ARBITRATION , CONCILLIATION AND ALTERNATE DISPUTE

RESOLUTION (PRACTICAL TRAINING)

TOPIC NO. 1 TO 4 ARE FIELD WORKS TO BE DONE BY STUDENTS

WITH THE HELP OF THERE CASE DIARY MAINTAIN DURING THE
VISITS THEY HAVE DONE.

5.Effectiveness and menaces of existing justice delivery system

Introduction

The Indian judicial system, a part of world’s largest democracy, is very old to
follow. Right from the monarchical rule to the British era and the modern
system of the independent India, the Indian judicial system has always tried to
seek justice for the innocent and punishment for the guilty. The modern day
judicial system administers a common law system of legal jurisdiction. The laws
are codified, and different types of punishment are given depending upon the
crime of the culprit.

Let’s take a look at how the Indian judiciary works. There are various levels of
judicial bodies in India. If we look at the hierarchy, it is as follows:

 The Supreme Court.

 The High Courts.
 The District Courts.
 The Village Courts/Panchayats.
All these courts have their jurisdictions and are to follow the laws according to
the Constitution of India. It is their duty, as mandated by the Constitution, to be
its watchdog. They do so by calling into scrutiny any act of the legislature or the
executive, who otherwise, are free to enact or implement these, from
overstepping the boundaries set for them by the Constitution. The Indian
judicial system is independent from legislative and executive bodies in India.

Issues with the Indian judicial system

Despite the independence of the judiciary from the executive and legislative
bodies, the Indian judicial system faces a lot of problems. We will now discuss a
few problems that the Indian judicial system faces.

The major issues that the Indian judicial system faces are:

 The pendency of cases.

 Corruption.
  Lack of transparency (particularly in the appointment of judges).
 Judicial vacancies.
 Under trials of the accused.
 Lack of information and interaction among people and courts.
Let’s now try to elaborate the following points.

The pendency of cases

“Judicial discipline requires promptness in delivery of judgments.” The courts
have observed in the case of Anil Rai v. State of Bihar (2001) that delay in
reasoned judgement by the courts amounts to a violation of the Right to Life as
guaranteed under Article 21 of the Constitution. The Court also laid down that
after the operative part of the decision is delivered, the judgement should also
be delivered within 2 months from the date of delivery of the operative part. If
the court fails to adhere to the following guidelines, any of the parties to the
suit can file an application before the Chief Justice of the High court. If the
judgment, for any reason, is not pronounced within a period of six months any
of the parties of the said case become entitled to move an application before
the Chief Justice of the High Court with a prayer to withdraw the said case and
to make it over to any other Bench for fresh arguments.

One of the primary issues with the Indian judicial system is the pendency of
cases. If the vacancies are filled, pendency would go down and make the justice
delivery system efficient. According to a report of 2015, there were close to 400
vacancies for the post of judges in the 24 High Courts of the country. The
pending number of cases in the Supreme Court has mounted to around 60,000.
There are some 25-30 million cases in various courts. Budget allocation for the
judiciary is just 0.2 percent of the GDP. The judge-population ratio is 10.5-11 to
one million, which should be at least 50-55 to one million.

One of the dazzling defects of the Indian Judiciary is the huge pendency or
backlog of cases at all levels of the Indian Judiciary. About four lakhs of them
are cases in the High court, 65,000 in the Supreme Court. The rate of the
backlog of cases is increasing with every passing day. The number of
institutions of a suit is quite large in comparison to the number of judges that
have to dispose of it. For 1 million people there are only 17 judges at levels of
the Judiciary. The litigants have to wait for years to have their rights
determined by the court of law. According to the Code of Civil Procedure
1908, in a civil suit, there cannot be more than three adjournments. According
to a report of Vidhi Centre, 70% of civil cases get more than three
adjournments. The infrastructure of the courtrooms is not sufficient for the
delivery of quality judgements, moreover, the lower Judiciary is still not
equipped with technological resources and most of the work is done through the
traditional way of paperwork. The quality of the judges of the subordinate
courts is also not acceptable which leads to a high rate of cases being appealed
before the High courts. The Supreme court does not have any listing calendar
even when a case is listed there is no certainty that the case would be heard on
that particular day. There is no time fixation up to which a case has to be finally
disposed of which increases the load of pendency of cases.

A large number of cases that are pending in the Supreme Court as well as the
other lower courts has defeated the purpose of the judicial system. A famous
proverb says, ‘justice delayed is justice denied’. Judiciary is no longer attracting
the best legal talent because of disparity in the income of bright young lawyers
and the emoluments of judicial officers. To attract persons of true potential to
the judicial cadre, the system must improve their service conditions, particularly
the conditions of the trial court judges.

In general, when the victim is not economically well off, they need to suffer as
they are financially weak and hence cannot afford high profile lawyers who can
win the case in a limited span of time. Meanwhile, the rich can easily afford
expensive lawyers and change the course of dispensation of the justice in their
favour (not necessarily true if the lawyer follows ethical standards). This also
creates a big blockade for international investors and corporations who want to
conduct business operations in India. According to a report, in Mumbai, India’s
financial hub, the courts are burdened with age-old land disputes which act as a
hurdle to the city’s industrial development. Thus, the pendency of cases and
lack of lawyers and judges is a big challenge to the Indian judicial system.

Corruption
Like the other pillars of democracy, the executive and the legislative, the
judiciary too (in some instances) has been found to engage in corruption. There
has not been established any system of accountability. In the case of judicial
processes, even the media is unable to give a proper and clear picture of the
corruption scenario. The media seems to be more focused on exposing
corruption in other fields, especially the executive. A minister taking a bribe or
distributing money during elections may become a headline, but a courtroom
clerk taking a bribe and altering the date of the trial remains unnoticed.

As per the constitutional provision, there is no provision yet for registering an

FIR against a judge who has taken bribe without taking the permission of the
Chief Justice of India. Obviously, visiting the CJI, seeking his permission, and
then registering an FIR is not what a poor man will prefer to do. This will prove
to be more expensive and time consuming for him, besides the court and
lawyer’s expenses.

The Professional arrogance of the judges whereby judges do not do their

homework and arrive at decisions of grave importance while ignoring precedent
or judicial principle delays justice and adds to trial’s spam. In 2011, Soumitra
Sen, a former judge at the Calcutta High Court became the first judge in the
India to be impeached by the Rajya Sabha alleged for misappropriation of
funds.
Lack of transparency (particularly in the
appointment of judges)
In the recent past, there have been many debates around all over the nation
regarding the Collegium system and the new system that the government wants
to introduce for the appointment of judges, the NJAC. Well, be it the collegium
system or the NJAC, none seem to be transparent enough to make the selection
process of judges clear and understandable to the common public. All
democracies are swiftly moving toward an open government and a citizen’s
right to know — an international trend increasingly being supported by judicial
decisions. Further, the right to know is a part of the freedom of speech and
expression and the present secretive system, as implemented by the collegium
system, violates this fundamental right. The principle of open trials and justice
is highly essential for the fair administration of justice.

The Judiciary is that organ of the Government which is not accountable for its
actions. The Right to Information Act does not apply to the Judiciary. Under a
recent judgement, the Court has held that the office of the Chief Justice of India
also falls under the Right to Information Act,2002. Transparency of the Judiciary
enhances the support of its citizens. Where the Judiciary is transparent, people
are assured that justice is being served. There is a lack of transparency in the
Judiciary as to many aspects such as the appointment of the judges and in the
administration of justice. The January press conference of 2018 consisted of the
then Chief Justice of India- Ranjan Gogoi and four senior judges- Justice N V
Ramana, Justice D Y Chandrachud, Justice Sanjiv Khanna and Justice Deepak
Gupta. It was set up regarding what extent the information about the
appointment of the judges should be accessed by the general public. If the
Judiciary defends its standing of not making the information open for the public
to access, it means it is restricting the people’s Right to Information in the light
of judicial independence. Lack of transparency in the Judiciary makes the people
sceptical about the fairness of the Judiciary in carrying out its functions and
their faith in the Judiciary is somewhat minimized.

The current government led by Prime Minister Modi states that the introduction
of NJAC shall be more transparency in appointment of judges. The supreme
court of India, however, denied the fact and said there is a need for the even
higher level of law for the appointment of judges as NJAC is not “perfect.”
According to the SC, the bar council was invited to amend the NJAC saying that
the committee must comprise of the Chief Justice of India and four senior
judges of the supreme court.

Well, let’s say on this matter the government and the supreme court stand face
to face, but the fact is still unanswered whether the stated amendment or even
the current proposal bring transparency in the selection of judges and make the
framework clear to the common public?
6.PUBLIC INTEREST LITIGATION
 The expression ‘Public Interest Litigation’ has been borrowed from
American jurisprudence, where it was designed to provide legal
representation to previously unrepresented groups like the poor, the
racial minorities, unorganised consumers, citizens who were
passionate about the environmental issues, etc.
 Public interest Litigation (PIL) means litigation filed in a court of
law, for the protection of “Public Interest”, such as Pollution,
Terrorism, Road safety, Constructional hazards etc. Any matter
where the interest of public at large is affected can be redressed by
filing a Public Interest Litigation in a court of law.
 Public interest litigation is not defined in any statute or in any
act. It has been interpreted by judges to consider the intent of public
at large.
 Public interest litigation is the power given to the public by courts
through judicial activism. However, the person filing the petition must
prove to the satisfaction of the court that the petition is being filed for
a public interest and not just as a frivolous litigation by a busy body.
 The court can itself take cognizance of the matter and proceed suo
motu or cases can commence on the petition of any public spirited
individual.
 Some of the matters which are entertained under PIL are:

o Bonded Labour matters

o Neglected Children
o Non-payment of minimum wages to workers and exploitation of
casual workers
o Atrocities on women
o Environmental pollution and disturbance of ecological balance
o Food adulteration
o Maintenance of heritage and culture
Genesis and Evolution of PIL in India: Some Landmark
Judgements
 The seeds of the concept of public interest litigation were initially
sown in India by Justice Krishna Iyer, in 1976 in Mumbai Kamagar
Sabha vs. Abdul Thai.
 The first reported case of PIL was Hussainara Khatoon vs. State
of Bihar (1979) that focused on the inhuman conditions of prisons
and under trial prisoners that led to the release of more than 40,000
under trial prisoners.

