Category: ADR

INTRODUCTION The Indian economy was up for competition in the year 1990. And with competition, disputes and conflicts came. That requires quick decisions on disputes and proper negotiations to minimize the chances of disputes. To solve this problem, the Government of India enacted the Arbitration Conciliation Act, 1996(amended in 2015 by way of the Arbitration and Conciliation (Amendment) Act, 2015), Legal Services Authorities Act, 1987. In 2001 Civil Procedure Code, Sec. 89 was enacted to provide ADR methods liked Mediation, Conciliation, Lok Adalats, and Arbitration. Following this amendment, the Supreme Court has repeatedly pointed that the courts must identify appropriate cases of mediation, conciliation, or Lok Adalat. According to the National Litigation Policy Of 2011, the average life of litigation in Indian courts is 15 years, and these policies planned to bring it down to 3 years by the end of 2020. Alternative Dispute Resolution (ADR)  ADR is a technique used to resolve conflicts and disputes between parties while delivering an agreeable experience for the parties involved. It can help reduce the burden of litigation on courts. The dispute resolution usually takes place in a private place in the presence of a neutral third party. Types of ADR Arbitration Part 1 of the Arbitration and Conciliation Act, 1996 establishes the process of Arbitration. If an arbitration agreement exists between the parties, before the dispute arises, then the party can take this option as a resolution. Section 7 of the act, states that such agreements must be in writing. Any party can initiate the process of appointing an arbitrator. If the other party is not cooperating, they can approach the office of chief justice for the appointment of an arbitrator.  Only on two grounds, The Party can challenge the appointment of an arbitrator, When there is reasonable doubt in the arbitrator’s neutrality As per the Arbitration agreement, When there is a lack of proper qualifications of the arbitrator. There is little scope of interventions of the judiciary in the process of Arbitration.  If the period for filing an appeal for setting aside an award is over or such appeal is rejected. Then the award is binding on the parties and is considered as a decree of the court. Trials are more formal than Arbitration, and rules of evidence are many times relaxed. Conciliation  Part 2 of The Arbitration and Conciliation Act, 1996 establishes the process of conciliation. Under Article 62 of the Arbitration and Conciliation Act, The party who initiates a conciliation shall send a written invitation briefly stating the subject of disputes in it. When the other party in written accepts a written invitation, then only Conciliation proceedings shall start. Under Section 30 of the Act, any party can initiate a conciliation process, even if the Arbitration process is going on. In conciliation, the parties to the dispute use conciliator who meets with them separately to settle their dispute and lower the tensions between the parties. There is no need for a prior agreement like in Arbitration. According to Conciliator, there is a settlement element, then he may list the terms of settlement and send it to parties. If both the parties sign the document mutually, it shall be final and binding on both parties. Mediation  It aims to assist two or more parties in reaching an agreement. Rather than accepting something imposed by some other person, these parties themselves determine their settlement terms. Mediators help the parties to settle on the disputed matter. Mediation covered a variety of disputes such as legal, commercial, and family matters. There are four stages in the process of mediation Opening Statement Joint session  Separate session Closing statement Negotiation It is a nonbinding procedure. Without third-party intervention, discussions between the parties initiated with the object to arrive at a negotiated settlement. It is the primary method of alternate dispute resolution in India. Lok Adalats  National and Legal Services Authorities Act, 1987 constituted the Lok Adalat system. It is an exclusively Indian approach that is on Gandhian principles. Lok Adalats means “People’s Court” There is no Court fee and no need to follow procedures given under CPC and Evidence Act. Parties can directly approach judges. The main motive of these Adalats is to do a compromise between the parties. If the Compromise has not arrived, it goes back to the courts. But if the Compromise has attained, it became binding on both parties. You cannot appeal for these awards even under Article 226 of the Constitution. Advantages of Alternate Dispute Resolution  People resolve their dispute in less time as compared to courts It saves a lot of money as compared to the litigation process. It is free from the technicalities of courts and has informal ways to resolve disputes. It prevents further conflict and maintains a good relationship between the parties as they discuss their issues together on the same platform. It preserves the best interest of both parties. Landmark Judgments  Bhargavi Constructions v. Kothakapu Muthyam Reddy In this case, The court held that under Articles 