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Alternative dispute resolution (hereinafter: ADR) refers to any process in which the parties to a dispute attempt to reach an agreement without using conventional litigation procedures, with the help of a neutral third party. The main types of ADR processes are mediation and arbitration, but other ADR techniques also exist, such as conciliation, expert appointments, or early neutral evaluation of the dispute.

Arbitration

Arbitration is the form of out-of-court dispute resolution that is most similar to judicial dispute resolution. By concluding an arbitration agreement, the disputing parties agree to submit the dispute to one or more arbitrators and exclude the jurisdiction of the court. An arbitrator is a neutral third party who, based on the evidence and arguments presented, issues a final and legally binding decision.

1. Advantages of Arbitration

Compared to judicial procedures, arbitration offers several advantages. The process is not public, meaning that business secrets or sensitive data do not become public. Arbitration is often faster than court proceedings, which can drag on for years. The parties themselves select the arbitrators, which means they can appoint experts with specific knowledge and experience and establish the rules of the procedure. While the costs of arbitration may vary, it is often cheaper than prolonged court procedures.

2. Disadvantages of Arbitration

Despite its many advantages, arbitration also has some drawbacks. One of them is the limited possibility of appealing an arbitral award, which may affect the parties’ rights in the event of an unfair decision. Arbitrators do not have the same coercive powers as judges, meaning they cannot directly force witnesses to cooperate or impose compulsory measures. Additionally, arbitration does not create judicial precedents, which can make predicting future decisions more difficult.

3. Institutional and Ad Hoc Arbitration

Parties can choose ad hoc arbitration, which is established based on an agreement between the parties and arbitrators for a specific dispute, with the parties themselves designing the rules of procedure, or opt for institutional arbitration, which takes place under the auspices of an arbitration institution and provides administrative support (e.g., ECDR). Institutional arbitration offers greater legal security, while ad hoc arbitration offers more flexibility.

Mediation

Mediation is a process in which a neutral third party, the mediator, helps the parties voluntarily reach a resolution of the dispute. Mediation can take place as part of a court-based program or entirely independently. Unlike arbitration, the mediator does not make a decision on the dispute but only helps the parties find a mutually agreeable solution. Mediation is used as an alternative dispute resolution method in various legal fields, such as civil, commercial, family disputes, and labor-law procedures.

1. Advantages of Mediation

One of the key advantages of mediation is the assistance of a neutral third party who ensures impartiality and encourages the parties to seek a joint solution. Mediation is quick, cost-effective, and ensures confidentiality, as all data related to mediation is confidential unless the parties or the law provide otherwise. Furthermore, mediation allows flexibility, as it is not as strictly bound by procedural rules as judicial procedures. In mediation, the parties may mutually agree to have the dispute resolution agreement drawn up as an enforceable notarial deed, settlement before the court, or an arbitral award based on a settlement. The process can be concluded in just one or two meetings, meaning faster resolution of the dispute and lower costs.

2. Mediation in Courts

Mediation is available at 64 courts across Slovenia, including District, Regional, and Higher Courts. It is conducted in various types of procedures, such as civil, commercial, family, and labor-law disputes.

3. Who Are the Mediators?

Mediators involved in court programs are professionals such as lawyers, judges, psychologists, and social workers. All mediations in courts are conducted by qualified mediators who are listed in the registry of mediators at the courts. Mediator training is regulated by the Alternative Dispute Resolution Act (ZARSS).

4. Impact of Mediation on Judicial Procedures

Mediation has a positive impact on the burden on courts, as it allows for faster dispute resolution and reduces the number of court cases. If mediation does not lead to a resolution, the procedure continues in the regular judicial process, ensuring that the entire process is not significantly delayed, as mediation lasts no longer than three months.

5. Mediator Training

Mediators participating in court programs must undergo appropriate training, which includes at least 40 pedagogical hours and a final exam. Training programs are available through the Center for Education in the Judiciary, Ministry of Justice.