o Right to speedy justice emerged as a basic fundamental

right which had been denied to these prisoners. The same set
pattern was adopted in subsequent cases.
 A new era of the PIL movement was heralded by Justice P.N.
Bhagawati in the case of S.P. Gupta vs. Union of India.

o In this case it was held that “any member of the public or social
action group acting bonafide” can invoke the Writ Jurisdiction of
the High Courts (under article 226) or the Supreme Court (under
Article 32) seeking redressal against violation of legal or
constitutional rights of persons who due to social or economic or
any other disability cannot approach the Court.
o By this judgment PIL became a potent weapon for the
enforcement of “public duties” where executive action or
misdeed resulted in public injury. And as a result any citizen of
India or any consumer groups or social action groups can now
approach the apex court of the country seeking legal remedies
in all cases where the interests of general public or a section of
the public are at stake.
o Justice Bhagwati did a lot to ensure that the concept of PILs was
clearly enunciated. He did not insist on the observance of
procedural technicalities and even treated ordinary letters from
public-minded individuals as writ petitions.
 The Supreme Court in Indian Banks’ Association, Bombay & Ors.
vs. M/s Devkala Consultancy Service and Ors held :- “In an
appropriate case, where the petitioner might have moved a court in
her private interest and for redressal of the personal grievance, the
court in furtherance of Public Interest may treat it a necessity to
 enquire into the state of affairs of the subject of litigation in the
interest of justice.” Thus, a private interest case can also be
treated as public interest case.
 M.C Mehta vs. Union of India: In a Public Interest Litigation brought
against Ganga water pollution so as to prevent any further pollution
of Ganga water. Supreme Court held that petitioner although not a
riparian owner is entitled to move the court for the enforcement of
statutory provisions, as he is the person interested in protecting the
lives of the people who make use of Ganga water.
 Vishaka v. State of Rajasthan: The judgement of the case
recognized sexual harassment as a violation of the fundamental
constitutional rights of Article 14, Article 15 and Article 21. The
guidelines also directed for the Sexual Harassment of Women at
Workplace (Prevention, Prohibition and Redressal) Act, 2013.
Factors Responsible for the Growth of PIL in India
 The character of the Indian Constitution. India has a written
constitution which through Part III (Fundamental Rights) and Part IV
(Directive Principles of State Policy) provides a framework for
regulating relations between the state and its citizens and between
citizens inter-se.
 India has some of the most progressive social legislations to be
found anywhere in the world whether it be relating to bonded labor,
minimum wages, land ceiling, environmental protection, etc. This
has made it easier for the courts to haul up the executive when it is
not performing its duties in ensuring the rights of the poor as per the
law of the land.
 The liberal interpretation of locus standi where any person can
apply to the court on behalf of those who are economically or
physically unable to come before it has helped. Judges themselves
have in some cases initiated suo moto action based on newspaper
articles or letters received.
 Although social and economic rights given in the Indian Constitution
under Part IV are not legally enforceable, courts have creatively read
these into fundamental rights thereby making them judicially
enforceable. For instance the "right to life" in Article 21 has been
expanded to include right to free legal aid, right to live with dignity,
right to education, right to work, freedom from torture, bar fetters and
hand cuffing in prisons, etc.
 Judicial innovations to help the poor and marginalised: For
instance, in the Bandhua Mukti Morcha, the Supreme Court put the
burden of proof on the respondent stating it would treat every case
of forced labor as a case of bonded labor unless proven otherwise
by the employer. Similarly in the Asiad Workers judgment
case, Justice P.N. Bhagwati held that anyone getting less than the
minimum wage can approach the Supreme Court directly without
going through the labor commissioner and lower courts.
 In PIL cases where the petitioner is not in a position to provide all the
necessary evidence, either because it is voluminous or because the
parties are weak socially or economically, courts have appointed
commissions to collect information on facts and present it before the
bench.
Who Can File a PIL and Against Whom?
 Any citizen can file a public case by filing a petition:

o Under Art 32 of the Indian Constitution, in the Supreme Court.

o Under Art 226 of the Indian Constitution, in the High Court.
o Under sec. 133 of the Criminal Procedure Code, in the Court of
Magistrate.
 However, the court must be satisfied that the Writ petition fulfils
some basic needs for PIL as the letter is addressed by the aggrieved
person, public spirited individual and a social action group for the
enforcement of legal or Constitutional rights to any person who are
not able to approach the court for redress.
 A Public Interest Litigation can be filed against a State/ Central
Govt., Municipal Authorities, and not any private party. The
definition of State is the same as given under Article 12 of the
Constitution and this includes the Governmental and Parliament of
India and the Government and the Legislature of each of the States
and all local or other authorities within the territory of India or under
the control of the Government of India.
Significance of PIL
 The aim of PIL is to give to the common people access to the courts
to obtain legal redress.
 PIL is an important instrument of social change and for
maintaining the Rule of law and accelerating the balance between
law and justice.
 The original purpose of PILs have been to make justice accessible
to the poor and the marginalised.
 It is an important tool to make human rights reach those who have
been denied rights.
 It democratises the access of justice to all. Any citizen or
organisation who is capable can file petitions on behalf of those who
cannot or do not have the means to do so.
 It helps in judicial monitoring of state institutions like prisons,
asylums, protective homes, etc.
 It is an important tool for implementing the concept of judicial review.
 Enhanced public participation in judicial review of administrative
action is assured by the inception of PILs.
Certain Weaknesses of PIL
 PIL actions may sometimes give rise to the problem of competing
rights. For instance, when a court orders the closure of a polluting
industry, the interests of the workmen and their families who are
deprived of their livelihood may not be taken into account by the
court.
 It could lead to overburdening of courts with frivolous PILs by
parties with vested interests. PILs today has been appropriated for
corporate, political and personal gains. Today the PIL is no more
limited to problems of the poor and the oppressed.
 Cases of Judicial Overreach by the Judiciary in the process of
solving socio-economic or environmental problems can take place
through the PILs.
 PIL matters concerning the exploited and disadvantaged groups are
pending for many years. Inordinate delays in the disposal of PIL
cases may render many leading judgments merely of academic
value.
Conclusion
 Public Interest Litigation has produced astonishing results which
were unthinkable three decades ago. Degraded bonded labourers,
 tortured under trials and women prisoners, humiliated inmates of
protective women’s home, blinded prisoners, exploited children,
beggars, and many others have been given relief through judicial
intervention.
 The greatest contribution of PIL has been to enhance the
accountability of the governments towards the human rights of the
poor.
 The PIL develops a new jurisprudence of the accountability of the
state for constitutional and legal violations adversely affecting the
interests of the weaker elements in the community.
 However, the Judiciary should be cautious enough in the application
of PILs to avoid Judicial Overreach that are violative of the principle
of Separation of Power.
 Besides, the frivolous PILs with vested interests must be
discouraged to keep its workload manageable.

7.Meaning of A.D.R.
Alternative dispute resolution (ADR) refers to the different ways people can resolve disputes without
a trial. Common ADR processes include mediation, arbitration, and neutral evaluation. These
processes are generally confidential, less formal, and less stressful than traditional court
proceedings.
ADR often saves money and speeds settlement. In mediation, parties play an important role in
resolving their own disputes. This often results in creative solutions, longer-lasting outcomes, greater
satisfaction, and improved relationships.
The New York State Unified Court System offers parties access to free or reduced-fee mediation
and other ADR services in family law, general civil and commercial law disputes. These services are
available in many courthouses and in the Community Dispute Resolution Centers located in almost
all of New York State’s 62 counties.

Advantage
(1) Lower cost ADR tends to be lower in cost than litigation.
2.Avoids a jury: alternative dispute resolution methods generally involves the use of one or more knowledgeable
professionals to resolve the dispute.
3. Privacy: alternative dispute resolution is a private process; whereas, litigation and court records are open to the
public. The result can be kept confidential in ADR.
4. ADR is speedy: trials are lengthy; whereas alternative dispute resolution techniques help to resolve the dispute in
a very minimum time.
5.Less stress: methods of alternative dispute resolution are often less stressful than expensive and lengthy litigation.
Many people have a high degree of satisfaction with ADR.
6.Co-operation: ADR allowed the party to work together with the help of third party appointed who is independent
and neutral.
7. The parties can often select their own arbitrator, mediator, conciliator to dissolve their disputes.

Disadvantages of ADR: no guaranteed resolution with the exception of

arbitration.
2.Discovery limitations: like some of the procedure of safeguard to protect the party is available
in court but this facility is not provided in ADR.

8.Types of A.D.R.
1 Arbitration
2.Mediation
3.Conciliation
4.Negotiation
5.Lok Adalat
1. Arbitration:
The definition of ‘arbitration’ in section 2(1) (a) verbatim reproduces the text of
article 2(a) of the Model Law-‘arbitration means any arbitration whether or not
administered by a permanent arbitral institution’. It is a procedure in which the dispute
is submitted to an arbitral tribunal which makes a decision (an “award”) on the dispute
that is binding on the parties.
It is a private, generally informal and non-judicial trial procedure for adjudicating
disputes. There are four requirements of the concept of arbitration: an arbitration
agreement; a dispute; a reference to a third party for its determination; and an award
by the third party.
The essence lies in the point that it is a forum chosen by the parties with an intention
that it must act judicially after taking into account relevant evidence before it and the
submission of the parties. Hence it follows that if the forum chosen is not required to
act judicially, the process it is not arbitration.
Types of arbitration are:

2. Mediation:
Mediation is a process in which the mediator, an external person, neutral to the
dispute, works with the parties to find a solution which is acceptable to all of
them.]The basic motive of mediation is to provide the parties with an opportunity to
negotiate, converse and explore options aided by a neutral third party, to exhaustively
determine if a settlement is possible.
Mediation is negotiation carried out with the assistance of a third party. The mediator,
in contrast to the arbitrator or judge, has no power to impose an outcome on disputing
parties.
Despite the lack of ‘teeth’ in the mediation process, the involvement of a mediator
alters the dynamics of negotiations. The concept of mediation is not foreign to Indian
legal system, as there existed, different aspects of mediation.
The Village Panchayats and the Nyaya Panchayats are good examples for this. A brief
perusal of the laws pertaining to mediation highlights that it has been largely confined
to commercial transactions. The Arbitration and Conciliation Act, 1996 is framed in
such a manner that it is concerned mainly with commercial transactions that involves
the common man rather than the common man’s interest.

