AVENUES OF MEDIATION
Author: Tushar Jain, III year of B.B.A.,LL.B.(Hons.) from Jagran Lakecity University
‘Discourage litigation. Persuade your neighbours to compromise whenever you can. Point out to them how the nominal winner is often a real loser—in fees, expenses, and waste of time. As a peacemaker, the lawyer has a superior opportunity of being a good man. There will still be business enough.’
Disputes are imminent and are a part of everyone’s life. A dispute can arise in any personal or commercial association but having a dispute is not a problem what is important is how the parties handle that dispute. In court, the process of civil suits is long-lasting and exorbitant.
So this problem can be solved by ADR. It is a procedure or mechanism that deals to resolve disputes outside the court without a trial known as Alternative Dispute Resolution (ADR). According to the Section 89 (1) of the Code of Civil Procedure[i] if the court seems that there are factors that exist for a settlement in the dispute that may be acceptable to the parties then the court can refer the matter to the ADR mechanism by way of mediation, conciliation, arbitration, negotiation and legal settlement by Lok Adalat.
ADR is not costly and speedier. It empowers the parties to know each other’s positions and to come up with more prolific solutions that a court may not be lawfully allowed to impose. ADR offers to settle matters like family, industrial, commercial and matrimonial disputes. ADR’s goal is to provide justice and preserve unity in society. ADR provides different methods for settlement including, mediation, conciliation, arbitration, negotiationand Lok Adalat.
Rule[ii]4 of the Civil Procedure - Alternate Dispute Resolution Rules, 2003 (ADR Rules) defines mediation by stating that
Settlement by ‘Mediation’ means the process by which a mediator appointed by parties or by the Court, as the case may be, mediates the dispute between the parties to the suit by the application of the provisions of the Mediation Rules, 2003 in Part II, and in particular, by facilitating discussion between parties directly or by communicating with each other through the mediator, by assisting parties in identifying issues, reducing misunderstandings, clarifying priorities, exploring areas of compromise, generating options in an attempt to solve the dispute and emphasizing that it is the parties own responsibility for making decisions which affect them.
Mediation is one of the most common and popular forms of ADR to settle a dispute. Mediation is a private process in which a neutral or unbiased third person called a "mediator" helps the parties principally through structured settlement discussions to reach a friendly resolution that is approachable to their needs and agreeable to both sides. The mediator does not directly resolve the dispute but helps the parties to understand them and accordingly communicate so that they can easily settle the dispute themselves. Mediation is willful and non-binding which mainly focuses on the needs, rights, and interests of the parties. Comparison between litigation and mediation process in relation of taking matter is that in litigation, there is an accusation and the accusation is to be proved, depending on that the Court will give solution whereas, in mediation, the matter gets resolved through negotiation, where the resolution is sought with the agreement of the parties after seeing the demands of both the parties.
Here the mediator’s role is to control the process by bringing the parties together eye to eye in an intimate and private setting. However, the mediator has no power to make a final judgement but to encourage open and honest communication between the parties. Both the parties have the freedom to lay down their perspectives and listen to each other sayings. There is no absolute qualification of who can be a mediator. A mediator can be anyone, of any designation, who can be appointed formally or casually depending on the wish of the parties in unlocking resolutions concentrated on finding an amenable settlement. A mediator helps the parties in[iii]:
Not taking sides with either party.
Helping you to evaluate the usefulness of the decisions you make.
Explain and determine what matters are in dispute.
Inspect both parties' real needs and interests.
Broaden the resolution options and examine the most efficient option.
Discussing the settlement agreement in detail, planning out how the parties have found resolution in each matter in dispute.
Other perceptions about mediation can be:
Mediation can be appropriate in many cases nevertheless it may not be acceptable for every case. You will probably be invited to attend a prelude meeting in which the mediator will evaluate whether mediation is appropriate for your specific circumstances, or your legal adviser may be able to help you to decide.
Both parties can dissolve the mediation process at any time and must acknowledge that what the other party says during the mediation session is without bias and hence cannot be used in any legal proceedings.
At any stage of the mediation, the parties can ask for legal assistance.
An agreement signed by both the parties which is framed in a mediation session is legally valid as a matter of contract. The agreement itself is not binding as a judgment like an order of the court or an arbitration award but an innocent party may file a suit against the other party in breach of its terms[iv].
