How To Avoid A Lawsuit

Alternative Dispute Resolution

• Resolving disputes short of trial
• Less expensive
• Less time
• Generally favored by courts

Types of ADR

• Demand correspondence
• Mediation
• Arbitration

Demand Letter

• Summary
• Explanation of why they must resolve issue
• Demand certain actions
• Intent: to begin negotiations

Negotiation Process

• Adversarial approach
• Problem-solving approach

Adversarial Approach

Adversarial Approach

• One party has no fault
• One issue must be resolved by other party

Problem-Solving Approach

Problem-Solving

• Mutual problem exists
• Focus: opportunities for joint gain
• Resolution involves benefit for both parties

Example

• Homeowner behind on dues, gives negative response to demand letter

Adversarial Approach

• HOA does not budge on amount owed
• Threaten further legal action

Problem-Solving

• Develop payment schedule
• Reduce debt in exchange for payment
• Forgive fines & fees

Approach depends on desired outcome!

Mediation

Mediation

• First extension of negotiation process
• Parties, rather than a judge, apply values to resolve issue
• Fewer costs/delays than litigation process

Advantages

• Faster
• Cheaper
• Simpler
• Consider human emotion

Disadvantages

• Some consider litigation "fairer"
• Both parties may feel "cheated"
• Lack of legal constraints
• Strength of legal argument is overshadowed by pressure to resolve the issue
• No guarantee of successful mediation

Arbitration

Arbitration

• Most formal ADR option
• "Mini-trial"
• Parties agree to mutual arbitrator to act as "judge"
• Arbitrator may have more expertise in the area than traditional judge

Advantages

• Generally faster than litigation
• May be less expensive than litigation
• Arbitrators not required to follow the law in ruling
• Courts usually do not overrule arbitrator
• Losing party may be stuck without recourse on unjust ruling

Only commit if you are willing to

Administrative Law Judge

ALJ

• Dept. of Fire, Life, Building and Safety
• Alternative to civil court system
• ALJ may order parties and levy civil penalty

ALJ

• Hears issue
• Determines facts
• Applies pertinent laws
• Does NOT actually issue final order
• Makes recommendation to Director of the dept.

ALJ only hears issues between
homeowners and the association,
not between homeowners

$550/$2000

Self-Help

Self-Help

• Authorized in governing documents
• Subject to municipality limitations
• Cost must be chargeable to the homeowner
• Requires prior notice and opportunity to be heard
• Court order recommended

Before self-help,
call your lawyer!

Community Meetings

Community Meetings

• Encourage discussion on community problems before they expand
• Members voice concerns; encourage neighbor upkeep

Contracts and Governing Documents

Contracts and Governing Documents

• Option to require specific methods of ADR
• Binds both parties
• Consult your attorney

Conclusion

• ADR is designed to save tiem and money
• Less adversarial
• Promote strong continuing relationship
• May fail, cost money, waste time
• Contact your attorney for advice!