging improper fee collections by the developer. The developer operated an independently owned club that assessed monthly dues. The Solivita homeowner association documents presumably provided that both membership in the club and payment of the monthly club dues were mandatory.
The Reunion West POA (“POA”) cannot provide a legal analysis of this lawsuit or guarantee the accuracy of the summary presented above. But several homeowners pointed to this litigation and argued the POA has a fiduciary obligation or other legal duty to investigate whether the POA should pursue similar legal action.
RESPONSE
The POA consulted its legal counsel on the POA’s fiduciary or other legal duty to investigate and possibly initiate legal action similar to the Solivita class action. Legal counsel confirmed the POA has no fiduciary or other legal duty to pursue this matter. The POA governing documents do not require the POA to undertake this duty.
Although POA legal counsel determined the POA has no duty to investigate or initiate legal action against the Encore Club (formerly known as the Reunion West Club), legal counsel noted the POA could voluntarily incur legal expenses in this matter. However, there are significant impediments to the POA incurring such legal expenses. These impediments are discussed below with references to our POA governing documents.
WHAT DO THE APPLICABLE POA GOVERNING DOCUMENTS PROVIDE ON THIS MATTER?
All homeowners at Reunion West belong to the Reunion West POA and are subject to the POA governing documents. You can obtain a copy of our Reunion West POA Articles of Incorporation, Bylaws, and Covenants, Conditions and Restrictions (“CC&R’s”) (“Governing Documents”) on Frontsteps. To locate these documents:
● Go to the Frontsteps website for our community.
● Click on “Documents”.
● Select “Important Community Documents”.
● Choose “RW-All Governing Docs” to locate these documents.
Alternatively, you may request a copy of these documents by sending an email to admin@reunionwestpoa.com.
Please note the following summary should NOT replace your personal reading of the Governing Documents. The POA is not offering an opinion as to the legal applicability or enforceability of these provisions. We encourage homeowners to contact their personal attorneys to answer questions they may have on the legality or enforceability of these provisions. THIS DOCUMENT IS NOT LEGAL ADVICE.
- Limitations on Engaging Legal Counsel. The Governing Documents require the POA to obtain approval of 75% of all homeowners (with limited exceptions) to prepare, investigate, or undertake legal action against a third party (such as the Encore Club). (See Article IV, Section C.12 of the POA Articles of Incorporation.)
This means the POA would first need to hold a meeting, in which 75% of all members (not just those attending the meeting) vote in favor of such legal action. Based on participation in past POA meetings, we do not believe the 75% approval threshold could be obtained.
As a point of reference, POA legal counsel estimated that legal costs to investigate and prepare for legal action (before any actual lawsuit) could be in excess of $100,000. - POA Requirement to Indemnify the Encore Club for Its Legal Fees. The Governing Documents require the POA to indemnify and hold harmless the Encore Club (e.g., the POA would pay the Encore Club’s legal fees and costs) for certain claims the POA makes against the Encore Club. This indemnification clause could be applicable in a POA legal action or legal investigation against the Encore Club. Homeowners should also consult with their personal legal advisors, as this same provision could have application to individual homeowners in certain situations. (See Article II. Section 3.F.(3) of the CC&R’s).
- Solivita Club Membership Remains Mandatory. Of interest, even after the conclusion of the Solivita class action judgment in 2021, members of the Solivita community are still required to be members of their club and pay monthly club dues, although we understand there are now differences in how those dues are handled in light of the lawsuit.
PLEASE READ THE POA GOVERNING DOCUMENTS AND OTHER DOCUMENTS TO CONFIRM AND CLARIFY THE SUMMARY PROVIDED ABOVE. PLEASE CONSULT WITH YOUR LEGAL COUNSEL REGARDING QUESTIONS YOU MAY HAVE ON THE GOVERNING DOCUMENTS, INCLUDING BUT NOT LIMITED TO LIMITATIONS OF THESE PROVISIONS, THE ENFORCEABILITY OF THESE PROVISIONS, THE INTERPRETATION OF THESE PROVISIONS, AND THE INDEMNIFICATION LANGUAGE INCLUDED IN THIS DOCUMENT. NONE OF THE INFORMATION PRESENTED ABOVE IS INTENDED TO CONSTITUTE LEGAL ADVICE OR TO BE RELIED UPON IN MAKING PERSONAL DECISIONS RELATED TO YOURSELF OR YOUR PROPERTY.