Early Neutral Evaluation of the Dispute

Early neutral evaluation (ENE) is a process in which an independent expert analyzes the factual and legal aspects of a dispute and assesses the parties’ chances of success in a possible judicial, arbitration, or other procedure. The goal of this process is to help the parties better understand the strengths and weaknesses of their claims, enabling them to negotiate more effectively, pursue mediation, or seek settlement solutions. The evaluation may also include predictions about the potential monetary amount the parties might receive and the likelihood of success in a litigation process. The process is voluntary and confidential, and the parties can select qualified neutral evaluators, such as retired judges or experts from various fields.

The ENE process is particularly suitable for disputes involving complex legal or technical issues, where an expert evaluation could help focus the dispute on key issues. It is also useful when parties cannot continue negotiations due to a lack of information or unrealistic expectations. The dispute evaluation may begin at the request of one or more parties, and the court may suspend the litigation process during the ENE process. After the evaluation is concluded, the parties can proceed to mediation, arbitration, or a combination of both for the final resolution of the dispute.

Conclusion

Alternative dispute resolution offers many advantages over traditional court procedures. The choice between arbitration, mediation, and early neutral evaluation depends on the specific circumstances of each case. Arbitration is suitable for disputes requiring a legally binding decision, mediation is ideal for seeking settlement solutions, and early neutral evaluation is useful for assessing the legal strength of a case. Parties opting for alternative dispute resolution must carefully weigh the advantages and disadvantages of each method and choose the one that best suits the goals they wish to achieve.

Selling a property is one of the most important financial decisions in life, so it is crucial to approach it thoughtfully. The process can be demanding and full of legal and administrative hurdles, making it essential to be well-prepared. In this article, we will outline the steps for a successful property sale and offer useful tips to avoid potential complications.

When selling a property, we recommend involving a real estate agent, lawyer, or other legal expert, especially in drafting the contract and completing tax forms. This can reduce risks and ensure a smooth sales process.

1. Checking the Land Registry Status

Before selling a property, it is necessary to check the data recorded in the land registry. The land registry is a public register intended for recording and publicly disclosing ownership information, as well as other rights and legal facts related to real estate. By reviewing the land registry status of the property, any interested buyer who has the identification details of the property can verify the following:

• Whether the seller is the actual owner of the property,
• Whether the property is subject to any encumbrances such as mortgages or easements, or obligations such as preemptive or lease rights,
• Whether there are any legal restrictions on transferring ownership (e.g., prohibition of alienation).

Reviewing the land registry status is important not only to determine the real market value of the property but also for the legal protection of the buyer and safeguarding their interests when purchasing the property. The Land Registry Act (ZZK-1) defines one of the most important principles in real estate transactions, namely the principle of trust in the land registry. This principle states that anyone who acts in good faith and relies on the recorded rights in the land registry should not suffer harmful consequences.

2. Checking Property Permits

Before selling or purchasing a property, it is necessary to verify the existence of a valid building and occupancy permit, the validity of the energy performance certificate, any preemptive rights that could affect the sale, and other relevant factors.

For the sale of land, additional information on land use designation, spatial limitations for construction, and the status of agricultural or otherwise protected land must be obtained. This information can be accessed through the local municipality or the competent administrative unit, or it can be obtained by a lawyer authorized to collect the necessary documents.

Building and Occupancy Permit

When purchasing a property, it is crucial to check whether the building has a valid building and occupancy permit. The building permit confirms that the structure was built in accordance with legal and spatial regulations, while the occupancy permit certifies that the building is suitable for living or use. Both permits are mandatory for new constructions and renovated buildings. If these permits are missing or the buildings were constructed unlawfully, it can lead to serious legal and financial consequences, including administrative procedures or, in extreme cases, the demolition of the structure.

If a building does not have the necessary permits, the owner can initiate the legalization process. This process is handled by a certified architect or civil engineer and begins with submitting an application for legalization. However, legalization is only possible if the building meets certain criteria; otherwise, the process cannot proceed.

