People frequently avoid dealing with uncomfortable problems because they are unsure of what to do. Although few people relish conflict, your HOA’s Board of Directors must prepare for problems.
No community escapes unpleasant issues forever. A dispute of some type will eventually afflict even the sweetest community. What you and your HOA Board can do is develop an alternative dispute resolution plan. Then, you are ready to respond in a rational, predefined way when a problem erupts.
ADR Supports Compliance With Texas Law
Texas law calls upon HOA management to engage with parties subject to many types of enforcement actions prior to filing a lawsuit. An alternative dispute resolution plan fits neatly into regulations that an HOA management team should observe prior to going to court.
Resolving Conflicts With Mediation and Arbitration
Alternative dispute resolution typically involves mediation or arbitration. Your plan will specify one or both as the route to resolving conflicts.
Mediation
You hire a professional mediator who acts as a neutral third party. The mediator meets with the parties in dispute and manages the conversation so that both sides may present their complaints and propose remedies. The role of a mediator is to uncover common ground and guide both sides toward a mutually acceptable resolution.
Arbitration
You hire a professional arbitrator who acts as a neutral third party and presides over the dispute discussion. An arbitrator differs substantially from a mediator in that the person has the authority to decide the outcome. Your alternative dispute resolution plan would need to clarify that arbitration results in a binding decision. Arbitration often removes the parties’ ability to take the case to court.
When Would an HOA Need ADR?
Ideally, an HOA’s board has a plan before a problem flares up. Your board should communicate the plan to property owners to know their rights and what steps to take when they have disputes.
As you might already know, disputes can arise from almost anything. They could emerge between a property owner and the HOA or between two or more property owners. Many people will immediately assume they have to take their complaints to court, but alternative dispute resolution will divert them away from costly and often damaging litigation.
Reasons an HOA Board Should Embrace ADR
Even when your lawyer tells you that the law is firmly on your side, this does not mean that a lawsuit will produce the outcome you expect. Success in court comes at a high cost, not only in terms of time and money but also because it eliminates the chance of a useful compromise.
On the other hand, mediation or arbitration can resolve a problem quickly and for much less money than litigation. You can hire a mediator or arbitrator faster than you can get a court date. These professionals can encourage complainants to fix a problem. The process possesses a collaborative nature that cannot be found in the court system and that is antagonistic by design.
Explore the Benefits of Professional HOA Management
In addition to adopting an alternative dispute resolution plan, your board might reduce conflicts by working with a professional HOA management company like Goodwin & Company. Reach us today to see how your community could benefit from our services.
