New Jersey Ct. Dismisses HOA Action to Allow “Alternative Dispute Resolution” Requested by Homeowner

New Jersey Appellate Court decision (May 7, 2015)

A condominium association (“Association”) sued homeowners for unpaid maintenance fees and related costs. The homeowners non-payment of monthly fees was precipitated by a dispute between the Association and the homeowners over the alleged failure of the Association to properly maintain portions of the condominium’s exterior (common area property) that was adjacent to the owners’ unit. Due to the unresolved dispute over the maintenance issues, the homeowners paid their monthly maintenance fees to their attorney to be held in escrow pending a resolution of their dispute with the Association. When the matter did not get resolved, the Association filed suit against the homeowners for the unpaid fees, together with late fees and attorney’s fees. The homeowners did not dispute that they owed the maintenance fees, but did dispute their liability for the late fees and the attorney fees.