Report Title:

Condominium Management Dispute Reso.; Mediation; Admin. Hrg.


Provides procedures for mediation of condominium management disputes. (SD1)


S.B. NO.



S.D. 1









SECTION 1. Section 514A-121.5, Hawaii Revised Statutes, is amended to read as follows:

"514A-121.5 Mediation[.]; condominium management dispute resolution; complaint; hearing. (a) If an apartment owner or the board of directors requests mediation of a dispute involving the interpretation or enforcement of the association of apartment owners' declaration, bylaws, or house rules, or involving section 514A-82(b)(1) to (13), 514A-82.1, 514A-82.15, 514A-82.3, 514A-82.5, 514A-82.6, 514A-83, 514A-83.1, 514A-83.2, 514A-83.3, 514A-83.4, 514A-83.5, 514A-84, [or] 514A-84.5, or 514A-92.5, the other party in the dispute shall be required to participate in mediation. Each party shall be wholly responsible for its own costs of participating in mediation; unless at the end of the mediation process, both parties agree that one party shall pay all or a specified portion of the mediation costs. If an owner or the board refuses to participate in the mediation of a particular dispute, a court may take this refusal into consideration when awarding expenses, costs, and attorney's fees in accordance with section 514A-94. If the parties agree to participate in early neutral evaluation, the mediator or early neutral evaluation facilitator may render a written perspective in a report or provide guidance verbally to all participants that substantiates or dismisses the validity of the dispute and the report may be viewed by the parties in the dispute, any hearings officer, and the real estate commission by request. The early neutral evaluation mediation report shall not be admissible in evidence in any litigation proceedings.

(b) If a dispute is not resolved by mediation as provided in subsection (a), any person that participated in the mediation may file a complaint with the office of administrative hearings in the department of commerce and consumer affairs, naming one or more parties that participated in the mediation as an adverse party; provided that no dispute arising out of section 514A-82(b)(1) to (13), section 514A-82.3, section 514A-83.1(b) and section 514A-83.4(c) or relating to the interpretation or application of any association of owners' declaration, bylaws, or house rules may be the subject of any complaint.

(c) The form and content of the complaint, the fees and costs for the filing of the complaint, and the method of service of the complaint by the person filing the complaint on the adverse party shall be in accordance with rules adopted by the department of commerce and consumer affairs.

(d) The director of commerce and consumer affairs shall appoint one or more hearing officers who shall hold a hearing, pursuant to chapter 91 and the rules of the department of commerce and consumer affairs, on the complaint not more than forty-five days following receipt of the complaint and submit the hearing officer's findings of fact, conclusions of law, and decision and order to the complainant and all other parties that participated in the hearing, within thirty days of the close of the hearing.

(e) Each person who is a party to the hearing shall bear the person's own costs, including attorney's fees, unless otherwise ordered by the hearing officer.

(f) Any person who is a party to a hearing and served with any order pursuant to subsection (d) may obtain a review thereof in the appropriate circuit court pursuant to section 91-14; provided that any review shall be confined to the record of the hearing and not subject to a trial de novo.

(g) Any cost incurred by the department of commerce and consumer affairs pursuant to this section shall be paid by the commission out of the condominium management education fund, established pursuant to section 514A-131.

(h) The department of commerce and consumer affairs shall adopt rules pursuant to chapter 91 necessary for the purposes of this section."

SECTION 2. The department of commerce and consumer affairs shall adopt administrative rules, as provided in section 2 of this Act, not later than July 1, 2005.

SECTION 3. Statutory material to be repealed is bracketed and stricken. New statutory material is underscored.

SECTION 4. This Act shall take effect on July 1, 2004.