Internal Dispute Resolution - Dispute Resolution And Enforcement - Civil Law - CA

Section § 5900

This section applies when there's a disagreement between a homeowners' association and a member about their rights, responsibilities, or liabilities. It covers disputes under this legal act, the Nonprofit Mutual Benefit Corporation Law, or the association’s rules. Also, it adds to existing rules requiring alternative ways to resolve disputes before going to court, rather than replacing them.

(a) This article applies to a dispute between an association and a member involving their rights, duties, or liabilities under this act, under the Nonprofit Mutual Benefit Corporation Law (Part 3 (commencing with Section 7110) of Division 2 of Title 1 of the Corporations Code), or under the governing documents of the common interest development or association.

(b) This article supplements, and does not replace, Article 3 (commencing with Section 5925), relating to alternative dispute resolution as a prerequisite to an enforcement action.

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Section § 5905

Homeowner associations must set up a fair and fast process to handle disputes. They should use local dispute resolution programs, like low-cost mediation, available from places like the Department of Consumer Affairs. If they don't have such a process, a default procedure under another section becomes applicable.

(a) An association shall provide a fair, reasonable, and expeditious procedure for resolving a dispute within the scope of this article.

(b) In developing a procedure pursuant to this article, an association shall make maximum, reasonable use of available local dispute resolution programs involving a neutral third party, including low-cost mediation programs such as those listed on the Internet Web sites of the Department of Consumer Affairs and the United States Department of Housing and Urban Development.

(c) If an association does not provide a fair, reasonable, and expeditious procedure for resolving a dispute within the scope of this article, the procedure provided in Section 5915 applies and satisfies the requirement of subdivision (a).

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Section § 5910

If there's a dispute between a homeowner and their association, there needs to be a fair and speedy way to sort it out. Either side can start the process with a written request, but the association must respond quickly. If a homeowner starts the process, the association must join in, but homeowners can choose not to join if the association initiates. If they do participate and the problem isn't settled, the homeowner can appeal. If both sides agree on a solution and write it down, it's legally binding. During the process, both parties can explain their viewpoints and might have a lawyer. Homeowners can't be charged a fee to take part.

A fair, reasonable, and expeditious dispute resolution procedure shall, at a minimum, satisfy all of the following requirements:

(a) The procedure may be invoked by either party to the dispute. A request invoking the procedure shall be in writing.

(b) The procedure shall provide for prompt deadlines. The procedure shall state the maximum time for the association to act on a request invoking the procedure.

(d) If the procedure is invoked by the association, the member may elect not to participate in the procedure. If the member participates but the dispute is resolved other than by agreement of the member, the member shall have a right of appeal to the board.

(e) A written resolution, signed by both parties, of a dispute pursuant to the procedure that is not in conflict with the law or the governing documents binds the association and is judicially enforceable. A written agreement, signed by both parties, reached pursuant to the procedure that is not in conflict with the law or the governing documents binds the parties and is judicially enforceable.

(f) The procedure shall provide a means by which the member and the association may explain their positions. The member and association may be assisted by an attorney or another person in explaining their positions at their own cost.

(g) A member of the association shall not be charged a fee to participate in the process.

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Section § 5910.1

If a member of an association asks to resolve a dispute through internal processes, the association can't take that issue to court until it has made a sincere effort to resolve it using those internal methods.

An association may not file a civil action regarding a dispute in which the member has requested dispute resolution unless the association has complied with Section 5910 by engaging in good faith in the internal dispute resolution procedures after a member invokes those procedures.

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Section § 5915

This law covers how disputes within certain associations should be handled when there's no existing fair process. It sets up a method for either party in a dispute to request a meeting to try to resolve things together. If a member requests to meet, the association can't refuse, but the member can say no if the association requests. The association will send someone from its board to discuss and try to resolve the issue. Any decision made should be written down and signed by everyone involved, and it's enforceable if it doesn't break any laws or association rules. Importantly, participating in this process is free for members.

(a) This section applies to an association that does not otherwise provide a fair, reasonable, and expeditious dispute resolution procedure. The procedure provided in this section is fair, reasonable, and expeditious within the meaning of this article.

(b) Either party to a dispute within the scope of this article may invoke the following procedure:

(1) The party may request the other party to meet and confer in an effort to resolve the dispute. The request shall be in writing.

(2) A member of an association may refuse a request to meet and confer. The association shall not refuse a request to meet and confer.

(3) The board shall designate a director to meet and confer.

(4) The parties shall meet promptly at a mutually convenient time and place, explain their positions to each other, and confer in good faith in an effort to resolve the dispute. The parties may be assisted by an attorney or another person at their own cost when conferring.

(5) A resolution of the dispute agreed to by the parties shall be memorialized in writing and signed by the parties, including the board designee on behalf of the association.

(c) A written agreement reached under this section binds the parties and is judicially enforceable if it is signed by both parties and both of the following conditions are satisfied:

(1) The agreement is not in conflict with law or the governing documents of the common interest development or association.

(2) The agreement is either consistent with the authority granted by the board to its designee or the agreement is ratified by the board.

(d) A member shall not be charged a fee to participate in the process.

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Section § 5920

This law section requires that the yearly policy statement, as specified in a different section, must describe how disputes are resolved within the organization.

The annual policy statement prepared pursuant to Section 5310 shall include a description of the internal dispute resolution process provided pursuant to this article.

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