ACKNOWLEDGEMENT

First of all I would like to thank my subject teacher Mr. SHUKESH MISHRA
for giving such an assignment to prepare, which I found very interesting and
helped me to know various aspects of the additional dispute resolution in india. I
would also like to thanks my family and friends who helped me a lot in
completing this assignment

THANKING YOU
 INDEX

 INTRODUCTION

 NEED OF ADR IN INDIA AND LAW COMMISSIONS

 DEVELOPMENT OF ADR SINCE AGES

 IMPACT/RESULTING ACTS OF ADR

 DIFFERENT TYPES OF DISPUTES RESOLUTION IN INDIA

 DIFFERENCE BETWEEN MEDIATION AND OTHER

DISPUTE RESOLUTION PROCESS

 DIFFERENCE BETWEEN MEDIATION AND

CONCILIATION

 CONCLUSION

 BIBLIOGRAPHY
 INTRODUCTION

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.

Even though Alternative Dispute Resolution is intended to reduce the costs,

stress, and formality associated with going to court, many parties still hire
attorneys to represent them at ADR proceedings. They also seek out pre-
proceeding consultations about possible solutions or strategies. Just as with any
legal dispute, you should hire an attorney with experience in your particular
legal issue who also is familiar with the collaborative process of ADR.

Additionally, arbitrators and mediators are often lawyers. Rather than hiring a
lawyer to represent each party in an ADR proceeding, some parties agree to hire
a single lawyer to act as an impartial third party to guide the resolution and
ensure that all solution proposals are legal.

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. ADR is
generally classified into at least four types: negotiation, mediation, collaborative
law, and arbitration. Sometimes a fifth type, conciliation, is included as well,
but for present purposes it can be regarded as a form of mediation

NEED OF ADR IN INDIA AND LAW COMMISSION REPORT

The system of dispensing justice in India has come under great stress for several
reasons mainly because of the huge pendency of cases in courts. In India, the
number of cases filed in the courts has shown a tremendous increase in recent
years resulting in pendency and delays underlining the need for alternative
dispute resolution methods. It is in this context that a Resolution was adopted by
the Chief Ministers and the Chief Justices of States in a conference held in New
Delhi on 4th December 1993 under the chairmanship of the then Prime Minister
and presided over by the Chief Justice of India.

It said: "The Chief Ministers and Chief Justices were of the opinion that Courts
were not in a position to bear the entire burden of justice system and that a
number of disputes lent themselves to resolution by alternative modes such as
arbitration, mediation and negotiation. They emphasized the desirability of
disputants taking advantage of alternative dispute resolution which provided
procedural flexibility, saved valuable time and money and avoided the stress of
a conventional trial".

In a developing country like India with major economic reforms under way
within the framework of the rule of law, strategies for swifter resolution of
disputes for lessening the burden on the courts and to provide means for
expeditious resolution of disputes, there is no better option but to strive to
develop alternative modes of dispute resolution (ADR) by establishing facilities
for providing settlement of disputes through arbitration, conciliation, mediation
and negotiation.

Reasons of finding alternatives:

1. Weight of Pendency
The need for finding alternatives arises due to the working of the present system
of administration of justice, which is crumbling under the weight of the pending
cases.

2. State fighting the citizens

Interestingly, the government is the biggest litigant in the country. According to
a rough estimate, around 70 per cent of all cases are either agitated by the State,
or appealed by it. The State fight cases against the citizens at the costs of
citizens. Thus, directly or indirectly the State is also responsible for increasing
the weight of pending cases.

3. Other reasons
Jurists have suggested that the reduction in number of holidays of courts, and an
increase in the working of days. At present the court are working for 210-230
days per year, with a fairly long summer vacation. If courts work for longer
hours and days, litigation can be brought under control.

4. Adjournments
Unnecessary adjournments also extend the life of litigation. The process of
adjournment, on frivolous grounds, is one of the major reasons for increase in
delay. There is a need to evolve a set of guidelines for granting adjournments,
and a framework for the settlement of dispute should be designed.

