LHC NEWSLETTER, VOL. 11, NO. 1
Neighbor to Neighbor Conflict Resolution: What Is the Board’s Role?
By: David A. Loewenthal, Esq.
Loewenthal, Hillshafer & Carter, LLP
Anyone who has served on a Board of Directors knows that one of the most difficult situations to deal with involves neighbor to neighbor disputes. There is really no limit as to what may constitute a neighbor to neighbor dispute since what one individual may find offensive another may find acceptable.
Examples of issues that may give rise to neighbor to neighbor disputes includes nuisances such as noise, odors, visual eyesores, etc. between neighbors; property damage between neighbors who share a common wall or floor/ceiling assembly and harassment related issues where there may be housing related discrimination.
Historically, in evaluating “neighbor to neighbor disputes” Boards would generally consider whether the dispute was limited to two owners and/or did not involve the common area. Assuming that was the case, Boards often would take the position that the Association would not get involved nor conduct any investigation.
In my opinion, the day of simply telling a neighbor that “the issue is between you and your neighbor and that the Association will have no involvement” is over. Boards of Directors have an obligation to perform a reasonable investigation when a neighbor dispute is brought to their attention and decide what, if any, action is warranted. Management’s role in these matters may include obtaining and compiling information regarding the dispute; preparing a warning/violation letter; discussing the issues with the Board including recommending that the Association’s counsel be brought in to evaluate the matter, etc.
Neighbor disputes often arise from a claim of nuisance. Homeowners are not entitled to complete isolation and separation from their neighbors; however, unreasonable noise, smell or eyesores certainly can constitute a nuisance. If the Board, after reasonable investigation, determines that a nuisance exists, the Board may take several steps including issuing a warning letter to the member who is allegedly creating the nuisance, request further information as to the issue and demand that the owner cease and desist the action that is the basis of the nuisance.
If the conduct continues, the Board can schedule a Board hearing for the individual who is allegedly creating the nuisance pursuant to Civil Code section 5855 for the purpose of determining if a fine or other disciplinary action should be taken against that homeowner. In the event of a hearing, the offending member must be given at least ten (10) days prior notice of the date, time and location of the hearing, the purpose of the hearing, and that they have a right to address the Board of Directors regarding the issues that are the subject of the hearing. The Board must decide whether or not the information presented justifies taking further action such as issuing a fine. Within 15 days of the completion of the hearing, the Board of Directors must advise the owner in writing of the result of the hearing including if there will be a levying of fines or other disciplinary action.
A Board should only levy a fine if the Board has performed a reasonable investigation to determine the validity of the complaint which may include evaluating evidentiary support against the violating member. This includes considering any written complaints that have been presented to the Board; violations witnessed by members, residents, third parties, Board members, or the manager; independent confirmation by outside sources such as a police, animal control, building department report, etc. Ultimately, if the Association wishes to collect on a fine or enforce the governing documents, it may be forced to file a lawsuit. As such, unless the Board reasonably believes that its decision regarding the issuance of a fine or taking other disciplinary action is supported, it should not so proceed.
It is important to note that simply because the Association issues a warning letter and conducts a disciplinary hearing does not automatically obligate the Board to proceed forward with litigation even if the conduct continues. Generally, the Board has discretion in determining whether to proceed forward in instituting legal action against the offending party.
Neighbor disputes also arise when there is physical property damage between units often caused by water originating from one unit into an adjacent/connecting unit with attached walls or floor/ceiling assemblies. Generally, if the source of the water is a separate interest item, such as a washing machine hose, refrigerator water line, etc. the owner in control of that separate interest item would be responsible for the costs associated with the damage. Conversely, if the water source is a common area element, the cost of repair would generally be the Association’s responsibility. A thorough review of the facts and the Association’s governing documents including the Condominium Plan, Covenants, Conditions and Restrictions, Maintenance Matrix (if one exists) and Civil Code are essential in making these determinations.
Regarding neighbor to neighbor property disputes, the Association should perform a reasonable investigation into the cause and extent of the damage in determining responsibility. Board action may include submitting a claim to the Association’s master policy of insurance since it is often the case that the Association’ insurance has broader coverage than what the CCR’s identify and members are often identified as beneficiaries under the policy and/or pursuant to the CCR’s. Also, in cases of water related damage between neighbors, it is often better to attempt to limit the claim by remediating the damage, including dry out, as soon as possible and then continue to sort out who is actually responsible and costs.
Finally, an area that has become hotly contested over the last several years pertains to claims of harassment and housing related discrimination. Boards have an obligation to investigate claims of housing related discrimination once it is brought to the attention of the Board of Directors. Specifically, effective October 14, 2016, the U.S. Department of Housing and Urban Development (HUD) established regulations requiring all housing providers to take steps to end harassment. Homeowners Associations are included as a housing provider.
The alleged harassment must be related to the complaining persons membership in a protected class which includes harassment based upon race, color, religion, national origin, sex, familiar status, or disability. This includes homeowners Associations involving harassment by other residents, Board members, managers and vendors.
Pursuant to 24 Code of Federal Regulations section 100.7(a)(1)(iii) a person is “directly liable” for “failing to take prompt action to correct and end a discriminatory housing practice by a third party, where the person knew or should have known of the discriminatory conduct, and had the power to correct it.” Pursuant to CFR Section 100.20 a “Person” includes associations which can be held liable for a resident’s harassment of another resident when:
1) The harassment is based upon race, color, religion, sex, national origin, disability and familiar status;
2) The homeowners Association knew or should have known of the harassment;
3) The homeowners Association had the power to correct and end the harassment; and
4) The homeowners Association failed to take prompt action to correct and/or end the conduct.
In order to attempt to avoid liability, an Association’s Board must take some action to address any alleged discrimination by residents or other people within the authority of the Board of Directors/Association. In a neighbor to neighbor discrimination claim, the Board’s failure to take action could lead the Association to being sued and potentially be liable for monetary damages.
The type of action to be taken by the Association depends on the circumstances and factors involved. It could include a warning, either verbally or in writing, as well as the demand that the discriminatory conduct stops. If preliminary steps fail to correct the actions, a Board may consider proceeding forward with making a request for Alternative Dispute Resolution (Civil Code section 5925 et seq.) prior to commencement of an enforcement action. If ADR fails, legal action, including seeking a harassment restraining order, may be warranted. In performing its investigation, the Board may wish to engage the services of an independent investigator to interview the parties involved, witnesses, etc. and provide an opinion.
HUD’s position on these types of claims is that a Community Association generally has the authority to deal with harassment claims as empowered by the Association’s CCR’s or by other legal authority including notices of violations, fines, etc.
In the Association’s evaluation of the issues, facts, evidence, claims, etc. it could arrive at a decision that the complaining party is not a member of a protected class or that the discrimination is not attributable to that status. Not every claim of discrimination in fact rises to the level of a housing act violation. The Association should conduct a thorough review of the issues and claims and make an informed determination of what it can do to eliminate the claimed discrimination, if it determines the discrimination exists, or whether it is even actionable discrimination in the first place.
The historic positions of Boards that disputes between neighbors were not the Association’s concern is no longer the case. Boards need to take appropriate steps, including a reasonable inquiry and investigation, in order to determine what action, if any, is required.
