Mediation - A "Winning" Alternative

Despite the best efforts of well-intentioned REALTORSÒ, disagreements still occur. While less formal, faster, and less expensive than litigation, arbitration is not without cost in both time and money on the part of the parties. Substantial board/association human and financial resources are also consumed in providing this service to members. There is an alternative to arbitration, albeit one that is available only where all parties to a dispute voluntarily agree to use it - mediation.

Mediation is a service provided by every board/association of REALTORSÒ. Unlike arbitration, in which the parties present their cases to a panel of arbitrators whose decision is final and binding, mediation brings the disputing parties together in an atmosphere conducive to dialogue and conciliation, encouraging them to work together to reach a mutually acceptable resolution. Experience has shown that 80% or more of the disputes that otherwise would be arbitrated can be resolved faster and more efficiently through mediation. This is a significant savings in time and expense for both the parties and for boards and associations. Mediation can also be a positive experience for those who participate because, rather than a "winner" and a "loser" being determined by a panel of arbitrators, in mediation the parties work together, guided by a mediator, to fashion their own solution. Mediation is frequently a "win-win" situation for everyone.

Boards/associations generally have one or more mediation officers who act as facilitators/intermediaries. These  are typically REALTORSÒ who are experienced and adept in dispute resolution techniques. While mediators often have personal "styles", their primary objective is to help each party appreciate the position of the other party, then to move them forward toward an amicable resolution.

Detailed information about mediation is in the National Association's Code of Ethics and Arbitration Manual. Specific information about the procedures for initiating mediation can be obtained from local boards/associations of REALTORSÒ.

Mediation can be initiated in a number of ways. While there is no reason why two REALTORSÒ  with a disagreement cannot simply ask the local board/association to provide a mediator, in many instances mediation begins with the filing of a formal arbitration request. In some areas, requests for arbitration are automatically reviewed by the grievance committee and, after a determination is made that an arbitrable dispute exists, the disputing parties are invited to participate in mediation.

In other areas, filing a formal arbitration request automatically triggers a request to the parties asking whether they would like to attempt mediation. If the parties agree to mediate their dispute, the grievance committee is not called on to consider whether an arbitrable dispute exists unless a party subsequently withdraws from the mediation process, or mediation proves unsuccessful. And, where mediation is offered prior to initial review of an arbitration request by the grievance committee (to determine whether an arbitrable dispute actually exists), if any of the parties initially refused to participate in mediation, mediation will be offered to the parties again following the grievance committee's review if an arbitrable dispute actually exists. This "second chance" approach is based on the premise that mediation is preferable to arbitration, not only from the parties' standpoint but from that of the board/association, and acknowledges that some parties may not choose to mediate unless it is clear that an arbitration hearing is the undeniable alternative. Offering a second chance to participate in mediation ultimately benefits the parties and the board/association.

A mediation session is fundamentally simple. The mediation officer uses various techniques to encourage the parties to explore, understand, and appreciate each other's position. The most desirable solution is one crafted by the parties themselves through cooperative effort. When the parties reach agreement, they are encouraged to put it in writing and sign it. If the parties are unable to reach a mutually acceptable solution, the mediator can recommend a solution. The mediator's recommendation can be made orally or in writing, though a written proposal that the parties can subsequently consider is preferred. The parties then have up to forty-eight hours to consider the mediator's recommendation and decide whether they will agree to it. If either party does not agree with the mediator's recommendation, the mediation process is over and the arbitration process proceeds (assuming arbitration has been requested).

The fact that at times mediation does not produce the desired result does not diminish its value to REALTORSÒ  and to boards/associations. There will be instances when REALTORSÒ  mediate in good faith but, for one reason or another, are simply unable to reach a joint agreement or accept the solution proposed by the mediator. In such cases, the alternative is a decision imposed on the parties by a panel of arbitrators after an arbitration hearing. While this may be the only answer, a mutually-fashioned, mutually agreed upon solution to disagreements between REALTORSÒ  is the preferred outcome.


Mediation Services at NEAR


Participation in mediation procedures is voluntary, and the service is offered at no cost to the parties following a determination by the NEAR Grievance Committee that a Profesional Standards hearing is warranted. Parties to mediation may withdraw from the process at any point prior to reaching an agreement. Parties to mediation that do not reach an agreement shall be free to pursue arbitration of the dispute (or an Ethics Complaint) in accordance with the guidelines set forth in the Code of Ethics and Arbitration Manual of the NATIONAL ASSOCIATION OF REALTORS®. The mediator does not provide legal representation, legal advice, or legal services, and the parties have the right to be represented by counsel at mediation and have the right to obtain independent legal advice (if counsel are not at the mediation) before signing any final settlement agreement.


Any offers of settlement that were not accepted or any suggested resolution proposed by the Mediation Officer that was not accepted will not be introduced as evidence nor considered in any manner should the matter require arbitration by the Board's Professional Standards Committee. However, if the parties agree to a settlement of the dispute, and the settlement is reduced to writing and has been signed by all of the parties, the matter shall be considered resolved, and shall not be the subject of a subsequent arbitration hearing. In the event that either of the parties fails to abide by the terms of the settlement, the matter may not be arbitrated; instead, the other party should be encouraged to have the settlement agreement judicially enforced by a court of competent jurisdiction.


No aspect of a mediation conference shall be relied upon or introduced as evidence in any arbitration, judicial, or other proceeding, including, but not limited to: views expressed or suggestions made by a party with respect to a possible settlement of the dispute; admissions made in the course of the mediation; proposals made or views expressed by the Mediator or the response of any party thereto. No privilege shall be affected by disclosures made in the course of mediation. Disclosure of any records, reports, or other documents received or prepared by the Board or Mediation Officer shall not be compelled. Neither the Board nor the Mediation Officer can be compelled to disclose or to testify in any proceeding as to information disclosed or representations made in the course of the mediation or communication to the Mediator in confidence.