To overcome, such problems, the law commission of India set up to reform the
‘justice delivery system in India’, time in time came up with the solutions and
suggestions, and these are:

The Law Commission of India, 117th Report in the year 1986, talks on the
‘training of judicial officers’ so that the huge backlog of cases can be managed.
The law officers should be trained as per modern methods of dispute resolution,
so as to re-establish the credibility on justice delivery system in India and to
restructure judiciary on all level in India.

The 221st Law Commission of India, in the year 2009 came up with their report
on ‘Need for Speedy Justice – Some Suggestions’ since there was Mounting of
arrears of cases in courts, particularly in High Courts and District Courts, has
been a cause of great concern for litigants as well as for the State. It is a
fundamental right of every citizen to get speedy justice and speedy trial which
also is the fundamental requirement of good judicial administration. In this
Report, they have made few proposals which when given effect to, will be
helpful not only in providing speedy justice but also in controlling frivolous,
vexatious and luxurious litigations.

Several amendment has been suggested, In order to shorten delay in disposal of

cases, it is necessary that provisions parallel to section 80 CPC be introduced for
all kinds of civil suits and cases proposed to be filed by a litigant.

The 222nd Report of the Law Commission of India on the subject- Need for
Justice-dispensation through ADR etc. came up in 2009 “To keep under review
the system of judicial administration to ensure that it is responsive to the
reasonable demands of the time and in particular to secure:-

(i) Elimination of delays, speedy clearance of arrears and reduction in costs so

as to secure quick and economical disposal of cases without affecting the
cardinal principle that decision should be just and fair.

(ii) Simplification of procedure to reduce and eliminate technicalities and

devices for delay so that it operates not as an end in itself but as a means of
achieving justice.

(iii) Improvement of standards of all concerned with the administration of

justice.”

This report was in the continuum of the Law Commission’s various earlier
reports on the subject of judicial administration. Hence, it is the execution of the
saying that Justice must be effective, speedy, less costly and non-cumbersome.

The recommendations of law commission were adopted and incorporated in

Rules 1-A, 1-B and 1-C of Order X of the CPC.

Law Commission of India (report no. 230) on ‘Reforms in the judiciary – some
suggestions’ The recommendations in this Report are the suggestions made by
the Hon’ble Shri Justice Ashok Kumar Ganguly, former Judge of the Supreme
Court, these recommendations are:

 There must be full utilization of the court working hours. The judges must
be punctual and lawyers must not be asking for adjournments, unless it is
absolutely necessary. Grant of adjournment must be guided strictly by the
provisions of Order 17 of the Civil Procedure Code.
  Judges must deliver judgments within a reasonable time and in that
matter, the guidelines given by the apex court in the case of Anil Rai v.
State of Bihar,1 must be scrupulously observed both in civil and criminal
cases.

 Considering the staggering arrears, vacations in the higher judiciary must

be curtailed by at least 10 to 15 days and the court working hours should
be extended by atleast half an hour.
Law commission of India in its 240th report in the year 2012 on ‘Costs in Civil
Litigation’ also suggested some measures. The Law Commission has taken an
in-depth study and had interaction with the judicial officers and lawyers at the
conference held in some of the States. The Rules of various High Courts
governing taxation of costs and advocate’s fee have been pursued. Keeping in
view the triple goals of (i) ensuring realistic and reasonable costs to the
successful party, (ii) curbing false and frivolous litigation and (iii) discouraging
unnecessary adjournments, the recommendations have been made. To felicitate
expeditious realization of costs pending appeals, amendments to law has been
suggested. As per the recommendations, certain legislative changes in CPC
have been proposed. Amendments to Section 35A (compensatory costs for false
and frivolous litigation), S. 95 (compensation for obtaining arrests, attachment,
etc., on insufficient grounds), Order XXV (security for costs), Order LXI
(appeals from original decrees), Order XX, Rule 6A (preparation of decree),
have been suggested.

1
Anil Rai v. State of Bihar, (2001) 7 SCC 318.
 DEVELOPMENT OF ADR SINCE AGES

Dispute resolution outside of courts is not new; societies world-over have long
used non-judicial, indigenous methods to resolve conflicts. What is new is the
extensive promotion and proliferation of ADR models, wider use of court-
connected ADR, and the increasing use of ADR as a tool to realize goals
broader than the settlement of specific disputes.