Categories of mediation that are commonly followed in India are
1. Mediation referred through court
In a few cases, the court directs the parties to get resolution of disputes through mediation under section 89 of Code of Civil Procedure 1908. It is important to take assent of the parties before referring the case to settle by mediation.
Companies Act 2013[v]includes provisions under section 442 for arbitrating authority to refer the unresolved matter for mediation to an individual empanelled as mediator.
Commercial Courts, Commercial Division & Commercial Appellate Division of High Courts Act 2015 order through section 12A that if a person has a dispute which can only be tried under the act must first go through mediation exercise except it is suitable to have a remedy to the court for an urgent interim order before resorting to litigation. This type of mediation mostly comes under matrimonial disputes, specifically divorce cases in which if such mediation settles then it has to be mentioned back to the court by the mediator together with the report and then the court shall pass a legal order in terms of the settlement.
In criminal cases that can be settled under the Code of Civil Procedure 1908 if the dispute is compoundable which can becompromised. Heinous offences like rape, murder, assault, kidnapping, robbery cannot be referred for mediation as they are un comprising[vi].
2. Private and Contractual Mediation
Arbitration and Conciliation Act (ACA) gave rise to private mediation in India in 1996. Civil Procedure Code and Arbitration and Conciliation Act are the two laws that govern mediation in India. Section 89 of the CPC act towards court-annexed mediation where the rules are framed by the high court whereas private mediation has been dealt with in part III of Arbitration and Conciliation Act. Various rules governing mediation have been given in part II of the Civil Procedure Alternative Dispute Resolution and Mediation Rules.
Both parties can incorporate a mediation clause into a contract based on the terms of their agreement for a fruitful resolution. Choosing the mediator and other mediation conditions are mentioned in the contract. The outcome of the mediation was probably imposed as judgments of a court. Willingly parties, the court or a contract could also determine to look for mediation of their own accord which can be done at any time and is controlled by the parties[vii].
3. Mandatory or Statutory Mediation
Some disputes are binding by the law to be put through in the mediation process, such as Labour and Family cases in law. In India according to the Rule 5(f)(iii) of the Civil Procedure Alternative Dispute Resolution Mediation Rules, 2003 it provides for obligatory mediation[viii].
Advantages of Mediation
Willingly consent- If any parties find mediation futile then they can willingly exit at any stage.
Confidential and Private- Knowing the circumstances of the mediation being known only to the mediator and both the parties, mediation remains strictly confidential as this helps in attaining successful communication between the parties.
Control- By having these parties have the authority over the extent of the mediation in terms of the issues discussed and their outcome. Control is in the hands of the parties not in the judge or jury to aid them in reaching a jointly agreeable solution. By having control vested with the parties, it may also resolve connected issues and disputes. It also allows the parties to satisfy their needs, rights, and interests at each stage. This is extremely pivotal as it allows the parties an opportunity to come up with creativity in examining alternatives, assessing options and reaching a settlement. There is compliance with the terms when the parties themselves agree to the conditions of the settlement.
Favourable to dispute resolution- Mediationcreates a favourable, friendly and conducive environment for settlement by giving a mechanism that is adaptable according to the case and gives parties comfortably in carrying on with their day to day activities side by mediation.
Completeness- Mediation encourages finality and completeness in dispute settlement as it gives no scope for appealing again and additional litigation if the settlement of the mediation is successful.
Money-Saving- Proceedings of the court are long, could potentially take months or years to assert judgement in cases either it is complex or a simple case because of the pendency of disputes on the other hand mediations take mere hours.On average, settlement of mediation disputes takes around 3 months with fewer meetings as compared to going to courts. Also, mediation sessions can take place even on evenings or weekends according to the convenience of the parties, unlike court hearings which have fixed dates and timings.
Court fees refund- Under court-referred mediation court fees return is allowed.
Amicably- Since parties to a mediation are cooperative itallows both the parties to solve the dispute in a way that is agreeable to both sides while this supports in settling a dispute in a cooperatively beneficial manner and also in re-establishing the relationship between the parties[ix].