In India, mediation has not yet been very popular. One of the reasons for this is that
mediation is not a formal proceeding and it cannot be enforced by courts of law. There
is a lack of initiative on the part of the government or any other institutions to take up
the cause of encouraging and spreading awareness to the people at large.

3. Conciliation:
Conciliation is “a process in which a neutral person meets with the parties to a dispute
which might be resolved; a relatively unstructured method of dispute resolution in
which a third party facilitates communication between parties in an attempt to help
them settle their differences”.]
This consists in an attempt by a third party, designated by the litigants, to reconcile
them either before they resort to litigation (whether to court or arbitration), or after.
The attempt to conciliate is generally based on showing each side the contrary aspects
of the dispute, in order to bring each side together and to reach a solution.
Section 61 of the 1996 Act provides for conciliation of disputes arising out of legal
relationship, whether contractual or not and to all proceedings relating thereto. After
its enactment, there can be no objection, for not permitting the parties to enter into a
conciliation agreement regarding the settlement of even future disputes.

There is a subtle difference between mediation and conciliation. While in meditation,

the third party, neutral intermediary, termed as mediator plays more active role by
giving independent compromise formulas after hearing both the parties; in
conciliation, the third neutral intermediary’s role, is to bring the parties together in a
frame of mind to forget their animosities and be prepared for an acceptable
compromise on terms midway between the stands taken before the commencement of
conciliation proceedings.
4. Negotiation:
Negotiation-communication for the purpose of persuasion-is the pre-eminent mode of
dispute resolution. Compared to processes using mutual third parties, it has the
advantage of allowing the parties themselves to control the process and the solution.
Essentials of Negotiation are:

1. It is a communication process;
2. It resolves conflicts;
3. It is a voluntary exercise;
 4. It is a non-binding process;
5. Parties retain control over outcome and procedure;
6. There is a possibility of achieving wide ranging solutions, and of maximizing
joint gains.
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.

5. Lok Adalats:
Lok Adalat was a historic necessity in a country like India where illiteracy dominated
other aspects of governance. It was introduced in 1982 and the first Lok Adalat was
initiated in Gujarat. The evolution of this movement was a part of the strategy to
relieve heavy burden on courts with pending cases. It was the conglomeration of
concepts of social justice, speedy justice, conciliated result and negotiating efforts.

They cater the need of weaker sections of society. It is a suitable alternative

mechanism to resolve disputes in place of litigation. Lok Adalats have assumed
statutory recognition under the Legal Services Authorities Act, 1987. These are being
regularly organized primarily by the State Legal Aid and the Advice Boards with the
help of District Legal Aid and Advice Committees.
Legal Services Authorities Act, 1987:
The Legal Services Authorities Act, 1987 was brought into force on 19 November
1995. The object of the Act was to provide free and competent legal services to the
weaker sections of the society to ensure that opportunities for securing justice are not
denied to any citizen. The concept of legal services which includes Lok Adalat is a
revolutionary evolution of resolution of disputes.

Though settlements were affected by conducting Lok Nyayalayas prior to this Act, the
same has not been given any statutory recognition. But under the new Act, a
settlement arrived at in the Lok Adalats has been given the force of a decree which
can be executed through Court as if it is passed by it. Sections 19, 20, 21 and 22 of the
Act deal with Lok Adalat. Section 20 provides for different situations where cases can
be referred for consideration of Lok Adalat.

Honorable Delhi High court has given a landmark decision highlighting the
significance of Lok Adalat movement in the case of Abdul Hasan and National Legal
Services Authority v. Delhi Vidyut Board and Others The court passed the order
giving directions for setting up of permanent Lok Adalats.

8b. Court Annexed Arbitration

 1) To encourage the settlement of disputes by way of negotiations,
arbitration and conciliation. (2) To lay down policies and principles
for making legal services available in the conduct of any case before
the court, any authority or tribunal. (3) To frame most effective and
economical schemes for the purpose.

8c.Mediation and Hybrid Process

A hybrid dispute resolution process combines elements of two or more traditionally
separate processes into one. The most common hybrid process is mediation-arbitration,
or "med-arb", which uses the same individual or dispute resolution forum first as
a mediator, and then if necessary, as an arbitrator. This is distinguished from the
common circumstance where more than one type of dispute resolution procedure is
provided for in sequence, such as a grievance procedure that provides first for
negotiation, then mediation, and finally for arbitration, where each of these processes is
carried out by a different person.

Med-arb or other hybrid processes are generally used where parties believe a given
dispute is likely to require elements of two or more processes, and/or where they
believe that an individual or forum is available who has the skills necessary to enact
more than one process, with a consequent saving of time and expense.

Med-arb was first used in U.S. public-sector collective bargaining, particularly for public
safety groups (e.g. police and fire departments) where strikes are generally illegal. In
many states, the state legislature has called for a hybrid system to resolving these
disputes peacefully and efficiently.

Usually such systems call for mediation, after which either party can compel arbitration
if the mediation effort fails to reach an agreement. The mediation in this type of case is
often actually the second attempt at mediation, following an earlier "pure mediation"
effort by the labor-management mediation agency of that state. The hybrid process is
invoked if the initial, agency attempt at mediation fails.

Such "duplicate mediation" has two advantages: first, neutrals who practice as
mediator-arbitrators are sometimes able to apply skills that agency neutrals may not
possess to the same degree (though often, the agency neutrals are themselves highly
skilled); second, and more important, is that a mediator-arbitrator's suggestions carry
more weight than those of a "pure mediator," even when the suggestions are similar or
identical. This is because the mediator-arbitrator may have the final decision if the case
is unresolved. This gives the "neutral" more perceived power, even in the mediation,
and most certainly in the arbitration phase of the process.

Med-arb in these contexts has generally been considered effective, as illegal strikes are
very rare, and most parties believe the process works effectively and promptly.

However, parties sometimes object to the amount of power a mediator-arbitrator has.

Typically, arbitrators never meet with the parties separately, but only meet together
where both sides can hear (and rebut) all the arguments the other side makes. In
addition, arbitrators avoid reaching any conclusions or dropping hints as to the decision
until the last argument has been fully expressed.

This mode of working is greatly different from the typical working methods of a mediator,
which usually include meeting privately with each party, and at times, trying to persuade
a party to make a particular concession, or to try another approach to their negotiations.
If the mediator is also an arbitrator, such pressure can take the form of an implied threat
of an adverse decision if one party is seen as being "unreasonable."

In such cases, the losing party may believe (rightly or wrongly) that the decision was
influenced by private conversations between the mediator and the opposing party.
Concerns about such issues have led some jurisdictions to opt for mediation followed by
separate arbitration instead of med-arb as the public service dispute resolution
procedure of choice.

Other hybrid combinations of role also exist. The combination of the roles of facilitator
and mediator is so common that many believe that the role of a mediator can hardly be
fulfilled without taking on a facilitator's role as well — though the converse is not true.
And it is quite common for a judge to take on the role of a mediator. While this
inherently triggers the same potential concerns as mediation-arbitration, it is
indisputable that many cases have been resolved, and often to the satisfaction of all
parties, when a judge has engaged in adroit and sensitive intervention along these
lines.

Parties who understand the risks inherent in mixing the roles of a neutral are in a much
better position to make creative uses of available neutral talents, a hallmark of the
flexibility that conflict resolution claims as one of its virtues as a field. There is probably
no pair of neutral functions that has not been combined in one individual at some point,
many times to the benefit of all parties. And there are subtleties in the distinctions
between the common combinations: for example, many see a meaningful distinction
between a mediator-arbitrator and an arbitrator-mediator. (In this instance, the
distinction is in which role the neutral was primarily selected for. Thus describing a
neutral as an "arbitrator-mediator" typically sets up an expectation that the case will
probably be pursued to the point of a decision by an arbitrator, but with the parties
willing to mediate if the circumstances seem favorable. A "mediator-arbitrator" is hired
by the parties with the expectation that the focus will be on mediation, with arbitration
reserved as a last resort.)

Other forms of hybrid include the "Special Master" in such major issues as the
September 11 Victims' Compensation Fund or the "Black Farmers' Case" (involving tens
of thousands of farmers who sued the U.S. Department of Agriculture over decades of
racial discrimination in its lending policies). Both of these are highly responsible
functions that include elements of a mediator, an arbitrator, and a magistrate.

Meanwhile, fact-finding, summary jury trials, mini-trials, and private judging have also
been described as hybrid processes, although in these instances the term "hybrid"
refers more to a process that exists between two more classical neutral roles than to
one in which the neutral is asked to "wear two hats."
Although the latter three processes are more commonly used in more limited or
"tractable" conflicts than they are in intractable conflicts, fact-finding is used extensively
in intractable conflicts (witness the 2002-2003 U.N. effort to confirm or deny Iraq's
asserted stockpile of weapons of mass destruction), and there are occasions where
other hybrid processes might be useful as well.

8d. Judicial Settlement conferences

What is a judicial settlement conference?
A judicial settlement conference is an informal process in which a retired circuit court judge, trained in
mediation and settlement conference skills, actively facilitates a process whereby parties in conflict may
reach a mutually satisfactory resolution.

How much does it cost to participate in the Judicial Settlement Conference

Program?

Settlement conference services are available to all circuit courts at no cost to the parties.

Why have a Judicial Settlement Conference Program?

Settlement conference judges, who have a wealth of legal experience and subject matter expertise, can
offer attorneys and their clients valuable case evaluations and neutral settlement assistance.

