ALTERNATIVE DISPUTE RESOLUTION

Submitted By:Arjun Singh

Submitted to:Mr. Arpit Batra (Additional Director) Medition and Conciliation Centre

Index

I. II. III. IV. V. VI. VII. VIII. IX. X. XI. XII. XIII.

Introduction International Scenario The Concept & its efficacy ADR Procedure Philosophy & Implementation in India Various Type Of ADR Advantages of ADR Mediation as Mode of Alternate Dispute Resolution Advantages of Mediation as an ADR Role Played By A Mediator In Making Mediation A Success Drawbacks of Conciliation How Does a Mediator Differ From A Conciliator? Conclusion

Introduction
It is the spirit and not the form of law that keeps the justice alive. LJ Earl Warren The disillusionment and frustration of people over the inordinate delay in dispensation of justice today looms large as a great threat to erode the confidence of people in the justice system of the country. It is the constitutional obligation of the judiciary to exercise its jurisdiction to reaffirm the faith of the people in the judicial set up. Therefore, evolution of new juristic principles for dispute resolution is not only important but imperative. International Scenario A brief look at the international scenario of ADR Mechanism reveals the popularity of its usage in various countries. The seeds of ADR in the UK can be traced to the work of the advisory, conciliation and arbitration service which was formed in 1974.In China and Japan mediation was used as primary means of conflict resolution. The Chinese principle was the influence of Confucian view of harmony and dispute resolution by morals rather than coercion. Informal dispute resolution was used in many cultures of the world including India, Africa and Israel. In Japan, Judges intervene extensively during the in-court settlement; every Japanese Judge is expected, both by law and by litigants, to move a case towards settlement. This has the force of statutory law. At least 40% of the

cases are settled. The Judge, who decides to switch the litigation to a settlement mode, takes off his robe and acts as mediator. In 1976, Rosco Pound Conference was held to commemorate the anniversary of his dissertation on Public dissatisfaction with the American Legal system. It was this conference that the current ADR movement actually started in America and now these methods are so successful that nearly 93% of the civil disputes are settled outside the courts. Even in Europe, mediation is seen as a potentially promising mechanism for the resolution of both simple and complex disputes. In 1995, France expanded the legislative basis for judicial conciliation and mediation. The Hong Kong International Arbitration Centre, most probably the largest arbitration service centre in Asia, has held the view arbitration as compared to litigation has become very popular for resolving the disputes. Similarly, conciliation and mediation find an increasing measure of support in future.

The Concept & its efficacy The concept of Conflict Management through Alternative Dispute Resolution (ADR) has introduced a new mechanism of dispute resolution that is nonadversarial. A dispute is basically lis inter partes and the justice dispensation system in India has found an alternative to Adversarial litigation in the form of ADR Mechanism. New methods of dispute resolution such as ADR facilitate parties to deal with the underlying issues in dispute in a more cost-effective manner and with increased efficacy. In addition, these processes have the advantage of providing parties with the opportunity to reduce hostility, regain a sense of control, gain acceptance of the outcome, resolve conflict in a peaceful manner, and achieve a greater sense of justice in each individual case. The resolution of disputes takes place usually in private and is more viable, economic, and efficient. The Alternative Dispute Resolution Mechanism has proven to be one the most efficacious mechanisms to resolve commercial disputes of an international nature. Transcending national boundaries it renders proportionate judgements over the merchants disputes, as the Law

Merchants of Medieval ages rendered justice in light of fair price, good commerce, and equity. Infact the Law merchant precepts have been reaffirmed in new international mercantile law. Visualizing the participatory nature of such laws the ADR method is also formulated in the similar vein.

