The purpose of having a legal system is to maintain an adequate balance between the law-making procedure and ensuring justice within a reasonable time. The term “reasonable” has not been defined anywhere in the law, but it can be interpreted in the literal sense as the time frame within which an individual should have been given justice. However, the present scenario reflects the diminishing view of the objective of legal justice. As per the data of National Judicial Data Grid, the total cases pending (including High Court and lower Court) till date are 3,28,95,950/. Pendency of the cases in a large number raises various questions on our judiciary systems such as the inefficiencies of the judicial system, ignorance towards the concept of a reasonable time for justice or shrinking confidence of people on our justice system. To combat all such issues, a wide variety of “Alternative dispute resolution” mechanism is being adopted nowadays. Such a mechanism not only proved as an additional aid to reduce the backlog of pendency cases but also an efficient mode to reduce the number of litigation.
“An ounce of mediation is worth a pound of arbitration and a ton of litigation.”
– Joseph Grynbaum
Alternative Dispute Resolution Mechanism
The various types of Alternative Dispute Resolution Mechanism are :
- Arbitration: It is a way of resolving the dispute in which a third party known as “arbitrator” mutually decided by both the party, renders the “arbitration award”. Such award is binding on both the parties.
- Conciliation: A non- binding procedure in which an independent third party, the conciliator assist the parties to a dispute in reaching a mutually acceptable decision. However, if both the parties agree to the settlement document drawn by the conciliator, it shall be then final and binding on both.
- Mediation: In this process, an impartial person called as “mediator” helps the parties to try to reach a mutually acceptable resolution of the dispute.
- Negotiations: A non- binding procedure in which discussions between the parties are initiated without the intervention of any third party with the object of arriving at a negotiated settlement to the dispute.
Mediation – A Comprehensive Analysis
Mediation is a well- known mechanism which is being practised in India since ancient times. The “Mahajans” were considered as respected and impartial- businessmen who used to resolve the disputes between merchants through mediation. By 1753, India got converted into a British colony, and the British style courts were established in India by 1775. The British ignored the local method of adjudication (i.e. mediation and negotiation) and modelled the process in the Court. Since then, the British system of justice gradually became the primary justice delivery system of India.
Legal recognition of mediation in India
The concept of mediation received legal recognition for the first time in India through the Industrial dispute Act,1947. The conciliator’s appointed under this act is charged with the responsibility of adopting mediation to resolve the dispute and promote the settlement of an industrial dispute.
Section 89 of Civil Procedure Code,1908, got amended and mandated the courts to explore the possibilities of resolving the disputes through arbitration or mediation or lokadalat. Further Mediation Rules,2003 provides for mandatory mediation which means Court is empowered to refer the case for mediation even when parties are not ready for reference for mediation if there is an element of mediation.
Section 442 of Companies Act 2013 read with the Companies (Mediation and conciliation) rules,216; provides for referral of disputes to mediation by the National company law tribunal and appellate tribunal.
Family and personal laws, including the Hindu marriage act,1955 and the special marriage act,1954 require the Court in the first instance to attempt mediation between parties.
The Micro, Small and Medium Enterprises Development Act, 2006 mandates conciliation where a dispute arises on account of payment to MSME.
Evolution of mediation in India
There are various phases in which mediation evolution in India has taken places. They are –
- The Institute for the study and development of legal system sent the American trainers in Gujrat in the year 2000 to train the mediators. This was followed by a training workshop conducted by Institute for Arbitration Mediation Legal Education and Development, a public charitable trust settled by two senior lawyers of Ahmedabad.
- On 27th July 2002, the chief justice of India formally inaugurated the “Ahmedabad Mediation Centre” the first lawyer managed mediation centre in India.
- On 9th April 2005,” Chennai-Mediation Centre” was inaugurated and it started functioning in the premises of Madras High Court. This became the first Court annexed mediation centre in India.
