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BobT2
(California)

Posts:43

06/12/2008 7:51 PM
I have requested ADR with my board over monthly fines that are now over $1,000.00. I got a letter back from the board's attorney stating that they would be representing the board at the ADR. This letter came last week. Today I received another letter from the board's attorney stating that they would be willing to go to binding arbitration instead. I am sure that I will win wherever we go, as are several of the other members. Can anyone tell me the difference? I am sure one difference is the cost to me and the association for one thing. I thought the idea of ADR was to get the parties together to compromise and try and resolve issues to keep us from going to court. How much would this cost? Just curious if anyone has seen or heard this before. Bob

GlenL
(Ohio)

Posts:1362

06/12/2008 8:16 PM
The way it was explained to me is that ADR is non-binding meaning it can be appealed. Binding Arbitration means the results are final and cannot be appealed.

JeanneK3
(Maryland)

Posts:129

06/13/2008 5:45 AM
Bob T: What you are thinking of is mediation. A mediator tries to help both parties reach a compromise and if a compromise is not reached the testimony given cannot be used later in a law suit. There is no such thing as being sure you will win when your homeowners association has endless money (yours and the other homeowners') to spend on attorneys. I would never agree to binding arbitration as you give away all your legal rights. However, a mediation process is well worth trying.

TracyT
(Maryland)

Posts:220

06/13/2008 8:33 AM
To follow on Jeanne's comments. My understanding of ADR is that it can be a mediator, arbitrator and/or binding arbitration. (If you yahoo or google Alternate Dispute Resolution you'll get several very good articles and case studies on their effectivenes in reducing the number of case that go court). If parties don't go through these steps (for what ever reason) there is also a process called pre-trial settlement conference. Here there is mediator/arbitor who works with the parties settle their disagreements before court. I believe that it is customary for the costs of mediation/arbitration to be split equally between both parties. (at least that's what the judge ordered in my case). I would also favor the mediation process as the first step. It may help both parties to determine whether or not to proceed to arbitration. Tracy

KirkW1
(Texas)

Posts:1110

06/13/2008 9:45 AM
ADR generally refers to the whole area or mediation and arbitration. I would recommend a mediator first, and then think carefully about binding arbitration. You definitely want an attorney if you go into binding arbitration. But I too would certainly try mediation before going into arbitration.

JohnK3
(Pennsylvania)

Posts:437

06/13/2008 9:53 AM
A traditional defense (you) gambit is the compelling Certified Check. Have one cut payable to the plaintiff (your Board) for, say, $500 and wave it under their noses. Satisfying to your sense of right and wrong? No. Sensible as a current/future cost savings & hassle factor avoidance? Yes.

BobT2
(California)

Posts:43

06/13/2008 10:41 AM
I do not get the check and waving it under their nose part. I wanted ADR so we could sit down me, the board, and a third party. I have checked into it and it would cost me $200.00 and it would cost the board $200.00. My problem is that the board is having the attorney be there for them. So what is the point? I can't go into this without my attorney if they send theirs. Why waste the money? The board has stated at meetings that they will not file a lawsuit against me because it would cost too much but that they will wait for me to be backed into a corner and when I file a lawsuit it will be covered in their insurance. I have never even mentioned a lawyer or suing or any other useless threats, although I have talked to one and they are waiting in the wings. I have even had a board member stand up at a meeting and tell everyone they will just lien my house. I am trying to avoid this but it is to the point that I have tried everything to end this and the board refuses. I even have had several homeowners that have written letters, spoken at meetings on my behalf and nothing. Some have even told me to wait until August and they will run for the board and end this. But I will not risk that happening. Is it correct that the board not be at the ADR and the lawyers be there for them? I think that the new lawyer that has seen all the stuff the board has done and now wants binding arbitration, will go into to it and state that the board will no longer fine us, we can continue doing paperwork from our home ( as our CCR's allow) and this is dropped. My problem with that is that we still have fines we have paid under protest and outstanding and we will have to pay our lawyer.

