Overall, the often statutorily required pre-suit mediation process governed by §720.311, Fla. Stat., can potentially save a community association tens of thousands of dollars by providing an opportunity to resolve the dispute prior to litigation. In fact, a great many disputes resolve themselves at this stage, but not all disputes are subject to the pre-suit mediation requirements. Sometimes opting to use the process is voluntary, and sometimes it is mandatory. Condominium, homeowners’, and arguably cooperative associations can all take advantage of the pre-suit mediation process described in §720.311, Fla. Stat., though there are a few noticeable differences.
As per §720.311, Fla. Stat., election and recall disputes are not eligible for pre-suit mediation. This is because those disputes must be resolved via arbitration by the DBPR Division of Florida Condominium, Timeshares, and Mobile Homes—Arbitration Section or filed in a local court of competent jurisdiction. Other HOA disputes for which the pre-suit mediation process is not required include collection of any assessment, fine, or other financial obligation, including attorneys’ fees and costs, claimed to be due or any action to enforce a prior mediation settlement agreement between the parties.
Regarding HOA disputes that must follow the pre-suit mediation process before the dispute is filed in court, the aggrieved party must follow the pre-suit mediation when the dispute meets one of the following criteria:
- Between an association and a parcel owner regarding use of or changes to the parcel or the common areas
- Other covenant enforcement disputes
- Disputes regarding amendments to the association documents
- Disputes regarding meetings of the board and committees appointed by the board
- Membership meetings not including election meetings
- Access to the official records of the association.
As to condominium association disputes, §718.1255, Fla. Stat., provides that in lieu of the initiation of manditory nonbinding arbitration, a party may submit their dispute to pre-suit mediation in accordance with the homeowners’ association pre-suit meditation process set out in §720.311, Fla. Stat. The condominium association disputes eligible for the pre-suit mediation process include the authority of the board of directors, under Chapter 718, Fla. Stat., or association’s documents, involving any of the following:
- Requirement for any owner to take any action, or not to take any action, involving that owner’s unit or the appurtenances thereto
- Alteration or addition to a common area or element
- The failure to properly conduct elections
- The failure to give adequate notice of meetings or other actions
- The failure to properly conduct meetings
- The failure to allow inspection of books and records
- Challenges to a plan of termination of the condominium pursuant to §718.117, Fla. Stat.
As to condominium association disputes, mandatory, non-binding arbitration or, alternatively; the presuit mediation process, is not required for:
- Title to any unit or common element
- The interpretation or enforcement of any warranty
- The levy of a fee or assessment, or the collection of an assessment levied against a party
- The eviction or other removal of a tenant from a unit
- Alleged breaches of fiduciary duty by one or more directors, or
- Claims for damages to a unit based upon the alleged failure of the association to maintain the common elements or condominium property.
It is also good to know that in any dispute subject to the statutory required pre-suit mediation where emergency relief is required, a motion for temporary injunctive relief may be filed with the court without first complying with the otherwise required pre-suit mediation process.
As to cooperative association disputes, §719.1255, Fla Stat., provides that disputes can be subject to the alternative dispute resolution process set out in §718.1255, Fla. Stat. This statute then refers to §720.311, Fla. Stat., which describes the pre-suit mediation process in detail. Therefore, parties involved with cooperative association disputes follow the same guidelines as condominium association disputes.
Regarding the mediation process itself, pre-suit mediation proceedings must be conducted in accordance with the applicable Florida Rules of Civil Procedure, and that these proceedings are privileged and confidential to the same extent as court-ordered mediation. This means what happens at mediation, stays at mediation (like Vegas)!
The pre-suit mediation process is fully described in §720.311, Fla. Stat. Simply put, the aggrieved party must serve on the other party(ies) (by certified mail, return receipt requested, and regular U.S. mail) written demand for participation in mandatory pre-suit mediation, which must provide a list of five mediators from which the recipient must choose one. The recipient will have 20 days from the date of mailing to serve (by certified mail, return receipt requested, and regular U.S. mail) a written response to the aggrieved party. The pre-suit mediation must then be held within 90 days unless the parties jointly agree to an extension. The parties split the costs of the mediator, and each party is responsible for their own respective attorneys’ fees and costs (unless otherwise agreed to at the mediation as part of any settlement).
The failure of any party to respond to a pre-suit mediation demand, to agree upon a mediator, to make payment of fees and costs within the time established by the mediator, or to appear for a scheduled mediation session without the approval of the mediator constitutes an “impasse” in the pre-suit mediation by such party, entitling the other party to proceed in court and to seek an award of the costs and fees associated with the mediation. Additionally, and most importantly, the party who fails or refuses to participate in the entire mediation process may not recover prevailing party attorneys’ fees and costs in subsequent litigation relating to the dispute should they actually prevail.
If pre-suit mediation is not successful in resolving all issues between the parties, the aggrieved party may file the unresolved dispute in a court of competent jurisdiction. As to any issue or dispute that is not resolved at pre-suit mediation, and as to any issue that is settled at pre-suit mediation but is thereafter subject to an action seeking enforcement of the mediation settlement, the prevailing party in any subsequent litigation proceeding is entitled to seek recovery of all costs and attorneys’ fees incurred in the pre-suit mediation process.
Again, if the receiving party does not timely and properly respond to the aggrieved party’s pre-suit mediation demand, then should the aggrieved party proceed with the litigation and lose, since the receiving party did not comply with the pre-suit mediation demand, they would not be entitled to their otherwise awardable prevailing party attorneys’ fees and costs due to their failure to comply. As those legal procedures and their surrounding strategy have a signficant impact on association legal counsel familar with the intracacies of community association law should be involved.