You have a set of rules and regulations that you expect the community to live and abide by. However, your HOA is now facing opposition from a community member. If the situation can’t be resolved, alternative dispute resolution (ADR) may be the answer. These paths to a resolution keep your disagreement and HOA out of the already overloaded court system. There are several HOA legal counsel benefits that come with speaking to a lawyer about possible alternative solutions to your HOA’s dispute.

There are two types of ADR: mediation and arbitration. Find out which one is right for your situation.

What Is Mediation?

When agreeing to mediation, a neutral third party listens to each party’s point of view and arguments. They then work with both sides to find a compromise somewhere in the middle of each party’s position. This process is voluntary, and no party can force the other to agree to a resolution. Some states require parties to go through a mediation process before moving to initiate litigation. An association’s documents can also use mediation as a method of dispute resolution before litigation.

The parties participating will have to pay for a mediator, and the process does take some time. However, this process is more affordable and faster than going through litigation.

Florida Homeowners’ Associations Act

Mediation is most often chosen for ADR in Florida because the Florida Homeowners’ Associations Act requires pre-lawsuit mediation or an attempt at it. Florida Statute 720.311 outlines the dispute resolution process that is applicable for homeowners’ associations.

What Is Arbitration?

Arbitration is similar to mediation because the two parties that are in dispute will hire a neutral third party to hear each side’s position. However, it differs because the arbitrator is responsible for deciding how the dispute is resolved. Similar to mediation, you will have to pay for the arbitrator, and the process takes time. However, it is still more affordable and faster than going through litigation. The risk with arbitration is that both parties may not be happy with the arbitrator’s final decision.

Are They Legally Binding?

The short answer is yes, the terms agreed to at the end of the meditation, and the terms outlined by the arbitrator are legally binding. There will also be terms explaining the remedies available should either party breach the agreement. There is an option for non-binding arbitration. In this situation, either one of the parties could reject the arbitrator’s ruling and continue forward by filing a lawsuit.

Do you Need a Lawyer For Mediation or Arbitration?

While there is no requirement to hire legal representation, having a layer with you could be beneficial. Your lawyer has a working knowledge of the law and experience with situations similar to yours. They can guide you through the process will advocating for your rights and best interests. The lawyer can alert you to proposed agreement terms that conflict with the law. You can also have a lawyer review any prepared agreements documents. This ensures that the document you sign correctly states the agreement and nothing more or less.

Which One Do You Choose?

In some circumstances, you cannot choose which one you would prefer to use. Look at the HOA documents and Florida state law. Both will tell you when mediation or arbitration is required. For example, Florida Law states that mediation is mandatory before filing a lawsuit in these situations:

  • Changes to a parcel or common areas;
  • Covenant enforcement;
  • Amendments or modifications to HOA documents;
  • Meetings of the board and board-appointed committees;
  • Membership meetings that aren’t election-related; or
  • Access over access to records.

Florida law requires arbitration in these matters:

  • Disputes involving the recall of a member of the HOA board; and,
  • Disputes between an HOA member and the HOA that involve elections.

There are also certain situations where meditation and arbitration are not appropriate, and the only solution is to file a lawsuit and go through the state court process.

  • Collection of assessments, fines, or other financial matters;
  • Enforcement of a prior mediation settlement agreement between the parties;
  • A lawsuit by a party seeking to enforce a prior arbitration award;
  • Lawsuits for injunctive relief;
  • Title to property; or,
  • Breach of duty allegations against a director.

Have HOA Legal Counsel Benefits

While everyone hopes that interactions between community members and the HOA remain cordial and pleasant, disagreements are bound to arise. The best solution is to reach an amicable resolution before allowing the situation to spiral out of control. However, sometimes, people feel passionate about their position, and things escalate. When this happens, it can be tempting to file a lawsuit and go to court. Mediation and arbitration are alternative dispute resolution options that reduce the cost of resolution and increase the speed at which that resolution is found. If you find your HOA facing conflict, several HOA legal counsel benefits come when hiring the right representation.

Schedule a consultation to discuss your HOA’s situation with one of our skilled attorneys.