Tara Woods Spe, LLC v. Cashin

• Decision Date: 15 July 2013
• Docket Number: No. 2D12–3854.,2D12–3854.
• Citation: 116 So.3d 492
• Parties: TARA WOODS SPE, LLC, Appellant, v. Louella CASHIN, Appellee.
• Court: Florida District Court of Appeals

116 So.3d 492

TARA WOODS SPE, LLC, Appellant,

v.Louella CASHIN, Appellee.

No. 2D12–3854.

District Court of Appeal of Florida,

Second District.

May 24, 2013.

Rehearing Denied July 15, 2013.

Jody B. Gabel and J. Allen Bobo of Lutz, Bobo, Telfair, Eastman, Gabel & Lee, Sarasota, for Appellant.

Robert B. Burandt of Burandt, Adamski & Feichthaler, PL, Cape Coral, for Appellee.

BLACK, Judge.

Tara Woods SPE, LLC, appeals the final judgment and supplemental final judgment entered in favor of Louella Cashin. Collectively, the judgments interpret provisions of Florida's Mobile Home Act, chapter 723, Florida Statutes (2007), and permit Ms. Cashin to rescind her lease contract. Presented with an issue of first impression, we must determine whether Tara Woods SPE, LLC (Tara Woods), a mobile home park owner, complied with the disclosure requirements of the Mobile Home Act (Act) as it relates to resale purchasers. Ms. Cashin persuaded the circuit court that the park owner did not comply with the Act; Tara Woods contends that the circuit court erroneously concluded that the park owner did not do enough to comply with the Act and further contends that Ms. Cashin waived certain rights. As we will explain in detail, we agree with Tara Woods' arguments and therefore reverse the judgments on appeal.

I. Background

In August 2007 Ms. Cashin purchased a mobile home in Tara Woods Mobile Home Park. Tara Woods owns the park, which is regulated by the Act. Ms. Cashin's mobile home was a resale; she purchased the home from the trustee of a deceased resident's trust (Seller).

A. Documents

On August 8, 2007, Ms. Cashin executed a Rental Assumption Agreement acknowledging and agreeing to assume the remaining term of the rental agreement between Tara Woods and the Seller. In addition, she executed a Rental Agreement to be effective for the period assumed—September 1, 2007 through December 31, 2007. The Rental Agreement included a rent increase provision identical to the rent increase provision in the Seller's original rental agreement, to wit: “The LANDLORD may raise the amount of base rent and special use fees and other charges annually effective the 1st day of January, ____. Increases in the base rent and other fees and charges will be determined in the manner disclosed in the Prospectus.”

On the same day, Ms. Cashin signed an acknowledgment stating that she received a copy of Tara Woods' Prospectus and a Lifetime Lease. The Prospectus provided to Ms. Cashin was approved by the Department of Business and Professional Regulation (Department) in 1994, pursuant to the Act. See §§ 723.006(8), .011(1); Vill. Park Mobile Home Ass'n., Inc. v. Fla. Dep't. of Bus. Reg., 506 So.2d 426, 426 (Fla. 1st DCA 1987). The Lifetime Lease, as an attachment to the Prospectus, had been approved by the Department on March 28, 2006. See§§ 723.011(2), .012(14)(d).

The first page of the Prospectus contains four paragraphs, each of which is typed in capital letters and required under the Act. See § 723.012(1)(b). As relevant to this appeal, paragraphs one, two, and four provide:

THIS PROSPECTUS CONTAINS VERY IMPORTANT INFORMATION REGARDING YOUR LEGAL RIGHTS AND YOUR FINANCIAL OBLIGATIONS IN LEASING A MOBILE HOME LOT. MAKE SURE THAT YOU READ THE ENTIRE DOCUMENT

AND SEEK LEGAL ADVICE IF YOU HAVE ANY QUESTIONS REGARDING THE INFORMATION SET FORTH IN THIS DOCUMENT.

THE STATEMENTS CONTAINED HEREIN ARE ONLY SUMMARY IN NATURE. A PROSPECTIVE LESSEE SHOULD REFER TO ALL REFERENCES, ALL EXHIBITS HERETO, THE CONTRACT DOCUMENTS, AND ALL SALES MATERIALS.

....

UPON DELIVERY OF THE PROSPECTUS TO A PROSPECTIVE LESSEE, THE RENTAL AGREEMENT IS VOIDABLE BY THE LESSEE FOR A PERIOD OF FIFTEEN (15) DAYS.

Section VIII, paragraph D of the Prospectus, under the heading “Increases in Lot Rental Amount,” addresses factors affecting rent increases:

Factors which may affect the level of increases in the lot rental amount or user fees are as follows:

Consumer Price Index (CPI): [Tara Woods] will consider increases in the level of CPI for the twelve-month (12–mo.) period immediately preceding the notice of increase. Rent and other charges may be increased by a percentage equal to the increase in the level of CPI but such increase will not exceed ten percent (10%) of the level of rent or other charges in the year prior to the effective date of the increase.