Disadvantages of Mediation
No Formality- The absence of formality in mediation being a benefit can also be a disadvantage because no formal rules or procedures are followed in the meeting of the mediation. Mediation between parties with different rates of sophistication and control mediators do not have avenues to produce evidence or to get people to testify to know the truth of the matter.
Cannot Set Legal Paradigm- Mediation is not pivotal to social cases which come by the magnitude of not only for satisfaction for the named complaint but also with anticipation of setting a new legal paradigm that can have a wider social impact on the society. Such cases are only successful if an apex court makes an affirmative judgement on the issue.
No guarantee of resolution- Mediation can be unsuccessful and not lead to a resolution. In such circumstances, the parties do not have an option other than moving to the court’s time and money consuming system after so far squandering time and amount of them in the mediation[x].
Process or steps of Mediation
Opening Statements and introduction from the parties
This step includes ground rules like unbiasedness, creating knowledge of the procedure, acquiring parties trust, supporting both the parties for creating an amicable and friendly environment appropriate for settlement.
Firstly the mediator starts the procedure by introducing himself/herself, their qualifications and experience to the parties. Then the mediator expresses the message that he/she has no discordance in the mediation process and conveys that a friendly settlement or anything close to one, would lead to fruitful sessions. The mediator affirms both sides of the parties that they have no doubt and have the control to negotiate and come to a settlement.
The mediator sets a pitch for the mediation by making them cognizant about steps and concepts in the process, everyone's part, set up some keystones for mediation and take every benefit from the process. The mediator conveys to the parties that mediation is fully non-mandatory and secretive and the productive settlement would count on the effective involvement of the parties.
Setting the agenda
Mediator has the foremost responsibility of setting the agenda to get transparency and remove obscurity in the proceedings of the mediation. It gives the parties guidelines helping them in evaluating the improvement of the settlements individually. The place and time for the settlements sessions could be chosen by the mediator along with the issues before the parties which are consecutively discussed.
This stage includes gathering every detail, discovering the point of view, inspecting the matter and facts. Interacting with the mediator supports both sides in manifesting their cases, during the time the counsellors propose the legal issues thoroughly. Both sides detail their stance on the matter and also reply to the queries to the other party. At this stage, the parties may also ask questions to each other. Since the mediator has to be non-partisan, the coordinator has to see that both parties are heard effectively and also listens to each side sedately.
Private session or Caucus
In the Caucus stage, it helps the mediation process to look into expeditious settlement and often a settlement as well in most cases. At this stage an individual session is organised by the mediator with each party so that they can independently interface with the mediator, propose details and some possible resolution conditions to discuss that amply and easily with the other party. Questions can be offered by the mediator to both sides and the counsellor to get details which they were not able to do in the joint sessions. Parties may seek the mediator to keep certain information confidential from the opposing party which are discussed in the private session but the mediator has an obligation not to unfold such information yet can utilize this detail for a successful settlement. Caucus provides an opportunity for both parties to openly discuss their views. Multiple joint sessions and caucuses can be conducted by the mediator depending upon the facts and circumstances.
Closing and Resolution
At this last stage, the mediator's work is to ascertain offers and counter-offers and help the parties to give up rigid positions which can lead to creative options for settlement. After a settlement is reached then the settlement agreement is written assisting the parties to draft this agreement. These terms would be inclusive to prevent uncertainty. This settlement is binding like a contract and is enforceable in a court of law. Still, a situation can arise where the parties are not ready for settlement, then the case would be returned to a referral court asserting the matter was "not settled" or the parties may decide the way forward. Mediator conclude this by thanking both the parties and appreciates that the parties have given a try to a mediation[xi].
Scope or cases where mediation can be applied or made necessary in India
In Afcons Infrastructure Ltd. and Anr. V. Cherian Varkey Construction Co. Pvt. Ltd. and Ors.[xii]the Supreme Court passed the guidelines referring to the kind of cases that can be referred to ADR and cannot be:
Cases that cannot be referred to ADR
1) Under Order, I Rule 8 of the Code of Civil Procedure 1908, representative suits involve public interest or interest of numerous persons who are not parties before the court.
2) Election to public offices disputes.
3) Cases that involve a grant of authority by the court after enquiry.
4) Cases claiming specifically of fraud, fabrication of documents, forgery, impersonation, coercion etc.
