How is Your HOA Dealing with Neighbor-to-Neighbor Disputes?

Operating a homeowners association (“Association”) that governs a common interest community means that sooner or later there are going to be issues that that the Association has to address which are related to what is commonly referred to as “neighbor-to-neighbor” disputes. Neighbor-to-neighbor disputes are disputes that are lodged by one owner of a separate interest within the community against another owner of a separate interest. Such disputes do not typically involve the common areas or more than the owners that the dispute is directly related to. Common examples of neighbor-to-neighbor disputes are disputes relating to such things as: (1) noise (playing loud music or T.V.s, yelling, musical instruments; (2) issues with pets (barking); (3) walking on hard surface flooring; (4) smoking; (5) cooking odors; (6) parking issues; (7) overhanging trees; and (8) property maintenance issues.

Frequently, the neighbor-to-neighbor issue involves a matter that is addressed in the Association’s governing documents (restrictive covenants contained in CC&Rs and/or rules) and the neighbor that claims to be suffering from an alleged violation of the Association’s governing documents will request intervention by the Association to resolve the conflict. Whether or not to become involved in neighbor-to-neighbor disputes continues to be an ongoing dilemma for homeowners associations. Association boards frequently question whether they have a duty, or obligation, to get involved in an effort to resolve the conflict, or whether they should remain neutral because the dispute only impacts a small number of owners and the directors are reluctant to utilize the Association’s resources in such a manner. While many court decisions relating to the issue of an Association’s involvement in neighbor-to-neighbor disputes have upheld a board’s authority to decide whether or not to become involved based on the directors’ sound business judgment, there have also been increased instances where various statutes and case decisions have indicated a need for Associations to take a more proactive role in seeking to resolve neighbor-to-neighbor disputes internally. Cases that would support Association intervention in a neighbor-to-neighbor dispute involve issues such as: (i) claims pertaining to alleged nuisances that are prohibited by the Association’s CC&Rs and which are subject to the imposition of fines or the suspension of privileges; (ii) claims that could impact the health, safety and welfare of multiple members of the Association; (iii) claims that involve the breach of duties that are imposed by laws such as the Fair Housing Act.

When an Association first receives a complaint concerning a neighbor-to-neighbor dispute it should have assigned management personnel (a director or a retained property manager, or appointed agent) properly document the complaint and then investigate the facts to gather sufficient information for the Association’s board of directors to make a determination as to whether or not the Association should become involved in the matter. The Association’s inquiry into the facts should be conducted timely and should seek to determine such things as: (i) whether the alleged conduct is a threat to person or property; (ii) does the alleged conduct violate laws or any of the provisions of the Association’s governing documents; (iii) is the alleged conduct reoccurring or was it a one-time problem; (iv) what does the alleged offender have to say about the alleged conduct; (v) are there any other parties who are affected by the alleged conduct or who are supportive of either party’s position.

After the matter has been investigated, the Association’s board of directors should meet to discuss the issue and make a decision on whether or not to become involved in the matter. When in doubt, the board should seek input from the Association’s legal counsel. Once a decision has been made, the Association should provide written notice of its decision to the parties.

Even if the Association makes a determination that it does not want to become involved in the neighbor-to-neighbor dispute, it should always be responsive to the parties involved and encourage them to: (i) meet and talk in a neutral environment in an effort to “find a solution” to the problem; (ii) be respectful of their neighbor’s concerns and to address the issues in a civilized manner without using inflammatory or threatening language or conduct; (iii) be rational and not get emotionally charged; (iv) try to resolve their dispute with the assistance of a professional mediator or through binding arbitration. As parties often avoid seeking professional assistance due to cost considerations, try to have information available on free or low cost programs that are available. Help the parties to understand: (i) that mediation involves a negotiated settlement that both sides must agree to; (ii) a mediator cannot make a decision in favor of one party or the other; (iii) a settlement reached in mediation can be legally enforceable. Helping the parties to understand how mediation or arbitration works and that it can be a fast, low cost alternative to becoming embroiled in costly litigation proceedings through the court system, should promote agreements to seek resolutions to disputes through such mechanisms.

Given the fact that neighbor-to-neighbor disputes are a reality within common interest developments, it is a good practice for Associations to have a set policy in place that covers how it will handle such disputes when they do arise. The initial drafting of such a policy should be done by a professional and templates of previously drafted policies can be utilized and modified — with the assistance of a professional. Once such a policy is established, the Association’s board of directors should make sure that each of the directors is familiar with the policy and that it is consistently followed when neighbor-to-neighbor disputes arise. The proper handling of such disputes will minimize the impact of the dispute on the Association.