MEDIATION – The Amicable Resolution of Disputes

An Amicable Way of Resolving Disputes

Alternative dispute resolution methods, which allow disputes to be resolved without disturbing social peace and harmony, are widely accepted throughout the world and are found in every legal system; conciliation in criminal proceedings and mediation in civil disputes are likewise gaining considerable importance in Turkey and are being applied successfully.

There are various routes to the amicable resolution of disputes.

Informal practices in which a neutral third party assists the parties towards a resolution have long existed in many cultures. In that method, however, the outcome reached at the end of the process remains a recommendation without binding force.

Mediation is the most amicable resolution method capable of producing effective results, in which the mediator, acting as an independent and impartial person, aims to reach a solution by organising meetings with the disputing parties in order to find a solution acceptable to them. Through the mediator, the parties produce a solution to their dispute. In this process the mediator does not render a binding decision; however, for the parties who produce their own solution, the outcome reached is a satisfactory one that serves the interests of both sides.

In arbitration, by contrast, the arbitrator gives a decision that binds the parties, but the outcome is the arbitrator’s decision and not the parties’ — just as, in litigation, it is the judge’s decision. Mediation is subject to fewer rules than arbitration. The mediator may therefore hold informal meetings with the parties together or separately in order to understand the issues, the facts and the parties’ positions, so that the process remains flexible.

The parties may include a mediation clause in their contract so that disputes arising in the future can be resolved by mediation. Recourse to mediation may thus be made compulsory before any other method of resolution is used, or a separate mediation agreement may be concluded once a dispute has arisen. Matters such as the choice of mediator, time limits and the place of meetings are included in the agreement. If the dispute is not resolved by mediation, the process may continue by way of arbitration; it is therefore advisable to include a clause providing that, if the dispute is not concluded through the mediation procedure, it may proceed to arbitration.

What Is Mediation and Who Is a Mediator?

Introduced into Turkish legislation in 2013 by Law No. 6325 on Mediation in Civil Disputes, mediation is a dispute resolution method conducted with the participation of a mediator, an impartial and independent third party who has received specialist training, for all kinds of private law disputes, including those with a foreign element, arising from acts or transactions over which the parties may freely dispose.

The mediator, applying certain systematic techniques, brings the parties together to discuss and negotiate and establishes a communication process between them so that they understand each other and thereby produce their own solution. Where the parties are unable to propose a solution, the mediator may also put forward a proposal to them.

Who is a Mediator? How Does One Become a Mediator?

A mediator is a graduate of a faculty of law with at least five years’ professional experience who has completed professional training covering theoretical and practical matters — basic information on mediation, communication techniques, negotiation and dispute resolution methods, behavioural psychology and the like — has passed the mediation examination and is entered in the register of mediators kept by the Ministry of Justice (Mediation Law art. 20).

• Holding a law degree
• Having at least 5 years of professional experience
• Completing professional mediation training
• Passing the mediation examination
• Being entered in the mediation registry maintained by the Ministry of Justice

Who May Attend Mediation Meetings?

Under Article 15/6 of Law no. 6325, the parties may attend mediation meetings in person or through their lawyers.

Where one of the parties to the mediation is not a natural person but a legal entity or an institution:

In negotiations falling within the condition of action in employment disputes, the company may be represented by a shareholder authorised to sign on its behalf, by an insured employee appointed in writing by the company, or by the company’s lawyer. In negotiations falling within the condition of action in commercial disputes, the company may be represented by a shareholder authorised to sign on its behalf or by the company’s lawyer.

Under Article 15/8 of Law no. 6325 (added by Article 22 of Law no. 7036 of 12 October 2017), the administration is represented in mediation negotiations by a committee consisting of two members designated by the senior manager together with the head of the legal unit or a lawyer or legal adviser designated by them.

Experts capable of contributing to the resolution of the dispute may also be present at the negotiations.

Persons who may attend the meetings

Mandatory and Voluntary Mediation

MEDIATION, is divided into two: “compulsory mediation” and “voluntary mediation”:

Compulsory Mediation: For certain disputes, recourse to a mediator before bringing proceedings is compulsory as a condition of action. For those disputes, compulsory mediation is a condition of action; an action brought without recourse to a mediator will be dismissed for failure to satisfy that condition.

