1 . Define mediation in your jurisdiction
The application and procedure of mediation in Cyprus is governed by the Certain Aspects of Mediation in Civil Matters Law of 2012 (159(I)/2012), which is the national law governing mediation in respect of civil disputes (hereinafter "Cyprus Mediation Law").
Article 2 of the Cyprus Mediation Law provides a definition of mediation as a "structured procedure, by whatever name it may be called, in which two or more parties to a dispute voluntarily attempt to reach agreement on the settlement of their dispute with the assistance of a mediator".
2 . What is the role of a mediator in your jurisdiction?
During the mediation process, the mediator assists the parties involved to better understand their wishes and needs while remaining impartial throughout. The mediator's responsibility is the promotion, organisation and control of the mediation procedure and not the making of suggestions/solutions to the parties. The main role of the mediator is to assist the parties to reach a settlement on their own, which will be mutually acceptable and which will satisfy the needs and interests of all parties involved. Although the mediator does not have the power to take decisions, their role is nevertheless very important as they try to understand the causes of the dispute and create a climate of understanding and respect between the parties so that they can reach a solution/compromise that leaves them all satisfied.
Article 10 of the Cyprus Mediation Law lists several of the duties of the mediator, who shall ensure, inter alia, that the parties understand the nature of the process and the role of the mediator and the parties (prior to the commencement of mediation) and that the parties have an equal opportunity to participate in the process (throughout mediation).
3 . How does mediation differ from arbitration or litigation?
Mediation is a consensual method of resolving a dispute, like arbitration, since the consent of all involved parties is necessary in order to resort to mediation and the parties participate in the mediation process voluntarily. In contrast, litigation is not necessarily consensual, as one party may initiate judicial proceedings without the prior consent or notification of the other parties and the party against whom the proceedings are directed may not participate voluntarily but may be compelled to appear and participate in order to avoid the issuance of a judgment/orders/measures against them in their absence.
Unlike in arbitration and litigation, where the parties generally appear through their lawyers, in mediation the personal appearance of the parties (together with their lawyers if they so wish) is required. If a party cannot afford representation by a lawyer, it can appear by itself and in this manner it can limit its costs to those of the mediator, since in mediation each of the parties shall bear its own costs.
Moreover, the mediation process is confidential, as is the arbitration process, unlike the proceedings in courts which are usually open to the public, conducted in public sessions and only in exceptional cases conducted only in the presence of the parties and other specific people, such as witnesses, experts, stenographer, etc.
In mediation, private sessions between the mediator and each party may be held if the mediator deems that this will be more efficient under the circumstances of each case.
Furthermore, the mediator does not take binding decisions, unlike arbitration and litigation where the decisions of the arbitrator and the court are binding. However, the settlement agreement to which parties may have agreed, may, upon application of the parties, be registered and enforced as if it were a court judgment/order.
4 . Are there specific rules and regulations regarding mediation?
The Cyprus Mediation Law is the national law regulating the application and the procedure of mediation in Cyprus in respect of civil disputes. This law does not govern family disputes, as there is a separate law regulating issues that fall within the ambit of family law — the Law on Family Disputes Mediation of 2019 (Ν. 62(Ι)/2019) (hereinafter "Family Mediation Law"). More details on the scope of these laws are given below.
5 . Is your jurisdiction encouraging mediation instead of going to court to settle disputes?
Since 1 September 2023, the new Civil Procedure Rules ("CPR 2023") have applied in Cyprus, which encourage and promote alternative dispute resolution (ADR) and specifically mediation. In particular, encouraging the parties to use an ADR method is included in the court's task of active case management (CPR 1.5(2)(e)). In addition, a person wishing to commence legal proceedings must, before commencing such proceedings, send the potential defendant a pre-action letter stating (if applicable) their intention to engage in mediation or other ADR (Part II, Form III, point 2(f) of the CPR 2023). Similarly, the potential defendant should state in its response letter whether they intend to engage in mediation or another ADR method. The purpose of including and promoting mediation at the pre-action stage is precisely to prevent the parties from resorting to court by settling the claim between them before the commencement of legal proceedings. In general, the CPR 2023 promote ADR methods in order to reduce the workload of the courts, since due to the high caseload, court cases are heard with enormous delays and generate significant legal costs.
Moreover, Article 16 of the Family Mediation Law provides that the parties to a family dispute may settle it or resolve it entirely or partially through mediation without going to court. However, it is clear from the letter of this law that this is not a compulsory pre-trial mediation but simply a recommendation.
In C. Roushas Trading and Developments Ltd ν. Michali Mosaikou (2016) 1 JSC 2178 there was a dispute for a very small amount of money. The Supreme Court allowed the appeal and ordered re-trial of the case by a first-instance court. At the end of the appeal procedure the legal fees far exceeded the amount of the original dispute. The Supreme Court highlighted the responsibility of both the parties and their lawyers for not taking care to reach an amicable settlement or to refer the dispute to ADR methods.
To read this article in full, please click here.
Originally published by The Global Legal Post.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
