HUNGARY Law and Practice Contributed by: István Varga and Viktor Előd Cserép, PROVARIS Varga & Partners
12. Alternative Dispute Resolution (ADR) 12.1 Views of ADR Within the Country The two most popular methods of alternative dispute resolution in Hungary are mediation and arbitration. As of 2018, the arbitration court attached to the Hungarian Chamber of Com- merce and Industry (the “Commercial Arbitration Court”) has a separate set of rules for institu- tional mediation proceedings, which is based on the relevant UNCITRAL materials and has been updated as of 2022. It is also possible to have an award on agreed terms issued by the mediators as arbitrators based on a settlement reached in an institutional mediation. 12.2 ADR Within the Legal System Pre-trial Settlement Attempt in Court If the amount in dispute does not exceed HUF3 million (approximately EUR8,000), either an order for payment procedure must be initiated or an attempt at pre-trial settlement must be made (see 3.1 Rules on Pre-action Conduct ). If a settlement attempt is requested, the court holds a hearing after having served summons on both parties. If a settlement is reached and it complies with the relevant legal provisions, the court approves it and includes it in the protocol. If no settlement is reached, the court declares the settlement attempt unsuccessful and termi- nates the proceedings. The court proceedings can be suspended upon the joint request of the parties in order that they can participate in mediation proceedings. Conciliation Bodies in Consumer Disputes There are conciliation bodies attached to the (20) territorial chambers of commerce and industry. Consumers can initiate the resolution of B2C disputes by these bodies. Businesses have the
either in accordance with the retainer agreement of the respective attorney or law firm, or pursu- ant to the schedule provided for in the Decree: • 5% of the value of the dispute up to approxi- mately EUR25,000; • 3% of the value above approximately EUR25,000 and up to approximately EUR250,000; and • 1% of the value exceeding approximately EUR250,000. While nominally keeping the aforementioned default schedule, the draft decree clarifies the criteria for the reduction of attorneys’ fees, the considerations for which need to be clearly reflected in the decision. The decree also intro- duces safeguards that limit the possibility to reduce attorneys’ fees. These ensure the parties’ rights to the full recovery of procedural costs and, at the same time, reasonably prevent the award of excessive attorneys’ fees. The reasons for the decision on reducing attorneys’ fees must be detailed, supported by an analysis of the con- tent of the case, the costs included in the fees as well as the scope and the specificity of the work carried out. The new regulation reflects the developments in neighbouring countries as well as the practice of the Kúria . 11.3 Interest Awarded on Costs Interest is not awarded on costs by the court. However, if court fees are not paid within the time limit set forth by the court, fines are imposed in accordance with the provisions on taxation law. Statutory interest on legal costs not paid by the losing party may be requested in enforcement proceedings.
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