H.R. NO.













REQUESTING the convening of a Task Force to conduct a study on imposing Mandatory alternative Dispute Resolution to resolve Homeowners Associations Disputes.



     WHEREAS, currently, major homeowner association disputes are handled by association boards that are also responsible for controlling millions of dollars in annual association dues and that consist of voluntary members who are in a position where their actions are often questioned; and


     WHEREAS, the lack of an alternative dispute resolution mechanism to resolve these disputes has resulted in litigation and, as a consequence, association coffers are being used for legal fees rather than common maintenance repairs; and


     WHEREAS, delays in resolving these disputes can ultimately affect the health and safety of hundreds of people, particularly in large subdivisions where the lack of maintenance leads to the disrepair of critical infrastructure, such as a major road; and


     WHEREAS, condominium complexes, which have similar disputes as homeowners associations, have access to benefits such as an education fund under section 514A-131, Hawaii Revised Statutes, and arbitration and mediation under sections 514A-121, 514A-121.5, and 514B-161, Hawaii Revised Statutes, but homeowners associations do not have such benefits; and


     WHEREAS, among its duties, the Real Estate Commission of the Department of Commerce and Consumer Affairs administers the Condominium Education Trust Fund, for which a fee is collected from each project and association under the Commission's jurisdiction, for purposes including financing or promoting expeditious and inexpensive procedures for resolving association disputes; and

     WHEREAS, the dispute resolution and mediation systems that currently exist within the Judiciary may meet the needs of homeowners associations; now, therefore,


     BE IT RESOLVED by the House of Representatives of the Twenty-eighth Legislature of the State of Hawaii, Regular Session of 2016, that the Department of Commerce and Consumer Affairs is requested to convene a task force to conduct a study and develop a plan for requiring homeowners association disputes to be resolved by dispute resolution alternatives prior to resorting to litigation; and


     BE IT FURTHER RESOLVED that this task force be composed of the following members:


     (1)  The Director of Commerce and Consumer Affairs or the Director's designee;


     (2)  A representative from the Alternative Dispute Resolution branch of the Judiciary selected by the Chief Justice;


     (3)  The Ombudsman or the Ombudsman's designee;


     (4)  A representative from a Homeowners Association selected by the Department of Commerce and Consumer Affairs;


     (5)  A representative from the Legislative Reference Bureau, who shall provide legislative drafting assistance, should the task force propose any legislation; and


     (6)  A member of the Hawaii Association of Realtors; and


     BE IT FURTHER RESOLVED that the task force is requested to report its findings and recommendations, including any proposed legislation, to the Legislature no later than twenty days before the convening of the Regular Session of 2017; and

     BE IT FURTHER RESOLVED that certified copies of this Resolution be transmitted to the Ombudsman, the Director of Commerce and Consumer Affairs, the Administrative Director of the Courts, the Acting Director of the Legislative Reference Bureau, and the President of the Hawaii Association of Realtors.









Report Title:

Requesting a Task Force to Research the Feasibility of Establishing a Mandatory Dispute Resolution Program to Handle Homeowners Associations Disputes