ADR Procedures ADR procedures can be broadly divided into two categories namely, adjudicatory and non-adjudicatory. The adjudicatory procedures such as arbitration and binding expert determination lead to a binding ruling that decides the case. The non-adjudicatory procedures contribute to resolution of disputes by agreement of the parties without adjudication such as Negotiation, Mediation and Conciliation. Mediation is different from Conciliation only in that in the former the neutral third party plays a more active role in putting forward his own suggestions for the settlement of the dispute. A brief description of few ADR procedures widely used is as follows: Negotiation : A non-binding procedure in which discussions between the parties are initiated without the intervention of any third party with the object of arriving at a negotiated settlement of the dispute. Conciliation Mediation: A non-binding procedure in which an impartial third party, the conciliator/mediator, assists the parties to a dispute in reaching a mutually satisfactory and agreed settlement of the dispute. Med-Arb: A procedure which combines sequentially conciliation/Mediation and where the dispute is not settled through conciliation/mediation within a period of time agreed in advance by the parties, arbitration. MEDOLA : A procedure in which if the parties fail to reach an agreement through mediation, a neutral person, who may be the original mediator or an arbitrator, will select between the final negotiated offers of parties such selection being binding on the parties. Mini-Trial : A non binding procedure in which the disputing parties are presented with summaries of their cases to enable them to assess the strengths, weaknesses, and prospects of their case and then an opportunity to negotiate a settlement with the assistance of a neutral adviser.

Arbitration: 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. Fast track Arbitration: A form of arbitration in which the arbitration procedure is rendered in a particularly short time and at reduced cost. Neutral listener Agreement: Parties to a dispute discuss their respective best settlement offer in confidence with a neutral third party who, after his own evaluation, suggests settlements to assist the parties to attempt a negotiated settlement. Rent a judge: Disputing parties mutually approach a referee, usually a retired judge, before whom they present their case in informal proceedings. The referee judge gives his decision which is enforceable in a court of law. The fee of the referee is paid by the parties. Final offer arbitration: Each party submits its monetary claim before a panel that renders its decision by awarding one and rejecting the other claim. Philosophy & Implementation in India ADR is by no means a recent phenomenon in India, though it has been organized and systematized, expressed in clearer terms, employed more widely in dispute resolution in recent years than before. In earlier times, disputes were peacefully decided by intervention of kulas (family or clan assemblies), srenis (guilds of men following the same occupation), parishads (assemblies of learned men who knew law) before the king came to adjudicate on disputes. There were Nyaya panchayats at grass root level before the advent of the British system of justice. Later on, Lok Adalats (people's court) have provided speedy and inexpensive justice in both rural and urban areas in India. In India, laws relating to resolution of disputes have been amended from time to time to facilitate speedy dispute resolution. The Judiciary has also encouraged out of court settlements to alleviate the increasing backlog of cases pending in the courts. To effectively implement the ADR mechanism, organizations like ICA, ICADR were established, Consumer redressal forums and Lok Adalats revived. The Arbitration Act, 1940 was repealed and a new and effective arbitration system was introduced by the enactment of the Arbitration and Conciliation Act, 1996.This law is based on the United

Nations Commission on International Trade Law (UNCITRAL) model law on International Commercial Arbitration. The Legal Services Authorities Act, 1987 has also been amended from time to time to endorse use of ADR methods. Section 89 of the Code of Civil Procedure as amended in 2002 has introduced conciliation, mediation and pre-trial settlement methodologies for effective resolution of disputes. Mediation, Conciliation, Negotiation, Mini Trial, Consumer Forums, Lok Adalats and Banking Ombudsman have already been accepted and recognised as effective Alternative dispute resolution methodologies. Abraham Lincoln puts the philosophy of Alternate Dispute Resolution systems by declaring "discourage litigation; persuade your neighbours to compromise whenever you can. Point-out to them how the normal winner is often a loser in fees, expenses, cost and time." Further, the Constitution of India has defined and declared the common goal for all of us as "to secure to all the citizens of India Justice social, economic and political; Liberty; Equality and Fraternity". ADR is a vehicle to achieve these principles and objectives. Various Types of Alternate Dispute Resolution: Arbitration alone is not ADR; ADR may be through the following modes of ADR:


Negotiation: Is a non-binding procedure, in which discussions between the parties are initiated without the intervention of any third party, with the sole objective of arriving at a negotiated settlement of a dispute. Conciliation/Mediation: A non-binding procedure in which an impartial third party i.e the conciliator or the mediator, assists the parties to a dispute in reaching a mutually satisfactory and agreed settlement of disputes. Mediation/Arbitration : A Procedure which combines conciliation and mediation at a subsequent stage in instances where the dispute is not settled through either conciliation /mediation within a period of time agreed in advance by the parties to arbitration.