JohnK3
(Pennsylvania)

Posts:437

06/13/2008 10:54 AM
Bob, I was suggesting the CC as a direct entreaty to your Board prior to entering into formal, costly and time-comsuming procedures. But if that wouldn't solve future, continuing issues, or satisfy your personal agenda, I'll guess it wouldn't serve the intended object: putting this mess behind you. Good luck.

MaryA1
(Arizona)

Posts:2156

06/13/2008 11:20 AM
FYI. . . Following is the definition of mediation and arbitration from US Legal. Note that the arbitrator is chosen by the parties or IAW the terms of the contract which the parties have agreed to. No way would I agree to allowing the HOA attorney to act as the artibrator unless I also have chosen another artibrator and a 3rd disinterested arbitrator - the 3 of which would comprise a panel. Arbitration and Mediation Law & Legal Definition Arbitration is an alternative means of setttling a dispute by impartial persons without proceeding to a court trial. It is sometimes preferred as a means of settling a matter in ordert to avoid the expense, delay, and acrimony of litigation. There is no discovery and there are simplified rules of evidence in arbitration. The arbitrator or arbitrators are selected directly by the parties or are chosen in accordance with the terms of a contract in which the parties have agreed to use a court-ordered arbitrator or an arbitrator from the American Arbitration Association. If there is no contract, usually each party chooses an arbitrator and the two arbitrators select a third to comprise the panel. When parties submit to arbitration, they agree to be bound by and comply with the arbitrators' decision. The arbitrators' decision is given after an informal proceeding where each side presents evidence and witnesses. Arbitration hearings usually last only a few hours and the opinions are not public record. Arbitration has long been used in labor, construction, and securities regulation, but is now gaining popularity in other business disputes. Title 9 of the U.S. Code establishes Federal law supporting arbitration. It is based on Congress's plenary power over interstate commerce. Where it applies its terms prevail over state law. There are, however, numerous state laws on ADR. The majority of states have adopted the Uniform Arbitration Act as state law. Thus, the arbitration agreement and decision of the arbiter may be enforceable under state and federal law. In 1970, the United States joined the UN Convention on the Recognition and Enforcement of Foreign Arbitral Awards. Some arbitration proceedings are mandatory, such as many labor disputes. Other arbitration proceedings are incorporated into contracts in the event of a dispute. Couples who sign cohabitation agreements or divorce agreements often include a clause agreeing to go to arbitration if any dispute should arise, thereby avoiding the delay, expense, bitterness and formality of litigation. Companies may seek arbitration of disputes for public relation reasons, so as to avoid the negative publicity of a trial. Mediation is a non-adversarial method of alternative dispute resolution (ADR) in which a neutral third party helps resolve a dispute. The mediator does not have the power to render a decision on the matter or order an outcome. If a satisfactory resolution cannot be reached, the parties can pursue a lawsuit. Mediation is often used to help a divorcing or divorced couple work out their differences concerning alimony, child support, custody, visitation and division of property. Some lawyers and mental health professionals employ mediation as part of their practice. Some states require mediation in custody and visitation disputes. Other states allow courts to order mediation and a few states have started using mediation to resolve financial issues as well.

BobT2
(California)

Posts:43

06/13/2008 11:25 AM
Are you are suggesting that I just give into the board and do what they say when our ccr's do not allow them to do what they are doing, I will not. I have paid, my fines, under protest, and I do follow ALL ccr's, Rules, ect. even though others in this do not. If I have to spend money to fight a bad board that has put this whole community as risk then I will, but I will not go to another ADR with an attorney without having my own representation. If it comes to me having to get an attorney or as my board states, "backed into a corner" and must get an attorney to make this stop, I will, but I will go for broke!!! I think they are counting on me not paying to fight this issue. There needs to be better laws that make the boards of associations accountable if they continue to cause havoc on the common folk, that follow the rules and pay their dues.