Certain disputes forming the subject of commercial actions and employment actions (claims for employee entitlements) have been brought within the scope of compulsory mediation.

Compulsory Mediation in Commercial Actions

Under Article 5/a of Turkish Commercial Code no. 6102, recourse to a mediator before bringing proceedings has, since 1 January 2019, been a condition of action in respect of claims for debt and compensation for the payment of a sum of money, arising out of all commercial actions referred to in Article 4 of the TCC and commercial actions provided for in other special laws. Actions for a negative declaration and actions for the setting aside of an objection are likewise treated as falling within the condition of action.

The mediator concludes the application within six weeks of the date of appointment. In cases of necessity this period may be extended by the mediator by no more than two weeks.

Compulsory Mediation in Employment Law

Since 1 January 2018, disputes arising out of employee entitlements between employee and employer — such as annual leave pay, overtime pay and wages, and entitlements such as notice pay and severance pay — are to be resolved through compulsory mediation.

The mediator concludes the application within three weeks of the date of appointment. In cases of necessity this period may be extended by the mediator by no more than one week (Labour Courts Law no. 7036, art. 3/10).

Areas of mandatory mediation and time limits described in the article

Voluntary Mediation: Voluntary mediation is where the parties, although under no obligation to have recourse to a mediator, choose to do so before bringing proceedings in order to resolve the dispute. Recourse to a mediator is also possible after proceedings have been brought, up to the delivery of judgment.

The parties may have recourse to voluntary mediation in respect of any private law dispute over which they may freely dispose.

Legal Aid, Limitation Period and the First Meeting in Employment Disputes

Legal Aid in Mediation

As provided in Articles 334–340 of the Code of Civil Procedure, a party whose financial situation does not allow them to meet the costs of the proceedings may request that the litigation costs be met by the Treasury, to be borne by the losing party at the end of the case; in parallel with this rule, Article 21 of Labour Courts Law No. 7036 has introduced a similar provision for mediation costs.

“A party in need of legal aid to meet the mediation fee may benefit from legal aid by decision of the civil court of peace at the place where the mediation office is located.”

Labour Courts Law No. 7036, Article 21

The Effect of Recourse to Mediation on Limitation in an Employment Action

In line with the Law on Mediation in Civil Disputes (HUAK), the Labour Courts Law also provides that applying to mediation interrupts the limitation period.

Labour Courts Law, Art. 3/17: “The limitation period is suspended and the peremptory period does not run during the period from the application to the mediation office until the date on which the final report is drawn up.”

Labour Courts Law, Art. 3/17

Legal Liability of a Party Who Does Not Attend the Mediation Meeting

The parties may attend mediation meetings in person, through their statutory representatives or through their lawyers. An employee authorised in writing by the employer may also represent the employer at the meetings and sign the final record (Law no. 7036, Labour Courts Law art. 3/18).

Where the mediation comes to an end because neither party attends the first meeting, in any proceedings subsequently brought each party bears its own costs.

Disputes That Are and Are Not Suitable for Mediation

For Which Disputes and Actions May Voluntary Mediation Be Used?

All private law disputes, matters and actions over which the parties may freely dispose may be resolved through the application of the mediation legislation (Mediation Law art. 1/2).

Disputes over which the parties may freely dispose are, in general, those that do not concern public order and do not harm the rights of persons other than the parties, in particular those of public institutions. In employment law, for example, severance pay may be the subject of mediation, whereas disputes forming the subject of an action for the determination of service cannot be resolved by mediation, since such an action affects not only social security rights over which the person cannot dispose but also certain rights of the public administration (the collection of contributions and so on).

Some of the actions and matters over which the parties may freely dispose and which are suitable for mediation are as follows:

• as a rule, all matters and actions relating to commercial law and insurance law,
• Actions for pecuniary and non-pecuniary damages,
• Actions concerning legal disputes such as the division of an estate, actions for abatement due to the reserved share under inheritance law and collusive transactions by the deceased,
• Division of property on divorce, claims for pecuniary and non-pecuniary damages on divorce once the divorce judgment has become final, and claims and actions concerning contribution or participation receivables,
• All kinds of compensation claims arising from employment law, such as severance pay, notice pay and overtime pay receivables; compensation for disability or death resulting from an occupational accident, compensation for loss of support and the like,
• Disputes arising from real property law, such as actions brought on grounds of abuse of a power of attorney or collusive transactions by the deceased, actions for cancellation of title and registration brought on grounds such as unlawful disposal, actions to prevent interference with immovable property, actions for compensation for unlawful occupation (ecrimisil), pre-emption (şufa) actions, actions for the termination of co-ownership (izale-i şuyu), and disputes concerning flat-for-land construction contracts and promissory contracts for the sale of real property.

