The stability and value of a shared interest community hinges on a lot of things; financial solvency, good governance, and proactive physical maintenance, to name a few. But another key component, and one that may be less obvious to the eye, is social cohesion and mutual respect among residents, administrators, and staff. Unresolved conflict and the acrimonious environment it produces are anathema to the peace and sense of community residents of condominiums, co-ops, and HOAs seek. 

The responsibility for cultivating and supporting that social cohesion ultimately rests with the board, and often depends on how the board handles conflicts between itself and the community, individual members, and between residents.  

Sources of Conflict

There are many sources of conflict in a shared interest community.  They can range from spats between neighbors to conflict between a resident and the board, or between the board and management, or resident(s) and management. All are serious, and all require proper attention. Much like a virus, conflict can worsen quickly and spread beyond its origin point to poison the whole community.

“There are too many common sources of conflicts to list them all,” says William McCracken, a partner with NYC-based law firm Moritt Hock Hamroff.  “When you deal with multifamily buildings, you learn that neighbors and management can get into fights about almost anything. Disputes about water leaks are very common, as are so-called ‘quality of life’ disputes—things like noise and odors.”

Jen Barnett, a partner with the Braintree, Massachusetts-based law firm Marcus, Errico, Emmer & Brooks, expands on this.  “Generally,” she says, “community association disputes will fall into one of four main categories: unit owner versus unit owner, unit owner versus board, board member versus board member, and factional disputes (unit owners versus tenants, residential owners versus commercial unit owners, etc.). 

“Sources of conflict will vary among different associations,” Barnett continues, “but often concern the use of the common areas and facilities. In essence, parking, use of limited common areas, landscaping, shared amenities, such as pool, clubhouse, gym, etc. Other causes are rule violations (often related to noise, odors, pets, or the unauthorized use of a unit for business or short-term rentals), financial issues like assessments, fines, budget increases, capital improvements, etc., architectural and structural modifications, and maintenance responsibilities.”

Nip it in the Bud 

No matter the cause, the best way to minimize the effects of conflict on a community is to deal with it early. In other words, nip it in the bud. Don’t let it fester and turn into an even bigger problem. Quick attention and response is the best route to de-escalation.

“The first step is early intervention,” says Michael Shifrin, principal of Shifrin Legal, a law firm located in Chicago. “Boards and managers should address complaints promptly and professionally, while encouraging direct, respectful communication between neighbors when appropriate. Maintaining neutrality, focusing on facts instead of personalities, and reminding parties of the community’s governing documents and their shared objective of preserving and protecting their investment often help lower tensions. Sometimes, simply acknowledging a person’s concerns goes a long way toward de-escalation.”

From a procedural point of view, explains McCracken, “It helps when everyone understands each other’s rights and limitations. For example, when there’s a water leak, you hope that everyone has insurance—the main reason being that it helps ensure that everyone involved is made whole, but also because insurance professionals are better at understanding the parties’ respective rights and obligations, and there are fewer unnecessary disputes about who should pay for what. 

“That’s why it is sometimes a good thing when residents hire attorneys, at least as long as those attorneys are interested in resolving disputes and not just making a mess,” he continues. “Attorneys should be able to explain to their clients when what they want is not really reasonable or supportable under the building’s governing documents. If they do that, then it’s easier to work towards a reasonable compromise.”

 McCracken also stresses that “it’s really important for all interested parties to understand that in most cases, after the dispute is over, they have to continue living together. Ideally, you want to get the parties to a situation where they are not uncomfortable riding the elevator together—and to do that, everyone needs to feel like they were treated fairly.”

 Barnett concurs, but cautions that “as a general rule, boards should avoid becoming involved in interpersonal disputes between residents, though a board may have a duty under the FHA to help mediate disputes when they arise. In those cases, in response to any reported rule violation, the board should conduct its own unbiased and objective investigations; it shouldn’t rely solely on uncorroborated statements made by individual residents when determining how to proceed, if at all, against the person or persons alleged to be responsible.”

Mediation Station

One possible option for resolving disputes without resorting to costly, acrimonious lawsuits is mediation. In general terms, mediation—and its more structured cousin, arbitration—is defined as a mindful intervention in a dispute in order to resolve it. Professionally facilitated mediation and arbitration are remarkably effective in reaching mutually acceptable conclusions in all kinds of disagreements, usually in a fraction of the time and at far less cost than litigation. 

