Italy’s Constitutional Court has ruled that the Italian government overreached its legislative authority in making mediation a mandatory precursor to trial.

By its decision issued on 24 October 2012, the Italian Constitutional Court has declared the illegitimacy of the provision of the Legislative Decree n. 28 dated 4 March 2010 implementing the “Compulsory Mediation” procedure for the resolution of certain disputes (article 5.1 of the “Decree”).

The Decree contains rules on mediation in civil and commercial disputes and was enacted with the goal to ease the overwhelming caseload in the Italian courts as well as to prevent additional delays in judicial proceedings.

The Constitutional Court’s statement of illegitimacy of the Compulsory Mediation procedure is grounded on the lack of legislative power of the Italian Government having introduced, through article 5.1 of the Decree, the Compulsory nature of the Mediation for the aforementioned specific disputes (i.e. going beyond the relevant provisions of the Delegation Law n. 69/2009 - which did not explicitly refer to the Compulsory Mediation procedure).

On 24 October 2012, the Constitutional Court rejected those provisions of the Decree providing for mandatory mediation.

CONSEQUENCES - FOCUS ON INSURANCE AND FINANCIAL LITIGATION

After the judgment publication, parties of a dispute concerning - inter alia – insurance, banking and financial disputes, are no longer subject to the preliminary mediation attempt and can therefore access the Justice immediately regardless of the nature of their dispute.

Although the decision at issue eliminates the Compulsory Mediation procedure, since it is to be considered illegitimate, parties of a dispute of any nature, aiming at avoiding the overload of the legal system, are still entitled to (voluntarily) apply for the Non-Compulsory Mediation procedure.