Sujenna, you misunderstand the point of mediation. It is not to formally resolve the problems in respect of the strata Act. It is instead to get the parties together informally and try to bridge the dispute(s).
Actually, I think you have misunderstood the OP’s point, which is that just calling for mediation might have the effect of making the other party realise there is a process that could lead to the Tribunal and that process has formally begun.
She said: ” I am anticipating that proceedings will stop at mediation, as that will be enough of a shock for the SM to ‘pull his head in’ and stop issuing frivolous work orders.”
This is an absolutely valid tactic, especially now that applications for mediation are free of charge. If the other side doesn’t show up, then she can take it to the next level if she chooses.
If they do show up, then someone at Fair Trading might explain the facts of strata life to them and they can decide if they want to take their chances at a tribunal.
But the most important thing at this stage is that the other side now knows she has options.