Settlement conference judges may provide an independent assessment of the risks of litigation.

The Judicial Settlement Conference Program facilitates the settlement of cases that would otherwise
result in costly and lengthy trials.

When may a judicial settlement conference be useful?

Parties may be motivated to settle due to time constraints, expenses, or other factors.

Parties wish to have a neutral evaluation of their case in a private setting or wish to undergo a legal and
factual “reality testing” by the settlement judge.

Parties differ substantially in their opinions on the value of the case and/or on the amount of damages
that should be awarded.

What kinds of cases are appropriate for the Judicial Settlement Conference
Program?

Settlement conference may be used for any civil case filed in court.

The program may be used with a variety of case categories, including but not limited to: tort/personal
injury, commercial, domestic relations, etc.

Settlement conference may be most useful in cases where the parties have not completely explored
settlement options and are unlikely to do so without the assistance of a neutral party.
What happens during a judicial settlement conference?

 Involvement of Litigants and Their Lawyers: Lawyers and parties on all sides are
encouraged to be active participants. By their presence at the settlement conference, lawyers
and parties are deemed to be making a good faith effort at resolving the case in controversy.
 Collaborative Session: The settlement conference judge may allow an opportunity for both
parties to be heard and may use other conflict resolution techniques that are characteristic of
mediation. There may be an initial session in which all parties are in the same room. Often the
parties segregate immediately after the initial session and do not directly interact. The
settlement judge may elect to reconvene the parties later in the process.
 Urging Settlement: The settlement conference judge may use a variety of techniques to
encourage and shape settlement, including suggesting settlement terms, providing settlement
ranges, and directing the parties to appropriate grounds for settlement based on law or industry
practice.
 Case Evaluation within the Separate Caucus: The settlement conference judge may meet
privately with each side of the case and point out strengths, weaknesses, and potential problems
that the party may not have considered regarding their case. Everything said in a private caucus
is confidential, except for what the party in the caucus room authorizes the settlement judge to
communicate to a party in the other caucus room.
 Independent Perspective: The settlement conference judge may provide the parties with an
independent perspective regarding the outcome of the case.

How much settlement authority do the judicial settlement conference judges

have?

Settlement conference judges have no trial authority with regard to a given case, but merely assist the
parties in assessing their case and possibly reaching settlement.

Is the Judicial Settlement Conference Program voluntary?

Once a judge refers parties to the program, the parties are required to attend the conference; however,
they do not have to settle. If the dispute is not resolved by the conference prior to the parties’ trial date,
the parties shall appear in court at the appointed time.

Is the Judicial Settlement Conference Program confidential?

Yes. Nothing said during the settlement conference and nothing prepared for the settlement conference
is deemed admissible evidence at trial, unless the statement or document is independently admissible.
Furthermore, the settlement conference judge maintains confidentiality with respect to the settlement
conference proceedings and only reports to the referring court the terms of the agreement, if authorized
by the parties, or the fact that no agreement was reached.

9. Lok Adalat
NALSA along with other Legal Services Institutions conducts Lok Adalats. Lok Adalat is one
of the alternative dispute redressal mechanisms, it is a forum where disputes/cases pending
in the court of law or at pre-litigation stage are settled/ compromised amicably. Lok Adalats
have been given statutory status under the Legal Services Authorities Act, 1987. Under the
said Act, the award (decision) made by the Lok Adalats is deemed to be a decree of a civil
court and is final and binding on all parties and no appeal against such an award lies before
any court of law. If the parties are not satisfied with the award of the Lok Adalat though
there is no provision for an appeal against such an award, but they are free to initiate
litigation by approaching the court of appropriate jurisdiction by filing a case by following
the required procedure, in exercise of their right to litigate.

There is no court fee payable when a matter is filed in a Lok Adalat. If a matter pending in
the court of law is referred to the Lok Adalat and is settled subsequently, the court fee
originally paid in the court on the complaints/petition is also refunded back to the parties.
The persons deciding the cases in the Lok Adalats are called the Members of the Lok
Adalats, they have the role of statutory conciliators only and do not have any judicial role;
therefore they can only persuade the parties to come to a conclusion for settling the dispute
outside the court in the Lok Adalat and shall not pressurize or coerce any of the parties to
compromise or settle cases or matters either directly or indirectly. The Lok Adalat shall not
decide the matter so referred at its own instance, instead the same would be decided on the
basis of the compromise or settlement between the parties. The members shall assist the
parties in an independent and impartial manner in their attempt to reach amicable
settlement of their dispute.

Nature of Cases to be Referred to Lok Adalat

1. Any case pending before any court.

2. Any dispute which has not been brought before any court and is likely to be filed before
the court.

Provided that any matter relating to an offence not compoundable under the law shall not
be settled in Lok Adalat.

Which Lok Adalat to be Approached

As per section 18(1) of the Act, a Lok Adalat shall have jurisdiction to determine and to
arrive at a compromise or settlement between the parties to a dispute in respect of -

(1) Any case pending before; or

(2) Any matter which is falling within the jurisdiction of, and is not brought before, any court
for which the Lok Adalat is organised.

Provided that the Lok Adalat shall have no jurisdiction in respect of matters relating to
divorce or matters relating to an offence not compoundable under any law.

How to Get the Case Referred to the Lok Adalat for Settlement

(A) Case pending before the court.

(B) Any dispute at pre-litigative stage.

The State Legal Services Authority or District Legal Services Authority as the case may be on
receipt of an application from any one of the parties at a pre-litigation stage may refer such
matter to the Lok Adalat for amicable settlement of the dispute for which notice would then
be issued to the other party.

Levels and Composition of Lok Adalats:

At the State Authority Level -

The Member Secretary of the State Legal Services Authority organizing the Lok Adalat
would constitute benches of the Lok Adalat, each bench comprising of a sitting or retired
judge of the High Court or a sitting or retired judicial officer and any one or both of- a
member from the legal profession; a social worker engaged in the upliftment of the weaker
sections and interested in the implementation of legal services schemes or programmes.

At High Court Level -

The Secretary of the High Court Legal Services Committee would constitute benches of the
Lok Adalat, each bench comprising of a sitting or retired judge of the High Court and any
one or both of- a member from the legal profession; a social worker engaged in the
upliftment of the weaker sections and interested in the implementation of legal services
schemes or programmes.

At District Level -

The Secretary of the District Legal Services Authority organizing the Lok Adalat would
constitute benches of the Lok Adalat, each bench comprising of a sitting or retired judicial
officer and any one or both of either a member from the legal profession; and/or a social
worker engaged in the upliftment of the weaker sections and interested in the
implementation of legal services schemes or programmes or a person engaged in para-legal
activities of the area, preferably a woman.

At Taluk Level -

The Secretary of the Taluk Legal Services Committee organizing the Lok Adalat would
constitute benches of the Lok Adalat, each bench comprising of a sitting or retired judicial
officer and any one or both of either a member from the legal profession; and/or a social
worker engaged in the upliftment of the weaker sections and interested in the
implementation of legal services schemes or programmes or a person engaged in para-legal
activities of the area, preferably a woman.

National Lok Adalat

National Level Lok Adalats are held for at regular intervals where on a single day Lok Adalats
are held throughout the country, in all the courts right from the Supreme Court till the Taluk
Levels wherein cases are disposed off in huge numbers. From February 2015, National Lok
Adalats are being held on a specific subject matter every month.

Permanent Lok Adalat

The other type of Lok Adalat is the Permanent Lok Adalat, organized under Section 22-B of
The Legal Services Authorities Act, 1987. Permanent Lok Adalats have been set up as
permanent bodies with a Chairman and two members for providing compulsory pre-
litigative mechanism for conciliation and settlement of cases relating to Public Utility
Services like transport, postal, telegraph etc. Here, even if the parties fail to reach to a
settlement, the Permanent Lok Adalat gets jurisdiction to decide the dispute, provided, the
dispute does not relate to any offence. Further, the Award of the Permanent Lok Adalat is
final and binding on all the parties. The jurisdiction of the Permanent Lok Adalats is upto Rs.
Ten Lakhs. Here if the parties fail to reach to a settlement, the Permanent Lok Adalat has the
jurisdiction to decide the case. The award of the Permanent Lok Adalat is final and binding
upon the parties. The Lok Adalat may conduct the proceedings in such a manner as it
considers appropriate, taking into account the circumstances of the case, wishes of the
parties like requests to hear oral statements, speedy settlement of dispute etc.

Mobile Lok Adalats are also organized in various parts of the country which travel from
one location to another to resolve disputes in order to facilitate the resolution of disputes
through this mechanism.

10. ARBITRATION AGREEMENTS

Arbitration agreements are usually signed at the beginning of a business relationship
– long before there’s a disagreement.

They are often just a few sentences long, and are commonly found near the end of a
larger contract under a heading such as “Arbitration” or “Dispute Resolution.” Employee
arbitration agreements may be buried in an employment contract or employee
handbook.

An arbitration clause will typically say that all disputes arising under the larger contract
will be submitted to binding arbitration. Sometimes a contract will say that only certain
disputes will be arbitrated.

The agreement may also say how the arbitration will be conducted. It may specify
certain arbitration rules, such as the American Arbitration Association (AAA) rules, and it
may say whether there will be one arbitrator or a panel of arbitrators. The agreement
may also specify how the arbitrator will be chosen.

The parties to a dispute may also agree to arbitration after a conflict has arisen, or even
after a lawsuit has been filed.

Advantages of Signing an Arbitration Agreement

 Arbitration is usually faster and less expensive than litigating a case in court.
 Arbitrations are confidential, which means that you will not have to publicly
testify. The specifics of your dispute will not be in the public court records.
 In arbitration, you can choose who will decide your dispute. This can be
particularly helpful if you want a decision maker who has specialized technical
knowledge or experience in your industry.
  Some employers will not hire you if you refuse to sign an employment arbitration
agreement.

