Puerto Rico shifts condo dispute jurisdiction from DACO to the courts

Puerto Rico Gov. Jenniffer González Colón has signed Senate Bill 1086 into law, transferring jurisdiction over condominium-related disputes from the Department of Consumer Affairs (DACO) to the Court of First Instance — a structural change prompted by mounting public frustration over more than 900 unresolved complaints that have languished at the agency.

The amendment to the Condominium Law aims to ease the bottleneck at DACO, where cases have often dragged on for months or even years. Under the new statute, any complaint, claim, or action already filed with DACO will continue to proceed there. However, either party may request that the matter be moved to the Court of First Instance, provided the petition is filed within 30 days of the law’s effective date.

The shift has raised concerns among condominium associations. Marcos Rosado, president of the Alianza de Condominios de Puerto Rico, warned that the change could complicate matters for unit owners rather than streamline them. He noted that DACO’s processes tend to be more accessible for consumers, while court proceedings involve stricter evidentiary rules, formal procedures, and filing costs.

Rosado emphasized that the real impact will only become clear once cases begin moving through the judicial system. “We have to see how these changes play out in practice,” he said.

The move comes as DACO faces heightened scrutiny for procedural delays. In 2023, community leaders successfully sued the agency for shortening the public comment period required under the Uniform Administrative Procedure Act (LPAU) during the approval of Regulation 9457. A court later nullified the regulation, underscoring that public participation cannot be reduced to a mere formality.

The new law arrives at a moment when DACO is also managing emergency price controls on water, ice, cisterns, and water hauling services due to an ongoing drought, as well as responding to executive orders issued by the governor declaring a state of emergency over water use.