Providence Square Ass'n, Inc. v. Biancardi

• Decision Date: 23 April 1987
• Docket Number: No. 68304,68304
• Parties: 12 Fla. L. Weekly 200 PROVIDENCE SQUARE ASSOCIATION, INC., Petitioner, v. Connie BIANCARDI, Respondent.
• Court: Florida Supreme Court

Page 1366

507 So.2d 1366

12 Fla. L. Weekly 200

PROVIDENCE SQUARE ASSOCIATION, INC., Petitioner, v. Connie BIANCARDI, Respondent.

No. 68304.

Supreme Court of Florida.

April 23, 1987.

Rehearing Denied June 29, 1987.

Harlan L. Paul of James, Zimmerman & Paul, DeLand, for petitioner.

Michael S. May, DeLand, for respondent.

PER CURIAM.

We have for review Biancardi v. Providence Square Association, Inc., 481 So.2d 1272 (Fla. 5th DCA 1986), which expressly and directly conflicts with decisions of another district court of appeal on the same question of law. ¹ We have jurisdiction pursuant to article V, section 3(b)(3), Florida Constitution. The issue in this case is whether a court may award the equitable remedy of reformation to change the percentages of ownership interests in the common elements of a condominium as set forth in the condominium declaration. We hold that it may and that reformation is proper in this case. We, therefore, quash the district court's decision.

As initially constructed, the Providence Square office condominium consisted of four identical units. One of these units was later divided in half so that when subjected to the condominium form of ownership there were three units of equal size (units one, two, and three) and two units (units four and five) half the size of the larger three. The declaration of condominium, however, provided that each of the five units would have an equal twenty-percent ownership share in the common elements. Connie Biancardi purchased units four and five, one on January 31, 1984 and the other on March 19, 1984. On April 6, 1984, a fire completely destroyed the office building comprising the Providence Square condominium.

Biancardi filed an action for declaratory judgment, seeking a determination that, as forty-percent owner of the common elements and common surplus, she would be entitled to receive forty percent of the net insurance proceeds. The condominium association filed a counterclaim seeking reformation of the condominium declaration. The trial court found that the developer and the purchasers of the condominium parcels intended each unit to carry a percentage share of ownership of the common elements proportionate to its size. Accordingly, the parties understood that units one, two, and three each carried a twenty-five percent ownership share in the common elements while units four and five each carried a twelve and one-half percent ownership share in the common elements. The court found that the declaration provision indicating equal twenty-percent shares for all five units was a drafting mistake. The court reformed the document to express the arrangement it found the parties to have intended.

The district court of appeal reversed, ruling that the declaration of condominium, being a unilaterally created document, could only be amended in accordance with the proper statutory prerequisites. Noting that the developer sold the units according to the terms of the declaration and the related documents and that Biancardi had paid the appropriate amount reflected in those documents, the district court concluded that any fault lay with the declaration's original draftsman and that the court had no authority to alter the document's terms.

A court of equity has the power to reform a written instrument where, due to a mutual mistake, the instrument as drawn does not accurately express the true intention or agreement of the parties to the instrument. Blumberg v. American Fire & Casualty Co., 51 So.2d 182 (Fla.1951); Rosenthal v. First National Fire Insurance Co., 74 Fla. 371, 77 So. 92 (1917); Phenix Insurance Co. v. Hilliard, 59 Fla. 590, 52 So. 799 (1910); Malt v. R.J. Mueller Enterprises, Inc., 396 So.2d 1174 (Fla. 4th DCA 1981); Gennaro v. Leeper, 313 So.2d 70 (Fla. 2d DCA 1975). This principle is applicable to instruments of conveyance of real property as well as to contracts and can be applied to correct an erroneous land description in order to protect a person's rights in real property. Crompton v. Kirkland, 157 Fla. 89, 24 So.2d 902 (1946); Shell Creek Land Co. v. Watson, 101 Fla. 172, 133 So. 621 (1931); Horne v. J.C. Turner Cypress Lumber Co., 55 Fla. 690, 45 So. 1016 (1908); Herring v. Fitts, 43 Fla. 54, 30 So. 804 (1901); General Development Corp. v. Kirk, 251 So.2d 284 (Fla. 2d DCA 1971); Goodstone v. Shamblen, 141 So.2d 8 (Fla. 2d DCA 1962). Notably in reforming a written instrument, an equity court in no way alters the agreement of the parties. Instead, the reformation only corrects the defective written instrument so that it accurately reflects the true terms of the agreement actually reached. Porter v. Meigs, 74 So.2d 82 (Fla.1954); Southern Lead Corp. v. Glass, 103 Fla. 657, 138 So. 59 (1931); Smith v. Caravasios, 96 Fla. 219, 118 So. 10 (1928).