Paragraph E of the Prospectus, under the same section and heading, addresses “Additional Considerations” and provides, in relevant part:

Tenants assuming the remaining portion of a rental agreement as prescribed by § 723.059(3), F.S., are hereby notified that upon the expiration of the assumed rental agreement, the Park Owner expressly reserves the right to increase lot rental amount in an amount deemed appropriate by the Park Owner with such increase being imposed in the manner disclosed in the Prospectus delivered to the initial recipient. The increase must be disclosed and agreed to by the purchaser in writing prior to occupancy.

Also on August 8, 2007, Ms. Cashin signed an acknowledgement stating that Tara Woods provided her with an approved Prospectus and that she had not been supplied with the original prospectus delivered to the Seller. That document reads:

The owner of the home I purchased on Lot 143 did not supply me (we) or the Sales Office with the original Prospectus which was delivered to the previous owner(s), per the terms specified in Chapter 723, Florida Statutes, Department of Business Regulation, Division of Florida Land Sales, Condominiums and Mobile Homes.

Tara Woods Community Management furnished me (us) with a current approved Prospectus, which is now being delivered to new residents who purchase new homes. I(we) were informed that it may or may not be the same form as the original Prospectus delivered to the previous owner(s). I(we) the buyer(s) Louella Cashin accept the current Prospectus given to me (us) at the time of the signing of the Lease Agreement to be used as a guide for information purposes.

The final document signed by Ms. Cashin is her lot rental agreement (Lifetime Lease). Although the date Ms. Cashin signed the Lifetime Lease is unclear—two executed Lifetime Leases were introduced into evidence below—it is clear Ms. Cashin signed a Lifetime Lease.¹ Section C, paragraph 3(C), of the Lifetime Lease addresses factors affecting increases in rent and reads:

Effective the first day of every calendar year the base rent shall be adjusted by the percentage increase in the CPI; however, if the percentage increase in the CPI is less than three percent for any year, the base rent shall be increased by three percent. Alternatively, at the sole discretion of Community Owner, effective the first day of each calendar year, the base rent shall be adjusted to the market rent, but in no year by more than the percentage increase in the CPI plus two percent.

On the last page of the Lifetime Lease, section V, Homeowner Acknowledgement of Understanding, provides: “Homeowner hereby acknowledges that [s]he has read the foregoing Lot Rental Agreement and that prior to executing this Lot Rental Agreement [s]he has had a reasonable opportunity to read and review it....” Finally, immediately preceding the signature lines on the last page of the lease, and typed in bolded, all capital letters appears the following disclosure:

YOU DO NOT HAVE TO ACCEPT THIS RENTAL AGREEMENT.

THIS RENTAL AGREEMENT CONTAINS PROVISIONS WHICH ARE DIFFERENT FROM THE PROSPECTUS DISCLOSURE. THESE DIFFERENCES MAY INCLUDE FEES AND FACTORS WHICH MAY AFFECT THE LOT RENTAL AMOUNT OF OTHER PROVISIONS.

THIS RENTAL AGREEMENT APPLIES ONLY TO THOSE HOMEOWNERS WHO CONSENT TO IT.

B. Lawsuit

On June 24, 2010, almost three years after executing her Lifetime Lease, and after two annual rent increases, Ms. Cashin filed a two-count complaint against Tara Woods. In count I, Ms. Cashin sought declaratory relief, asking the court to declare the Prospectus the “supreme governing document” such that any provision in Ms. Cashin's Lifetime Lease which conflicted with the Prospectus was unenforceable. In count II, she claimed damages based on the difference between the rent she paid under the Lifetime Lease and what she would have been obligated to pay under a lease identical to the Seller's.

Tara Woods answered the complaint and filed affirmative defenses including (1) that Ms. Cashin accepted the Rental Assumption Agreement, Rental Agreement, and Lifetime Lease without question, protest, or dispute; (2) that Ms. Cashin executed an acknowledgment stating that she had not received the Seller's prospectus and had accepted the current Prospectus; (3) that Ms. Cashin voluntarily agreed to the Lifetime Lease which includes conspicuous language indicating that it was optional; and (4) that Ms. Cashin waived any claim asserting an entitlement to a different rental agreement by her voluntary execution of the Lifetime Lease and the thirty-four-month period in which it had governed the parties' relationship.

C. Judgments

Following an unsuccessful mediation, the matter went to nonjury trial on May 27, 2011. On January 30, 2012, the court issued its final judgment, concluding in pertinent part:

Assuming ... a prospectus can be amended by attaching a rental agreementas an exhibit with provisions which conflict with those in the prospectus, as was the situation in this case, the prospectus, as amended, the disclosures made, and the manner in which it is presented to prospective purchasers of existing homes, must, at a minimum, in order to comply with the full and fair disclosure requirements set forth in Chapter 723, Florida Statutes, clearly inform [Ms. Cashin] of her rights under Fla. Stat. 723.059 and choice to enter into a lot rental agreement on the terms and conditions consistent with her Seller's prospectus. On the facts of this case, [Ms. Cashin] was not given that disclosure and choice. Here, [Ms. Cashin] was not even provided with a copy of the optional lease she had the right...