226 and 227 of the Indian Constitution, settlements were appealed only on limited grounds. Brahmani River Pellets Ltd. V. Kamachi Industrial Ltd. In this case, both the parties consented to Bhubaneshwar as the venue for Arbitration proceedings. It shows the intention to exclude all the other jurisdictions. The apex court held that the Madras has no territorial jurisdiction in this case. Hindustan Construction Company Limited & Anr. Vs. Union of India & Ors. In this case, the apex court struck down Section 87 of the Arbitration and Conciliation Act because it is arbitrary as article 14 of the Indian Constitution. Rashid Raza v. Sadaf Akhtar In this case, the Apex court held that a mere simple allegation of fraud taints the effect of the Arbitration Agreement. Tulsi Narayan Garg v. The Madhya Pradesh Road Development Authority, Bhopal and Ors. In this case, the court held that if the person is a party to an arbitration agreement, then he cannot become an arbitrator in his cause. Salem Advocate Bar Association v.Read More

Vanshika Arora is a first-year student at Army Institute of Law, Mohali. This article provides the meaning and mechanism of the process of conciliation.  INTRODUCTION Conciliation is an alternate dispute resolution (ADR) technique. ADR is an attempt to devise mechanisms that are an alternative to the conventional justice systems. These alternatives are endorsed since the courts cannot take all the burden of administering justice. Some disputes can be amicably settled outside of court, hence sparing money, time, and effort of the aggrieved party as well as the judicial system. The pendency of cases in the courts is another reason that ADR techniques are preferred. A meeting of Chief Ministers and Chief Justices, held in 1993, formed a resolution to undertake and promote methods of ADR such as arbitration, conciliation, mediation, and negotiation. The meeting emphasized that these “out of court” techniques are flexible in terms of procedure, and save a lot of time and expenditure as compared to the traditional court dispute resolution.  Conciliation Part III of the Arbitration and Conciliation Act, 1996 deals with the procedure and mechanism of conciliation. According to Wharton’s Law Lexicon, conciliation is the “settling of disputes without litigation”. It is done outside of court, with the help of a third party called the “conciliator”. The parties involved, arrive at a decision themselves, with the assistance of the conciliator, and no administrative or judicial intervention is observed, as is the case with arbitration, wherein the final judgment is decided by the Arbitration Tribunal.  According to Halsbury’s Law of England, “Conciliation is the process of persuading parties to reach an agreement, and is plainly not arbitration, nor is the chairman of a conciliation board an arbitrator.” Meaning Section 61 (Application and Scope): This section of the Arbitration and Conciliation Act, 1996, clearly states that conciliation proceedings can only be carried out in disputes arising out of a legal relationship, that could be contractual in nature. For a dispute to arise out of a legal relationship, the right to sue should exist. Moreover, conciliation proceedings cannot be carried out in such disputes where by virtue of law, conciliation is prohibited.  Role and Appointment of a Conciliator Section 63 and 64 lay down the qualification, number, and process of appointment of conciliators. According to Section 63, the number of conciliators may vary from one to three. In the case of more than one conciliator, they must function jointly. Section 64  provides that for assistance in the appointment of a conciliator, parties can approach a suitable institution for hiring a conciliator.  Section 66 further provides that the conciliator is not bound by the Code of Civil Procedure(1908) and the Indian Evidence Act(1872). Role of Conciliator(Section 67): This section provides that the conciliator has to carry the process amicably, in an independent and impartial manner. He can conduct the conciliation proceedings in any manner he deems fit and does not have to adhere to any manner stipulated by any enactment. He may also at any point in time refer the dispute to settlement proceedings, without furnishing any statement enumerating reasons for the same.  Lastly, the conciliator has to be guided by the principles of objectivity, fairness, and justice. For better conduct of the proceedings, parties may also seek the administrative assistance of a suitable institution or party, as given under Section 68. Restrictions on Role of Conciliator As per Section 80 of the Act, the conciliator shall not act as an arbitrator in any proceeding subject to conciliation. Moreover, he shall not be presented by the parties as a witness in any arbitral or judicial proceedings.  Procedure The procedure of conciliation is carried out in the following manner:  Section 62(Commencement of Conciliation Proceedings):  This section provides that the party wishing to conciliate shall send a written notice enumerating the objective of conciliation, to the other party. The other party can accept or reject the notice. If rejected, no conciliation proceedings can be carried out. If the sending party does not receive a reply within thirty days, or within such a period as defined under the notice, this should be treated as a rejection.  