In this case, the city must reconsider.
Judge Edward Nicholas of the 12th Judicial Circuit issued an April 26 opinion reversing and remanding a Holmes Beach special magistrate’s order finding a code violation against 100 73rd LLC, the owner of two units at the Coconuts Beach Resort, 100 73rd St.
Developer Shawn Kaleta is the title manager of 100 73rd LLC, which owns Coconuts resort units 102/103B and 203C.
Special magistrate Michael Connolly, of the Sarasota-based Fournier, Connolly, Shamsey, Mladinich & Polz law firm, ruled Nov. 12, 2021, to find the property owner of unit 102/103B violated city code by advertising and renting a unit for less than seven-night stays and without a city-issued vacation rental certificate.
Connolly’s ruling also included a $100 daily fine from Sept. 24, 2021, which was set to run until 100 73rd LLC came into compliance by obtaining a vacation rental certificate and correcting its advertising.
Attorney Michelle Grantham of Bradenton-based Najmy Thompson law firm, representing 100 73rd LLC, filed an appeal Dec. 10, 2021, claiming Connolly rejected the admission of relevant evidence and that city code did not require seven-night stays in the A-1 residential district.
A-1 zoning is intended for multifamily residential and seasonal tourism. The district, known as the “motel zone,” runs along the beach from about the Martinique condos at 5200 Gulf Drive to 74th Street.
The city argued during an Oct. 20, 2021, special magistrate hearing that the property was subject to the use requirements of the R-4 residential district, which requires seven-night minimum rental stays, despite its location in the A-1 district.
The Kaleta appeal also argues that the city violated his corporation’s due process rights by not noticing the owner about the potential fine at the hearing.
The city filed an answer April 1, 2022, arguing it did not violate the property owner’s due process rights and that the appeal was “frivolous” since the appellant admitted to committing a repeat violation by renting without a city-issued vacation rental certificate.
Nicholas wrote in his April 26 opinion that the city’s R-4 zoning district’s rules only applied in the city’s A-1 zoning district if the principal use of a property is for multi-family dwellings, not resort housing such as the Coconuts.
Nicholas’ opinion ordered that, upon remand, Connolly must determine the property’s principal use in order to determine whether rental duration restrictions apply to the property.
The judge affirmed Connolly’s rejection of the property owner’s evidence relating to its historical use, dismissing one of the three grounds of appeal.
Nicholas wrote that the city properly noticed 100 73rd LLC and did not violate the property owner’s due process rights, but did not specify “how much weight the magistrate gave to the violation for renting for an improper length of stay in imposing the fine”.
The judge ordered that, on remand, if Connolly finds the property owner in violation of city code for “an improper length of stay then the fine shall be affirmed.”
If Connolly finds the property owner did not commit a length-of-stay violation upon reconsideration, then he “shall re-evaluate the fine” without considering that violation.
Nicholas acknowledged that “the record clearly reflects the violation for renting without a valid vacation rental certificate occurred; counsel for the appellant specifically stipulated to that fact.”
The principal in the firm representing Kaleta, attorney Louis Najmy, wrote in an April 28 text message to The Islander that the magistrate’s rulings were part of the city’s attack on his client.
“Upon learning Shawn (Kaleta) owned some units in this condo/hotel property, the city changed its mind and in a discombobulated way determined the code doesn’t allow nightly rentals in the A-1 district,” Najmy wrote. “The code is clear that it does allow nightly rentals and everyone knew that. But rules were attempted to be changed because of Shawn.”
City attorney Erica Augello told The Islander May 1 that the remand order may not include significant changes after reconsideration by a magistrate.
“I don’t foresee the same issues being litigated,” Augello said. “I do believe that the city can go back before the magistrate and ask for a narrow ruling on the things the judge requested or found flawed with the magistrate’s order.”
“I can’t see that he would rule any differently given that the evidence will be nearly identical,” she added.
The case is one of three appeals of magistrate rulings for the Coconuts cases for which Nicholas ordered reversal and remand April 26-27.
There other two appeals involve the following units at the Coconuts Beach Resort:
- Unit 111/202A, owned by KCI Island Investments LLC, Kimberly and Christopher Roehl;
- Unit 118/202C, also owned by 100 73rd St.