The commercial real estate industry is one of the most profitable industries in the world. Almost every real estate transaction involves a significant sum of money. For some people, this is perhaps the most expensive transaction they enter into in their lifetime. Therefore, it is common for disputes to arise during such transactions. Sometimes these disputes, when not handled sensibly, can result in the deal falling through.
This can also lead to the two parties battling out in court, leading to financial ramifications for everyone involved. Therefore, the more sensible approach towards handling a real estate dispute is to find common ground and settle the dispute outside of the court.
In recent years, the US has seen a dramatic rise in litigation. People prefer going to court over minuscule problems instead of opting for a more cooperative route. The problem with this approach is that lawsuits tend to take a financial and emotional toll on the participants. This is especially true for disputes involving personal property. Fortunately, alternatives like mediation are effective at settling real estate disputes outside the court. Mediation is a sort of informal negotiation between the involved parties to resolve a dispute without legal intervention.
Here are some important details you should keep in mind while meditating on a real estate settlement.
All Decision Makers Must Be Present
For any settlement to be successful, all the stakeholders need to be involved in the mediation process. For a typical property-related mediation, the buyer and the seller or the tenant and the landlord must be present at the conference. If you are facing logistical issues and can not attend the meeting in person, there is always an option to join via web conference.
It Is Not Binding Until an Agreement Is Finalized
Mediation is simply a settlement conference where the involved parties try to reach a mutual agreement. The mediator is only present to help the parties resolve their differences out of court by exploring all possible options. Therefore, a mediator does not hold any special powers. Neither can he rule for or against anyone that is part of the dispute.
Instead, the only point of mediation is to let the concerned parties decide whether they want to settle on mutual terms or file a lawsuit and take the matter to court. This implies that if any of the involved parties is not satisfied with the proposed agreement, they may opt-out of the settlement and pursue a legal route. However, if they reach a mutual agreement, then the terms of that agreement become legally binding.
Terms Discussed During Mediation Must Remain Confidential
As per the real estate law of the state of California, all communication during a settlement conference is supposed to stay confidential. As mentioned by an Indian land personal injury lawyer, the mediator can not reveal any information that either party wants to remain undisclosed. That is to make the concerned parties feel at ease while discussing the agreement terms. According to this law, if the mediation is unsuccessful and a lawsuit follows, any statement made at the settlement table will be inadmissible in court. However, if any statement made during the settlement process is proven outside of mediation, legal repercussions may follow.
Always a Good Idea to Settle
From a financial standpoint, the best decision you can make is to reach a settlement agreement at the mediation. That will save both parties a lot of money and time as compared to arbitration or litigation. If you are representing an organization, settling outside of court will be better for your market reputation.
Also, ensure that the terms of the agreement are all documented in case of a disagreement. While this is not a strict requirement, it will help prevent any future disputes. This can be simply done by exchanging emails or letters between the parties.
Communication Is Key
It is essential to develop a proper communication stream between the two parties. The only way to deal with disputes and disagreements is through dialogue. Effective communication ensures that the parties are not dissatisfied and have their expectations fulfilled. In the real estate business, it is the job of the real estate agents to bridge the communication gap between the involved parties. Before a deal is finalized, agents can negotiate matters like postponing the moving date due to a personal issue, getting maintenance work done in the house, or even discussing what stuff comes with the house.
Certain real estate transactions are not as straightforward and might require the services of a property lawyer. A real estate lawyer can formulate the agreement terms of a contract and also explain the legal jargon.
Mediation, or Alternative Dispute Resolution, is simply a process of informal dispute resolution whereby the concerned parties attempt to resolve their differences via negotiation with the assistance of a mediator. Setting a case through negotiated compromise is the preferred way to achieve a more satisfying and meaningful outcome for all parties involved. Parties can devise a workable solution and find a middle ground, which would not otherwise be possible if a court or a tribunal were to give a final decision.
Upscale Living Magazine