Raising the roof

Ed Koch, Las Vegas Sun

Saturday, Aug. 26, 2006 | 7:28 a.m.

THE RECOURSE

The Nevada Real Estate Division offers two ways to resolve disputes between homeowners and homeowners associations short of going to civil court: the intervention affidavit process and alternative dispute resolution program, which is arbitration. The intervention process is free. The arbitration method involves a $50 filing fee and paying a mediator or an arbitrator to reach a binding or nonbinding resolution. It also could involve paying attorneys fees. With the exception of going to court, here are the two options as gleaned from Nevada Real Estate Division brochures and an interview with Real Estate Division Executive Director Gail Anderson:

Option 1: 2003 plan

The intervention affidavit process enacted by the 2003 Legislature:

The complainant must write a certified letter to the subject of the grievance with return receipt requested.

If a resolution is not reached within 15 days, a second certified letter has to be sent with return receipt requested. That letter should note that a grievance may be filed with the real estate divisions ombudsman if a resolution is not reached.

If there still is no resolution, copies of the certified letters and return receipts showing the signature of the recipient along with a notarized affidavit must be sent to the real estate division. (A form for the affidavit is available at red.state.nv.us.)

If the ombudsmans efforts at mediation do not produce a resolution the matter is sent to the real estate compliance section.

If compliance investigators find that the associations rules may have been violated but not state law, the complainant may choose to use the alternate dispute resolution program.

If the chief investigator and executive director of the real estate division believe a law may have been broken, they submit the file to the attorney generals office for review.

The attorney generals office can prosecute the matter, send it back to real estate officials for more investigation or kick it out of the system if the lawyers believe the case is not winnable.

Option 2: 1995 plan

The alternative dispute resolution program enacted by the 1995 Legislature:

A complainant must file a form provided by the real estate division with the ombudsmans office and pay the filing fee.

The ombudsmans office provides the claimant with the forms that have to be served on the respondent within 45 days after the filing.

The respondent has 30 days from the date served to respond. That party also is required to pay a $50 filing fee.

A certified copy of the affidavit of service has to be filed with the ombudsmans office within 10 days of the service.

If the parties agree to mediation often it is less expensive than arbitration they meet with a mediator who tries to get them to reach a fair, written compromise. If either party does not agree to mediation, the matter automatically goes to arbitration.

In nonbinding arbitration, each side presents its case to an arbitrator who renders a decision. Either party can then demand a court trial. If requested, the court will conduct the civil trial as if the nonbinding arbitration never occurred.

In binding arbitration, the decision and awards are final. The judgment can be vacated only if it can be proven that there was corruption, fraud, arbitrator partiality, misconduct or a similar violation.

Brett Bertram got so frustrated with his homeowners association board for what he considered arbitrarily removing trees and dragging its feet on roof repairs that he decided to tell the world about it.

An Internet Web designer, Bertram created the lasvegashoas.org Web site, taking to task the homeowners association of the 312-unit Las Casitas condominium complex in southwest Las Vegas.

Several days later, a tree shading his condo was brought down against his wishes, he said. Creating the Web site was not Bertram's first clash with the board. As a result of previous battles, he said, four other shade trees near his unit have fallen victim to chain saws.

"The frustration is unbelievable," said Bertram, who has filed two complaints with the Nevada Real Estate Division's ombudsman's office seeking intervention to settle his disputes with the association. "I go to work to relieve my stress when my home should be used for that purpose. My hair stands up on the back of my neck each time I pull into the gates."

Bertram is not the only Las Casitas resident to complain, and an official with the company that manages the complex said that hard feelings run deep between some residents and the board.

"You have two opposing factions, and they simply do not like each other," said Judith Fenner, manager of Old West Realty. "I manage 19 properties and occasionally there will be a dispute or two, but nothing to this extent. In my 40 years in this business, this is one of the worst I have seen."

Las Casitas residents are not alone. Horror stories about Southern Nevada homeowners' battles with their association boards have been well documented by local news reports in recent years. Although the real estate division tries to settle such disputes with its free ombudsman service, few complaints are litigated because the acts - no matter how cruel or retaliatory they seem - often don't violate the law, said Gail Anderson, the division's administrator.

"It's a pretty high standard to meet," she said. "The truth is that many complaints do not rise to that level."

Real estate division records show that between July 2004 and March of this year, just 16 of the 293 complaints filed were forwarded to investigators to determine whether any laws had been broken.

The agency also has struggled to address a backlog of complaints. As of March 31, 143 complaint files remained open, 104 of them in Las Vegas.

