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Real Estate Mediation is a voluntary cost-effective process for resolving disputes involving the sale and ownership of real property.  Issues to be resolved can include one or more of the following:

PURCHASE DEPOSITS – When a buyer, who deposits money as part of a real estate purchase contract, later decides not to (or is unable to) complete the purchase, and a dispute arises as to whether or not the buyer is entitled to recover all or part of their deposit.

CONTRACTUAL COMPLIANCE – When a buyer of a property contends that the seller has not fulfilled their obligations of an agreed upon real estate purchase contract, prior to and/or after close of escrow.

PROPERTY DISCLOSURES – After the purchase of a property, when a buyer discovers problems they believe were not disclosed to them prior to the sale, as required by California real estate law.  These cases make up the majority of real estate mediations, and involve a buyer requesting reimbursement for repair costs, payment of damages, and/or a retroactive adjustment in the purchase price.

OWNERSHIP AND/OR NEIGHBORHOOD DISPUTES – Where the owners of one or more parcels are unable to come to agreement about actions to take in order to protect and/or develop the property(s).  These cases can involve issues such as lot line adjustments, water/well drilling rights, road maintenance agreements, property development, easements, septic/sewer problems and water runoff.

DISSOLUTION OF OWNERSHIP – When two or more parties share ownership of a property, and one or more owners wish to sell their interest in the property.

Most real estate contracts executed in the state of California include a clause requiring parties to mediate a conflict prior to taking the issue to arbitration or filing a lawsuit.  Refusal to participate in the mediation process usually precludes the party that prevails in the arbitration or lawsuit form being awarded attorney fees.  Thus, it is in the interest of all affected parties to participate in the mediation process.

The mediator is jointly chosen by mutual agreement of all parties to the mediation process.  Fees and costs charged by Common Ground Mediation Services (CGMS) will be split equally by all parties to the dispute, unless otherwise agreed to in writing.

Once CGMS is chosen to mediate the dispute, and a Real Estate Mediation Agreement has been signed, the following activities will take place:

DOCUMENT REVIEW:  Parties to the conflict will submit to CGMS copies of documents related to the dispute, such as the purchase contract, contingency releases, transfer disclosure statements, and written communications between the parties.

JOINT MEDIATION SESSION:  All parties will meet with the mediator at a neutral site at a mutually agreed upon date and time.  Normally no attorneys are present, although parties are encouraged to consult with their attorneys prior to and after the session.  Real estate agents for the buyer and seller often attend to assist their clients.  On occasions, the real estate agents may be one of the parties to the mediation.

The Joint Session begins with introductions and a review of the mediation process by the mediator.  Each party to the dispute will then have an opportunity to present their point of view, without interruption by the other parties.  The mediator assists in clarifying issues, identifying the interests of the parties, and isolating the areas of agreement and dispute.

Next, the mediator will meet separately to “caucus” with each of the parties to consider alternatives to the positions that they had taken prior to mediation.  Partied sometimes make new offers at this point, based on a deeper understanding of the other parties’ points of view.  The mediator will often “shuttle” back and forth between parties to clarify points and/or present new offers prepared by other parties.  The mediator will review with each party the strengths and weaknesses of their positions.  Sometimes a joint "brainstorming" session is held to stimulate new ideas.  During this period, the mediator may offer suggestions as to available options that had not been previously considered.  The mediator probes into underlying and often unspoken issues by the asking of pertinent questions. The parties trade with each other over the terms of the settlement until all issues have been resolved.

ADJOURNMENT:  In some cases all issues may not get resolved during the Joint Mediation Session.  If so, it may be necessary to adjourn to allow parties to research additional information, obtain additional bids for work to be done, and to consult with their attorneys.  CGMS will normally coordinate additional negotiations between the parties via telephone.

AGREEMENT:  Once the parties reach agreement on all issues, CGMS will prepare a written Memorandum of Understanding.  This Memorandum is then used by an attorney to create a legally binding agreement, which typically includes a clause stating that it settles any and all present and future claims between the parties.

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