Question: We have an ongoing dispute with an owner. They are always late on maintenance fees and they claim they have a right to deduct half their fees because of a water leak affecting their unit. They just sent us a check for about 75% of what is owed, and said that this was payment in full. Is there any reason we should not cash the check?  J.M. (via e-mail)
Answer:  Owners have the obligation to pay their assessments in a timely manner and do not have the right to withhold any portion of their assessment payments due to such a dispute.Florida appellate courts have found that an owner’s contention that the association is failing to maintain the common elements is not a defense to an assessment lien foreclosure action. However, the appellate courts have recognized that “setoff” can be a defense to a foreclosure action.
Therefore, if the owner is able to demonstrate that she suffered damages as a result of the association’s failure to maintain the common elements,  those damages could reduce the amount of the association’s lien foreclosure judgment. 
With regard to the owner delivering a check to the association for less than the full amount owed but stating on the check that it was for “payment in full,” the Florida Condominium Act provides that any payment received by an association must be applied first to any interest accrued by the association, then to any administrative late fee, then to costs and reasonable attorney’s fees incurred in collection, and then to the delinquent assessment. The Act further provides the foregoing is applicable notwithstanding any restrictive endorsement, designation, or instruction placed on or accompanying a payment. Many have believed these provisions entitle the association to accept payments such as the one in your case without any adverse risk to the association.
However, a recent Florida appellate case held the statutory language concerning restrictive endorsements is limited to restrictive endorsements instructing how the association must apply the payment on the account, and not necessarily to those restrictive endorsements intended to operate as an accord and satisfaction or a settlement of the claim. Therefore, the association should consult with its attorney concerning whether it should accept the payment in your particular case. Accepting the payment might result in a full settlement of the amounts due to the association.