Answers to Realtors' Top Coronavirus Legal Questions
Here are answers to some of the more recent legal questions about the impact of COVID-19 on real estate fielded by Florida Realtors attorneys.
Is there a standard letter a real estate licensee should carry if conducting necessary work in the field, (outside the licensee’s home) which verifies that real estate is an essential service?
No, there is no paperwork that you must carry that Florida Realtors is aware of. However, numerous callers to the Florida Realtors Legal Hotline indicated they would like to have access to some such documentation in case they are questioned.
One idea is for you to carry (1) a copy of your real estate license and (2) a copy of Gov. Ron DeSantis’ Executive Order 20-91, which broadly designates essential services, including those referenced in the March 28, 2020, Guidance on the Essential Critical Infrastructure Workforce, that accompanies the order. See Section 2A of the Order, which defines essential services, then the top of page 18 (1st bullet point) and top of page 20 (3rd and 4th bullet points) for a list of specific real estate services.
Have residential tenants in Florida been excused from paying rent given the widespread impact of the COVID-19 pandemic?
No, tenants are not excused from paying rent to a landlord, absent the parties having renegotiated the terms of the lease. However, with regard to residential tenancies, Governor DeSantis issued an Executive Order 20-94 on April 2, 2020, suspending and tolling statutes related to evicting a tenant when a tenant can’t pay the rent due to COVID-19. So, where a residential tenant does not pay rent due to COVID-19, the landlord will not be able to evict the tenant. The eviction ban has been extended to 12:01 a.m. July 1 by Governor DeSantis’ Executive Order 20-137.
In addition, the Florida Supreme Court suspended Florida’s Clerks of Court from issuing writs of possession, following a final judgment for the delivery of possession of real property. As such, sheriffs cannot put landlords in possession of premises, and landlords are not able to remove tenants’ possessions to the property line, even where a final judgment has been rendered. This includes an eviction that is not based on failure to pay rent. Though subject to debate, there appears to be no expiration date on the order suspending the issuance of writs of possession.
Lastly, the CARES Act enacted by Congress provides a 120-day temporary eviction moratorium on covered dwellings that will end on July 25, 2020. During the moratorium period, the landlord of a covered dwelling is prohibited from issuing a notice to vacate for nonpayment of rent. Once the moratorium period has ended, the CARES Act provides that the landlord must give the tenant 30 days to vacate the rented premises and cannot require the tenant to vacate at an earlier time. Covered housing is defined in Section 4024 of the Act and includes properties that have a federally-backed mortgage loan or a federally-backed multifamily mortgage loan.
Please note that the moratorium and suspensions do NOT excuse a tenant from paying rent and it will not prevent a landlord from recovering the amount of rent the tenant owed and did not pay.
If a buyer does not obtain loan approval by loan approval period using the Florida Realtors/Florida BAR As Is Residential Contract, is the buyer’s deposit at risk?
In general, if a buyer applied for the financing in a timely manner, used good faith and due diligence in the process and was either denied loan approval or simply did not obtain loan approval for financing within the designated time period, then the deposit may be returned to the buyer, as long as other contract provisions are followed.
So, assuming the facts recited in the prior sentence, to be entitled to the deposit at the conclusion of the loan approval period, a buyer must notify the seller in writing within the loan approval period that buyer did not obtain the loan and that buyer elects to terminate the contract.
That being said, even if the buyer did everything required, there is still no guarantee that the parties won’t get into a dispute over who is entitled to the funds. Where a title company is holding the deposit monies, and the transaction has fallen apart, it is unlikely the deposit will be disbursed unless the parties are in agreement as to who is entitled to the funds.
If the parties can’t reach a resolution through mediation or otherwise settle, then either can file suit against the other for breach of contract, or the title company can file an interpleader action requesting a judge decide who is entitled to the funds.
If the escrow agent is a brokerage, a dispute between parties over the deposit will also tie up the release of the deposit by the brokerage. The brokerage will have to notify the Florida Real Estate Commissions (FREC) of the dispute and then follow 475.25 and FREC rule 10.032.
Are vacation rentals still prohibited from resuming operations in Florida?
Vacation rentals remain closed but counties may submit their reopening strategy to the Department of Business and Professional Regulation for consideration. Find out more, including details about safety precautions for owners, here.