Disadvantages of Signing an Arbitration Agreement

 Arbitration awards cannot be appealed. You must accept the arbitrator’s decision
as final.
 You cannot have a jury trial. This can lead to a worse result if you have an
employment dispute because juries are often sympathetic to employees.
 The parties’ exchange of information is more limited in arbitration. This can make
it harder to develop your case in an employment arbitration or in any other
situation where the other party has most of the information and documents.
 If you are asked to agree to arbitration before you even have a dispute, you may
not know whether you want to arbitrate or not. If you sign the agreement and
decide later that you would rather pursue a claim in court, you won’t be able to –
or you will rack up legal fees trying to invalidate the arbitration agreement.
 Like all contracts, arbitration agreements can be one-sided in favor of the party
who wrote the agreement. You should be on the lookout for this and make sure
the agreement gives you an equal voice in choosing the arbitrator, does not limit
the remedies available to you, and does not deny you the right to an attorney.

Arbitration agreements are a way to limit litigation costs and keep disputes confidential.
But signing an arbitration agreement also means giving up important rights. Before
signing, it pays to read arbitration clauses and reject or renegotiate anything that you’re
uncomfortable with.

11.INTERNATIONAL COMMERCIAL AGREEMENT

International commercial arbitration is a means of resolving disputes arising under international
commercial contracts. It is used as an alternative to litigation and is controlled primarily by the terms
previously agreed upon by the contracting parties, rather than by national legislation or procedural rules.
Most contracts contain a dispute resolution clause specifying that any disputes arising under the contract
will be handled through arbitration rather than litigation. The parties can specify the forum, procedural
rules, and governing law at the time of the contract.

Arbitration can be either “institutional” or “ ad hoc .” The terms of the contract will dictate the type of
arbitration. If the parties have agreed to have an arbitral institution administer the dispute, it is an
institutional arbitration. If the parties have set up their own rules for arbitration, it is an ad
hoc arbitration. Ad hoc arbitrations are conducted independently by the parties, who are responsible for
deciding on the forum, the number of arbitrators, the procedure that will be followed, and all other
aspects of administering the arbitration.

The types of law that are applied in arbitration include international treaties and national laws, both
procedural and substantive, as well as the procedural rules of the relevant arbitral institution. Previous
arbitral awards carry persuasive authority, but are not binding. Scholarly commentary, or “doctrine,” may
also be applied.

11.COMPOSITION AND JURISDICTION OF ARBITRATION

TRIBUNAL

It would not be appropriate to say that an arbitral tribunal has statutory

jurisdiction. The tribunal determines its jurisdiction to adjust the needs of the
parties. The arbitral agreement mainly determines the ambit of jurisdiction of
the arbitral tribunal. The focal of party-autonomy declares that when the two
parties have the remedy to resolve their disputes on their own then they have
the remedy to show this right to any third party, to determine overt that
squabble.

Thus it is very essential to contemplate a well-drafted agreement because it

results in giving complete strength to the tribunal to determine matters related
to the jurisdiction. The Arbitration and Conciliation Act, 1996 also specifically
mentions the jurisdiction to determine explicit matters in Section 17 of the Act.

 Appointment of a guardian for a person who is of unsound mind or

minor age in between the process of arbitration
 Safety/Security/ Confinement/ provisional injunction of the subject
matter of the arbitration.
There are some cases in which the competency of the arbitral tribunal is
contingent on gaining questions.

The relevant provision under the Act (Sec 16)

Section 16 of the Arbitration and Conciliation Act provides the following
provisions:

 The arbitral tribunal may regulate or direct on its own jurisdiction,

which also incorporates any objection regarding the validity or
existence of the arbitration agreement, and for that objective:
o An arbitration clause which is a term of a contract agreement
must be deemed as an agreement free and autonomous of the
other terms of the contract, and
o A decision of the arbitral tribunal declaring the contract as
invalid does not necessitate ipso jure the invalidity of the
arbitration clause.

 A plea which emanates that the arbitral tribunal doesn’t have

jurisdiction shall not be made after the defense statement is
submitted; however, a party shall not be prevented from making such
a plea only because of his participation in the appointment of, or he
appointed, an arbitrator.
 A plea claiming that the arbitral tribunal is surpassing the scope of its
authority shall be made as soon as the matter alleged to be
transcended the scope of its authority is made during the arbitral
proceedings.
 In each of two cases referred to in sub-section (2) or sub-section (3),
The arbitral tribunal may accept a delayed plea if it concludes with an
opinion that the delay is justified.
  The arbitral tribunal shall determine the plea referred to in sub-section
(2) or sub-section (3) and take up with arbitral proceedings where the
arbitral tribunal takes a decision rejecting the plea.
 A party, if disgruntled by such an arbitral award, may make an
application for rescinding such an arbitral award according to Section
34.

Competence of the arbitral tribunal

The Arbitration Act of 1940 lacked such provisions which authorized the Arbitral
Tribunal to regulate on its own jurisdiction and it was upon the court to
scrutinize and decide on the jurisdiction of the arbitral tribunal. But Section
16 of the Arbitration and Conciliation Act, 1996 grants power to the Arbitral
Tribunal to look on its own jurisdiction. Section 16 (1) of the Act provides that
the arbitral tribunal may regulate or direct on its own jurisdiction, which also
incorporates any objection regarding the validity or existence of the arbitration
agreement.

Section 16 of the Arbitration and Conciliation Act incorporates the concept of

competence-competence. It contains two facets i.e. the first one reflects that
without support from the courts, the tribunal may decide on its jurisdiction and
secondly, it shows reluctance from the courts in deciding this issue before the
tribunal has decided on this issue. But questions regarding the binding effect of
the decisions made by the arbitral tribunals need to be discussed and can these
decisions be challenged in courts?

In Union of India vs. M/s. East Coast Boat Builders & Engineers Ltd., the Hon’ble
Delhi High Court observed that it was apparent from the scheme of the act that
the legislature didn’t grant appeal against the order under Section 16(5) where
the arbitral tribunal decides rejects a plea that it has no jurisdiction. Apparently,
the intention is that the arbitral tribunal shall proceed with the arbitral
proceedings and make an award without any delay and without interference at
any stage in the arbitral process due to supervisory role of the court.

In the case of Nav Sansad Vihar Coop. Group Housing Society Ltd. (Regd.) vs.
Ram Sharma and Associates the Hon’ble Delhi High Court held that if the
Arbitral Tribunal rejects a plea under Section 16(5) of the Arbitration and
Conciliation Act, the arbitral process shall take place and the award shall be
declared and meanwhile, the aggrieved party shall wait till the award is
announced and there is no remedy against such order.

But determination made by the tribunal to admit the plea that it doesn’t have
jurisdiction or that it is surpassing its ambit of authority is appealable and
triable under Section 37(2) of the Arbitration and Conciliation Act. In the case
of Pharmaceutical Products of India Ltd. vs. Tata Finance Ltd., the Hon’ble
Bombay High Court opined that in cases where the Arbitral Tribunal rejects the
plea related to its jurisdiction, Section16(5) of the Arbitration and Conciliation
Act clearly empowers the Tribunal to resume with the arbitral proceedings and
declare an arbitral award. Section 16(5) grants procedure to challenge an
arbitral award. It states that only in accordance with Section 34, such an award
can be challenged. whereas, if the Arbitral Tribunal determines to accept the
plea that it does not have jurisdiction, then such decision can be appealed
under Section 37(2) of the Arbitration and Conciliation Act.

Thus, it is clear that when the Arbitral Tribunal decides to reject a plea that it
does not have the jurisdiction then the order made related to its jurisdiction
cannot be appealed but when the Arbitral Tribunal accepts the plea that it does
not have jurisdiction then such an order can be appealed under Section 37(2) of
the Arbitration and Conciliation Act.

Jurisdiction of the arbitral tribunal when contract containing an arbitration

clause is declared void

There may be cases where the arbitration agreement is not made as a separate
agreement. Instead, it is embedded, as a clause, in the agreement between the
parties and such contract or the agreement between the parties is pronounced
void or illicit. The question which arises is that what happens to the agreement
in such cases and can the arbitration clause in such cases become void?

In the case of Jawaharlal Burman vs. Union of India, the Hon’ble Supreme Court
held that it is theoretically possible that the contract may end and the
arbitration contract may not and similarly it is also theoretically possible that
the contract may be valid whereas the arbitration agreement may be void and
in that sense, there is a difference between the contract and its part of
arbitration agreement but in the present situation, a challenge to the contract
itself includes a challenge to the arbitration agreement. If there is a concluded
contract the arbitration clause is also valid and if there is not a concluded
contract the arbitration clause is also invalid. The Court also acknowledged that
there could be a vast majority of cases in which the arbitration agreement
exists as a part of the main contract itself, and challenging the validity or even
existence of one would mean a challenge to the validity or existence of others.

In the case of Waverly Jute Mills Co. Ltd. Vs. Raymon and Co. (India) Ltd., The
Hon’ble Supreme Court opined that discourse to the legitimacy of a contract
could be the subject matter of an agreement of arbitration similarly as a debate
identifying with a case made under the contract. But such an agreement would
be operative and effective only when it is distinct from and independent of the
contract which is disputed as illegal.

In the case of Jaikishan Dass Mull vs. Luchhiminarain Kanoria & Co., the Hon’ble
Apex Court of India opined that there cannot be any doubts that if a contract is
void and illegal, then, the arbitration clause must also perish along with the
contract itself. As Viscount Simon, L.C. also pointed out in Heyman vs. Darwins
Ltd. that if one party to the contract contends that it is void ab initio, and for
this view, the clause itself is void and therefore the arbitration clause cannot
operate. The arbitration clause, which is an essential content of the contract,
cannot stand if the contract itself is declared to be illegal.

But the position has changed after the enactment of The Arbitration and
Conciliation Act in 1996. And Section 16 (1) of this Act declares that the
arbitration clause even if inserted in a contract, shall be considered as an
independent from the remaining of the contract and a determination made by
the Arbitral Tribunal regarding the invalidity of the contract shall not
require ipso jure invalidation of the arbitration clause.

