New York, my old home state, presently litigates all co-op and condo disputes. Litigation, however, continually proves to be an expensive and time-consuming endeavor. Perhaps it’s time for New York to consider compulsory mediation-arbitration before initiating court proceedings. Mediation is negotiated peacemaking and arbitration is a decision favoring one side over the other. The main benefit to both is that they take place outside of a courtroom setting, saving precious money and time. From beginning to end, the process runs about five months. Parties don’t have to lose endless hours from work while they wait around in stuffy, crowded, run-down courtrooms waiting for their cases to be called. Parties and witnesses appear once at the scheduled hearing date and that’s it. Court cases–even here–can take a couple of years to conclude. That shopworn phrase of "Justice delayed is justice denied" doesn’t apply to arbitration cases.
Listen Up, New York
Currently, Nevada and Texas are the only states that compel compulsory mediation-arbitration before parties can seek court redress. Nevada’s statute (Nevada Revised Statutes, Chapter 38.360 to 38.360), under which I serve as a mediator-arbitrator, is four years old; the Texas statute is one year old.
Nevada’s statute states: "No civil action may be commenced in any court in this state upon a claim relating to the interpretation, application or enforcement of any covenants, conditions or restrictions applicable to residential property, or any bylaws, rules or regulations adopted by an association, or the procedures used for increasing, decreasing or imposing additional assessments on residential property unless the action has been submitted to mediation or arbitration." In other words, no one can commence a civil suit relating to residential issues without first going through mandated mediation or arbitration.
Co-op and condo owners in New York are familiar with the typical association disputes found nationwide. Like New York, disputes in Nevada involve violations of "house rules" (regulations) such as disturbing noises, pets, placement of plantings, renovations of units, and littering in the common areas. Board election results, sponsor-developer control issues, and board failure to respond to shareholder concerns are all part of the arbitration punch list.