Council of New York Cooperatives & Condominiums
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Legal Issues

Published: Spring 1997


CNYC thanks Julie Marcus, Director of Program Development for the American Mediation Council, LLC, for the following guest article.

No cooperative or condo board expects to be caught up in costly, possibly ugly disputes in unknown future situations. Yet conflicts between neighbors do occur, and many face the expensive and destructive adversarial processes of arbitration and litigation that most commonly result from trivial disputes that escalate out of control.

Eighteen million civil lawsuits are filed in the U.S. each year. And $80 billion in direct legal costs, and many billions more in indirect costs, are spent fueling those lawsuits.


It doesn't have to be this way. It is possible -- in fact, critical -- to protect your cooperative or condominium from the drain of money, time and precious personal energy that results when disputes become adversarial.

Generally, the mediation begins with a joint session attended by all participants. A confidentiality agreement is signed and each party summarizes its position on the key factual and legal issues. The mediation process is nonbinding until the parties agree to make it so.

The joint session is followed by confidential caucuses between the mediator and each party. The mediator assists each party in evaluating its position and in assessing alternatives for resolution. Due to the confidentiality of the caucuses and the voluntary nature of the process, the parties retain control over what information is shared, which options are discussed, and the terms of the ultimate agreement.

The end result of the process is a written settlement agreement. Most disputes are settled within one day, and often leave the door open for further constructive action among the parties.

The compelling logic of using mediation fundamentally changes the way professionals view and resolve conflict. American Mediation Council founder and president, Susan Bird, cites seven reasons for choosing mediation:

1. Control. Unlike arbitration and litigation, a mediated dispute is not left in the hands of an unpredictable third party whose decision is binding on the parties. The parties to mediation choose whether or not they will be bound by the results of their mediation.

2. Speed. Most matters are resolved in a matter of hours, as opposed to weeks, months, even years of litigation. Even complex issues involving multiple parties can be resolved in a fraction of the time of litigation or arbitration.

3. Economy. Mediation can resolve disputes in an extremely cost-effective manner, in contrast to the expense, disruption and distraction of litigation. Even an unresolved mediation may prove economical by abbreviating the discovery phase of litigation and defining the remaining issues.

4. Privacy. Mediation proceedings are strictly confidential. No public or legal precedent is set. The mediator may not be called as a witness in any litigation involving the issues that are mediated.

5. Preserved Relationships. Mediating parties learn that addressing rather than suppressing conflicts opens the lines of communication, and prepares people to fashion realistic and workable resolutions without necessarily destroying the relationship between parties.

6. Tailored, Creative Solutions. Because the process of mediation is not limited to "money" solutions, resolutions can be tailored to meet the unique circumstances of the parties.

7. Finality. Resolutions reached through mediated negotiation generally are followed because the participants are involved in crafting the solution to their problem.

Rather than waiting until your cooperative or condominium is involved in a dispute to take advantage of mediation, you can bring the process to your building by adding a mediation clause to all contracts and by amending your corporate documents to require mediation of disputes. Typically, the clause will provide that the parties mediate first, before resorting to binding arbitration or to litigation.

A sample clause is available from the American Mediation Council, a nationwide network of attorney mediators who joined forces to promote mediation based on their belief that lawyers, at their best, are problem solvers, skilled at avoiding conflicts and resolving those that inevitably occur. AMC can be reached by phone at (203) 622-1448 or by e-mail at, and has mediation available in New York City.

The Association of the Bar of the City of New York will soon be offering similar mediation services. The Committee on Cooperative and Condominium Law and the Special Committee on Alternative Dispute Resolution have instituted a new pilot project for the voluntary mediation of disputes involving cooperatives, condominiums and their residents, owners, managers, officers and employees. Administered through the Association of the Bar, its services will be available in the fall. Both parties to a dispute must agree to participate and to share the modest cost of the mediation. For more information, including a copy of the project's guidelines, contact Laurie Milder at (212) 382-6629

There are also many private individuals and groups that will perform mediation services for cooperatives and condominiums.


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