Section 65(Submission of Statements to the Conciliator): This section provides that, upon the election of a conciliator, he can furnish a written statement from both parties, describing the dispute. This statement has to be sent to the opposite parties too. Further, the conciliator may also furnish a written statement, of a party’s position, facts and ground, and any document or evidence corroborating their plea. This statement too has to be exchanged between both the parties. At any stage of the conciliation proceedings, the conciliator may ask for any additional statements. Section 69 (Communication): This section provides that the conciliator may communicate with the pirates orally or in a written manner. He may communicate with them together or separately. Also, the place of conciliation shall be decided by the conciliator, unless both parties have mutually agreed upon a place.  Section 70 (Disclosure of Information): According to this section, when the conciliator receives any factual information from a party, he shall disclose it to the other and demand any explanation. If a party provides any information, demanding it be kept confidential, the conciliator has an obligation to furnish the same to the other party.  Settlement As stated earlier, Section 67 provides that the conciliator may at any point in time refer the case to settlement. Moreover, the parties can also, under Section 72, suggest the settlement of the dispute. Section 73(Settlement Agreement): According to the section, when it appears to the conciliator that elements of settlement exist, he may formulate terms of such settlement and submit them to the parties, which can suggest observations for re-formulation. When the parties reach a settlement, they need to draw up and sign a written settlement, which shall be binding upon both parties.   In the case of Harsh Dayaram Thakur v State of Maharashtra, the Apex Court held that a settlement formulated by the conciliator on his own, in secrecy is sentRead More

This article is written by APURVA, a student of the Fairfield Institute of Management and Technology, GGSIPU. This article deals with the topic of Mediation, a mechanism of ADR. ABSTRACT In India, ADR- Alternative Dispute Resolution encompasses various methods of settling disputes outside the traditional judicial system. It mentions various methods, such as, arbitration, mediation, negotiation, conciliation, etc. An Alternative Dispute Resolution is an upshot of all such issues which are faced by the public constantly in the litigation. It is like a proxy to the traditional methods of resolving disputes. The mechanisms of ADR mainly focus on resolving disputes of the parties in the minimum time unlike Litigation. It is an option to resolve their issues without an interference of the court. But these mechanisms of ADR have some pros and cons. This article mainly focuses on one of the ways, i.e., Mediation, its position in India and the advantages and disadvantages of that. Keywords: ADR, Mediation, Litigation, Advantages and Disadvantages INTRODUCTION Rule 4 of the Civil Procedure – Alternate Dispute Resolution Rules, 2003 (ADR Rules) defines mediation by stating that:  ‘Mediation’ means the process by which a mediator appointed by parties or by the Court, as the case may be, mediates the dispute between the parties to the suit by the application of the provisions of the Mediation Rules, 2003 in Part II, and in particular, by facilitating discussion between parties directly or by communicating with each other through the mediator, by assisting parties in identifying issues, reducing misunderstandings, clarifying priorities, exploring areas of compromise, generating options in an attempt to solve the dispute and emphasizing that it is the parties own responsibility for making decisions which affect them.  In India, Mediation is a voluntary process in which the disputing parties mutually decide to find a solution to their legal issue by appointing a mediator and entering into a written contract. The mediator acts as a buffer to bring them to an understanding but the decision-making powers remain with the disputing parties. To represent the parties before the mediator and explain the situation in a professional way they can hire ADR lawyers. A mediator can be anyone of any designation and can be appointed formally or casually depending on the wish of the parties, but an Arbitrator needs to be formally appointed either in advance or at the time of the need.  In India, Mediation is divided into two categories as follows:  1. Court referred Mediation:Under Section 89 of the Code of Civil Procedure, 1908, the court may refer to a pending case for mediation in India This type is frequently used in Matrimonial disputes, particularly divorce cases. 