Most landlords do quarterly or semi-annual inspections.Every case is tenant, property, and location specific.No legal advice given. 

If they legally can't break the lease, I would request they pay the monthly rent when it's due, and return the security deposit as you would normally, less damages, a month from now.

The whole concept of a contract is not the legal terms and out foxing someone, but it serves to document the agreement, clearly and in precise terms so that anyone can understand who said and agreed to what.

Welcome to BP, I'm sure you can help plenty of people on here with legal questions and such.

Is this a legal duplex?

But the legality behind that, I am not sure. 

If you actually care about whether it's legal in Florida, Florida statute 475.43 may be enlightening.

Specifically, the law provides that a financial institution, and its directors, officers, employees and agents, that make a disclosure of any possible violation of law or regulation, including in connection with the preparation of suspicious activity reports, “shall not be liable to any person under any law or regulation of the United States, any constitution, law, or regulation of any state or political subdivision of any state, or under any contract or other legally enforceable agreement (including any arbitration agreement), for such disclosure or for any failure to provide notice of such disclosure to the person who is the subject of such disclosure or any other person identified in the disclosure”.A covered entity, and any director, officer, employee, or agent of any loan or finance company, that makes a voluntary disclosure of any possible violation of law or regulation to a government agency or makes a disclosure pursuant to FinCEN’s rule or any other authority, including a disclosure made jointly with another institution, is protected from liability for any such disclosure, or for failure to provide notice of such disclosure to any person identified in the disclosure, or both.

I am not a huge fan of garden apartments but this building is built out to have a legal basement with very good access and ceiling height so hate to waste that value add if we can contest or file a few documents and get a legal 4th unit.  

Especially since it sounds like you would have no legal standing signing an application for coverage.