Mandatory Mediation Process in Dues Receivables

What Is Mandatory Mediation?

Mediation is a method of trying to resolve a dispute with the accompaniment of an impartial mediator, without going to court. For certain types of disputes, applying to a mediator before filing a lawsuit is provided by law as a prerequisite (a lawsuit condition). This aims to reduce the burden on the courts and to resolve disputes more quickly.

The Situation in Dues Receivables

Some disputes arising from common expense and dues receivables may require the mediation stage before a lawsuit is filed. For this reason, management considering direct litigation against an owner who does not pay dues must first check whether the process is subject to mediation. Proceeding on the wrong path may lead to the lawsuit being rejected on procedural grounds.

How Does the Process Work?

The process, in general terms, is as follows:

• The creditor party (management) applies to the mediation office
• A mediator is appointed and the parties are called to the meeting
• The parties come together and try to agree; if they agree, a settlement record is drawn up
• If no agreement is reached, the path to litigation opens with the final record

If an agreement is reached, the record drawn up has the quality of a strong document and may serve as the basis for enforcement proceedings.

Relationship with Enforcement Proceedings

Mediation is not an alternative to enforcement proceedings but, in certain situations, a pre-litigation stage. We explained the pursuit of a dues debt through enforcement and its steps in detail in our enforcement process against a non-paying neighbor article. Which path is followed depends on the nature of the dispute.

The Importance of Documents

Whether it is mediation or litigation, it is essential that the receivable be documented. Accrual records, payment history, late-payment interest calculation, and debt notifications ensure that the process proceeds on solid ground. Regular maintenance of all these records in a digital management system provides a strong position both in mediation and in litigation.

Common Mistakes

• Skipping the process: A lawsuit filed without going to mediation when required may be rejected on procedural grounds.
• Undocumented application: Without records proving the receivable, the process remains weak.
• Failing to keep the record: The mediation record is an important document later.

Related Topics

We covered the general framework of mediation in our mandatory mediation article and the enforcement process if results are not obtained in our enforcement proceedings article.

This content is for informational purposes. Whether mediation is mandatory and the process vary according to the nature of the dispute; you must consult a legal counsel.