Agrelo v. Affinity Management Services, LLC
841 F.3d 944
11th Cir.2016Background
- Homeowners Jorge Agrelo and Olga Fernandez were members of Marbella Park HOA; Affinity was the HOA’s property manager and Meloni the collection counsel.
- Marbella’s governing documents allowed fines for violations and expressly provided that any fine would be “deemed an individual assessment” and subject to assessment-collection remedies (including lien/foreclosure).
- Marbella assessed a $1,000 fine (maximum under Fla. Stat. § 720.305(2)) for alleged unapproved alterations; homeowners disputed the fine and alleged inadequate process.
- Affinity and Meloni sent multiple demand letters seeking the $1,000 fine plus assessments, late fees, and attorneys’ fees; homeowners disputed the debt and made FDCPA/FCCPA requests.
- Homeowners sued under the FCCPA and FDCPA; the district court granted summary judgment to Affinity and Marbella, ruling the fine was not a “debt” under the FCCPA and that Marbella could not be vicariously liable.
- The Eleventh Circuit reversed as to Affinity, vacated as to Marbella, and remanded: it held the fine is a “debt” under the FCCPA and instructed the district court to apply Florida law on vicarious liability.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether an HOA fine is a “debt” under the FCCPA | The fine was treated by the governing documents as an assessment arising from the home-purchase transaction, so it is a consumer debt subject to the FCCPA | The fine is akin to noncontractual tort or government-imposed fines and thus not a "debt" under the statute | The fine is a "debt": because governing documents contractually treat fines as assessments, the obligation arises from a consumer transaction and falls within the FCCPA |
| Whether Marbella (a non‑statutory debt collector) is subject to the FCCPA | Marbella can be liable because the FCCPA regulates conduct of any "person" collecting debts, not only defined debt collectors | Marbella argued it was not a debt collector and thus not liable under the FCCPA | FCCPA is not limited to statutorily defined debt collectors; Marbella is not exempt merely because it is not a defined debt collector |
| Whether Marbella can be vicariously liable for agents’ FCCPA violations | Homeowners argued Marbella could be vicariously liable for Affinity/Meloni’s collection conduct | Marbella argued vicarious liability requires the principal itself be a debt collector (relying on FDCPA cases) | Court declined to decide; remanded for district court to apply Florida agency law to vicarious-liability question |
| Whether summary judgment for defendants was appropriate | Homeowners argued disputes of fact and legal error supported denying summary judgment | Defendants argued no debt, and Marbella lacked vicarious liability; district court granted judgment | Eleventh Circuit reversed grant to Affinity, vacated Marbella judgment, and remanded for further proceedings |
Key Cases Cited
- Brown v. Budget Rent-A-Car Sys., Inc., 119 F.3d 922 (11th Cir. 1997) (transaction-created payment obligations can be "debts" under the FDCPA)
- Oppenheim v. I.C. Sys., Inc., 627 F.3d 833 (11th Cir. 2010) (debt definition requires an obligation arising from a consumer transaction)
- Hawthorne v. Mac Adjustment, Inc., 140 F.3d 1367 (11th Cir. 1998) (obligations arising solely by operation of law, without a consensual transaction, are not FDCPA debts)
- Haddad v. Alexander, Zelmanski, Danner & Fioritto, PLLC, 698 F.3d 290 (6th Cir. 2012) (homeowner assessments derive from consumer transaction and qualify as FDCPA debts)
- Newman v. Boehm, Pearlstein & Bright, Ltd., 119 F.3d 477 (7th Cir. 1997) (past-due homeowners’ assessments qualify as FDCPA debts)
- Franklin v. Parking Revenue Recovery Servs., Inc., 832 F.3d 741 (7th Cir. 2016) (contractual penalties tied to private transactions can be FDCPA debts)
- Gulley v. Markoff & Krasny, 664 F.3d 1073 (7th Cir. 2011) (municipal fines treated as not arising from consensual transactions and thus not FDCPA debts)