- February 14, 2019
In an attempt to lighten the heavy burden of the Greek judicial system, articles 178 to 206 of Law 4512/2018 on Arrangements for the Implementation of the Structural Reforms of the Economic Adjustment Programmes and Other Provisions regulate the new mediation procedures in civil and commercial matters. This alternative extrajudicial dispute resolution method seeks to provide an attractive expeditious solution of an executed agreement that can be immediately enforceable. The Law was published on January 17, 2018 and came immediately into force in its part concerning voluntary mediation; however, the effectiveness of its provisions of Article 182 on compulsory mediation – which are considered to be the most controversial provisions of the Law – was suspended until September 16, 2019.
Article 182 applies to the following seven categories of private disputes prior to referring the case to the competent court: a) landlord – condominium cases, b) road traffic accident cases unless the harmful event resulted in death or personal injury, c) professional fees/remuneration, d) certain family law matters, e) medical liability related to malpractice, f) industrial property rights (trademarks, patents, designs), and g) stock exchange transactions. Failure to engage in a mediation attempt by submitting the respective document signed by the party and the lawyer along with the action is sanctioned with inadmissibility of the proceedings.
Prior to filing any legal action, lawyers are obliged to inform their clients, in writing, about the mediation option and initiate the process by appointing a person from a list of accredited mediators who may have no legal background or knowledge of special law provisions providing a minimum protection to the claimant. The mediator has to notify the party on the date of mediation by registered letter, electronically or by any other legal means that, with the exception of a bailiff, may not always secure the validity of the mediation procedures in terms of proof of receipt of the document or in accordance with the service regulation in cross – border disputes. Following such notice, the first mediation session has to take place within 15 days, with a maximum extent of 30 days. The mediation proceedings cannot last for more than 24 (working) hours, unless the parties agree otherwise. The summons to the compulsory mediation proceedings suspends the respective limitation periods.
During the mediation session both parties shall have to attend in personalong with their lawyers, save for small claims up to EURO 5,000 and consumer protection cases. Parties of unknown residence are excluded from this obligation. In case physical presence is not feasible, the use of digital technology through electronic platforms is allowed.
This provision has raised many issues in view of the decisions of the CJEU for legal costs raising disproportionately the costs of mediation. Further to that, the obligation of personal attendance could create a deadlock for legal entities or in case of objective difficultiespreventing attendance. Online mediation could be part of a solution but it can only work when all the parties have access to digital tools. The party who has been summoned in the proceedings may opt not to attend; however, it is in the discretion of the court to impose a fine against such party ranging from EURO 120 to EURO 300 assessing the reasons of non-attendance. In addition, the court could further impose a penalty up to 0,2% of the claim depending on the extent of a negative outcome.
Moreover, the fact that the minimum remuneration of the mediator is owed even when a party is refused to follow the mediation process from the very beginning exacerbates the disproportionate nature of compulsory mediation.
Although the supporters of compulsory mediation claim that it is not mandatory to resolve the dispute through mediation but it is mandatory to be informed and get acquaintance with this procedure, this provision caused many reactions leading to decision no 34/2018 of the Administrative Grand Chamber of the Supreme Court. The decision held that the provisions for compulsory mediation contradict the provisions of Article 20 (1) of the Greek Constitution, Article 6 (1), 13 of the ECHR and Article 47 of the Charter of Fundamental Rights of the EU, since serious extra costs are incurred and the weaker party is indirectly obliged to accept a mediation agreement, being deprived of the “natural judge” privilege set out in the Greek Constitution and the ECHR.
In light of the above, a remedial action on the compulsory mediation terms is much expected in order to ensure compatibility with the national legislation and EU legal order basically in terms of minimum costs.