According to the Building Act, the owner of a structure must keep documentation related to the building permit, project documentation, and safety certifications of the building. For newer buildings, the building permit can be checked in the spatial information system, while for older ones, inquiries must be directed to the relevant administrative unit. In multi-apartment buildings, this responsibility is typically handled by the property manager.

Although procedures for older buildings (built before 1967) are simplified, purchasing new constructions without valid permits carries significant risks. A property with both a building and an occupancy permit is the safest choice, as it minimizes potential problems with financing, insurance, and property use. This documentation is particularly important if the purchase is financed through a loan, as banks usually require an occupancy permit as a condition for approving the mortgage to protect themselves against potential issues if the buyer defaults on payments. Additional costs may also arise if the buyer intends to renovate the building, as they would first need to obtain an occupancy permit, leading to delays and extra expenses.

3. Advertising and Viewings

Once all necessary documents are prepared, the property can be advertised. It is important to be transparent about the property’s condition and not conceal any defects, as this can lead to legal complications later on.

4. Drafting and Signing the Sales Contract

The most crucial stage in selling a property is signing the sales contract, which formalizes the agreement between the seller and buyer. The key elements of the sales contract include:

• Definition of the subject of sale,
• Purchase price and payment terms,
• Land registry authorization,
• Deadline and conditions for property handover,
• Allocation of costs (taxes, notary fees, etc.).

The sales contract must be legally sound, as errors can lead to delays and financial losses.

5. Payment of Taxes

After signing, the contract must be submitted to the Financial Administration of the Republic of Slovenia (FURS) for tax assessment. The seller is responsible for paying the real estate transaction tax, which amounts to 2% of the sales price, and in some cases, capital gains tax.

Capital gains tax applies if the property is sold within fifteen years of ownership, with the taxable amount depending on the profit made from the sale.

6. Notarial Certification and Property Handover

Once taxes are paid, the seller must have their signature notarized on the sales contract. This step is necessary for transferring ownership rights in the land registry. It is advisable to keep a notarized copy of the contract with a notary, lawyer, or real estate agency until the full purchase price is paid.

The handover of the property is also outlined in the sales contract. Both parties should be aware of the conditions required for the transfer. The handover should be documented with a handover report, which details the exact condition of the property.

7. Registration of Ownership in the Land Registry

For the buyer to become the legal owner of the property, ownership rights must be registered in the land registry. The application for registration can be submitted through a notary, and the land registry court will process the request and execute the registration.

8. Conclusion

Selling a property is a complex process that requires thorough preparation. By taking the right approach and possibly seeking professional assistance, you can ensure that the transaction proceeds smoothly and without unexpected complications.

Whether you are a tenant or a landlord, it is crucial to understand all the rights and obligations that arise from a rental agreement. Residential lease agreements are regulated in detail by the Housing Act, which also defines the mandatory components of a rental contract. Including these required elements in the lease agreement ensures a high level of security and smooth “legal life” of the contract and the lease relationship. In this article, we will outline the key steps and provide tips to help you rent or lease a property in Slovenia safely and with peace of mind.

Signing the Lease Agreement

One of the fundamental steps is signing a rental contract that clearly defines the rights and obligations of both parties. It is essential that the agreement includes all legally required components, ensuring a high level of legal protection. For additional security, it is recommended that the agreement be executed in the form of a directly enforceable notarial deed, as this allows for the swift and straightforward fulfillment of contractual obligations without prolonged litigation. Concluding the contract in this form is crucial for the property owner or lessor, particularly for two reasons: the enforcement of the tenant’s financial obligations (payment of rent and costs as stipulated in the agreement) and the vacating and return of the property to the lessor at the end of the lease term. If the tenant breaches the contract, for example by failing to pay rent or by not returning the property upon termination of the lease, the owner can immediately initiate enforcement proceedings. In this process, the court does not verify the facts regarding the existence of the claim, as the contract is already considered valid, provided certain conditions are met. This means that the property owner can enforce their rights more quickly and with less uncertainty.