2. Private Mediation:Corporates, general Public, anyone from courts as well as the government sector can appoint a Private mediator. In Private Mediation, the mediator is qualified personnel who works on a fixed-fee basis. Principles of Mediation  Mediation has 5 basic fundamental principles which are followed strictly by a mediator as well as the parties for an effective outcome. They are: Parties should participate voluntarily  It is in the hands of the parties to decide whether they want their dispute to be resolved by a mediator or they want to go to a court. Both the parties decide voluntarily, and It is necessary that no one should force them to mediate. Confidentiality matters in the process  Every discussion and information given during the mediation shall be kept confidential unless there is a criminal intent or act that involves harm to self or others. And the information provided cannot be used in the court proceedings neither by the mediators nor a court can ask why the mediation did not work. Mediators are impartial  The mediator should observe all the principles of mediation and consider only matters of procedure and must act impartially and neutrally. He. He should not comment, value judgments, nor give advice or suggest solutions.  An agreement has to be settled with the satisfaction of parties concerned  The process of mediation can only be initiated if there is an agreement between the parties. Mediation cannot be started without the consent of both the parties intending to resolve the dispute. A mediator should know how to explain the advantages of such dispute resolution to the parties, so that they themselves voluntarily agree to be part of such process. A party may at any time withdraw their participation according to their discretion and then transfer the case to the judge. A mediator can interrupt mediation if he feels that the parties have turned away from the solution or that they are even more opposed than they were at the start of mediation.  Mediation is without prejudice to other procedures  Mediation is only meant to resolve issues between parties and not prejudice them. Mechanism of Mediation  “Mediation” is a well-known term in International Law. The process of mediation may include several stages. They are: opening statement opening statements of the parties summarizing and agenda exploration of issues private sessions or caucuses joint negotiation session agreement Practitioners in this field adopt their own preferred styles and they differ in their basic steps. It completely depends upon the nature of the dispute. In this process the mediator gets the opportunity to locate the points of differences and the areas of controversy and then help the parties to overpass the gap between them. The mediator should be neutral to both the parties. The neutrality of the mediator is similar to the neutrality of a Judge, but the role is completely different from that of a Judge. The mediator is not supposed to either deliver a judgment or dictate the terms of the agreement to the parties. Why Mediation is Effective? The following points are advantageous for the effectiveness of the ADR mechanism of Mediation: Informality – The mechanism of mediation is informal by nature as it does not involve any court rule or legal precedents. No rights are vested in the hands of the mediator to impose his decisions upon the parties, rather, the solutionRead More

This article is written by K.Lasya Charitha pursuing BALLB in Damodaram Sanjivayya National Law University, Visakhapatnam. In this article, the researcher describes the History of ADR in India, types of ADR, the Importance of ADR in India, and few case laws related to ADR. What is ADR? Alternate Dispute Resolution (ADR) is the process that helps parties of a suit to resolve their disputes without the intervention of any judicial institution or any trial process. This process is usually confidential, less formal, and also less stressful compared to the traditional court procedures. The Alternate Dispute Resolution process resolves all types of disputes which include civil, commercial, family, and high profile labor disputes, etc., where the parties will not be able to negotiate and reach a settlement. ADR process uses third parties to help and communicate between both parties and reach a conclusion. These are often collaborative and help the parties to understand each other easily. Generally, the ADR process comes out with creative idea solutions that the traditional courts may not be legally allowed to impose. The ADR process gives the opportunity to the parties to maintain co-operation, social order and helps to reduce hostility. History of ADR in Ancient India Dispute resolution through ADR is inherently built into Indian culture. Since the Vedic period, the indigenous peoples have not used opposing methods to resolve their disputes. Yajnavalkya and Narada found that the courts of Kula, SRENI, and Puga had settled disputes in ancient India. Disputes between family members, communities, castes, or races and tribes were settled using these methods. The SRENI was a court composed of trade experts that helped traders resolve their trade disputes internally. Puga was a court made up of people who belonged to several parishes, but from the same place as Panchayat, these courts followed a simple decision-making process. The Kula decision can be challenged before the SRENI and the SRENI decision before Pradvivaca. and the final calling was allowed to the king. These courts had made decisions about the interests of the party and the community.