1. What is mediation?
Mediation is a non-adversarial confidential process that brings disputing parties together with a neutral, unbiased third party (mediator) who assists the parties in reaching a mutually agreeable settlement of the dispute. The mediator does not make decisions or impose sanctions. Settlement terms reached and agreed to by the parties during the mediation become binding only when and if the parties sign a written settlement agreement.
2. When is mediation appropriate?
Mediation is a highly successful method of resolving disputes between parties and may be initiated at any time by agreement between the parties. Sometimes mediation is required (see question 3 below) and other times it simply may be a useful tool used by the parties to efficiently, swiftly and affordably resolve a dispute. Mediation is a non-adversarial and confidential process designed to encourage the parties to reach a mutually agreeable resolution to their dispute.
3. Is mediation required?
Mediation is required where the parties have signed an agreement to mediate their disputes. Most parties to a real property contract in California utilize the CALIFORNIA ASSOCIATION OF REALTORS® Residential Purchase Agreement (“RPA”). Section 26A of the RPA requires “Buyer and Seller agree to mediate any dispute or claim arising between them out of this Agreement, or any resulting transaction, before resorting to arbitration or court action.” In addition, mandatory mediation clauses are frequently contained in other real estate related agreements.
4. Must the parties agree to resolve their dispute during the mediation?
No. While the mediation process frequently assists the parties in resolving their dispute, the agreement to mediate and mediation process do not bind the parties to any result that might be achieved during mediation. The parties retain the right to go to court or arbitration, as applicable, in the event that mediation is unsuccessful. If a settlement is reached during mediation, it becomes binding only when it is put into writing and signed by all the parties. Once the parties have signed a written settlement agreement, they are legally bound to abide by its terms.
5. What if mediation does not resolve the dispute?
If the mediation process does not result in an agreement between the parties, the parties will be free to pursue any other available dispute resolution venues such as arbitration or litigation. Statistics show that mediation is a highly successful dispute resolution tool and, even where no agreement is reached, mediation can be a valuable resource to help the parties express their grievances and focus their issues as they work toward resolving their dispute.
6. How do I begin the mediation process?
First, we recommend that you contact your broker or salesperson who was involved in your real estate transaction since he/she may be able to help you resolve the dispute without mediation. In addition, we recommend that you seek legal counsel to determine if mediation is required and the best option for resolving your dispute. To begin the mediation process, we highly recommend that you contact the other party to your dispute to make a demand for mediation with our program. You may use C.A.R. Form DM for this purpose. Next, you must complete the Request for Mediation, C.A.R. Form RM and follow the steps outlined in section Begin the Process.
7. How do I choose a mediator?
Mediators on our panel are specially trained and screened to possess the training and qualifications we believe are necessary to successfully mediate consumer real estate transaction disputes. These mediators have absolutely no personal interest in the outcome of the mediation and are required to disclose any conflicts. You may select a mediator from our panel list or ask us to assign one for you. The choice is yours.
8. Why choose the CALIFORNIA ASSOCIATION OF REALTORS® Real Estate Mediation Center for Consumers to mediate your dispute?
Our mission is to provide consumers with a supportive and confidential process that, working with the mediator of their choosing, will assist them to reach a mutually agreeable settlement and to avoid the time, expense and uncertainty of litigation. Our mediators are experienced in mediation and the issues that commonly arise in real estate disputes. They receive ongoing real estate focused training and support to ensure that they are prepared to efficiently and knowledgeably guide you through the mediation process.
9. What types of disputes can be mediated by the Center?
Almost any type of dispute between or among buyers, sellers, brokers and other parties to a real estate transaction can and should be mediated. These include, among other common disputes, those related to earnest money deposits, cost of repairs where there is an allegation of a failure to disclose a known defect and claims for damages associated with a claim of misrepresentation about the condition of the property.
10. Does the Program accept mediation applications for all real estate disputes?
Each application is carefully reviewed by the Center and mediator. In some instances, either the Center or mediator may determine that the subject of the dispute to be mediated involves extremely complex legal issues, allegations of criminal misconduct or violations of state licensing laws that may not be appropriate for mediation at the Center. In the rare case that the Center declines your application to mediate, all filing fees of the parties will be refunded. In addition, disputes between REALTORS® that are subject to arbitration or a hearing before a REALTOR® Professional Standards panel will not be mediated at the Center and will be referred to a local association of REALTORS®.
11. How much does mediation cost?
There is a non-refundable filing cost of $200 to be paid directly to the Center to initiate the process. In addition, the Center mediators have agreed to a mediator fee of $150.00 per hour maximum for the first 2 hours of hearing time. Thereafter the parties will be charged for hearing time at the mediator’s published hourly rate or as otherwise agreed to in writing by the mediator and parties. All mediator fees are paid directly to the mediator. Except as noted above, each mediator establishes his/her own rates. Click here for more information.
12. Who pays for the mediation?
If the parties have pre-committed to mediation, the payment of fees may be specified in their agreement. If no agreement has been made, the parties are free to negotiate responsibility for payment. In most cases, the parties split the cost of mediation equally. The CALIFORNIA ASSOCIATION OF REALTORS® Residential Purchase Agreement (“RPA”) provides for the cost of mediation to be split equally by the parties.
13. Who should attend the mediation?
All parties, and their counsel if represented (see question 14 below), and any other individual necessary to settle the dispute must attend the mediation.
14. May the parties be represented by counsel at the mediation?
Yes. Any party may be represented by counsel. If a dispute involves a small sum and is not complex, parties may choose not to be represented by counsel. If a party will be represented by counsel at the mediation conference, the mediator and all parties must be notified in writing at least ten (10) days in advance of the conference date of such party’s intent to be represented by counsel.
15. May the parties include witnesses at the mediation?
Generally, witnesses are not participants to the mediation since the parties are attempting to reach a settlement rather than to “prove” their case. At times the mediator may allow for the participation of a witness if all parties to the mediation agree. Before inviting a witness to attend the mediation, you should contact your mediator to obtain all necessary approvals.
16. What is the role of the mediator?
The mediator is an impartial and neutral intermediary whose role it is to help the parties resolve their dispute and reach a mutually agreeable settlement. The mediator listens to the position of the parties, provides guidance and may give opinions as to the potential outcome in the event the dispute is not resolved by mediation. The mediator does not make decisions for the parties, but instead encourages the parties to achieve a mutually acceptable resolution of their dispute.
17. Is the mediation confidential?
Except as otherwise provided by the California Evidence Code or California law, all communications, negotiations, or settlement discussions in the course of a mediation or mediation consultation are confidential and are not admissible or subject to discovery.
18. How long does the process take?
In almost all cases, the mediation conference will be held within 60 days from the date the Center accepts the parties request to mediate. The typical mediation conference lasts from between 3 to 4 hours and a second conference is rarely needed. The parties are required to commit to a minimum of 3 hours of mediation time to ensure sufficient time for the mediation process to be successful.
19. How do I prepare for mediation?
The parties to the mediation should be prepared to provide any information they believe will assist the mediator to understand the issues presented. Relevant information would include any materials not already provided with their mediation application. The participation of witnesses at the mediation is covered in Question 15 above. During the initial interview and scheduling process, your mediator may request that you provide further information in advance of the mediation conference.
20. How do I provide feedback about my mediation or mediator?
At the conclusion of the mediation, you will be asked to complete a brief survey about your mediation experience. You should expect an email from the Center a few days following the mediation. In addition, feedback and questions about the Center may be directed to email@example.com.