In the case of Olympus Superstructures vs. Meena Vijay Khaitan, the Apex
Court stated that it shall be noticed that the arbitral tribunal is now empowered
under sub-section (1) of Section 16 of the Act to look and reconsider on its own
jurisdiction which also includes deciding on any objection related to the validity
or even existence of the arbitration agreement and for such purpose, the
arbitration clause which is a part of the contract and any decision by the arbitral
tribunal related to the invalidity of the contract shall not require ipso jure affect
the validity of the arbitration clause. It is clear from clause (b) of Section
16(1) which provides that a decision by the arbitral tribunal related to
invalidation of the main contract shall not require ipso jure invalidation of the
arbitration clause.

12.CONDUCT OF ARBITRAL PROCEEDINGS AND

ITS TERMINATION AND MAKING ARBITAL AWARD
Section 21 of the Act provides the rules which govern the commencement of
arbitral proceedings. It gives freedom to the parties to agree and determine
when the arbitration proceeding can officially commence. But in the absence of
such an agreement or where the parties fail to arrive at an agreement, the
arbitral proceedings can commence when one party issues a notice to the other
party, in writing, showing its intention to refer the dispute to arbitration.

So in respect of a particular dispute, the arbitral proceeding commences on the

date on which a request for that dispute to be referred to arbitration is received
by the other party. In order to determine the date of receipt, the provisions
of Section 3 of the Act must be looked into.

Rules and legislation

Limitation period
Section 43 of the Act provides that the Limitation Act, 1963 shall apply to
arbitrations as it applies to civil suit proceedings in the courts, except to the
extent expressly excluded by the Arbitration and Conciliation Act. Thus, the date
of commencement of arbitral proceedings assumes relevance for calculating the
time-limit for arbitral proceedings under the Limitation Act, 1963. Any
arbitration proceedings commenced after the limitation period, i.e., three years
from the date on which the cause of action arose, will be time-barred.

Equal Treatment of Parties

Section 18 of the Act has two fundamental principles. Firstly, it provides that
the parties to an arbitration proceeding shall be treated with equality and
secondly, that each party shall be given a full opportunity to present their case.
This section is a mandatory provision and the arbitral tribunal has to comply
with it. The tribunal has to act in an impartial manner to the parties and no
party has to be given an advantage over the other.

Procedure of Arbitral Proceedings

Section 19 of the Act recognises the right of the parties to agree on the
procedural rules which are applicable in conducting the arbitral proceedings.
This provision establishes the procedural autonomy of the parties.

When the parties fail to agree on a procedure or frame the procedure, it grants
the arbitral tribunal a wide range of discretionary powers to frame the arbitral
proceedings. The Act does not prescribe any default rules regulating the arbitral
proceedings.

This provision also provides that the application of the Code of Civil Procedure,
1908 or the Evidence Act, 1872 to the arbitral proceeding is also at the
discretion of the parties.

Place of Arbitration
Section 20 of the Act provides that the parties are free to agree on the place of
arbitration and if they fail to agree then the arbitral tribunal has to determine
the place of arbitration in a judicial manner, considering the circumstances of
the case and convenience of the parties.

Also, the place of arbitration is of paramount importance because the laws of

the place of arbitration play a fundamental role in the arbitral proceeding. It
determines the substantive laws for the time being in force in India.

Language to be used in Arbitral Proceedings

Section 22 of the Act deals with the language which has to be used in arbitral
proceedings. The parties to the arbitration agreement are free to choose the
language or languages which have to be used in the arbitral proceedings. In
cases where the parties fail to arrive at such an agreement then it is the role of
the arbitral tribunal to determine the language or languages to be used in the
arbitral proceedings. The language shall also apply to any written statement by
a party, any hearing and any arbitral award, decision or other communication
by the arbitral tribunal.

When the arbitral tribunal agrees on the language to be used in arbitral

proceedings, it may order that any documentary evidence shall be accompanied
by a translation into the language agreed. The arbitral tribunal must ensure that
all the parties are able to follow and understand the proceedings.

Statement of Claim and Defence

Section 23 of the Act provides for pleadings of the parties before the arbitral
tribunal. After the arbitral tribunal has been established, the usual practice is to
exchange and file their pleadings before the tribunal.

The claimant states the facts and other relevant matters, while the respondent
opposes the facts and the averments made in the claim statement and contests
the relief claimed by the claimant. The contents of pleading may vary from case
to case depending upon the facts and circumstances of each case.

Within six months of the appointment of the arbitral tribunal, the statement of
claim and defence has to be completed under this section.

Hearing and written proceedings

Section 24 of the Act discusses the manner in which arbitral proceedings are to
be conducted. In the absence of any prior agreement between the parties
relating to this matter, the arbitral tribunal has the power to decide whether the
proceedings shall be held orally or on the basis of documents and other
materials.

Default of Party
Section 25 of the Act deals with three situations where the parties are at
default.

Firstly, the arbitral tribunal terminates the proceedings when the claimant
without showing sufficient cause, fails to communicate his statement of claim in
accordance with Section 23(1). Secondly, the arbitral tribunal continues the
proceeding when the respondent fails to communicate his statement of
defence in accordance with Section 23(1).

Thirdly, if there is sufficient cause then the termination is recalled and

proceeding gets restored.

Appointment of Experts
Section 26 of the Act gives the arbitral tribunal power to appoint one or more
experts based on the requirement or request of the parties. It requires the
parties to provide relevant information to the experts.

Also, the arbitral tribunal cannot appoint experts and delegate the duty of
determination of the dispute.

Court Assistance
Section 27 of the Act provides the arbitral tribunal with the power to apply for
the court assistance in taking evidence. Persons can also be held guilty and
tried before the court, if they refuse to give evidence or do not cooperate.

Termination
The arbitral proceedings are terminated either by the final arbitral award or by
an order of the arbitral tribunal terminating the arbitral proceedings.

The arbitral tribunal terminates the arbitral proceedings in any of these cases
where:

1. the claimant withdraws the claim and respondent does not object to it,
2. both parties are in consensus and agree to terminate the arbitral
proceedings, or
3. the continuation of the arbitral proceedings has become impossible or
irrelevant considering the present facts of the case.
Also, the termination of the arbitral proceedings terminates the mandate of the
arbitral tribunal and the arbitral tribunal becomes functus officio. The term
“functus officio” means no longer holding office or having official authority once
a decision is rendered.

ARBITRAL AWARD
This topic is wholly dealt with in CHAPTER VI of the Arbitration and Conciliation Act, 1996. Sections
28 to 33 wholly deal with “making of arbitral award and termination of proceedings” under this
Chapter. This article will not only explain the important bare provisions but will also lay specific
emphasis on Section 32. This section deals with the “Termination of proceedings”.
Arbitral award
According to the Definition given under Section 2(c) it is clear that the 1996 Act doesn’t give a
concrete definition of Arbitral awards. It only affirms that arbitral awards include interim awards too.
However, the final decision given by the arbitral tribunal [as per Section 2(d)] is the arbitral award.
Types of arbitral awards
There are 2 types of awards –

 Domestic awards- this type of award is governed under Part I of the Act
 Foreign awards- this type is subsequently governed under Part II
Domestic awards, as per Section 2(7), are wholly dealt with in part one till Section 43 of the act
whereas Sections 44 to 60 deal with different kinds of foreign arbitral awards.
The arbitral award is worth only to the extent of the parties’ ability to enforce the terms they initially
agreed upon. Section 36 lays down provisions for the speedy enforcement of the domestic awards.
Under this very section, it is made clear that a domestic award is enforceable in the same manner as
that of a decree passed by a court. In practice in domestic arbitrations, it is easier to enforce an
arbitral award than judgment by a court. If the assets of the parties are almost in one and the same
jurisdiction, the enforcement of domestic wards s much easier.

13.RECOURSE AGAINST ARBITRAL AWARD

The arbitration may be a method of dispute resolution between the parties through an arbitral
tribunal appointed by parties to the dispute or by the Court at the request of a party. there's no
provision for appeal against an arbitrational award and it's final and binding between the parties.
However, an aggrieved party could take recourse to a law court for setting aside the arbitration
award on bound grounds per Section thirty-four of the Arbitration and Conciliation Act, 1996.
Setting Aside arbitrational Award
The parties cannot appeal against an arbitral award on its merits and also the court cannot
interfere on its merits. The Supreme Court has determined “an arbitrator may be a judge
appointed by the parties and in and of itself passed by him isn't to be lightly interfered with.”
However, this doesn't mean that there's no check on the arbitrator’s conduct. so as to assure
correct conduct of the continuing, the law permits certain remedies against an award.
Under the repealed 1940 Act remedies were obtainable against an award- modification,
remission and set aside. These remedies are put under the 1996 Act into 2 teams. To the extent
that the remedy was for rectification of errors, it's been handed over to the parties and also
the tribunal. The remedy for setting aside has been moulded with returning back the award to the
court for removal of defects.
Section thirty-four provides that an arbitral award is also put aside by a court on bound grounds
such as that. These grounds are:

1. Incapacity of a party
2. Arbitration agreement not being valid
3. Party not given correct notice of proceedings
 4. Nature of dispute not falling at intervals the terms of submission to arbitration
5. The arbitral procedure not being in accordance with the agreement

Section thirty-four of the Act relies on Article thirty-four of the UNCITRAL Model Law and
also the scope of the provisions for setting aside the award is much but it had been below the
Sections thirty or thirty-three of the 1940 Act. In Municipal corp. of greater Mumbai v. Prestress
products (India)[i], the court command that the new Act was brought into being with the
categorical Parliamentary objective of curtailing judicial intervention. Section thirty-four
considerably reduces the extent of the attainable challenge to an award.
An award that is set aside isn't any longer remains enforceable by law. The parties are improved
to their former position on their claims within the dispute. Setting aside an award means it's
rejected as invalid. The award is avoided and also the matter becomes open for the call once
more. The parties become unengaged to return to arbitration or to own the matter set through
court.
FINALITY OF ARBITRAL AWARD

Section 36 of the Arbitration and Conciliation Act, 1996 after the 2015 Amendment Act,
provides that when the time period that is provided for making an application in the court for
setting aside an arbitral award has expired the award of the arbitral tribunal will have an effect of
a decree of a court and shall be enforced in the same way. (As per the provisions of Code of
Civil Procedure of 1908).
If a party challenges the award of an arbitral tribunal (under section 34 of the Arbitration Act) by
filing an application for the same in the court, just because he has applied would not set aside the
arbitral award. The award will be set aside only when the court orders so.
The court may put a stay on the arbitral award if it is satisfied that the award is against the
principles of justice. The court shall record its reason for doing so.
EFFECT OF THE 2015 AMENDMENT
Before the amendment of 2015 to section 36, if an award is challenged in the court, it would
imply an automatic stay on the arbitral award. But now the position has been changed and the
provision of the automatic stay on the award by just by applying has been scraped out. This was
important as the party aggrieved by the award would use the filing of an application challenging
the award as an unjust instrument to put a stay on the arbitral award.
Now, for putting a stay on an arbitral award there shall be a specific order from the court.

