How HOA Boards Should Handle Disputes to Avoid the Courtroom

HOA DisputeEvery community and every HOA board will encounter conflict at some point. Communities are complicated just like the people that inhabit them. HOA boards that accept and prepare for this reality in their governing documents and through training, while remaining sensitive to resident needs and emotions, are better able to resolve disputes quickly and before they result in a lawsuit.

Conflict is unavoidable, for sure, but there are simple ways HOA boards can control what they can control, thereby reducing the possibility of disputes overall.

According to CAM Voice, a website for community association managers, “The first step an HOA can take to avoid lawsuits is, of course, to make sure that they are following all laws and agreements to their fullest. They should also be sure to consult an attorney or another expert on matters of possible liability, and then follow their advice exactly; liability for some issues is reduced or eliminated if the HOA was acting on the advice of counsel.”

In other words, the board and its partners need to make sure they’re doing their jobs and upholding their fiduciary obligations to the community. That’s the first step--making sure your team is doing their job to the best of their ability and its partners, whether a community management firm or maintenance crews are doing the same.

Download The Community Association Guide To Legal Disputes

Here are a few other tips for HOA boards to limit disputes overall and keep the community peace:

Maintain Your Community. Nothing gets residents riled up like the perception of negligence on the part of the homeowners association. Snow that doesn’t get removed in a timely fashion, missed garbage pickup, deteriorating common areas...failure to proactively maintain the shared spaces of your community is a recipe for disputes and future lawsuits. Residents pay fees to ensure the community’s quality of life and to protect their property value. Failure to do so could open the door to unrest and conflict.

Remain Fair and Follow the Governing Documents. Your CC&Rs, bylaws and rules and regulations must be followed and applied fairly. Making exceptions for certain residents while being a stickler for others is asking for trouble. The governing documents are there to ensure HOA boards act legally and that residents follow the community’s policies. A breach of that trust by the HOA board creates myriad problems when it comes to legal action and the overall credibility of the board. If the board doesn’t follow the rules, why should the residents?

Pick Your Battles. If a board member looks hard enough, it’s very likely they’ll be able to find a resident in violation of some rule or bylaw. This is not to say that you should let a violation go-as that sets a bad precedent. However, pursuing legal action at every turn creates bad will between the board and the community and could create a tit-for-tat mentality, i.e. you sue my neighbors at every turn, now we are going to return the favor. Use legal remedies as a last resort, always, and seek out and go the extra mile to resolve disputes out of the courtroom.

Here are a few tips for board members when it comes to conflict resolution that can avoid expensive legal proceedings:

Always Have a One-on-one Conversation. If an ongoing issue arises between residents or the board and a community member, make the effort to engage the parties in a face-to-face discussion. We all know email and texts are terrible when it comes to tone and intent. The written word, particularly in these mediums, is ripe for misinterpretation. Schedule an informal meeting with the aggrieved party, or, if you can get all parties together, that can work, too (you’ll need to judge this on a case-by-case basis). When you meet, remember to follow these guidelines:

  • Be open, patient, and pleasant during discussion. Make sure everyone knows you don’t have a preconceived agenda and that you are there to listen.
  • Employ problem-solving language and avoid editorializing or expressing your own opinion. Phrases like, “How do you think we can solve this problem”, "How do you suggest we approach this?" or "I think I have a solution”, open the door to dialog and make the community member feel in control and that they have a say.
  • Try to solve the complaint efficiently to avoid debate and over complication.
  • Keep this dialog among the parties that are in conflict; gossiping and talking about the issue is a no-no and could damage the trust you’ve built.

Read the HOA complaint letter. If your one-on-one or small group meeting doesn’t resolve the issue, a homeowner may put their complaint in writing. It’s your responsibility to read this letter carefully and examine it objectively. In many disputes, both sides have some legitimate claims.

That said, it’s critical for you to understand the letter and then put the complaint in the context of your community’s rules and regulations, bylaws and CC&Rs. Once you understand how the complaint falls with the governing documents of the community, put a response in writing explaining the board’s reasoning and how you believe the dispute can be amicably settled.

Engage in Mediation. If the face-to-face meeting and the response to the complaint letter fail to resolve the issue, it’s a wise idea to propose mediation. Many HOAs have a mediation committee that steps in to facilitate and hopefully resolve disputes. Where there is no sub committee, hiring a mediation professional is an option. In either case, mediation is an important step to take prior to becoming embroiled in a lawsuit. This is a less expensive option compared to legal action.

Consider Small Claims Court. Depending on the nature of the complaint, small claims court is a good option should mediation fail to resolve the dispute. Most disputes will be resolved before reaching this point, but small claims is often a viable and less expensive legal option.

People are complicated. Your board cannot avoid all conflict, but it can reduce the volume of conflict by fulfilling its fiduciary duties to the best of its ability. HOA boards that make good faith efforts to do their very best, be transparent and remain fair will significantly reduce unnecessary disputes by creating trust among community residents.

Fair and consistent application of your governing documents and a reasonable, fair and transparent conflict resolution process will help most HOA communities keep the peace and avoid costly, disruptive time spent in the courtroom.

Comsource has helped many communities just like yours stay on top of key issues, including conflict mitigation. Reach out to us today-we’d love to hear more about your community and its challenges. 

Download The Community Association Guide To Legal Disputes 

Tags: HOA legal process, HOA communication, HOA and condo associations, Rules and Regulations