A South Florida appellate panel has affirmed a trial court’s decision in favor of a church that was sued for breach of declaration when it wasn’t able to transfer the ownership of a radio antenna after purchasing property.
It’s a case that relied on the court’s interpretation of a condominium declaration and whether it was enforceable or not. The resulting opinion from the Third District Court of Appeal was a win for Akerman, which represented the church.
Both parties, 814 Property Holdings and New Birth Baptist Church Cathedral of Faith International, each owned a unit in a two-unit condominium building in Miami-Dade County. 814 Property owned the first unit and New Birth owned the second unit. New Birth operated a gospel radio station out of its unit and broadcasted from a radio antenna on the property.
According to the property’s declaration of condominium, there are provisions that categorize the antenna as a limited common element to the second unit, and a clause that gave 814 Property the first option to buy New Birth’s unit.
In 2017, 814 Property decided to buy New Birth’s unit. According to the opinion, 814 Property directed that New Birth “immediately use its best and good faith efforts to obtain approval for the transfer of the radio antenna by the [FCC]” to an appointee assigned by 814 Property.
815 Property sued after New Birth allegedly refused to recognize the purchase or transfer ownership of the radio antenna.
814 sought a declaratory judgment New Birth was obligated to use good faith efforts to get the FCC’s approval to transfer the radio antenna to 814 Property, and also sought damages for the alleged breach of the declaration due to failure to comply.
New Birth counterclaimed and wanted the court to declare the option clause unenforceable and void. Miami-Dade Circuit Judge Alan Fine granted summary judgment in favor of New Birth, reasoning that the word “transfer” meant transferring the antenna to another location, instead of to 814 Property. Fine also found the option clause void and unenforceable, citing an unreasonable restraint of alienation.
814 Property appealed the decision, arguing that the trial court erred in its decision. But Third DCA Judges Kevin Emas, Norma Lindsey and Alexander Bokor agreed with the trial court’s analysis.
“The declaration imposes both a fixed price and an indefinite duration on the purchase option. The options clause allows ‘a right of first offer . . . in favor of [814 Property] to purchase Unit No. 2′ for a fixed price of $200,000.00,” Bokor wrote in the opinion. “This provision includes no time limit for the option, providing only that ‘[t]he purchase option shall be exercisable’ within 10 days of New Birth providing notice of its effort to obtain transfer of the radio antenna from the FCC.”
Boker wrote that nothing required the church to seek approval within a limited time and, if it obtained FCC approval, the option would not terminate. 814 Property would retain a right of refusal on any outside offers and the right would go away if not exercised in a timely manner.
“Because these terms contain none of the limitations outlined in Iglehart and would constrain the development and marketability of the unit around New Birth’s endeavors to transfer the radio antenna, the trial court properly concluded that the options clause was unenforceable and granted summary judgment on that basis,” Bokor wrote.
The limitations outlined in the case Iglehart v. Phillips say, “It is generally agreed that an option restraint is reasonable if the option price is at market or appraised value, irrespective of the duration of the option.”
Leah Rose and Jonathan Smulevich of Lowy and Cook in Miami represented 814 Property Holdings with David Gersten of Gordon & Rees in Miami. Akerman attorneys Carmen Tugender, Gerald Cope Jr. and Michael Chavies represented New Birth Baptist Church Cathedral of Faith International. Neither side responded to a request for comment by deadline.