Mutual respect for obligations is the foundation of a successful lease relationship. The property owner must report rental agreements to the Financial Administration, especially if the tenants are legal entities, and must inform the building manager of new tenants and any changes in the lease arrangement.

Ensuring the Legal Validity of the Lease

A property can only be rented out by its legal owner. Before signing a contract, tenants should verify ownership by checking the land registry extract or other relevant documents. If the owner authorizes another person to lease the property, the authorization must be in writing and notarized, as oral authorizations can pose unnecessary risks for tenants.

If the ownership of the property changes, this does not affect the existing lease agreement, as the new owner assumes all rights and obligations outlined in the lease. Additionally, if the number of occupants in the rental unit increases (e.g., due to the birth of a child), the landlord is required to sign an annex to the contract reflecting the new circumstances.

What Happens at the End of the Lease?

If a tenant passes away, the landlord is required to sign a lease agreement under the same conditions with the tenant’s spouse, cohabiting partner, or one of their immediate family members, provided that person was living in the apartment at the time of the tenant’s death, had registered permanent residence there, and was mentioned in the lease agreement. A written request for the continuation of the lease must be submitted to the landlord within 90 days of the tenant’s death.

A tenant can terminate a lease agreement without providing a reason, but a 90-day notice period applies. On the other hand, a landlord can only terminate a lease agreement based on either fault-based or non-fault-based reasons. However, the law imposes significant restrictions on both types of terminations.

A fault-based termination must be either explicitly stated in the contract or legally defined. Additionally, the tenant must first receive a written warning about the violation and be given 15 days to correct it. A non-fault-based termination is much more challenging and, in practice, almost impossible for landlords. This is because, in such cases, the landlord is required to provide the tenant with an alternative suitable residence. Due to these legal requirements, long-term rental agreements for an indefinite period are rarely concluded.

Conclusion

Renting a property is a significant decision that requires careful consideration of all details. Whether you are a tenant or a landlord, make sure that all legal procedures are correctly followed. Before signing the contract, read and understand its terms, verify the ownership of the property, and comply with all legal requirements to ensure a smooth and trouble-free rental experience.

When it comes to divorce, one of the most challenging aspects is the division of joint property. How is property acquired together by both partners divided? What are the rules, and what should you be mindful of? In this post, we provide clear and practical explanations.

What is joint property?

Joint property includes everything that spouses or cohabiting partners acquire through work or for compensation during the duration of the marriage or cohabitation. This includes real estate, movable property (cars, artwork, etc.), monetary assets, and even business shares. However, joint property does not include things acquired gratuitously, such as gifts or inheritance.

How does the division of joint property proceed?

The division process takes place in two phases:

1. Determining the scope of joint property – What exactly is considered joint property?
2. Determining shares – What proportion of the property belongs to each partner?

Equal shares or adjusted division?

According to the Family Code, the assumption is that the spouses’ shares of joint property are equal (50-50), but one partner can prove that their contribution was greater and thus request a different division (e.g., 60-40, 70-30).
It is important to understand that the contribution is not always linked solely to income. The court will also consider other factors such as childcare, household duties, or assistance in maintaining and increasing the property. So, if one spouse earns more, it doesn’t automatically mean their share will be larger. Sometimes, the spouse who has contributed more through domestic work and childcare may end up with an equal share of the joint property, even if they earned less.

The court will often find that one partner has a larger share if they contributed their separate property to the joint estate, for example, money gifted by parents for purchasing a home. In such cases, the court may assign adjusted shares.

How does the division itself take place?

A spouse who requests the court to determine that a particular asset belongs to joint property will have to assert and prove that the property was acquired during the marriage or cohabitation and that it was acquired through work or compensation. One of the more complicated aspects of the process is determining when the cohabitation or marriage begins and ends. The law states that cohabitation is not only physical living together but also includes economic interdependence, emotional attachment, and intimate connection. Although it is usually difficult to pinpoint the exact moment the partnership begins or ends, the court will take into account all important circumstances and facts, such as shared life, assistance in the household, or financial contributions.