For Which Disputes and Actions May Mediation Not Be Used?

Disputes concerning legal issues over which the parties may not freely dispose cannot be resolved by mediation. Such disputes are for the most part those arising out of public law. In addition to public law, certain legal problems in areas of private law such as family law certain cannot be resolved by mediation either.

The disputes in which the parties may not have recourse to a mediator are as follows:

• Criminal cases,
• actions for the correction or amendment of civil registry records,
• Custody of a child,
• disputes involving allegations of domestic violence,
• Full remedy actions and actions for annulment falling within the jurisdiction of the administrative courts,
• Disputes arising from tax law,
• all declaratory actions arising out of employment law, such as the determination of service or of an occupational accident.

Application Period and Core Principles of the Process

The Time for Recourse to a Mediator

The parties to a dispute may agree to have recourse to a mediator either before or after proceedings are brought (Law no. 6325, Mediation Law art. 13). Provided the parties agree to go to a mediator, recourse to mediation is therefore possible at any stage of the dispute.

Where proceedings have been brought, the court may also inform the parties about, or encourage them to have recourse to, mediation. One of the parties may, before or after proceedings are brought, put a proposal to the other party for recourse to a mediator. A proposal for recourse to a mediator communicated to the other party is deemed to have been rejected if it is not answered positively within 30 days (art. 13).

Where, after proceedings have been brought, the parties declare that they will jointly have recourse to a mediator, the proceedings are adjourned by the court for a period not exceeding three months. That period may be extended by up to three months on a further joint application by the parties to the court (art. 15).

Rights and Obligations in the Mediation Process

• Confidentiality
• Equality
• Voluntariness
• Exclusion of evidence

The Principle of Confidentiality

The mediation process must be conducted confidentially (Mediation Law art. 4). The mediator must keep confidential all information, documents and records given to them by reason of the mediation or otherwise obtained. The parties must likewise observe confidentiality. No one may take photographs or make sound or video recordings during the mediation (Mediation Regulation art. 6).

If sound or images are recorded during the negotiations or in any setting where the parties come together, the offence of eavesdropping on or recording conversations between persons is committed. Persons working with or associated with the mediator are also obliged to comply with the principle of confidentiality.

The Principles of Equality and Voluntariness

The mediation process is one that begins by the free will of the parties. The parties are entirely free to have recourse to a mediator and, having done so, to continue the process or not. They cannot in any way be compelled to take part in the process, and may abandon the resolution of the dispute by mediation at any stage. The parties have equal rights both in having recourse to a mediator and throughout the process. Neither party may be excluded from the mediation process, nor may its right to speak be restricted by comparison with the other (Mediation Law art. 5).

The Prohibition on Use as Evidence

As a consequence of the confidentiality of the mediation, where the parties fail to reach agreement at the end of the process, statements, views, proposals and suggestions put forward by the parties during the mediation, admissions of any fact or claim, and documents prepared solely for the purposes of the mediation may not be used as evidence in court or in arbitration (Law no. 6325, Mediation Law art. 5).

Even if submitted as evidence, they may not be relied on by the court or the arbitrator as the basis of a decision.

Selection, Impartiality and Fees of the Mediator

The mediator is chosen by the free will of the parties from among the mediators entered in the register of mediators.

In mediation falling within the condition of action, the mediator is designated by the system on application to the Mediation Office, or the parties may choose a mediator by means of a record of designation.

The mediator must treat everyone taking part in the mediation process impartially and equally. The mediator may not engage in any act, attitude or conduct capable of casting doubt on their impartiality (Law no. 6325, Mediation Law art. 8).

As soon as the mediation begins, the mediator is obliged to inform the parties of what mediation means, of its basic principles, of how the process will be conducted and of its consequences (Mediation Law art. 11).