To resolve the kinds of homeowner complaints that fall through the cracks, backlog the system or linger in limbo, the Nevada Commission for Common-Interest Communities is considering implementing a system of administrative law judges.

The project, with an annual cost of $150,000, calls for a Nevada-licensed attorney or a group of lawyers to have the power to issue subpoenas and hold public hearings. Parties in the disputes would be allowed to appeal administrative law judges' decisions to the commission.

"Certainly we hope this will expedite things and address issues that do not rise to the level of prosecution," Anderson said.

Several commissioners said the focus of the judges' work should be settling disputes of interpretation of governing documents - such as bylaws, nonenforcement of community regulations, maintenance issues - and not try to determine whether laws had been broken.

"There needs to be some constraints on what the (administrative law judge) is doing (and) the type of cases the (judge) will hear," said commissioner Diane Radunz, during a hearing Tuesday in Carson City.

David Smith, who has been a member of homeowner association boards and is a resident of a Henderson HOA-governed community, said outside the meeting that lawyers with a history of representing homeowner associations should not be considered for the post.

"To be successful, there has to be neutrality," he said. "The system also has to be designed to find solutions to many of these nickel-and-dime disputes."

Even if the administrative law judge post is established, state officials said, the ombudsman still will play a major role in resolving issues.

Ombuds man Lindsay Waite, who was recently appointed, said she is establishing an additional step in the process to try to quell new problems before they become festering difficulties.

"Having familiarized myself with 50 of the open cases, I can see there is some frustration," said Waite, a former Baltimore public defender.

"Our new procedure is to set up an informal conference for the parties within four to six weeks of receiving an intervention affidavit. This will give them a chance to exchange ideas and resolve the dispute."

Anderson would neither confirm nor deny receiving any complaints about Las Casitas, saying such filings are confidential unless they become part of a legal action.

She said state laws regarding common-interest communities are strong enough to deal with violators and that thousands of dollars in fines have been doled out.

According to the winter 2005 and spring 2006 editions of the Real Estate Division's "Community Insights" newsletters, seven disciplinary actions were handed out.

Those hearings before the Common-Interest Communities Commission resulted in fines and reimbursements for investigations totaling $14,363, including an $8,000 fine against one man who managed a community without a permit.

Still, homeowners such as Bertram wonder whether such laws can hold in check associations and boards.

Bertram's neighbor Mark Hammond says Las Casitas' management company told him before he moved in last November that his aging roof was going to be repaired. He is still waiting.

Each month, Hammond sends by registered mail his $125 association payment along with a note reminding the association to fix his roof.

"They have the money to spend chopping down trees, but no money to repair my roof?" Hammond said. He hired an independent inspector who wrote in a report that the 18-year-old roof over Hammond's condo is "nearing the end of its useful life."

The report says there was moisture on the ceiling in two areas of Hammond's second-story home, and the inspector recommended "periodic inspections and maintenance."

Hammond, a character actor whose film credits include "The Purple Rose of Cairo" and "Babe 2: Pig in the City," said that as of last week he had received no word from the management company about when his roof might be repaired.

Fenner said that Las Casitas has a two-to-three-year plan to replace 26 roofs and repair five others, and that Hammond's roof "probably will be done by the end of the year."

"It costs us $6,000 to replace a roof ($156,000 to replace 26), and we cannot afford to do them all at once and drain our cash reserves," she said.

According to Las Casitas' most recent financial statement, sent to residents this month, it is projected that by year's end there will be $78,554 in cash reserves.

The tree issue, Fenner said, is much more complicated . The problem stems from the 1980s, when small pine trees were planted as close as 10 feet to the condos. As the pines grew into huge trees, their 40-foot roots threatened to damage foundations, buckle sidewalks and cut gas lines and water pipes.

While some homeowners are adamant that the trees stay to provide cooling shade for the units, she said, others want them removed because they block their view or are dying.

In the past week, 14 24-inch box trees have been planted to replace some of the trees that have been removed, she said.

Ed Dabrowski, one of seven Las Casitas Homeowners Association board members and its former president, said that while he sees a need to remove some trees, he is concerned about the appearance that there is selective targeting of individuals in this matter.

He said the board should be more sympathetic: "I think we have a responsibility to listen to homeowners. We should be there to serve them, not rule them."

Bertram, Hammond and other Las Casitas residents, however, said that they think their best hope for the immediate future is the homeowners association election in October.

"Going through the ombudsman will drag on for months," Bertram said. "I think we would win if we took the matter to court. But the only way we can do that is if 20 to 30 homeowners are willing to commit to going to court because of the high cost.

"I hope we can do something soon. Otherwise I'll be out of trees by the end of summer."

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