The mediation is an alternative out-of-court method of resolving legal and non-legal disputes, where an impartial third party, a mediator, assists the parties to reach an agreement on the disputed issues. Until now it has been regulated as a purely voluntary procedure, with only the obligation for the court to “push” the parties to resolve their dispute amicably.
However, with the amendments to the CCP, in certain categories of claims the parties will be obliged to participate in a first mediation meeting. These include certain real estate disputes, as well as disputes involving merchants - for the payment of the value of a company share upon termination of a partner's participation in a limited liability company and for holding a manager or controller of a limited liability company liable for damages caused to the company, among others.
In another broad category of disputes, the court will have discretion to compel the parties to participate in a first mediation meeting, taking into account factors such as the permanence of the relationship between the parties, the existence of other legal proceedings between them, their interests, etc. This group includes legal disputes over a monetary or property claim with a value in excess of BGN 25,000 (approx. EUR 12,500). Other groups of cases falling into this category are, for example, those for the protection of membership rights and for the annulment of decisions of a General Meeting in commercial companies, as well as for the protection of intellectual property such as trademarks, patents, etc.
The mediation will not be compulsory in disputes to which its application is expressly excluded by law, as well as in disputes to which the State or a consumer is a party (with the exception of disputes over bank loans and property insurance claims) and in cases where the defendant has admitted the claim.
It should be stressed that there is no requirement for the parties to conduct a full procedure, but only to participate in a first meeting with the mediator. Such a meeting takes place once during the proceedings and does not lead to a stay of the proceedings. However, in the event of a refusal to participate in a first meeting with the mediator, the refusing party shall bear the costs of the proceedings irrespective of the outcome of the case.
After the first meeting with the mediator, the parties face several options. Firstly, they can choose not to participate further in the proceedings and continue with the pending court proceedings. However, in the event that they reach an agreement on all or part of the dispute as a result of the mediation procedure, the law provides for an economic incentive, namely the return of 75% of the state fee paid when bringing the action. In comparison, 50% of the state fee is refunded in the event of a court settlement which is not the result of a mediation procedure. Thus, the successful completion of mediation would not only result in a quicker resolution of the dispute, but would also save a considerable amount in court costs.