Types of mediation
There are two types of mediation which are prevailing in our country. They are –
- Court Annexed Mediation – The Court provides the mediation service as an extended service of its judicial system. Court maintains a database of skilled and professional individual who acts as a mediator on behalf of Court. The overall supervision on the process is maintained as well as the confidentiality of the matter is retained. The same lawyers who appear in a case retain their brief and continue to represent their client in front of the mediator. The litigant also feels the sense of empowerment by being allowed to play a participatory role in resolving their disputes.
- Private – In this type of mediation, the outside independent party is being hired on a monetary basis by the parties on mutual consent to resolve the dispute.
Steps involved in Court annexed mediation
The steps involved are –
- Opening statement by the Mediator: At this stage, the mediator tries to build the confidence of the parties by establishing his independence, explain the procedure to the parties and inform them all that is discussed during this process will be kept confidential.
- Joint session: The mediator encourages the parties to explain their side of the dispute along with several differences, claims and complaint. This, in turn, gives the mediator an understanding of the case and also the opportunity to the parties to hear each other sides.
- Private Caucus/Separate Session: During this stage, mediator discusses the matter with parties separately. Evaluates and point out the strengths and weaknesses of the case. He also gets to know about the confidential information which a party may not wish to disclose to the other party.
- Finding a Solution: This is the last stage where mediators encourage parties to come out with solution/alternatives. Help the parties to draw the draft statement. Also, enable the party to reach a mutually agreeable solution.
Benefits of Court Annexed Mediation
The benefits are laid down as –
- The mediation procedure is speedy, economical as well as efficient.
- It encourages a “participative approach” where parties equally participate in resolving the conflicts.
- The proceedings are kept fair and confidential.
- The procedure is simple, flexible and not cumbersome as legal disputes in the Court.
- In mediation, the focus is on resolving the dispute in a mutually beneficial settlement.
Moti Ram(D) Tr.Lrs & Anr v Ashok kumar & Anr
The apex court held that if mediation is unsuccessful, then the mediator should only write one sentence in his report and sent it to the Court stating that the mediation has been unsuccessful. Beyond that, the mediation should not write anything which was discussed, proposed or done during the mediation proceedings.
M/S Afcons Infra Ltd & Anr v M/S Cherain Varkey Construction
The Court held that section-89 starts with the words “where it appears to the court that there exist elements of a settlement”. It clearly shows that cases which are not suited for the ADR process should not be referred under section 89 of the code. In all other case references to the ADR process is a must.
Salem Advocates Bar Asn v UOI
The apex court held that if the parties agree to arbitration, then the provision of the Arbitration and Conciliation Act,1996 will apply and the case will go outside the stream of the Court but recording to conciliation or judicial settlement or mediation to settling the dispute would not ipso facto take the case outside the judicial system.
It is rightly said by Albert Einstein that “In the middle of every difficulty lies opportunity”. In the same line “mediation” acts as a powerful tool to resolve the dispute amicably without degrading the long term relationship of the party. Beside it is an effective mechanism to settle the pending litigation and prevent future litigation.
Court annexed mediation has brought the confidence of the parties in the process as the entire process is governed by the Court. Besides, these matters such as fixing time frame within which the process should be carried out, the fees of the mediator and the resolution of the dispute in terms of settlement agreements are dealt by the Court. Thus, the Court plays a pivotal role in the successful implementation of the mediation process.
There are a few suggestions which could make the process of mediation more effective and acceptable by the public in general. These are (a) Standards for the code of ethics to be formulated. (b)Encouragement to the lawyers to persuade and educate the parties to adopt the mediation process.(c) Creating awareness about the procedure among the public.(d) Training programme for the mediators to be conducted regularly. (e)Comprehensive legislative framework on mediation should be incorporated.
Frequently Asked Questions
- What are the different types of Alternative Dispute Alternative Mechanism?
- What is the background behind mediation in India?
- What is the step involved in mediation?
- What are the benefits of mediation?
- Mention a few landmark judgments?
  14 (ADDL.) SCR 809
 2010 (8) SCC 24
 2002 Supp(3) SCR 353