Implementation of Mediation Directive in Italy Roberta Regazzoni Milan Chamber of Arbitration (Milan Chamber of Commerce) Workshop on Mediation for Business Operators Chamber of Commerce and Industry of Serbia

Court The Judge decides the case The outcome is a decision The decision is imposed on the Parties Only the rights of the Parties are taken into account Any emotional aspect does not count The investigation is about the past (what has happened, who is right?) Mediation 1.The Mediator does not decide 2.The outcome is an agreement 3.Parties are not obliged to reach an agreement 4.It’s interests’ based 5. the emotional side counts 6.It’s future – oriented (how can we solve this problem?)

WHY MEDIATION? I need to preserve the business relationship I need to keep the situation confidential I need to sort the problem out very quickly I need a customized solution (cross-border) I can bypass the issues relating another judicial sistem/applicable law Predictable costs

the Parties and their advisors (lawyers/accountants/managers) meet a third neutral (the Mediator) who: –facilitates the communication –manages emotions and conflict –(re)start a new negotiation phase by providing them with tools in order to collaborate to a mutual satisfying solution HOW DOES IT WORK? Facilitative model

The Mediator expert in Mediation and conflict management techniques helps the parties in finding by themselves the most appropriate solution for their case (empowerment) has to cope with: conflict (mis)communication negotiation flow technical problem

The Mediator must be: Independent: no business/personal relationship with the parties Impartial: cannot favour one party at the other’s expenses Neutral: no direct/indirect interest in the outcome of the mediation

Implementation of Mediation Directive (2008/52) in Italy

Justice of the Peace Court Superior Court Length of civil judicial proceedings in DAYS judicial cases out of citizens open proceedings Italian Ministry of Justice website

- Legislative decree 2010 n. 28 on mediation «aimed at conciliation of civil and commercial disputes» - Ministry of Justice decree 2010/180

- alienable rights - civil/commercial - domestic/cross-border

Mandatory Mediation NB it is mandatory to try Mediation before starting a judicial proceedings, it is not mandatory to reach a settlement

Classes of Disputes - Inheritance and family business agreements - Bank/financial/insurance contracts - Commodatum - Lease of going concerns - Claim for damages: a) medical malpractice b) defamation through press or other media c) generated by vehicles/floating - Right in rem - Termination of co-ownership - Renting - Condominium

Benefits (incentives) for users - Interruption of the period of limitation - suspension of prescription - Mediation agreement is enforceable - acts and agreements concerning the Mediation are exempt from stamp duty and charges, the Mediation fees give rise to tax credits for the parties

Definitions: Mediation Process, however denominated, carried out by an impartial third, finalized to assist 2 or more Parties in finding an amicable settlement for the resolution of a dispute or the formulation of a proposal for the resolution Mediator The person/s that individually or jointly carry out the Mediation with no power of adjudication or binding decision on the Parties (the Mediator must be listed in a specific Ministry of Justice’s register)

Organismo (Mediation Provider) Public/private body which provides a Mediation service in compliance with Decree 28/2010 accreditation by the Ministry of Justice over 900 Mediation providers

Duration: the Mediation proceedings must be completed within 4 months from the filing unless the parties agree otherwise The Mediation proceedings can be carried out also online The request for Mediation can be filed anywhere – no territorial jurisdiction criteria Fees are predetermined by the law (min/max)

There’s no obligation for legal advice or legal representation in principle (see on the contrary the rules of the provider set up by the Milan Bar where it is mandatory for the Parties to be assisted by a lawyer in the mediation proceedings) The lawyer has an obligation to inform the client about Mediation

Confidentiality: It’s an obligation for those who take part in the Mediation (officers, mediators, experts, parties). All declarations made and information acquired in a Mediation can’t be the subject of a witness/oath and can’t be used in a subsequent judicial proceedings

One of the Parties does not show up-> a report must be draft by the mediator, and the judge, in the subsequent judicial proceedings, can deduce evidence by the non participation in the Mediation without a justified reason + an economic sanction agreement -> put into writing signed by the Parties AND the Mediator If one of the Parties does not perform the agreement, the party who has an interest in the fulfilment, can asks the Court for an immediate enforcement Possible outcomes (1)

Possible outcomes (2) If the Mediation fails (and nobody asks for a mediator’s proposal), the Mediator will draft a report stating that they participated in the Mediation but they reached no agreement. This report will be part of the file submitted to the Court by the Parties in order to start the judicial proceedings

If no settlement is found, the Mediator can make a proposal. The mediator must make a proposal if all the Parties ask for it. The proposal can be rejected, but if the outcome of the subsequent court proceedings turns out to be identical, the Judge can sanction the Party who rejected the proposal (judicial fees) The proposal cannot keep record of statements and declarations conveyed by the parties during the Mediation unless they expressly agree so Possible outcomes (3)

The Mediator (eligibility criteria) Education qualification: 3 years degree (minimum) or registration with professional organizations + 50 hrs basic training on Mediation techniques + specific 2-year refresh course held by a training entity accredited by the Ministry of Justice + Honourability= good standing

Mediator must be: Independent = no personal/business relationship with the parties Impartial = cannot favor one party in detriment of the other Neutral = no direct interest in the outcome of the Mediation The Mediator can be appointed by the provider/the parties can carry out her/his task with the help of a co-Mediator and/or an expert

1 YEAR OF MANDATORY MEDIATION (March National) requests for mediation filed Most frequent cases: in Rem, building rental, bank contracts, insurance contracts, medical malpractice (only) 35% agreed to participate in the mediation 52% reached an agreement 77% of the requests fall into the mandatory field Over 85% of the parties were assisted by a lawyer Euro = average economic value 56 days average length of the proceedings Savings for 123 million Euros

1 YEAR OF MANDATORY MEDIATION (March 2012 – Milan Mediation Service) requests for mediation filed Most frequent cases: in Rem, building rental, bank contracts, insurance contracts, medical malpractice (only) 31% agreed to participate in the mediation 42% reached an agreement during the meeting/s and 16% before it 79% of the requests fall into the mandatory field Euro = average economic value 41 days average length of the proceedings

Issues raised by the new law: -Costs for the users (extra (judicial) costs in case the dispute won’t be settled in Mediation) -Access to court -(Bar national association) legal assistance not mandatory -Some classes of disputes are not suitable for mediation (?) -Jurisditionalization of Mediation (less informal/flexible)

The law has been challenged in front of the Italian Constitutional Court (right to directly apply to Court (access to Justice)/legislator exceeded the terms of the enactement law/legal advice not required by law) – the decision has still to be issued. But a press agency by the Court communicated that the legislator went further the delegation law.

What next?