The mediator may meet each of the parties separately or both of them together. What matters is that the parties’ rights and interests are balanced and that the process is conducted by the most appropriate method for resolving the dispute. The parties may attend these meetings together with their lawyers (Mediation Regulation art. 11/1).

The mediator must perform their duties personally and with due care, and may not delegate them to another, even in part.

The mediator is obliged to inform the parties where circumstances exist that may cast doubt on their impartiality. Doubt as to impartiality may arise for any number of reasons — for example, a social relationship between the mediator and the matter in dispute, or the mediator’s acquaintance with one of the parties. Where, despite that disclosure, the parties jointly request that the mediator continue, the mediator may do so (Mediation Regulation art. 12).

A mediator may not subsequently act as an expert witness or as a lawyer in proceedings brought in relation to the dispute in which they acted as mediator.

On the conclusion of the mediation, the mediator must retain the documents in their possession and the record drawn up at the end of the mediation for a period of five years (Mediation Regulation art. 15).

The Mediator’s Fee

Unless otherwise agreed by the parties, the mediator’s fee and all other costs are borne equally and in accordance with the minimum fee tariff. For example, in disputes whose subject matter can be measured in money, a total of 6% of the amount in dispute is paid equally by the parties, while in disputes whose subject matter cannot be measured in money, an hourly fee is paid as the mediator’s fee.

Conclusion of the Process and Documents Drawn Up

How the Mediation Process Ends

• Agreement
• failure to agree, without a meeting, because one of the parties could not be reached
• failure to agree following a meeting
• the matter becoming devoid of purpose through withdrawal
• termination on account of registration in error

Documents Drawn Up in the Mediation Process

1. Letter of invitationThe parties are invited to the process by a letter of invitation drawn up by the mediator.
2. Minutes of the first sessionAt the first joint meeting, the venue and date of the meeting, the attendees and whether agreement has been reached or the meeting postponed are recorded in minutes.
3. Son tutanakDrawn up at the end of the process; if no agreement is reached, it is attached to the statement of claim as part of the precondition to litigation.
4. Agreement documentContains all elements of the matters agreed upon; signed by the parties and their attorneys.

The parties are invited to the process by a letter of invitation issued by the mediator.

At the first joint meeting with the parties, a record of the first session is drawn up, recording the place and date of the meeting, those attending, and whether agreement was reached or the meeting adjourned.

At the end of the process a final record is drawn up. The final record sets out the parties, the date and place on which it was drawn up, the subject matter of the dispute between the parties and whether agreement was reached. A copy of the record — signed by the parties (or, where a party declines to sign, signed by the mediator and by any party who does sign, with the reason stated) and drawn up in one more copy than the number of parties — is sent to the Mediation Department.

Where the process ends because the parties have failed to reach agreement, the final record drawn up is the document annexed to the statement of claim within the scope of the condition of action.

Where the process ends in agreement, the record signed by the parties brings the dispute between them definitively to an end in respect of the matters negotiated at the meeting. In other words, no further recourse to the courts is possible in respect of the matters negotiated and agreed.

The document setting out all the elements of the matters on which the parties have agreed is thesettlement documentand is signed by the parties and their representatives (Law no. 6325, Mediation Law Mediation Law art. 18).

The parties may request an annotation as to enforceability be issued by the civil court of peace of the place where the mediator performs their duties. (Mediation Law, Art. 17/2) The agreement document, annotation as to enforceability . A settlement document bearing such an annotation is, however, treated in the same way as a decision given by a court, that is, as a document in the nature of a judgment.

The Benefits of Having Recourse to Mediation

Its flexibility and effectiveness have made mediation a method of dispute resolution that brings the parties together at the right point in working life, in the family, at school and even in international disputes. Parties who decide, of their own accord or at the suggestion of a court, to resolve their dispute with the assistance of a mediator have the opportunity to discuss the matter with a wholly impartial and unprejudiced mediator specially trained for the purpose and possessing the necessary technical and legal grounding, and to find the solution that is best for them.
Parties who seek a solution through mediation produce their own solution. It is this capacity that places mediation ahead of other alternative dispute resolution methods and of litigation.
This provides an extremely important advantage, particularly in view of the extraordinary workload of the judicial system in our country, the very long duration of proceedings and the considerably high cost of litigation. Indeed, high costs and lengthy proceedings in the judiciary become a serious obstacle to the “freedom to seek justice”.

