Update on Mandatory Mediation Requirements for HOA Disputes

    As we have reported in earlier editions of e-Lawyer, as of October 1, 2004 the following listed homeowners’ associations disputes must first go through a mandatory mediation process before suit can be filed. This mediation process is administered by the Division of Florida Land Sales, Condominiums, and Mobile Homes ('Division'):

Disputes between a homeowners’ association and a lot owner regarding use of or changes to the lot;
Disputes between a homeowners’ association and a lot owner regarding other covenant enforcement disputes;
Disputes regarding amendments to the homeowners’ association documents;
Disputes regarding meetings of the Board of Directors and meetings of committees appointed by the Board of Directors;
Disputes regarding membership meetings, but this does not include election meetings; and
Disputes regarding access to the official records of the homeowners’ association.
    Because this system has been in place for six months, we decided it might be appropriate to prepare this interim report.
 
A. Early Problems.
 
    As required by law, the Division began accepting the required Petitions for Mediation on October 1, 2004. However, because the legislature failed to supply sufficient lead time and money to the Division, it simply was not prepared to, and did not, act on those Petitions. In fact, it was not until February 3, 2005 that the final Administrative Procedural Rules were adopted that permitted the Division to comply with its statutory duties of reviewing the cases and assigning mediators. As a result, a serious backlog of cases developed.
 
B. Present Status.
 
    Notwithstanding this initial problem, we are pleased to report that the Division has been working hard to close this gap, and presently the time between a mediation petition being filed and it being reviewed and assigned to a mediator is now down to approximately one month. Hopefully, this time will continue to drop as the Division has an opportunity to refine the process.
 
C. Who Is Mediating These Cases?
 
    The new law originally anticipated that the party filing the Petition for Mediation could choose between using the Division’s in-house mediator(s) or the private mediators that were to be certified by the State. However, due to a lack of funding for this program from the Legislature, the Division presently has only one in-house mediator. Accordingly, when the final Procedural Rules were adopted, they provided that the Division would make that decision and, as you might expect, most cases are being assigned to the private mediators.
 
D. A Short Summary of the Mediation Process.
 
    The mediation process commences by filing a Petition for Mediation with the Division, along with a two hundred dollar ($200) filing fee. The Division then reviews the Petition and, if it determines that the matter qualifies for such action, a mediator is assigned to the case.
 
    The assigned mediator then contacts the Petitioner to obtain available dates for the mediation session and then sends a letter to the other party advising them of the mediation, providing a brief description of the mediation and asking that they contact the mediator to set a mediation date. If the other party contacts the mediator, a mutually acceptable date for the mediation is selected from the dates provided by the Petitioner and the mediator sends a notice of that date to both parties. If, on the other hand, the other party does not respond to the mediator’s letter(s), the mediator picks one of the dates provided by the Petitioner and sets the mediation for that date.
 
    Finally, if the mediation is successful the case is settled. If, on the other hand, the mediation is not successful, the Petitioner is then free to file the action in the local courts.
 
E. Payment for Mediation.
 
    The Florida law requires each party to share equally in the costs of mediation. However, there is no real mechanism to insure that such payments will be made.
 
    As a starting point, the two hundred dollar ($200) filing fee is to be used to partly fund the mediation costs. However, nothing presently provides for a way to force either party to pay their share of any mediation expenses that exceed that amount.
 
    This is important because the private mediators are demanding full payment before the mediation actually takes place. This means that in the vast majority of the cases the Petitioner will be required to fund the full mediation expense without assurance that they will be reimbursed without further enforcement actions.
 
E. Final Thoughts.
 
    At first blush, the mediation process seems cumbersome and ineffective. However, to be fair, it will take some time to properly analyze whether the process works. Certainly, some additional legislative or administrative amendments are in order.
 
    We will closely monitor this process and report further to you as time passes.
 
    If a homeowners’ association would like additional information regarding the mandatory mediation program, they should contact their association’s legal counsel.

The firm of Taylor & Carls, P.A., with offices located in Maitland, Melbourne, Tampa and Daytona Beach, Florida, was founded in 1981 and has practiced in the area of community association law since that date. This edition prepared by Robert L. Taylor, Esq. of Taylor & Carls, P.A. The information contained in The Association e-Lawyer should not be acted upon without professional legal advice.

 
 
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