When the contract is not fulfilled - how notaries help entrepreneurs in case of legal disputes
As an entrepreneur or as an individual, we can always find ourselves in a situation where another company with a contractual relationship with us does not perform for some reason, or performs incorrectly - for example, the debtor does not repay the loan or the entrepreneur installs the household appliance incorrectly.
Is it necessary to start a lawsuit immediately in this case, which often only results after many years? One of the tasks of notaries is to help avoid legal disputes and facilitate evidence in legal proceedings. Thanks to the peaceful settlement of disputes, the parties involved can maintain a good business or personal relationship, and last but not least, the costs of litigation can be saved.
The joint article series of the BKIK and the Hungarian National Chamber of Notaries (MOKK) reveals what options we have if we want to enforce our rights in a non-litigation procedure.
Commitment contained in a public document
Time is money, the saying goes. It is worth concluding the contract in a public document, but it is also possible to attach a unilateral declaration of commitment contained in a public document to the already signed contract.
The notarial deed is immediately enforceable. This means that if the undertaken obligation is not fulfilled in full and by the deadline, then instead of court proceedings, we can immediately turn to the bailiff.
The commitment can be included in a public document if, based on a contract, the debtor is obliged to pay or perform a specific act (for example, to vacate a property). Thus, if doubts arise regarding the ability to perform or the willingness to perform, the debtor can be asked at any time during the duration of the contract to make a declaration of commitment to the notary public as a kind of guarantee.
The notarial deed has the strongest evidential force. Therefore, in the course of a possible court proceeding, the other party must prove if, according to their point of view, its content does not correspond to reality.
https://www.mokk.hu/ugyfeleknek/okirat-ortažtesi-eljaras-tajekoztato.php
Certificate of fact
During the fulfillment of contracts and in other non-contractual life situations, it may be necessary to authentically record an existing situation in order to avoid disputes. This can be the case, for example, of a half-finished property on the deadline day, an incorrectly installed fixture, or the condition of a damaged apartment. In this case, the notary prepares a certificate of what he has experienced. The certificate of fact is a public document that can promote an agreement between the parties, and in a possible lawsuit, it enables the evidentiary process to be carried out faster and more efficiently due to its probative power.
You can find out more about public documents on the following page: https://www.mokk.hu/ugyfeleknek/okirat-ortažtesi-eljaras-tajekoztato.php
You can find out more about public documents here.
Payment order procedure
How can the notary help if our debtor does not pay his debt on time? By issuing a so-called payment order, which can speed up access to money for the beneficiary. The notary delivers the issued payment order to the debtor, who can react to it as follows: he can pay his debt, request payment in installments, object to it, but he can also decide to ignore it and do nothing. If the debtor does not object within 15 days of receipt, it becomes final. A final payment order is equivalent to a final court judgment: its contents cannot be disputed later, and the claim can be executed immediately. However, it is important to point out that if the debtor objects, the procedure automatically turns into a lawsuit. It is not necessary to attach evidence (such as a copy of the contract, invoice, certificate of completion) to the application, as the notary cannot conduct evidence, so he does not listen to the parties or examine documents.
You can find a description of the payment order procedure under the following link:
https://www.mokk.hu/ugyfeleknek/FMH-es-annak-vegrehajtasa-FMHVH-az-eljarasrol.php
Appointment of a judicial expert
In many cases, it is not enough to examine the contract and the legislation to decide the dispute, but special expertise is required. A good example of this is when it is necessary to decide whether a defect in a newly purchased car existed at the time of purchase or occurred later, or if a resident of a newly built apartment suffers from noise filtering in from the neighbor and disputes that the builder has completed the installation of the soundproofing he undertook. The expert opinion prepared by a legal expert helps to develop a negotiation position, and may contribute to convincing the other party, and thus to an out-of-court agreement. The expert opinion can be used not only during the negotiation between the parties, but also in court proceedings - it is equivalent to the expert opinion prepared by a court-appointed expert in a lawsuit. The expert opinion can therefore help the parties reach an agreement; but it can also be a good service in a possibly ongoing lawsuit, as it can speed up the evidence procedure, making the lawsuit faster and cheaper.
You can find a further summary of the assignment of the forensic expert here:
https://www.mokk.hu/ugyfeleknek/igazzsagugyi-szakerto-kirendelese.php
Preliminary proof
The express purpose of the preliminary evidence is for the parties to gather evidence in order to avoid/prepare for litigation. In this procedure, the notary carries out the evidentiary procedure: he can conduct an inspection, question witnesses, but also assign a forensic expert. Its importance lies mainly in the fact that the applicant does not have to worry about the subsequent damage and destruction of the evidence. Preliminary evidence is an important tool to avoid a lawsuit, and the conducted preliminary evidence procedure results in a significant tax discount if a lawsuit is brought.
A more detailed description of the preliminary proof:
https://www.mokk.hu/ugyfeleknek/elozetes-bizonyitas.php
Settlement procedure before the notary public
The procedure can be used during the negotiation process, but also before the parties reach an agreement. At the request of one party, the notary summons the other party to a settlement attempt, where the parties can discuss their positions and come to an agreement regarding their dispute.
The settlement approved by the notary has the same effect as the settlement approved by the court, so it can be implemented immediately. The parties can therefore put their agreement in writing and, for reasons of enforceability, attach security to the fulfillment of the obligations undertaken. In the procedure, the decision is entirely in the hands of the parties: they determine the subject and scope of the settlement, the notary does not decide or advise, he only examines compliance with the law and decides on the approval of the settlement. If no settlement is reached, or if either party fails to appear despite the summons, the proceedings are terminated.
You can find more information about the settlement procedure by clicking on the link below:
https://www.mokk.hu/ugyfeleknek/kozzeyzo-elotti-egyezsegi-eljaras.php
After a mediation process
BKIK has been providing mediation services for actors in the small and medium-sized business sector for many years. During mediation (or mediation), the mediator promotes the resolution of the dispute using communication techniques tailored to the parties and the case. The mediator - a suitably qualified professional - identifies and mediates the interests and needs of the parties, thereby contributing to making the dialogue more effective. The parties create their agreement jointly at their own risk.
If the parties have reached an agreement in the mediation process, they can attach immediate enforceability to their agreement by contacting a notary, either by approving the agreement by the notary or by making a declaration of commitment.
mediation service provided by BKIK here:
https://bkik.hu/hu/testuletek/gazdasagi-szolgaltatasok-tagozat/xxvii-mediacios-es-jogi-koordinacios-osztaly