“Mediation generally involves bringing in a neutral third party, sometimes a professional mediator or  a trusted manager or attorney, to facilitate a structured conversation between the parties,” explains Shifrin. “The mediator sets ground rules, ensures each side is heard, and helps identify common ground or creative compromises. Mediation is non-binding but can be very effective at preserving neighborly relationships compared to litigation.”

In practical terms, McCracken notes, “There isn’t a standard mediation process.  I would say that it helps tremendously to have someone on the board or management side who has gravitas and credibility to instill a sense of fairness and trust.” This is especially true in shared-interest communities, as opposed to, say, labor disputes in commercial ventures. “That role was traditionally often filled by someone senior at the management company, but it could also be the board president, the board’s attorney, or some combination,” McCracken says. 

According to Barnett, “Alternative dispute resolution may be required under an association’s governing documents. And it may be a good alternative, as litigation is often unpredictable and costly. Mediation services may be available through court sponsored mediation/conciliation services, or private alternative dispute resolution providers, and even harassment prevention orders in cases of unit-to-unit owner conflict.”

Improving Communication Strategies

A key aspect to avoiding conflict and improving communication strategies for boards and management is simply being proactive. 

Shifrin suggests communities consider the following options to improve communications:  “When confronting noise and/or nuisance complaints, acknowledge receipt of the complaint, investigate it fairly, and communicate outcomes, even if the board cannot act. Silence breeds frustration. Defining board boundaries is also a good policy.  Boards must clarify their role as enforcers of the governing documents, not as referees of every personal dispute. Publishing policies, FAQs, or flowcharts for handling common complaints such as noise, pets, and parking, sets reasonable expectations. Finally, transparency is always a good policy.  Regular newsletters, meeting summaries, and accessible channels for questions reduce rumors and mistrust.”

In dense urban environments, noise can be a particularly vexing issue.  “Some level of ‘noise’ is in fact, a fact of life in a multifamily residence,” says McCracken. “Fairly, it’s not the job of management to ensure that no one ever stomps their feet or plays loud music.  To take a noise issue from an annoying fact of life to a serious legal issue usually involves hiring experts, and performing studies that residents are usually reluctant to do, and they get frustrated when management won’t do it for them.  That can be a delicate communication issue.  Communication is always important, but when it comes to dealing with a dispute over a health and safety issue, in particular, the main thing is to protect the building and residents, regardless of how well the board’s position is communicated.”

Barnett encourages her clients to “establish clear channels of communication.  Encourage all parties involved to meet to express their concerns and listen to each other’s perspective. Also, be careful of what words you choose. Be respectful and begin statements with, I, rather than ‘you.’  Engage in active listening.”

Board training is also a good and appropriate tool for conflict issues and their resolution. “Many conflicts can be prevented if board members receive training on governance, communication, and conflict resolution,” says Shifrin. “A well-informed board is more confident, consistent, and less likely to make decisions that invite unnecessary conflict.”

Avoiding Lawsuits

As with so many things, clarity and transparency are among the best options for avoiding major conflicts that may spill over blurry, poorly-defined boundaries and impact residents who weren’t even involved. Adopt clear, consistent rules for your community, and enforce them uniformly.  Document all board actions. Legal disputes often stem not just from a given decision or action itself, but from how it was handled. If a lawsuit does arise, the board should immediately notify its legal counsel and insurance carrier, avoid discussing the case with residents, and continue operating as normal while relying on professional advice to guide their response.

Some sage advice from McCracken:  “When you realize that ninety-nine percent of lawsuits settle, and lawsuits that don’t settle are extremely expensive for all involved, you would think that everyone would be incentivized to avoid escalating to court. It is often in a board’s interest to compromise on an issue, even if they have the better legal position, just to avoid the expense and uncertainty of litigation.  

“And again,” he says, “unlike in the typical commercial context, when you go to court with a neighbor, you still have to see them in the building during the lawsuit and after it is over. It’s worth going the extra mile to avoid those sorts of awkward situations. Having said all that, if you’ve done everything you can to avoid the lawsuit and are in court regardless, the only thing to do is give everything to win.  Being in a lawsuit is bad; losing a lawsuit is much worse.”