More importantly, the search for justice often includes, alongside a claim to a material right, a desire to be understood and acknowledged. Even in the most concrete debt action, a person wants their grievance to be heard and recognised. The most common complaints about litigation are: “I was never allowed to speak at the hearing”, “The hearing was over so quickly”, “The judge did not listen at all”.

Sometimes the case is even won, but the person is not entirely satisfied because, in their own words, they “could not have their say” to the other side.

Parties are right to make these complaints; but it is equally clear that the present system does not allow them to be heard as fully as they would wish.
Both the rules of procedure and the sheer volume of work deprive the parties of the opportunity to express themselves freely during the proceedings. A person feels that they have not been heard or understood by the judge, and does not experience “emotional satisfaction” — a sense of justice — through the judicial route.

Charting One’s Own Path and Solution

Instead of the rigid rules of litigation and arbitration, in mediation the parties chart their own path and, in a sense, create their own solutions under the mediator’s guidance.

The mediator’s professional skills, based on their training and personal qualities, are used to identify and bring out the parties’ real concerns and interests rather than the problems that appear on the surface.

The process is, moreover, very fast. A straightforward employment or commercial action taking two to three years on average deprives justice of its value by the time it arrives, and lengthy proceedings are a ground for individual application to the European Court of Human Rights and to the Constitutional Court. Under the guidance of an effective and expert mediator, by contrast, settlement can be achieved in a few sessions.

Parties who come to understand one another better are also able to position themselves more accurately for the future. In the mediation process, where wishes and interests become clear, the negotiation of reciprocal proposals makes it possible to reach agreements that are effective and satisfy the parties’ interests to a degree unimaginable in litigation.

This feature of mediation means that the parties comply with the agreements they reach voluntarily, and not under compulsion of law.

In short, mediation gives the parties the opportunity to work within a highly flexible system in order to find their own just solution. It must not be forgotten that the mediator here is not a “judge” but a guide.

Why Should Mediation Be Preferred in Business and Commercial Life?

“IN BUSINESS LIFE THERE SHOULD BE NO ‘I’, ONLY ‘WE’.”

In mediation, “win-win” thinking is fundamental — that is, the logic of “I want to win, and I want you to win too”. It is a way of thinking and acting that seeks creative solutions of mutual benefit to institutions and individuals by having regard to reciprocal benefit and to needs.

Mediation Preserves Amicable Relations Between the Parties

The voluntary nature of the process and the fact that the parties create their own justice also help to preserve their future relations. The sword of justice, as is well known, is sharp: it usually cuts away not only the present dispute between the parties but also their future social and economic relations.

Parties who have gone “to court” harbour hostility towards one another thereafter, blame one another for having caused the process, and sever all ties.

By contrast, where a solution is reached through mediation, the parties leave the dispute with a solution of their own making and are able, having erased the traces of the dispute, to continue their relationship with ease should they need to.

In commercial relations in particular, the communication techniques used in the process enable the parties to understand one another better and thus to communicate more effectively. This may even contribute to a more successful commercial relationship than before, for commercial life is an environment in which relations must always be kept sound and alive and in which hostility causes loss.

The Principle of Confidentiality Ensures the Protection of Trade Secrets

Confidentiality is one of the most fundamental concerns of business life. In disputes with other companies or with employees, companies do not wish either the dispute or the manner of its resolution to become known. Court proceedings, by contrast, are by law public — open to everyone — save in exceptional cases.

This sometimes deters rightholders from pursuing their rights. One of the most important principles of mediation, however, is “absolute confidentiality”. The confidentiality of the process gives the parties a distinct sense of security in the commercial world and in society, enabling them to express their interests freely and without pressure. A process known only to the parties keeps both the information shared during the discussions and the outcome itself confidential, and makes the parties feel secure.

If one also considers the need of business and commercial life for fast and flexible solutions, classical litigation is slower and more rigid than that tempo requires.

Outcome

The spread of a culture of settlement will play a major part both in resolving disputes within companies and in resolving potential disputes with other companies. It is of great importance that this system take root through mediation work carried out within companies or procured from outside.