SB 512

This bill provides that, if a condominium association and unit owner have a

disagreement arising out of or related to the condominium, the association or unit

owner generally may not file a claim related to the disagreement in circuit court until

the association or unit owner complies with certain requirements created in the bill.

Under the bill, the association or unit owner must provide a notice of claim to

the other party, and either party may, within ten business days, request a direct

negotiation conference, which must occur no later than 30 days after the request is

delivered, to resolve the disagreement. Under the bill, “direct negotiation” means “a

dispute resolution process that involves an exchange of offers and counteroffers by

the parties or a discussion of the strengths and weaknesses or the merits of the

parties' positions, without the use of a 3rd person.” If a unit owner requests a direct

negotiation conference, the association is required to participate. If an association

requests a direct negotiation conference, the unit owner may, but is not required to,

participate.

The bill provides that, after the association or unit owner gives the notice of

claim, the association or unit owner may file the claim in circuit court when the

earliest of the following occurs:

1. Neither party timely requests a direct negotiation conference.

2. The parties fail to resolve the dispute within ten business days after

participating in a direct negotiation conference.

3. The parties fail to timely conduct a direct negotiation conference.

4. A party notifies the other party that direct negotiation has not resulted in

a resolution of the disagreement and the notifying party is terminating direct

negotiations.

The bill also provides that, if the parties resolve the disagreement through

direct negotiation and document that resolution in a written settlement agreement

signed by the parties and a party to the agreement materially breaches any material

part of the agreement, the nonbreaching party may file a claim in circuit court

related to the breach without first providing a notice of claim. If the nonbreaching

party prevails in the circuit court action, the circuit court must award the

nonbreaching party costs and reasonable attorney fees.