Once the scope of joint property and the spouses’ shares are determined, the division process itself follows. This usually takes place in a non-litigation procedure according to the rules for dividing joint property. The joint property of the spouses is divided as a whole, so the court, in deciding which spouse receives specific items from this property, considers the needs of the participants in the process (the divorced spouses) and their legitimate interests in the individual (real and movable) items. Natural division takes precedence (e.g., one partner retains the house, the other keeps other assets), but if this is not possible, a civil division follows – the sale of the property and the division of the proceeds.

Why is a lawyer crucial?

Division procedures are often time-consuming and complicated. A lawyer can help protect your interests, understand your rights, and achieve the best possible outcome. They also increase the likelihood of reaching an agreement without prolonged litigation.

Possession refers to the actual control over an object, which does not necessarily tell us who owns the object or who has the right to possess it – it only tells us who currently has physical control over the object. Control can be direct, when the object is directly in our possession, or indirect, when possession is exercised through another person. Often, the owner of an object is also its possessor, but this is not always the case. Therefore, we distinguish between ownership possession, when the owner has the object in possession and non-ownership possession, such as in the case of a tenant who possesses an object over which they have no ownership rights.

Possession is a relationship of physical control over an object, which meets the following criteria: external visibility, permanence, exclusivity and accessibility to the possessor. Possession ceases when the external appearance of control over the object ends.

A possessor can claim protection of possession in two ways – self-help and judicial protection (filing a lawsuit). The possessor has the right to self-help against anyone who unjustly disturbs or deprives them of their possession. However, the condition is that the danger is imminent, self-help must be immediate and necessary, and the manner of self-help must fit the circumstances of the danger – for example, when we catch a thief trying to steal our bicycle and prevent him from doing so.

Both direct and indirect possessors have the right to judicial protection of possession. In possession protection proceedings, only possession is relevant, so questions of ownership are not dealt with in possession disputes.

Judicial Protection of Possession

The court, in a lawsuit for disturbance of possession, provides legal protection to the possessor for both the disturbance and the deprivation of possession. It is not relevant whether the possessor had the right to possess the object or whether they were acting in good faith. The court grants protection based on the last state of possession and the disturbance that occurred. Even a possessor who acquired possession by force, secretly, or by abuse of trust has the right to protect possession, except in exceptional cases (e.g., a thief has possession protection against third parties, but cannot claim it directly against the previous possessor who caught them stealing). A possessor is not entitled to legal protection if the disturbance or deprivation of possession is based on the law.

A possession lawsuit can be filed by any last peaceful possessor who has been the victim of disturbing behavior, against the person disturbing the possession or an indirect disturber – someone who orders, approves, or benefits from the disturbing action.

In the court procedure, the plaintiff must prove: that they had possession of the object before the disturbance, that their possession was indeed disturbed, that the defendant was the one who interfered with the possession, and that the defendant’s actions were unlawful. Whether possession was disturbed is decided by the court in each case individually. Even a minor change in the state of possession does not necessarily mean disturbance or deprivation of possession. The interference must be such that it either prevents or significantly hinders the exercise of possession.

The process begins by filing a lawsuit with the competent District Court. The deadline for filing the lawsuit is 30 days from the day the possessor learned of the disturbance and the perpetrator or 1 year from the day the disturbance occurred. The deadline for a response to the lawsuit is 8 days.

The goal of the possession lawsuit is to restore the previous state of possession – it is preventive protection, as we aim to prevent future disturbing actions. In the lawsuit for disturbance of possession, the court will deal with two main issues: the last state of possession and the disturbing action, but it will not decide on the right to possess, the legal basis, the fairness or unfairness of possession, or any compensation claims. To pursue these claims, another procedure must be initiated, such as a lawsuit to determine ownership rights, a lawsuit for the return of property based on ownership rights, a compensation lawsuit, etc.

The defendant can oppose the lawsuit only with arguments related to the actual state of possession. At the end of the procedure, the court will issue an order prohibiting the defendant from further disturbing the possession or requiring the return of the deprived possession and other measures necessary to prevent further disturbance.