[i] Functions of ADR Reduce the workload of the courts, which has indicated that there are currently around 3.4 million cases pending in Indian courts (data from national justice data grid). Resolving cases swiftly equates to justice by avoiding procedural delays associated with the mandatory judicial system and therefore complying with the primary right of the speedy trial division of Article 21.[ii] As the cost and time of litigation decrease, the chances of access to justice will increase. Therefore, it fulfills its obligation to provide free legal aid to the poor under 39A.[iii] Save the common man from the complicated and unpleasant legal process.  The ADR procedure offers discretion. Assistance in important communal matters for litigants, especially in civil matters such as divorce.  In support of authority. For example Administrative Courts, National Company Law Court, National Green Court, and others. Some Important Provisions related to ADR Section 89 of the Code of Civil Procedure, 1908 talks about the ” Settlement of disputes outside the court”. The contents of the said section are as follows:         “where it appears to the court that there exist elements of a settlement which may be acceptable to the parties, the court shall formulate the terms of the settlement and give them to the parties for their observations and after receiving the observations of the parties, the court may reformulate the terms of a possible settlement and refer the same for : Arbitration Mediation Conciliation Lok Adalat”[iv] Other legislations which deal with Alternate Dispute Resolution are the Indian Arbitration Act of 1899, Arbitration (Protocol And Convention) Act of 1937,  The Arbitration Act Of 1940, Arbitration And Conciliation Act of 1996, Legal Services Authorities Act of 1987. Modes of ADR in India Arbitration In arbitration, a neutral person called an “arbitrator” listens to the arguments and evidence of the parties, and then determines the outcome of the dispute. Arbitration is not as formal as the courts, and the rules of evidence are generally relaxed. Arbitration can be “mandatory” or “optional”. Binding arbitration means that the parties waive their right of litigation and agree to accept the arbitrator’s decision as to the final decision. Usually, there is no legal remedy against the arbitrator’s decision. Non-binding arbitration means that if the parties do not accept the arbitrator’s decision, they can file a lawsuit. The types of arbitration are Ad Hoc Arbitration, Institutional Arbitration, Statutory Arbitration, Fast track arbitration. Mediation In mediation, an impartial person called a “mediator” helps the parties find a solution acceptable to both parties. The mediator does not resolve the dispute but helps the parties communicate so that they can try to resolve the dispute on their own. Mediation is not binding on the parties like arbitration. The biggest advantage of mediation is that the entire process is strictly confidential. Mediation saves time and financial and emotional cost of resolving a dispute, thereby, leads to the re-establishment of trust and respect among the parties. Emotions and feelings between parties can be preserved causing minimum stress and heartache. Conciliation Conciliation is a form of arbitration, but it is not so formal in nature. It is a process of promoting peaceful settlement between the two parties. In this process, the parties to the dispute appoint a conciliator to meet with the two parties separately to resolve the dispute to Reduce the tension between the two parties, improve communication, and explain the problem to reach a negotiated solution. There is no need for an agreement in advance, nor can it be imposed on any party that does not seek a settlement, because this is different from arbitration in that way. However, if both parties accept the settlement document drawn by the conciliator, it shall be final and binding on both. Negotiation In India, Negotiation doesn’t have any statutory recognition. Negotiation is self-counseling between the parties to resolve their dispute. Negotiation is a process that has no fixed rules but follows a predictable pattern. It occurs mostly in business, NGOs, among nations, and also in personal matters like marriage, divorce, and everyday life. Essentials of Negotiation are: It is a communication process; It resolves conflicts; It is a voluntary exercise; It is a non-binding process; Parties retain control over outcome and procedure; There is a possibility of achieving wide-ranging solutions, and of maximizing jointRead More

