Arbitration
A dispute resolution process where a neutral arbitrator hears evidence and arguments from both sides and issues a binding or non-binding decision. Arbitration is more formal than mediation but less so than court litigation. Some HOA governing documents include mandatory arbitration clauses. Binding arbitration decisions are generally final and cannot be appealed except in limited circumstances.
Common Misunderstanding
Many homeowners think arbitration works like mediation, but unlike mediation, a binding arbitration decision is final and generally cannot be appealed in court.
Related Terms
Frequently Asked Questions
Is HOA arbitration binding?
It depends on the type of arbitration. Binding arbitration produces a final decision that the parties must accept, with very limited grounds for appeal. Non-binding arbitration produces a decision that either party can reject, after which the dispute can proceed to court. Check your governing documents to see whether they require binding or non-binding arbitration for HOA disputes.