Appellate Division Determines Alternative Dispute Resolution is Not a Prerequisite to Litigation
In a case of first impression in New Jersey, the Appellate Division has determined that mediation – or Alternate Dispute Resolution (“ADR”) – is not a prerequisite to litigation and may be bypassed under compelling circumstances such as the immediate threat to the safety of others or an immediate and substantial threat to property. In addition, the Court agreed that the Association had a statutory right to bring an action for injunctive relief against Defendants, and that condominium tenants – as opposed to unit owners – are not covered by the plain language of the Condominium Act. The decision, approved for publication on January 23, 2007, was a victory for the Finderne Heights Condominium Association, which was represented by David J. Byrne and Jonathan H. Katz.
The facts are as follows. In order to prohibit a tenant from continuing a pattern of harassing and violent behavior towards her neighbors and Association employees, the Association sought, by way of Court Order, to compel this tenant to comply with the Association’s governing documents and to enjoin her from any further acts of harassment, trespassing or defacement of Association property. The Trial Court dismissed the Association’s Complaint, finding that the Association failed to comply with N.J.S.A. 46:8B-14(k) by first submitting the matter to either mediation or dispute resolution. The Association then appealed the Trial Court’s dismissal of its Complaint, arguing that the Association had a statutory right to bring an action for injunctive relief and further, under the circumstances presented here, that there the Association has no duty to first submit its claims to ADR.
The Appellate Division’s decision held that “so long as the unit owner and Association have a legitimate basis under the by-laws, the deed, or related covenants to file suit, same may be filed pursuant to N.J.S.A. 46:8B-16(b) without first resorting to alternative dispute resolution.” While still espousing the benefits of mediation, which may provide a quicker and perhaps more efficient method of resolution to disputes between unit owners rather than litigation, the Court upheld the Association’s right to bypass ADR, especially in the event – as was the case here – that there was a threat to the safety of others.
The Appellate Division’s decision in Finderne Heights Condominium Association v. Rabinowitz can be found here.
If you would like to discuss the Finderne opinion and how it affects condominium associations in more detail, please contact David J. Byrne or Jonathan H. Katz.
