Mediation Clause in Texas Residential Contracts

Mediation is a process that is structured and allows parties of a dispute to come together in order to assist with communication, allowing the parties of a dispute to settle an issue by reaching a mutually acceptable resolution. If an agreement is reached, the mediator may provide guidance with a written agreement to be signed by both parties. Mediation is NOT legal advice or representation for either party, it is simply the facilitation of communication with the goal of reaching an agreement that is acceptable to both parties.

The state of Texas encourages resolution of contract disputes with mediation. A mediation paragraph is even included (paragraph 16) in the One to Four Family Residential Contract. In the event a dispute arises and a resolution cannot be reached, the MEDIATION paragraph can come into effect if both parties agreed to mediation.

The paragraph also states that both parties will “bear the mediation costs equally” (Texas Association of REALTORS® (TAR) 1601). Don’t let this paragraph scare you into thinking that this process can be costly. Check with your local county to see if any services are provided for mediation. In San Antonio TX (Bexar County), there is a dispute resolution center located in our courthouse Justice Center. This service is provided at no cost as a community service, but there are forms that must be submitted to initiate the process.

The mediation process is based on fairness, and the mediators are often volunteers; a large percentage of mediators in Bexar County hold postgraduate degrees and many are bilingual. The goal of mediation is to avoid taking a case to court, which will cost money for both parties.

The mediation paragraph does not prohibit a party from seeking the advice of an attorney or from continuing with a lawsuit, but it is always best to attempt mediation first. One may be surprised to find that they are able to find an amicable resolution.

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