CROATIA Law and Practice Contributed by: Lada Ćustić and Marko Paulinović, Buterin & Partners
demonstrate that the case involves a significant legal question or inconsistency in judicial practice. 10.6 Powers of the Appellate Court After an Appeal Hearing The court possesses broad remedial powers. It may: • uphold the lower court’s judgment – ie, dismiss the appeal as inadmissible or unfounded and confirm the judgment; • set aside the judgment and remit the case for retrial if procedural or factual deficiencies exist; • set aside the judgment and dismiss the claim entirely; or • modify the judgment directly where sufficient facts are established in the proceedings and court records permit a lawful decision. 11. Costs 11.1 Responsibility for Paying the Costs of Litigation In Croatian civil proceedings, the losing party is gen- erally responsible for reimbursing the court awarded litigation costs of the successful party, including court fees and attorney’s expenses. When each party is only partially successful, the court apportions costs in pro- portion to the degree of success. The court may also order each party to bear its own expenses or to cover a share of the other party’s costs. Exceptions apply if a party’s fault or procedural con- duct caused unnecessary expenses, in which case that party must bear such costs regardless of the outcome. 11.2 Factors Considered When Awarding Costs When determining the amount of costs to be award- ed, the court considers all justified litigation-related expenses, including: • court fees prescribed by the Regulation on the Tariff of Court Fees; • advance payments made for procedural expenses; • expert witness and assessment costs; and
• attorney’s fees, as determined by the Tariff on Rewards and Reimbursement of Costs for the Work of Attorneys. 11.3 Interest Awarded on Costs If the awarded costs are not paid on time, the party is entitled to statutory default interest on such costs, the amount of which is defined in 9.3 Pre-Judgment and Post-Judgment Interest . 12. Alternative Dispute Resolution (ADR) 12.1 Views of ADR Within the Country In the Republic of Croatia, alternative dispute resolu- tion (ADR) is increasingly recognised as a mechanism for the efficient and amicable settlement of disputes, particularly in civil and commercial matters. The prin- cipal ADR methods formally recognised under the Law on Peaceful Dispute Resolution are mediation and structured negotiations. Of these, mediation is the most widely used, offering a flexible, confidential, and non-adversarial process that can result in a bind- ing and enforceable settlement, provided the agree- ment contains an enforcement clause. Structured negotiations, while also endorsed by legis- lation, typically lack enforceability unless specified by a separate legal provision. ADR is supported by both public and private institutions, including the state- established Centre for Peaceful Dispute Resolution and private bodies, such as the Centre for Mediation at the Croatian Mediation Association. Additionally, chambers such as the Croatian Chamber of Com- merce and Croatian Chamber of Trades and Crafts facilitate mediation in their respective fields. Euro- pean Union Directive 2008/52/EC further reinforces the development of ADR practices in Croatia, aligning Croatian legislation demonstrates a clear policy ori- entation toward the promotion of ADR, particularly as a preliminary step before litigation. Pursuant to Arti- cle 9 (1) of the Law on Peaceful Dispute Resolution, parties are required to attempt peaceful settlement in compensation-related disputes prior to initiating court them with broader European standards. 12.2 ADR Within the Legal System
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