STAND. COM. REP. NO.267-02

Honolulu, Hawaii

, 2002

RE: H.B. No. 1716

H.D. 1




Honorable Calvin K.Y. Say

Speaker, House of Representatives

Twenty-First State Legislature

Regular Session of 2002

State of Hawaii


Your Committee on Consumer Protection and Commerce, to which was referred H.B. No. 1716 entitled:


begs leave to report as follows:

The purpose of this bill is to amend the condominium property regime law to specify that in the mediation of a dispute between a homeowner and the board of directors of a condominium, each party shall be responsible for its own costs.

Hawaii Independent Condominium and Cooperative Owners, The Mediation Center of the Pacific, and six concerned individuals submitted testimony in support of this bill. Hawaiiana Management Company, Ltd.,

and the Hawaii Council of Associations of Apartment Owners supported the intent of this bill. The Real Estate Commission also supported the intent of this bill but recommended a moratorium on all condominium legislation until 2003 due to ongoing condominium law recodification. The Community Associations Institute provided comments.

Your Committee finds that an apartment owner or an association board of directors may request mediation of a dispute involving the interpretation, application, or enforcement of the condominium law or of the association of apartment owners' declaration, bylaws, or house rules. Your Committee further finds that if one party is required to pay the entire cost of mediation, this may result in undue financial hardship and serve as a deterrent to mediation.

Your Committee has retained the requirement that each party assume responsibility for its own individual costs of participating in mediation, and has amended this bill by:

(1) Mandating that the joint costs of mediation be shared equally amongst the parties; and

(2) Providing the parties with the alternative of allocating the costs of mediation by agreement at the end of the mediation process.

As affirmed by the record of votes of the members of your Committee on Consumer Protection and Commerce that is attached to this report, your Committee is in accord with the intent and purpose of H.B. No. 1716, as amended herein, and recommends that it pass Second Reading in the form attached hereto as H.B. No. 1716, H.D. 1, and be placed on the calendar for Third Reading.

Respectfully submitted on behalf of the members of the Committee on Consumer Protection and Commerce,