Educational program: strong peace, or why a notary is needed in mediation

The opportunity to resolve a dispute not in court, but with the help of a mediator, has existed in Russia for a decade and a half, but a special impetus for the procedure was given six years ago. In October 2019, the law on notarization of mediation agreements came into force.

Since then, the notary’s seal on a mediation agreement gives it the force of an executive document and guarantees the implementation of the agreements reached. In practice, this means that if one party stops fulfilling its obligations, the other can force it to do so without resorting to long and expensive litigation.

A document certified by a notary can be presented directly to the bank to recover funds from the debtor’s bank account. Or a bailiff who must initiate enforcement proceedings.

Flexible mechanism

The advantage of mediation over litigation is not only that it saves time and money. The fact is that the court’s decision may not suit both sides of the conflict equally. Thus, in the practice of notaries there are more and more mediation agreements that banks enter into with debtors who have committed serious delays in repaying loans. First of all, we are talking about legal entities and individual entrepreneurs.

Going to court in such situations is fraught with risks for both parties. If the claim is successful, it may lead to bankruptcy of the debtor, which means he will lose all income-generating assets. In turn, the credit institution may not recover all of its losses in the bankruptcy case. In addition, banks have to increase their portfolio of problem loans, and therefore increase reserves to cover the risks of non-repayment.

Meanwhile, a mediation agreement, which stipulates, for example, a reduction in the interest rate on a loan or an increase in the repayment period, entailing a reduction in the amount of monthly payments, is beneficial to both parties. The debtor retains the business, and the bank gets the opportunity to return its funds.

From work to hospital

The scope of application of the mediation procedure is very wide. Thus, recently a Moscow notary certified an agreement to settle a labor dispute. The dismissed employee filed a claim in court for reinstatement and payment of average earnings for the period of forced absence. The employer assessed the possible reputational risks and financial losses and offered the former employee compensation in exchange for an obligation to withdraw the claim after receiving the money.

In another case, the mediator resolved the founders’ disagreements regarding the further development of the company, and the notary, on the basis of a mediation agreement, certified the purchase and sale agreement for the share of one participant and the application for withdrawal from the LLC of another with the payment of appropriate compensation. At the same time, the representative of the notary himself sent the documents for registration to the tax office.

Notaries are also contacted to certify mediation agreements in disputes over the provision of poor-quality medical services, for compensation for harm to health, for example after an accident or industrial accident, or moral damage. Mediators also participate in the settlement of inheritance disputes.

Mediation agreements in the field of marriage and family relations are in demand. The mediator will help develop conditions that will suit both parties in a variety of issues: payment of alimony, division of property, nuances of communication with the child. Both couples on the verge of divorce and spouses who value their relationship but have communication problems apply for mediation. Some couples who are on the verge of divorce change their minds about separating after the mediation procedure.

Fruitful cooperation

The role of a notary in mediation procedures is not limited to ensuring the implementation of agreements without going to court. The fact is that the mediator, although he must have the appropriate professional education, may not be a lawyer. And he does not bear responsibility for the legal consequences of the mediation agreement.

Therefore, if a mediator helps to find a compromise that suits all parties to the conflict, then the notary ensures that the agreements reached meet the requirements of the law and are legally formalized.

The notary will also necessarily check the legal capacity of citizens and the legal capacity of legal entities that participate in mediation. He will also find out the real will of the parties and make sure that it coincides with what is written in the agreement. He will explain to the participants the essence of the agreement and its legal consequences.

If the subject of the agreement is a real estate property, the notary himself will send documents to Rosreestr to register the transfer of ownership in the Unified State Register of Real Estate. In this case, registration will take no more than a day.

The notary also checks the mediator himself: whether he has the necessary professional education and whether he has a criminal record. Another important check is whether the mediation agreement is being used for money laundering. Let us recall that last year a law was adopted, according to which notaries must check the validity of debt obligations when certifying the relevant mediation agreements.

The result of the mediation procedure may be not one mediation agreement, but a package of interrelated civil law transactions. In this case, the notary will ensure the legal consistency of all design elements.

And if the conflict is so deep that the parties, in principle, do not want to see each other in person, they do not have to meet in a notary office. The agreement can be certified remotely; to do this, each party must come to a convenient notary.

source: Federal Notary Chamber