LIMITATION OF SECTION 36
Section 36 of the Arbitration Act is applicable only in matters inside India. The provisions
relating to Foreign Awards and its enforcement are governed by Section 48 of the Arbitration
Act.

TOPIC 14 IS SEPRATELY COVERED IN PDF GIVEN FOR IT

15.MEDIATIONS
Mediation is an alternative method of resolving disputes without resorting to the courts. It is a
structured, voluntary and interactive negotiation process where a neutral third-party uses specialized
communication and negotiation techniques to help the parties in fulfilling their stated objectives. As a
party-centred process, it focuses on the interests, needs and rights of the parties.

Laws Governing Mediation in India

Mediation first came to be legally recognised as a method of dispute resolution in the Industrial
Disputes Act, 1947.

In 1999, the Code of Civil Procedure Amendment Act was passed by the Parliament. It provided for
Section 89 of the Code of Civil Procedure, 1908 which allowed the courts to refer to alternative
dispute resolution (ADR) methods to settle pending disputes.

Under this, consent of the parties was made mandatory and the court could refer cases for arbitration,
conciliation, judicial settlement through Lok Adalat, or mediation.

Moreover, the Civil Procedure- Mediation Rules, 2003 provide for mandatory mediation under r.
5(f)(iii). These allow the court to refer cases for mediation even when the parties are not ready for
reference for mediation if there is an element of settlement.

Types of Mediation
Mediation is of many kinds-

 Statutory/Mandatory
There are some kinds of disputes that are required by law to be subjected to the mediation process,
such as disputes in labour and family law. In India, r. 5(f)(iii) of the Civil Procedure- Mediation
Rules, 2003 provide for mandatory mediation, though recourse to it is rare.

 Court Ordered
Some sort of alternative dispute resolution is required by most jurisdictions in India before resolution
through the judicial process. As soon as a case is filed, the parties are provided with a number of
ADR options out of which they must select and pursue one unless exempted by the court.

1. Court-Annexed
Under Court-Annexed Mediation, the mediation services are provided by the court as part
of the judicial system.

The Court maintains a list of skilled and experienced mediators who are available to the
parties. The Court appoints a mediator and sets a date by when the mediation must be
completed. The results of the mediation are confidential, and any agreement reached is
enforceable as a judgement of the court.
 Since the case is referred to a court-annexed mediation service, the overall supervision is
kept on the process and there is no feeling of abandonment by the system. The litigants,
lawyers and judges become participants in the system and it is felt that the settlement is
achieved by all the actors in the justice delivery system.

The same lawyers who appeared in the case represent their clients before a mediator and
the litigants are also allowed to participate. The popular acceptance for mediation also
improves as it is the integral and impartial court-system which is seen as extending an
additional service. The dispensation of justice thus becomes well-coordinated.

2. Court-Referred
Under Court-Referred Mediation, the court merely refers the matter to a mediator.

 Private
In private mediation, mediation services are offered on a private, monetary basis by qualified
mediators to the Court, general public, and the commercial and governmental sectors for dispute
resolution through mediation. Recourse may also be taken to private mediation in pending cases or
pre-litigation disputes.

Contractual

1. Parties to a contract may include a mediation clause to resolve disputes as part of the
terms of their agreement as it can effectively resolve contractual disputes before they
turn into a protracted legal battle. The conditions of the mediation and the selection of
the mediator are mentioned in the contract. The results of the mediation may be
enforced as judgements of a court.
2. VoluntaryParties to a dispute may also decide to seek mediation off their own accord,
without being compelled by the law, the court or a contract. This can be done at any
time and is controlled by the parties.

Cases Suited for ADR

In Afcons Infrastructure Ltd. and Anr. V. Cherian Varkey Construction Co. Pvt. Ltd. and Ors., the
Supreme Court laid down guidelines pertaining to the kind of cases that would be eligible for ADR
and those not. It ruled that the following nature of cases would be considered unsuitable for ADR-

1. Representative suits under Order 1 Rule 8 CPC which involve public interest or interest
of numerous persons who are not parties before the court.
2. Disputes relating to election to public offices.
3. Cases involving grant of authority by the court after enquiry, as for example, suits for
grant of probate or letters of administration.
 4. Cases involving serious and specific allegations of fraud, fabrication of documents,
forgery, impersonation, coercion etc.
5. Cases requiring protection of courts, as for example, claims against minors, deities and
mentally challenged and suits for declaration of title against government.
6. Cases involving prosecution for criminal offences.
All other civil suits and cases were to be considered suitable for ADR, such as-

1. All cases relating to trade, commerce and contracts, including-

 Disputes arising out of contracts (including all money claims);

 Disputes relating to specific performance;
 Disputes between suppliers and customers;
 Disputes between bankers and customers;
 Disputes between developers/builders and customers;
 Disputes between landlords and tenants/licensor and licensees;
 Disputes between insurer and insured;
All cases arising from strained or soured relationships, including-

 Disputes relating to matrimonial causes, maintenance, custody of children;

 Disputes relating to partition/division among family members/co-parceners/co-owners;
 Disputes relating to partnership among partners.
All cases where there is a need for continuation of the pre-existing relationship in spite of the
disputes, including-

 Disputes between neighbours (relating to encroachments, nuisance etc.);

 Disputes between employers and employees;
 Disputes among members of societies/associations/Apartment owners Associations;
All cases relating to tortious liability including

 claims for compensation in motor accidents/other accidents;

All consumer disputes including

 Disputes where a trader/supplier/manufacturer/service provider is keen to maintain his

business/professional reputation and credibility or `product popularity.

Steps in the Mediation Process

Whenever any case is to be sent to mediation, the following steps are followed-
Step 1: Convening the Mediation Process
The convening of the mediation is often the most difficult and challenging part of the mediation
process. It involves a varied range of procedures-

 Reference to ADR by the Court

The court is required to direct the parties to opt for any of the five modes of alternative dispute
resolution and to refer the case for Arbitration, Conciliation, Judicial Settlement, Lok Adalat or
mediation under Section 89 and Order X Rule 1A of Code of Civil Procedure, 1908.

The Court must consider the option exercised by the parties and the suitability of the particular case
for the option chosen. The judge making the reference, known as the referral judge, is required to
acquaint himself with the facts and the nature of the dispute, and objectively assess the suitability of
ADR.

This appropriate stage for making the reference in civil cases is after the completion of pleadings and
before framing the issues, while in cases pertaining to family law, the appropriate time for making
the reference would be immediately after service of notice on the respondent and before the filing of
objections/written statements by the respondent.

Even if the court did not refer the cases to ADR at these times, nothing prevents it from referring to it
at a later stage.

 Preparation for Mediation

The referral judge then has the crucial job of bringing the parties together and motivating them to
resolve their disputes through mediation. This involves finding the reasons for any disinclination on
behalf of the parties to enter into mediation, along with explaining the concept, process and
advantages of mediation.

While the consent of parties is required for mediation, the court can also apply external pressure to
induce the parties to enter the mediation, to the extent of ordering or forcing them to do so.

 Referral Order
A referral order issued by the referral judge initiates the process of mediation and s the foundation of
a court-referred mediation. An ideal referral order contains details like name of the referral judge,
case number, name of the parties, date and year of institution of the case, stage of trial, nature of the
dispute, the statutory provision under which the reference is made, next date of hearing before the
referral court, whether the parties have consented for mediation, name of the institution/mediator to
whom the case is referred for mediation, the date and time for the parties to report before the
institution/ mediator, the time limit for completing the mediation, quantum of fee/remuneration if
payable and contact address and telephone numbers of the parties and their advocates.
Step 2: Initiation of the Mediation Process
The mediator has to ensure that the parties and their counsels are present at the commencement of the
mediation process.

Introduction and Opening Statement

Introduction

 The mediator gives an introduction with his qualifications, establishes his neutrality and
reposes faith in the mediation process.
 The mediator requests the parties to introduce themselves, attempts to develop a
rapport with them and gain their confidence and trust.
 The motive is to create a constructive environment conducive to negotiations and
motivate the parties for an amicable resolution of disputes.
 The mediator establishes control over the mediation process.
 There is no standard set of rules that have to be followed, making the mediation
procedure flexible.

Opening Statements

 The mediator’s opening statement is intended to explain to the parties-

o the concepts, processes and stages of mediation,

o the role of the mediator, advocates and parties and

o the advantages and ground rules of mediation.

 The mediator confirms that the parties have understood the process and gives them the
opportunity to get any doubts clarified.
 Statements are also sought from the negotiators. The parties articulate their positions,
enabling the other party to understand what they want.
 This is followed by a restatement of the problem by the mediator where an attempt is
made to incorporate the differing perspectives.

Step 3: Setting the Agenda

 Setting the agenda is an important duty imparted on the mediator in order to shed
clarity on the mediation proceedings and remove vagueness.
 It involves setting down the order in which negotiation is to proceed and gives the
parties a standard using which they can individually evaluate the progress of the
negotiations.
 The mediator may mention the time and venues for the negotiation sessions, along with
the issues before the parties, to be discussed sequentially.
Step 4: Facilitation of Negotiation and Generation of Options

Joint Session
The purpose of the joint session is to gather information.