We cannot agree with the district court's ruling that a declaration of condominium, being a unilaterally created document, is not subject to reformation on the ground of mutual mistake. Clearly, reformation principles cannot be applied to certain kinds of unilaterally generated legal documents which are noncontractual in nature. For example, a city council resolution expressing the city's intentions is not subject to reformation because, due to its unilateral nature, such a resolution simply cannot give rise to a mutual mistake. Carr v. City of Kissimmee, 80 Fla. 759, 86 So. 699 (1920). Additionally, where a deed is given gratuitously and thereby constitutes a unilateral act on the part of the grantor, or where the only consideration is "love and affection" rather than material value, equity will not decree reformation on the ground of mistake. Smith v. Pattishall, 129 Fla. 498, 176 So. 568 (1937); Triesback v. Tyler, 62 Fla. 580, 56 So. 947 (1911); Harrod v. Simmons, 143 So.2d 717 (Fla. 2d DCA 1962). On the other hand, a deed given pursuant to valuable consideration is normally the result of some degree of bargaining and is, therefore, bilateral in character. Whether there is an antecedent formal written contract of sale or merely an oral negotiation leading up to the execution of the deed, the provisions in the deed, such as covenants, conditions, restrictions and reservations, as well as the description of the land conveyed, are expressions of the agreement reached by the parties through the antecedent negotiations. Such a bilateral instrument is subject to reformation where the need arises.

Unlike either municipal resolutions or nongratuitous deeds, declarations of condominium have both unilateral and bilateral elements. When a declaration of condominium is initially filed for recording, it is unilateral in nature. Later, when condominium parcels are sold, each conveyance is made pursuant to and with reference to the declaration. Thus, to the extent that a declaration forms a part of the deed of conveyance and is based on the contractual agreement between the seller and the purchaser, it is a bilateral instrument as to which there can be a mutual mistake. In a sense, a declaration of condominium is analogous to a subdivision plat. The declaration sets the legal ground rules for a controlled process of subdivision, development, sale, and use of the individual parcels of real property pursuant to a general plan. See Bank of South Jacksonville v. Cammar, 89 Fla. 296, 103 So. 827 (1925); Lawyers Title Guaranty Fund v. Milgo Electronics, 318 So.2d 416 (Fla. 3d DCA 1975), cert. denied, 336 So.2d 602 (Fla.1976); § 718.104(7), Fla.Stat. (1984 Supp.) (declaration provisions are equitable servitudes that run with the land). Therefore, the provisions in the instant declaration of condominium pertaining to each unit's proportionate share of the common elements formed an integral part of each transaction between the developer and the condominium unit purchasers.

The district court concluded that only an amendment filed in accordance with the condominium statutes could change the terms of the declaration. Seeking to bolster the district court's decision, Biancardi argues that the extensive statutory regulation of condominium developments in Florida mandates that any amendments to declarations strictly follow statutory procedures. A close examination of the relevant condominium statutes, however, reveals that they fail to provide an adequate remedy in situations where an original declaration is erroneously drafted. ² Notably, the statutory amendment of a declaration is very different from the equitable reformation thereof. A reformation relates back to the time the instrument was originally executed and simply corrects the document's language to read as it should have read all along. Porter, 74 So.2d at 85. By contrast, an amendment that changes the provisions of a document prospectively does not provide a determination that, as originally written, it contained an erroneously drafted provision.

Section 718.110(1)(a), Florida Statutes (Supp.1984), provides that, in the absence of a method of amendment set forth in the declaration, a declaration may be amended by approval of "the owners of not less than two-thirds of the units" except as to matters described in subsections (4) and (8). Subsection (4) states that, unless provided in the declaration,

no amendment may ... materially alter or modify the appurtenances to [any] unit, or change the proportion or percentage by which the owner of the parcel shares the common expenses and owns the common surplus unless the record owner of the unit ... join[s] in the execution of the amendment.

§ 718.110(4), Fla.Stat. (Supp.1984). As written and recorded, the declaration provided that units four and five each had a twenty-percent share. The object of the amendment would be to reduce those shares to twelve and one-half percent. Thus, the declaration could not be amended under subsection (4) without Biancardi's consent.

Although subsections (5), (9), and (10) of section 718.110, Florida Statutes (Supp.1984), provide for the correction of errors in a...