Condo Media - August 2016 - 37

The costs of failing to reach agreement are very high,
both in financial and psychological terms.
because it is extra-judicial, the outcome
may not be accepted as authoritative.
The process may well result in an award
that is not workable or forward-looking. Almost certainly, it will do little or
nothing to revive or repair the relationship or reestablish lines of communication between the disputants. Indeed,
the reverse is true: arbitration is likely
to escalate the conflict beyond repair.
And that is if the parties are even
willing to submit to arbitration. Most do
not. In many condominiums, the more
viable option is simply to sell and move
away from mismanagement or personality conflicts, leaving them to the hapless
new buyer who may or may not be able
to put the association back on track. The
strategy of walking away from a dysfunctional condominium leads to frequent
turnover, higher vacancy rates, lower
market prices, and, ultimately, neighborhood instability. The property itself may
well fall into disrepair through indecision and neglect. These problems may
degrade not only the owners' property
interests, but the public interest in a
well-maintained housing stock.
Small-unit condominiums without
professional property management are
particularly hampered by the mandatory arbitration clause included in many
condominium declarations of trust. In
many cases, the owner-trustees settle
into a pattern of non-cooperation, unproductive communication, or silence,
not holding meetings, not discussing even necessary maintenance and
repairs. Arbitration is not
likely to change that
dynamic.

Finally, there is something inherently
unfair about forcing a buyer of a condominium unit to accept a mandatory and
binding dispute resolution procedure
that eliminates court review of the
substantive fairness of the resolution.
Public policy should militate caution in
conditioning the purchase of a condominium unit on acceptance of a dispute
resolution procedure that dispenses
entirely with the right to seek the judgment of the courts.
A LEGISLATIVE FIX
A Massachusetts bill was filed this legislative session (H.1137) that would repeal
the arbitration provision in § 12(b), and
instead require bylaws to provide a "procedure for resolving disputes arising from
the administration of the condominium."
According to the bill's sponsor, Rep. John
W. Scibak of South Hadley, Mass., the bill
would provide for "alternative methods
of dispute resolution (e.g., mediation) as
opposed to [the] current statute which
specifies arbitration as the procedure
of choice." This bill was recently sent to
study, and thus is effectively dead for this
session. Perhaps it will be refiled in the
future, and if so, the CAI Massachusetts
Legislative Action Committee (MALAC)
will continue to monitor its progress.
If the bill is refiled next year and passes,
condominium and homeowner associations in the Common-

wealth will be faced with the question of
what dispute resolution procedures to
adopt. Ideally, bylaws should provide for
a range of options, from an internal or
external ombudsman to mediation. Owners and trustees should retain the option,
if they are unable to resolve all issues
through mediation, to consider whether
resort to the courts or binding arbitration
best meets their needs. Arbitration affords greater privacy and it can be quicker
than litigation, but it is not necessarily
cheaper and may be less accepted by the
losing party as just.
Whatever menu of options is provided in the bylaws, mediation should
be included. It offers the condominium
association and unit owners the greatest potential for solving their own problems quickly, cheaply, and flexibly and
without creating winners and losers.

■ JEANNE M. KEMPTHORNE IS AN
ATTORNEY AND MEDIATOR IN SALEM,
MASS., AND FOUNDER OF
GOOD NEIGHBOR
MEDIATION PROJECT.

August 2016

Condo Media - August 2016

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