Bill Summary for H 278 (2013-2014)

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Summary date: 

Mar 12 2013

Bill Information:

View NCGA Bill Details2013-2014 Session
House Bill 278 (Public) Filed Tuesday, March 12, 2013
Intro. by D. Ross, D. Hall.

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Bill summary

Amends GS Chapter 7A by adding a new section, GS 7A-38.3F (Prelitigation of homeowners association disputes), providing for voluntary mediation prior to the filing of a civil action for a dispute that has arisen under the NC Condominium Act, the NC Planned Community Act, or the association's declaration, bylaws, rules, or regulations. Disputes related only to failure to pay an assesment or fines are not eligible for mediation under this new section.

Provides definitions that apply in proposed GS 7A-38.3F, including definitions for association, dispute, executive board, mediator, member, and party or parties.

Requires either an association or member to contact the NC Dispute Resolution Commission (Commission) to initiate mediation. The Commission will refer a local community mediation center (center) or will contact a center directly.  After receiving identifying and contact information, the center will contact the other party to notify him or her of the request to mediate. If the parties agree to mediate, the center will then attempt to schedule mediation at a time convenient for both parties. The center will issue written notifications of the date, time, and location of mediation as well as a copy of this section and a brochure explaining the mediation process. The center will appoint a qualified employee to conduct the mediation no later than 25 days after the center received the request from either the association or member.

Requires the following procedures to apply to mediation under this section:

(1) Attendance: the mediator will decide who may attend the mediation. A party's attorney may attend but is not required to.

(2) All parties are expected to attend mediation. However, parties that reside more than 50 miles from the center can participate by telephone or other electronic means, if the request to do so is received by the center at least five days before the mediation. Parties that reside within 50 miles of the center may participate in this manner if they are deemed, by the center, to have a compelling reason to do so.

(3) If no final agreement is reached, due to the need to seek outside approval from the association members, the mediator may recess the mediation for such review or vote as needed for approval.  The mediator must reconvene no later than 15 days after the recess is taken. No further notice of the reconvening is necessary if the date, time, and, place were agreed to at the mediation prior to recess.

(4) If a final agreement is reached, the mediator will put the agreement in writing and have the parties sign it and issue copies to both parties. A signed agreement is binding and enforceable.

Provides that either party to a dispute can decline mediation. The declining party must inform the center and the other party if mediation has been initiated but not yet scheduled or if it has been scheduled but not yet held. No costs are assessed if a party declines before the initial mediation meeting.

Requires that the costs of mediation will be shared equally by both parties. The fee for mediation is set at $100 per hour, not to exceed $600, due at the end of each mediation meeting. The center cannot charge any other fees.

After concluding mediation, the mediaor must prepare a certification stating the date the mediation concluded and the general results of the mediation.  If a cause of action is later filed involving the dispute mediated by both parties, either party can file this certification letter with the clerk of court, fulfilling any need under the law to mediate. The certificate or any other evidence of statements made during mediation are not subject to discovery and are inadmissible in any proceeding in the action from which the mediation arises.

Time periods relating to the filing of a claim or taking other action with respect to the dispute, including any statute of limitations, are tolled upon the initiation of mediation as provided in this section and last until 30 days after the date on which mediation is concluded, per the date on the mediator's certificate.

Requires associations to notify, in writing, its members of the ability to mediate to resolve disputes, as that term is defined in this section. If the association has a website, this notice must be published on that website. If not, the association will publish the notice at the same time as publication of contact information for all officers and board members, as provided in GS 47C-103 and GS 47F-3-103.

Effective July 1, 2013, applying to all homeowner association disputes not specifically exempted by this act that occur on or after that date.