MIAMI — A Florida appeals court has told condo owners that calling a lawsuit against their association a “direct” action does not let them skip the rules for derivative suits. In an opinion filed October 7, 2026, the Third District Court of Appeal ruled in Gratigny Park Condominium No. 1, Inc. v. Perez (No. 3D26-1268) that two owners should have met presuit requirements before suing over alleged mismanagement.
The case
Reinier Vargas Perez and Alina Garcia Gonzalez own a unit in a 79-unit condominium in Miami-Dade County. According to the court’s opinion, they sued the association and its management company, Sun City Condo Solutions, for injunctive and declaratory relief. They alleged breach of fiduciary duty, corporate mismanagement and improper spending, including that association money went to both the maintenance provider and the association president for the same services.
They asked the court to order the association to stop paying the president for “janitorial services”, terminate the management agreement over alleged licensing violations, set up the online records portal required by section 718.111(12)(g), and comply with its governing documents. Claims against Sun City were dismissed in the trial court.
The association moved to dismiss, arguing the claims were derivative, meaning brought on behalf of the corporation, and that the owners had not followed section 617.07401, Florida Statutes. That statute required a verified complaint and a written demand to the board, with 90 days for the board to respond, before a member could sue in the corporation’s name. The trial judge disagreed, finding that section 718.303(1) of the Condominium Act gives owners a direct right to sue.
What the appeals court decided
Judge Gooden, writing for a panel that included Judges Fernandez and Miller, granted the association’s petition and quashed the trial court’s order. The court held that the two statutes work together. Section 718.303(1) creates the right to sue, while the nonprofit corporation statute “supplies the procedural prerequisites for pursuing that claim derivatively.”
Whether a claim is direct or derivative depends on what it is really about, the court said. Here, “the injury sustained by the unit owner is the very same injury sustained by other unit owners.” Quoting an earlier First District case, the panel added that plaintiffs “may not decide that they are not subject to statutory requirements merely by labeling their allegations in an effort to avoid them.”
The opinion notes that section 617.07401 has since been repealed and replaced by a new section 617.0742, effective July 1, 2026, which sets its own requirements for complaints brought in the right of a corporation. The opinion is not final until any timely rehearing motion is decided.
What it means for owners and boards
Owners: if your complaint is that the board is wasting money, overpaying a vendor or ignoring the declaration, which are harms shared by every owner, a court is likely to treat it as derivative. Before filing, send the board a written demand that sets out the problem and what you want done, keep proof of delivery, and talk to a lawyer about the current requirements under section 617.0742. A claim that only affects you, like a refusal to let you inspect records or a fine imposed on your unit, may be direct. That distinction is worth getting right before you pay a filing fee.
Boards: this ruling gives associations a procedural defence, but not a substantive one. The underlying allegations in this case, such as payments to a sitting president and a missing records portal, are the sort of thing a demand letter is meant to fix. If you receive a demand, investigate and respond in writing within the statutory window.
For more on board duties around money, see our guides to what HOA and condo fees cover and special assessments.
Source: Florida Third District Court of Appeal, opinion filed October 7, 2026, No. 3D26-1268. General information only, not legal advice.
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