MEDOLA : Is a procedure in which ,if parties fail to reach an agreement through mediation, a neutral person ,who may be the original mediator or an arbitrator ,will select between the final negotiated offers of parties, such selection being binding on the parties. Mini Trial: A Non-binding procedure in which the disputing parties are presented with summaries of their cases, so as to enable them to access the strengths, weaknesses and prospects of their case and then an opportunity to settle it is explores. Arbitration: 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 upon the parties Fast Track Arbitration: A form of Arbitration in which the arbitration procedure is rendered in a particularly short time and that too at a reduced cost. Lok Adalats: Besides the above , Lok Adalats are also doing well as a mode of alternate dispute resolution system Ombudsman: Ombudsman is a person with special powers to investigate cases in certain areas such as health, pensions or in instances where there may be a dispute particularly if a government body is involved. An ombudsman can only recommend as to how a dispute may be resolved, however his/her recommendations cannot be enforced. Tribunals: Tribunals are similar to a court without the ritual or formality they, there are a no. of specialized tribunals which bear the name of their specialization, eg: Employment Tribunal, Immigration Tribunal.

Advantages of Arbitration as a Mode of ADR: Supporters of Arbitration hold that it has a multitude of advantages over the regular court litigation, The Advantages of Arbitration as a mode of ADR can be summarized as follows:

Freedom of choice of Decision Maker: Parties to Arbitration are free to choose a technical person as arbitrator, in case of disputes involving questions of technical nature. Efficiency: Hearings of arbitration proceedings are finished sooner than court proceedings, In addition Arbitration proceedings are of a shorter length and preparation work is less demanding. Privacy: Arbitration hearings are confidential private meetings in which attendance of media and members of public is not permitted and even final decision of such proceedings is not published, this procedure is particularly beneficial to those who dont wish to wash their dirty linen in public, and has consequently become a routine with corporate enterprises. Convenience: Arbitration hearings are arranged at times and places which suit the parties, arbitrators and witnesses. Flexibility: Arbitration Procedures can be segmented, streamlined or simplified according to change of circumstances.

Finality: There is as such no right of appeal in arbitration, even though the court has the power to remit or set aside the arbitration, more or less the award of an arbitrator is final. Final comment


Mediation as Mode of Alternate Dispute Resolution: Mediation is basically negotiations carried out with the assistance of a neutral third party; however recommendations of a mediator are not binding. In true sense of the term mediation is a method of non-binding dispute resolution involving a neutral third party, who tries to assist the disputing parties to reach a mutually agreeable solution.

Advantages of Mediation as an ADR: The Advantages of Mediation as Enumerated In Conciliation and Mediation Centre are:
   

It puts the parties in control of both dispute as well as its resolution. Law Mandates mediation and the courts encourage and enforce it. Process of Mediation is confidential. Procedure adopted in mediation is simple and the atmosphere at mediation cell is informal. Mediation as a mode of ADR is voluntary and parties to mediation can at any time opt out of mediation, if it does not help. Mediation saves costs on what actually becomes a prolonged litigation. Mediation makes the disputing parties aware of the strengths and weaknesses of their case and helps them find a realistic solution. Mediation as a mode of dispute resolution concentrates on long term interest and creates an opinion for settlement. Mediation is instrumental in restoring broken relationships; its main focus is on improving future and not dissecting the past.

 

Parties to mediation can, in fact opt for more by signing a settlement that works to the benefit of both the aggrieved as well as his opponent. At the end of the mediation, the relationship of the parties can be restored to a position as had existed before the culmination of such a dispute.