5) Cases necessary for the protection of courts.
6) Cases of prosecution for criminal offences.
Cases that can be referred to ADR
1) All cases of trade, commerce and contracts
2) All cases originating from strained relationships
3) All cases of tortious liability
4) All consumer disputes
5) All cases where it is important to continue the pre-existing relationship despite the disputes
Disputes arising between consumers and merchantscan be resolved by mediation as many businesses don't know how to resolve disputes, in case things go worse. Many times the two parties cannot communicate in the same language and get annoyed as both have their priorities set on various levels. Then parties approach the court to solve the dispute, which normally does not resolve the real dispute but grows it.
Estate matters which are very closely related to family matters can go for mediation as this process can easily resolve family matters and will also help the parties to get away with a lengthy process of litigation. Mediation can also help to assist revive familial ties. This process of mediation can also help in mitigating the poor communication among the heirs.
Mediation may help in resolving disputes between neighbours which are tortious. The traditional methods for resolving disputes by complaint in the police and litigation, generally take no notice of the underlying problem as neighbours are engaged in proving the opposite party wrong, causing their personalities to block in the process. Meditation helps them to directly get to the actual dispute in less time and with less money spent. At times disputes like a nuisance, vandalism, parking space, trespass to chattels, trespass to property can be easily solved just by directly talking to the neighbour.
Mediation can be helpful to obtain mutual and improving relations between a landlord and a tenant. The relationship between a landlord and a tenant is a knotty one whether there is a delay in payment of rent or misinterpretation of the lease agreement between the two parties while looking at various provisions and legal rights of the two parties. Disputes arising out of such misunderstanding lead the parties to the option of filing a suit against each other and there is no assurance of getting the rightful judgement of the problem. Also, court procedure takes a lot of money and time meanwhile the tenant finds another house and the landlord finds a new tenant. On the other hand, mediation is money and time saving and allows both the parties to look at the problem in a different way and comes up with an effective resolution[xiii].
Due to over-burdening and the accumulation of pending cases, Indian courts have become daunting. Albeit litigation provides a fruitful settlement but it has several shortcomings which include excessive costs, extreme delays and clumsy processes. Due to the introduction of sections required for necessary mediation in matters of any disagreement many MNCs and partnership firms have released the advantages of mediation. But despite having all these benefits, mediation lacks a favoured choice. Divorce mediation in India is the most common technique for mediation. Mediation has a demand as various mediation centres are coming up, and lawyers choosing mediation as a career option. There should be an urgency for developing mediation drives and advocacy towards mediation throughout the country.
Constraining mediation to just rudimentary and family matters, the ADR process is vastly considered underrated. The legal Industry is forced to get changed in the standards and get accustomed to the new normal owing to the arrival of the COVID-19. Due to the pandemic courts started operating at the minimum size and enforced in taking crucial cases, which allows the courts for approaching dispute resolution exercise. Mainly in commercial cases, mediation can be seen as a feasible and beneficial replacement of traditional dispute resolution especially in the get going present situation. Summarily mediation is that arm that can be used for fighting against injustice, deferral and cost[xiv].
[i] Code of Civil Procedure, 1908, §, 89 (1) (India). [ii]https://www.lexology.com/library/detail.aspx?g=d45eed57-db32-40b6-a5e6-edad2363de76 [iii]https://mediation.judiciary.hk/en/doc/What_is_Mediation-Eng.pdf [iv] supra note 3 [v]The Companies Act 2013, §, No. 18, 2013 (India) [vi]https://legallyflawless.in/2020/08/mediation-a-better-option-during-and-post-covid-19-era.html [vii] http://chetananand.co.in/index.php?route=product/category&path=103_108 [viii] Id [ix] Id [x] supra note 7 [xi]Jeff &Hesha Abrams, “Anatomy of a Mediation: What to Expect, How to Prepare & How to Win”, 2(3) The Indian Arbitrator 2 (March 2010) [xii] Afcons Infrastructure Limited and another V Cherian Varkey Constructions Company Private Limited, (2010) 8 SCC 24, (Para No. 27 and 28) [xiii] https://blog.ipleaders.in/mediation-in-india/ [xiv] https://blog.ipleaders.in/mediation-effective-form-dispute-resolution/