BobT2
(California)

Posts:43

06/13/2008 11:31 AM
Thank you Mary. I guess it would be in the best interest of the association to have their attorney be there at ADR for them. Which in turn would force me to have my attorney at the ADR also. I see that it is none binding so that may be why the association's attorney wants me to go to binding arbitration. I am just not sure if that is in my best interest. Thanks for all opinions Bob

TracyT
(Maryland)

Posts:220

06/13/2008 5:08 PM
Bob, I feel your pain. Like you I [and my husband] was confident that we were right. Also, like you our board felt they had the "HOA money" to spend. My board then went the extra mile and did "back us into a corner". They thought we'd simple go away. But our attorney agreed we had a "strong case" so we held our ground and defended ourselves. But I can't begin to tell what a nightmare this whole ordeal was. My board refused multiple requests for mediation AND binding arbition. When the judge ordered mediation they filed a motion to not have it (nice neighbors huh?). Thankfully, the motion was denied! My point is, at least your board is willing to come to the table in some manner. You are correct that attorney's are not required at mediation (at least here in MD). You might try to appeal to board to try mediation without attorney's. One thing that you mentioned was an election coming in Aug. and some of your neighbors will step in to help the situation. It is now mid-June. You'd have to snail mail your board (their attorney) and say thanks for your offer but you'd perfer to mediation without attorney's. You know, neighbors talking with one indepedent 3rd party for the financial health of the assoc. They may very well refuse. They'll have to snail mail you and say no thanks but the only way we'll talk is binding arb. If you and your attorney feel that you have a strong case then engage him to to select an arbitor. Beware that: A. if your atty hasn't read your covenants yet you'll have to pay for it at this point and B. this is where the real peeing contest starts. (You thought your board was bad - wait until you see atty correspondence!) By this time the ballots may be ready to be issued (with your friends who will run for the board). Heck by the time your atty says he's representing you then reviews the covenant the election might happen. If things progress then by the time of arbitor selection and every bodies schedule for arbitration (you/attorney, the board/attorney and the arbitor) the new board may drop the whole matter. ;-) I realize Plan A fits better in your budget. Based on my experience Plan B (that your board wants to force you into), might run you about 2-3K (Ask your atty). In the scheme of things I hope you don't go broke. BTW one day out of the blue . . . my board decided to drop the suit (we got about 6+K into it). To this day I still don't know why but I can only surmise that a violation couldn't be established. After a year and half I'm just happy it's over! Good luck and lets us know what you decided and how it turns out.

KirkW1
(Texas)

Posts:1110

06/16/2008 1:59 PM
There is a good reason for the BOD to have their attorney represent them in arbitration. It comes down to that one of them could open their mouth and ruin whatever ground they may have should the ADR fail. Also, if they come tot he table sans, attorney, then they give up attorney client privilege. Once you have an attorney take your case, you should NEVER drop said attorney. I would recommend you contact their attorney and tell him you prefer non-binding mediation. You simply don't know if it will work or not. But at the end of the day you will have a strong basis to know if you have a strong case or not. It sounds to me like they are wanting the issue resolved and to minimize their attorney expenses. While their attorney is representing them, you should feel free to ask him what your legal options are. He is bound to tell you honestly. Of course he is not going to tell you their case sucks or some such. But he has to tell you the choices available.

BobT2
(California)

Posts:43

06/16/2008 2:14 PM
Thank you for your suggestion. I am caught between contacting their attorney and forwarding it to mine. Although I have not signed on, I am sure that I have a strong case for harassment as a result of the boards actions,emails, ect. The board told the members at the last meeting that they were not going to involve attorneys. If they have them stand in their place at binding arbitration is that not involving attorneys and more costs? I found low cost mediation that has experience in HOA's and it would cost both parties $200.00 each. Asking their attorney to mediate is going to cost thousands I would guess. I have a strong feeling that the reason the board wants binding mediation is that once we go the board attorney says yes, you can continue your home office, and we will drop your fines, and this is over. My concern is that it has gone beyond that with damage to our reputation and lies about us told to homeowners. We will see. I will be makinga decision this week. I know we are not foolish enough to go to arbitratioin without an attorney on our side if the board insists one represent them. So much for working this out without cost! I will follow-up next week and let all know where we stand. Thanks to everyone's advice. Bob

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