Role Played By A Mediator In Making Mediation A Success: A Mediator plays an active role in settling the dispute between parties to mediation: Some of the Key roles played by a mediator for settling the conflict between the disputing parties are as follows:
    

Mediator organizes meeting related logistics. Ensures adequate representation of interests of both parties to dispute. Mediator assists in keeping the discussion focused on track. Mediator actively participates in assisting the development of an agreement. Presents series of settlement options available to parties.

Conciliation as a Mode of Alternate Dispute Resolution: Conciliation is a settlement of a dispute in an agreeable manner, it is a process in which a neutral person meets with a party to dispute and explores how the dispute might be resolved. Any Democracy worth the name must provide adequate means of dispute resolution. Settlement of disputes by mutual compromise is a much better method, than seeking adjudication in the adversary legal system. The System of conciliation was for the first time tried in Japan, France and Norway. In India the idea of conciliation was evolved on an experimental basis by the High Court of Himachal Pradesh. Conciliation as a method of alternate dispute resolution has been quite instrumental in relieving congestion, particularly at trial court level; in addition it has been quite successful in reducing the inflow of cases in superior courts. It was in fact the conciliatory principle of not allowing revision or appeal at the insistence of any of the reconciled parties that led to a dramatic reduction in the increasing inflow of revision and appeal cases in superior courts. Settlement by disputes my mutual compromise, envisaged by conciliation as a mode of alternate dispute resolution is a much better method than seeking

adjudication in the adversary legal system which apart from generating tension and leaving a trail of bitterness, burdens the parties with heavy financial expenditure. In certain instances even the successful party, has to wait for years before enjoying the fruits of litigation. Conciliation as a Beneficial Means of ADR Conciliation as a means of alternate dispute resolution has stood the test of time and has emerged as a beneficial mode for sharing the burden of litigation by encouraging quick amicable settlement of disputes. Conciliation has minimized the pendency of old cases and has been instrumental in ensuring that litigation is brought to an end by resorting to a mutually acceptable and amicable settlement of issues pending litigation. With a view to relieve regular courts of the excessive overflow of litigation, certain categories of cases with reasonable possibility of amicable settlement are transferred to conciliation courts ,which in fact do their best to assist parties to dispute to arrive at a mutually agreeable reconciliation. A settlement agreement reached by parties to conciliation has a status and effect similar to an arbitral award. The liberty given to civil courts under sec-89 of CPC, to refer a dispute for conciliation even where the parties do not consent, provided the court in all earnestness deems it fit for conciliation, has been one of the most important reasons for the phenomenal success of conciliation as a key alternate dispute resolution procedure.

Drawbacks of Conciliation Though Conciliation proceedings have proved themselves to be a beneficial mode of Alternate Dispute Resolution, yet certain aspects of the system demand an overhaul. Some Drawbacks of Conciliation as a Mode of Alternate Dispute Resolution: which need a mention are:

Once litigation starts there will rarely be negotiations as litigants have already invested some money and would not be willing to give up their chance of winning.

In addition to this lawyers of both sides, who charge their fee on the basis of every appearance, would have no incentive for considering any possible compromise.

How Does a Mediator Differ From A Conciliator? Conciliator is understood as one who simply passes on what each party state to the other, without any proposals emanating from him for settlement, while on the other hand in case of mediation a third party intermediary puts forward different alternative proposals for arriving at a settlement. It becomes quite difficult to maintain a clear line of demarcation between mediation and conciliation. Generally a mediator is likely to make directly or indirectly, some basis for settlement. Thus consequently what was purely mediation may slowly slide in to conciliation while on the other hand a conciliator may slowly assume the passive role of a mediator.

Conclusion As is said in the practical philosophy of law that lawyers are what their cases have made them, so goes the addendum that a legal system is venerated as it has been handled and managed in course of time. Then only a legacy is left for the future to find it sufficiently germane to be accepted as a proposition of inheritance. The law and legal system should appeal the reasons of people, is not a legal principle but a common sense observation of fact. It is this spirit that has led to the evolution of ADR Mechanisms for the dispensation of justice with efficacy and steadfastness!