 The mediator provides an opportunity for the parties to hear and understand each
other’s perspectives, relationships and feelings.
 The petitioner is allowed to explain their case in their own words, followed by the
presentation of the case by their counsel and the statement of the legal issues. Similarly,
the defendant is allowed to explain their case, followed by the presentation of the case
and statement of the legal issues involved by the defendant’s counsel.
 The mediator attempts to understand the facts, issues, obstacles and possibilities and
ensures that each participant feels heard.
 The mediator encourages communication and asks questions to elicit information.
 At the completion of the joint session, the mediator may also suggest meeting each
party with their counsel separately.

Separate Sessions
 The separate sessions are meant for the mediator to understand the dispute at a deeper
level.
 It provides the parties with a forum to further vent their feelings and disclose
confidential information they do not wish to share with the other parties.
 It helps the mediator to understand the underlying interests of the parties, the positions
taken by them and the reasons for these positions, identify areas of dispute, differential
priorities and common interests, and to shift the parties to a mood of finding mutually-
acceptable solutions.
 The mediator is supposed to reaffirm confidentiality, gather further information and
challenge and test the perceptions and conclusions of the parties in order to open their
minds to different possibilities. This is to be done by asking effective questions and
helping the parties understand the strengths and weaknesses of their cases.
 The mediator offers options which he feels bests satisfies the underlying interests of the
parties.

Step 5: Reaching a Settlement

 By helping parties to understand the reality of their situation and give up rigid positions,
the mediator creates creative options for settlement.
 The mediator can conduct as many separate sessions as necessary and may even
conduct sessions with groups on the same side with diverging interests.
  The parties negotiate through the mediator until a solution mutually acceptable to all
the parties involved. The mediator directs the parties to a solution which he believes will
satisfy the underlying interests of the parties.
 In case negotiations fail, the case is sent back to the referral court.

Step 6: Closing
 There is no fixed procedure that must be followed.
 Once the terms of the settlement have been agreed to, the parties are reassembled.
 The mediator orally confirms the terms the terms of the settlement as a procedural
requirement.
 The parties, with the mediator’s aid, write down the terms of the settlement and sign
the agreement.
 The settlement has the binding nature of a contract and is enforceable in a court of law.
 In his closing comment, the mediator thanks the parties for their help and participation
in the mediation process.
In case no settlement is reached between the parties, the case is returned to the referral court stating
failure to settle. The proceedings of the mediation are kept confidential and cannot be revealed even
to the court.

Advantages of Mediation
Mediation is a better and more lucrative alternative to the court system as-

 Control- It gives the parties control over the scope of the mediation in terms of the
issues discussed, and its outcome, with regard to the terms of the settlement and to
settle or not.
Control is vested not with a judge or jury, but the parties themselves and helps them in reaching a
mutually agreeable solution.

By giving control to the parties, it may also result in the settling of related and connected issues and
disputes.

It also allows the parties to satisfy their long-term and underlying interests at each stage. This is
immensely beneficial as it allows the parties creativity in examining alternatives, evaluating options
and reaching a settlement. When the parties themselves agree to the terms of the settlement, there is
compliance with the terms.

 Consent-based- Based on voluntary consent, it allows any party to opt out at any stage if
they find mediation to be unhelpful.

 Participation- It allows the parties to directly participate in the negotiation and present
the case in their own perspective.
  Economical- Mediation takes less time to resolve disputes than standard legal channels.
While courts may take months or years to pronounce judgements in cases, mediations
take mere hours. According to figures released by the Bangalore Mediation Centre, while
the mediation process can take a maximum of 60 days, the average time taken to settle
a case is a mere two hours.
If a settlement is reached, the parties also save money on their hourly costs and no further litigation.
Court fees are also refunded.

Since it takes less time, it is speedy, economical and efficient.

 Confidentiality- Mediations remain strictly confidential, with the terms of the mediation
being known only to the parties involved and the mediator. This aids in better and
effective communication between the parties.

 Conducive to dispute resolution- By providing a procedure that is simple and flexible,

mediation can be modified to the demands of each case and allows the parties to carry
on with their day to day activities. It thus created an informal, cordial and conducive
environment for dispute resolution.

 Mutuality- Since parties to a mediation are amenable to mutually working towards a

solution, they are more receptive to the other party’s side. This aids in restoring the
relationship between the parties and settles the dispute in a mutually beneficial manner.

 Support by mediator- As a neutral, impartial and independent third-party, mediators

ensure that the mediation remains a fair process. They also guide the parties through
the process as neutral facilitators, encourage creativity in resolution and broaden the
range of solutions.

 Finality- Mediation promotes finality in dispute resolution as there is no scope for an

appeal, a revision or further litigation on the successful conclusion of a mediation.

 Refund of court fees- Court-referred mediation also allows for a refund of court fees in
cases of settlement.

Disadvantages of Mediation
 Informality- In the informal setting of a mediation, there are no formal rules or
procedures that have to be followed. Thus, mediators do not have access to a lot of tools
to get people to testify or produce evidence to get to the truth of a matter.

 Unfairness- Moreover, the lack of formal rules means that there is no way to ensure a
fair procedure for the parties involved. An aggressive party might be able to steamroll a
timid one despite the best efforts of the mediator.
The imbalances of power that exist in a family may thus also lead to unfairness in the mediation.

 Success not guaranteed- Mediation may also be unsuccessful and not lead to a
settlement between the parties involved. The parties will then have to resort to the
 money and time intensive court system after already wasting a significant amount of
them in the mediation.

 Non-binding- The agreement reached in a mediation is non-binding. Parties to a

settlement may also attempt to dispute the settlement agreement in case the
agreement is not made binding on them. They can file another suit in court challenging
the legitimacy of the settlement, creating another dispute on top of the underlying one.
The only solution to this is to agree to make the settlement agreement binding on both parties before
signing it.

What To Consider When Going for Mediation

Time and Cost of the Mediation Process

 Time
Mediation can take any amount of time, ranging from several hours to days. This depends on the
complexity of the issues to be discussed, the number of parties, and their preparation, flexibility, and
desire to resolve disputes.

According to figures presented by the Bangalore Mediation Centre, however, the average mediation
in India takes only two hours. Moreover, the parties are given a maximum of 60 days to resolve their
disputes before reverting to the court.

 Cost
The cost of mediation is extremely economical as compared to the courts. A single motion filed by
an attorney often costs more than the mediation. Mediation fees currently range between Rs. 15,000
to Rs. 70,000.

A mediation is also less emotionally stressful than a trial might be.

What to Discuss With Your Lawyer Before Going to Mediation

 Alternatives to Trial to be Taken Up

Alternative methods to litigation and trial for dispute resolution that can be referred to by the court
include arbitration, conciliation, judicial settlement through Lok Adalat, and mediation. It is a good
idea to discuss with your lawyer exactly which method to take up as an alternative to trial.

 Form of Mediation to be Pursued

There are many different forms of mediation, with the most popular being traditional mediation. A
traditional mediation has many distinct phases, such as openings, joint sessions etc. Other forms of
mediation include-

 Facilitative Mediation
 Transformative Mediation
 Evaluative Mediation
 Directive Mediation
You can read more about them here.

 Parties to be Present at the Mediation

The success of a mediation depends highly on the parties present at the table. This, too, varies
according to the kind of mediation.

Any mediation requires a person who can make a binding decision to be present.

Parties may also want their technical experts to be present as it allows them the opportunity to learn
more in a short amount of time.

In emotionally charged mediation, it may be prudent for a party to ensure the presence of their
psychologist.

 Risk Factors
Mediation statements are issued by the parties days before the mediation begins. These contain the
factual claims and legal arguments according to a party. The parties and their counsels then need to
discuss the risk factors, i.e. the opposition’s strengths and their weaknesses. This also allows them to
start considering solutions.

 Timing of the Mediation

Timing is crucial in a mediation. A person should discuss the timing of the mediation with their
lawyer. The ideal time is as early in the dispute as possible after the parties and counsels have a good
knowledge of the factual and legal issues. It should take place before expensive phases in the trial,
such as depositions.

Challenging a Mediation Agreement

A successful mediation results in a negotiated agreement that takes the place of a contract between
the parties. The parties cannot pursue any litigation for the underlying dispute if they are dissatisfied
with the settlement reached as it would amount to a breach of the contract.
However, if the parties wish to dispute the agreement, they can bring an action in court challenging
the validity of the agreement based on principles of contract law, and not on the basis of the
underlying dispute.

Alternative dispute resolution

Alternative Dispute Resolution (ADR) is the procedure for settling disputes without
litigation, such as arbitration, mediation, or negotiation. ADR procedures are usually
less costly and more expeditious. They are increasingly being utilized in disputes that
would otherwise result in litigation, including high-profile labor disputes, divorce actions,
and personal injury claims.

One of the primary reasons parties may prefer ADR proceedings is that, unlike
adversarial litigation, ADR procedures are often collaborative and allow the parties to
understand each other's positions. ADR also allows the parties to come up with more
creative solutions that a court may not be legally allowed to impose

Objective
 Affordable and speedy trials with less procedural work.
 Aims to settle the disagreement peacefully by way of compromise,
negotiation or fair settlements.
 Uses a direct approach to settle the dispute– one to one conversations
and rigorous discussions to give a better understanding of each party’s
view.
 Explanatory in nature- gives in-depth information about the judicial
policies and rules without being binding on the party.
 Works on the principle of diplomacy- win-win for both parties.
 Communication is the key- the more the parties at dispute
communicate the more it increases the chances of coming to a
mutually agreeable point.
 Maintaining confidentiality– Keeping the information and dispute
classified and inside the organization.
 Creating pre-dispute guidelines and rules to save from future issues
and give a systematic framework.
 The most important aim- avoid judicial proceedings and trials.
The Supreme court of India has also in many instances emphasized the need of
ADR: In one case M/s Guru Nanak Foundation Vs M/s, Rattan Singh & Sons.