Everyone is rightfully concerned about liability these days.  The Trayvon Martin tragedy turned into a lawsuit against the association.  When a car crashed into a boy riding a bicycle, the association was held liable for several millions of dollars.  A jury awarded $20 million in damages to a woman who sued after she was raped in her apartment complex.  The jury said management should have warned the residents that a predator was on the loose.

Should the Board of Directors warn everyone when it appears a resident is listed on the Florida Department of Law Enforcement’s (FDLE) Registry?  Can the Board of Directors even do anything to prevent a Sexual Offender or Sexual Predator from living there?  What if the Sex Offender harms a child – is the Association liable?  I’ll start with a few idioms that apply:

Damned if you do…Damned if you don’t
Between a rock and a hard place…
Between the Devil and the deep blue sea….

A community association in South Carolina obtained information from the Sex Offender Registry website and distributed it to community residents hoping to avoid liability for failing to warn them about a possible dangerous person.  This ostensibly well-meaning action produced the exact opposite result – a big lawsuit with a big judgment at the end of the day.

The board members didn’t do their homework and it came back to bite the association.  The flyer, printed from the website, had an old photograph of someone named William James King, along with the information that he had been convicted of committing a lewd act upon a child.  James King owned two units in the condominium.  Some residents were reportedly told that the King in the flyer was the same King who owned property in the condominium complex.  They weren’t the same person and this was the bad mistake.

The newspaper article that reported the story doesn’t say whether the condominium association had Directors & Officers insurance coverage to cover the defense and the damage award.  With close to nine hundred thousand dollars in damages, who knows whether they have enough coverage even if they did buy the appropriate insurance policy?  Moreover, a chunk of the award ($340,000.00) represented punitive damages meant to punish the association for the wrongful conduct of the Board of Directors.

Coverage does not typically include indemnification for punitive damages.

What should you do?  Turn to local law enforcement for guidance and consult with your association’s attorney.  FDLE make certain information on Floridasexual predators and sexual offenders readily available to the public by;
  • posting the predators/offenders registration information and their photographs on the Internet;
  • maintaining a toll-free telephone line for the public to use to inquire whether an individual is a sexual predator or sexual offender;
  • making informational flyers and brochures on sexual predators and sexual offenders available to the public;
  • providing an online account search that allows citizens to see if an email address or instant message name belongs to a registered sexual offender or predator; and
  • having an automatic e-mail notification system that allows citizens to sign-up to receive e-mail notifications regarding offenders/predators in their area.
Take advantage of local law enforcement resources before finding yourself between a rock and a hard place.

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Bob Lancaster Insurance
Serving Florida since 1964