When last we met I talked about some of the most common areas of contention amongst condominium owners (and yes, say that three times fast!) – today I’d like to tackle the topic of hacking through the mess of resolving condominium disputes.
You may be surprised – and not terribly pleased – to discover how expensive it is to deal with these disagreements. There’s attorney fees, expert witnesses and professional mediators and arbitrators. Homeowner’s attorney fees are typically covered by insurance, which means that you as the individual owner are at a disadvantage since you’re paying out-of-pocket. And these costs can run anywhere between $10,000 (even for minor disputes) upwards of $75,000.
What’s more, if an association’s legal fees are footed by insurance, what is their incentive to settle? You could easily get locked in a battle that will steadily drain your wallet.
In accordance with the Davis-Stirling Act, every homeowner’s association that does not establish its own procedures is mandated to have an obligatory meet-and-confer session before taking any other actions. If that doesn’t work, and before a lawsuit is filed, both parties must attempt to resolve their differences through alternative dispute resolution – in other words, mediation and arbitration. Should informal resolution go down the drain, it’s typically required that the homeowner’s association and the owner go through binding arbitration, where a paid arbitrator reviews the case and makes a decision.
Keep in mind that arbitration is not cheap – and you can’t appeal. Chew on that before you decide how to proceed with your particular dispute.
Dreaming of San Francisco? Cece Blase offers local advice to San Francisco buyers, sellers and owners-- and feeds the dreams of those who wish they could live in Tony Bennett's 'City by the Bay.' Call 415-577-0809 or email cblase@paragon-re.com. www.ceceblase.com
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