INTRODUCTION This article is written by Hemant Kumar. He is a student of the Faculty of Law, Delhi University.  He has done his graduation from ARSD College, Delhi University. Brief The article is about how a good negotiation is done by a negotiator who is very attentive and active while discussing and bargaining things.    What is “negotiation”? It is a process through which parties solve disputes amicably by looking at each other’s profit. It is basically based on compromise and agreements, mutual understanding is must to negotiate between parties. From bargaining with a vegetable wander or the deals between two Nations, all these small to large contracts are based on negotiation because everyone wants the ball to favour them in their court. Negotiation starts from the time when the parties meet each other and they discuss what they want and at what cost.  A good negotiator is one who can make the deal in his favour without harming what he wants.  The one who has the following qualities is a good negotiator:  Effective Speaker: The one who can state his views clearly in front of everyone and can state what he wants and at what terms he has to speak to the point with effective communication showing confidence that yes he is there to deal and will get the deal.  Listening: He has to listen to the other party also so that he can know what they want and also that they are there for the business and want to make the profit. Effective listening can help him communicate and negotiate in the best way.  Preparation: He has to prepare with all the matters and subjects he is going to negotiate where he can relax what the most important terms and what are the least important terms where he can be more flexible and give relaxations.  Positive Attitude: Dealing with a positive attitude that we want the deal and will do everything to negotiate and get the deal in favour is one the important thing and makes the other party think that yes the man is really interested in the deal and will do all the work efficiently.  Respect: One has to respect the other party also he must bear in mind that they are also for the business and want to earn profit and will negotiate only when they are getting something. Sense of humour plays an important role as it makes both the parties comfortable with each other, when the things get sour one has to think from the other parties view.  Knowledge and Planning: It plays an important role, knowledge for the issue helps the negotiator to plan how much he can negotiate on the particular issue. Knowledge for other similar deals also helps to leave the deal at the correct time.  Patience: Every detail should be analysed properly with great precaution, one has to give time to the other party also and let them decide as we want to grab the deal and also want deals in the future also a mutual understanding has to be established so that none of the party is at loss.  Process of Negotiation Stage wise process of negotiation: Preparation: From time, place, members of the discussion team, rules etc. everything is to be kept prepared so that no last hurries are there. If preparation of thoughts and deal is at par then we will definitely get a better deal.  Discussion: It involves exchange of thoughts between the parties put up by them so that they can know if they are interested or not in the deal, it saves time and also makes parties comfortable with each other. The negotiator should be confident while discussing and not arrogant with his tone.  Bargaining: The start of negotiation, all the negotiations are stated by parties and the deal is finalized by stating what could be bargained and what not.  Closing: Final of the deal if it is made or not then both of the parties start working on their part of the deal.  Examples of Some of the Negotiation Payment of dues of employees during lockdown  The Honourable Supreme Court said that both the employer and employee must negotiate with one another on how they will solve the problem and an amicable solution should be accepted by both of them. Similar suggestions were given to the tenants and the owner of the house so that they can decide how much and when to pay the rent when they were not accommodating in the house during the period of the lockdown.  Joint Comprehensive Plan of Action (JCPOA)  Two permanent Permanent members of the UN and Iran were parties to the deal, where Iran said that they will use nuclear power only for power generation and restrict the use of Uranium. The deal was finalized in the year 2015, but after some time Iran started testing nuclear missiles which led to breach of trust hence the U.S. unanimously pulled itself out from the deal and made sanctions on Iran also on the countries who will do business with Iran. Proper negotiation and follow of the rules could have avoided sanctions and would have been better for the citizens of the country of Iran.  Denuclearization of North Korea Where the U.S. and North Korea were the parties and the deal was very near to finalization after three decades of talks between the officials but America wanted complete denuclearization without giving any relief in sanctions to North Korea hence the deal was not finalized. This was a very important deal for the whole world which could have benefitted all if finalized.  Babri Masjid To settle the dispute amicably outside every possible negotiation was decided by the parties but it was not finalized and hence decided by the Supreme Court of India.  Conclusion Most of the international deals fail to be compromised along with the negotiation as they are bound by restriction and have a force of sanctions but negotiation at a local level or companyRead More