HOA Dispute Resolution — California Civil Code §§ 5900–5965

When a member and an HOA disagree about their rights under the Davis-Stirling Common Interest Development Act, the Nonprofit Mutual Benefit Corporation Law, or the governing documents, two statutory processes can come into play before anyone files a lawsuit. The first is internal dispute resolution (§§ 5900–5920): a procedure the association must provide, which either side may invoke in writing. The second is alternative dispute resolution (§§ 5925–5965): a step the parties must have tried before filing certain enforcement actions in superior court. The Act says the first "supplements, and does not replace," the second (§ 5900(b)).

Neither process is the same as the disciplinary hearing a board must hold before fining or disciplining a member. That hearing, and the limits on fines, are covered on our HOA fines & hearings page. This page covers what comes next if the dispute is not resolved: what the internal procedure must look like, what a Request for Resolution is, and how the statute ties the ADR step to court filings and attorney's fees.

The internal-dispute-resolution article applies to a dispute between an association and a member involving their rights, duties, or liabilities under the Davis-Stirling Act, the Nonprofit Mutual Benefit Corporation Law, or the association's governing documents (§ 5900(a)). The association must provide a fair, reasonable, and expeditious procedure for resolving such a dispute, and in developing it must make maximum, reasonable use of available local dispute resolution programs involving a neutral third party, including low-cost mediation programs (§ 5905(a), (b)).

At a minimum, the procedure must satisfy these requirements (§ 5910): either party may invoke it, and the request must be in writing (§ 5910(a)); it must have prompt deadlines and state the maximum time for the association to act on a request (§ 5910(b)); if a member invokes it, the association must participate (§ 5910(c)); and it must give both sides a way to explain their positions, with an attorney or another person assisting at their own cost (§ 5910(f)). A member may not be charged a fee to participate (§ 5910(g)).

If the association invokes the procedure, the member may elect not to participate; a member who does participate, and whose dispute is resolved other than by the member's agreement, has a right of appeal to the board (§ 5910(d)). A written resolution signed by both parties that does not conflict with the law or the governing documents binds the association and is judicially enforceable, and so is a signed written agreement reached through the procedure (§ 5910(e)). The association's annual policy statement must describe its internal dispute resolution process (§ 5920).

If an association does not provide a fair, reasonable, and expeditious procedure, the statutory procedure in § 5915 applies and is treated as meeting the requirement (§ 5905(c); § 5915(a)). Either party may ask the other, in writing, to meet and confer (§ 5915(b)(1)). A member may refuse the request, but the association may not (§ 5915(b)(2)).

The board designates a director to meet and confer, and the parties meet promptly at a mutually convenient time and place, explain their positions to each other, and confer in good faith; either side may be assisted by an attorney or another person at its own cost (§ 5915(b)(3), (4)). Any agreement is memorialized in writing and signed by the parties, including the board designee on the association's behalf (§ 5915(b)(5)). It binds the parties and is judicially enforceable if both sides sign, it does not conflict with law or the governing documents, and it is either within the authority the board gave its designee or is ratified by the board (§ 5915(c)). A member is not charged a fee (§ 5915(d)).

The association's side of the bargain is enforced in one specific way: an association may not file a civil action about a dispute in which the member requested dispute resolution unless it complied with § 5910 by engaging in good faith in the internal procedures after the member invoked them (§ 5910.1). That section was added effective January 1, 2020 (SB 323).

"Alternative dispute resolution" means mediation, arbitration, conciliation, or another nonjudicial procedure that involves a neutral party in the decisionmaking; the form chosen may be binding or nonbinding, with the voluntary consent of the parties (§ 5925(a)). An "enforcement action" is a civil action or proceeding, other than a cross-complaint, to enforce the Davis-Stirling Act, the Nonprofit Mutual Benefit Corporation Law, or the governing documents (§ 5925(b)).

Neither an association nor a member may file an enforcement action in the superior court unless the parties have endeavored to submit their dispute to ADR (§ 5930(a)). The requirement is narrower than it sounds. It applies only to an action that is solely for declaratory, injunctive, or writ relief, or for that relief together with a claim for money damages not exceeding the jurisdictional limits stated in Code of Civil Procedure §§ 116.220 and 116.221 (§ 5930(b)). It does not apply to a small claims action, and, except as otherwise provided by law, it does not apply to an assessment dispute (§ 5930(c), (d)).

Associations must also tell members about it. The annual policy statement must include a summary of these provisions that quotes the statute's warning: failing to comply with the ADR requirements of § 5930 "may result in the loss of the member's right to sue the association or another member of the association regarding enforcement of the governing documents or the applicable law" (§ 5965(a), (b)).

Any party can start the ADR process by serving the other parties with a Request for Resolution (§ 5935(a)). It must contain a brief description of the dispute, a request for ADR, a notice that the party receiving it must respond within 30 days of receipt or the request will be deemed rejected, and — if the party served is the member — a copy of the ADR article (§ 5935(a)(1)–(4)). It may be served by personal delivery, first-class mail, express mail, facsimile, or other means reasonably calculated to give actual notice (§ 5935(b)).

The party served has 30 days after service to accept or reject the request, and silence is a rejection: if the party does not accept within that period, the request is deemed rejected (§ 5935(c)). If the request is accepted, the parties must complete ADR within 90 days after the party who made the request receives the acceptance, unless both parties extend the period by a signed written stipulation (§ 5940(a)). The costs of ADR are borne by the parties (§ 5940(c)).

The clock for suing is protected while this happens. If a Request for Resolution is served before the end of the applicable time limit for commencing an enforcement action, that limit is tolled during the response period (30 days, § 5935(a)(3)) and, if the request is accepted, during the period to complete ADR (90 days, extendable by stipulation, § 5940(a)) (§ 5945).

When a party files an enforcement action, it must file with the initial pleading a certificate stating that one or more of these conditions is met: ADR was completed in compliance with the article; another party did not accept the terms offered for ADR; or preliminary or temporary injunctive relief is necessary (§ 5950(a)). Failing to file the certificate is grounds for a demurrer or a motion to strike, unless the court finds that dismissal for non-compliance would result in substantial prejudice to a party (§ 5950(b)). After an enforcement action has been filed, the parties may also stipulate in writing to refer the matter to ADR, and the referred action is stayed (§ 5955(a)).

Refusing ADR can matter later on fees. In an enforcement action in which attorney's fees and costs may be awarded, the court, in setting the amount, may consider whether a party's refusal to participate in ADR before the action began was reasonable (§ 5960). And in an action to enforce the governing documents, the prevailing party shall be awarded reasonable attorney's fees and costs (§ 5975(c)). The Act's covenants and restrictions are enforceable equitable servitudes unless unreasonable, and unless the declaration says otherwise they may be enforced by any owner or by the association, or both (§ 5975(a)).

This page covers only the dispute-resolution steps. The notice-and-hearing procedure and the cap on fines are on HOA fines & hearings, and the rules for board elections are on HOA elections. Whether a particular dispute falls inside the ADR requirement depends on the relief sought and on the governing documents, which this page does not address.

This page is general information, not legal advice. Read the enacted text linked below and your association's own governing documents, and talk to a lawyer about a specific dispute.