 ADR in Ancient India

Alternate Dispute Resolution system is not a new experience for the people of
this country also. It has been prevalent in India since time immemorial. Legal
history indicates that down the ages man has been experimenting with
procedure for making it easy, cheap, unfailing and convenient to obtain justice.2

It is generally presumed that the commonly prevalent system of Government in

Ancient India was monarchy and instances of republic were either exceptions or
aberrations. The view is based on the apparent perception that since there were
kings in ancient India, the system was that of monarchy.

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. The political system of the Aryans in their
initial days here was amazingly complex, though quite ingenious. They hung
around together in small village settlements (which later grew to kingdoms) and
the basis of their political and social organization was, not surprisingly, the clan
or kula. Being of somewhat militant nature, this was very much a patriarchal
society, with the man in the house expected to keep his flock in control. Groups

2
Dr. Shraddhakara Supakar, Law of Procedure and Justice in Ancient India, Deep &
Deep Publication, New Delhi, 1986
of kulas together formed a Grama or village, which was headed by a Gramina.
Many villages formed another political unit called a Visya, headed by a
Visyapati. The Visyas in turn collected under a Jana, which was ruled by a
Rajana or king. However, the precise relationship between the grama, the visya
and the Jana has not been clearly defined anywhere.

In ancient India there were several grades of arbitration, for example the Puga or
a board of persons who belonged to different sects and tribes but lived in the
same locality; the Sreni or assemblies of tradesmen and artisans belonging to
different tribes but connected in some way with each other, the Kula or groups
of persons bound by family ties. From early times, the decisions of Panchayats
were accepted as binding. According to Colebrooke (an English scholar and
commentator on ancient Hindu law), Panchayats were different systems of
arbitration subordinate to the regular courts of law. The decision of a Kula or
kin group was subject to revision by the Sreni which, in turn, could be revised
by the Puga. From the decision of the Puga, appeal was maintainable to
Pradvivaca and finally to the sovereign and the prince.

It is important to note that in ancient India joint families were the order of the
day and they were usually very large. When therefore, a disagreement or dispute
used to take place between two members of a family, it was usually settled by
its elders. If they failed to bring about any compromise, the sreni or the guild
courts used to intervene. Srenis or guilds became a prominent feature of
commercial life in ancient India from 500 B.C. They were well organized and
had their own executive committees of four or five members.

 ADR in Mughal Period

The administrative system of the Mughal Empire was largely the work of
Akbar, for the early two Mughal kings (Babur and Humayun) did not really get
the chance to implement much of a system. Nothing like modern legislation, or
a written code of laws, existed in the Mughal period. The only notable
exceptions to this were the twelve ordinances of Jahagir and the Fatawa-i-A Xat
a digest of Muslim law prepared under supervision. The judges chiefly followed
the Quranic injunctions or precepts, the Fatawas or previous interpretations of
the Holy Law by eminent jurists, and the qanunus or ordinances of the
Emperors. They did not ordinarily disregard customary laws and sometimes
followed principles of equity.

The Mughals had three separate judicial agencies, all working at the same time
and independent of each other. Those were the courts of religious law, court of
secular law, and political courts. As regards the courts of religious law, those
were presided over by the Qazis who decided cases according to Islamic law. As
regards the courts of secular law, they were presided over by Governors,
Faujdars and Kotwals. In the time of Akbar, Brahmans were appointed to decide
the cases of Hindus. The Panchayats also fell under this category. The courts of
secular law were not under the thumb of the Qazi. Political courts tried political
cases like rebellion, rioting, theft, robbery, murders, etc. They were presided
over by Subahdars, Faujdars Kotwals, etc.

Mughal emperors had keen interest to deliver speedy justice to its citizens. The
justice system placed even senior officers within the law, and perhaps the only
person really above the law was the emperor himself. Most villagers however
resolved their cases in the village courts itself and appeal to the caste courts or
panchyats, the arbitration of an impartial umpire (salis), or by a resort to force”.
The punishments were fairly severe, ranging from imprisonment to amputation,
mutation and whipping. The approval of the emperor was however mandatory
for capital punishment. In the Mughal judicial system, the emperor was the final
court of appeal.

 ADR during British regime

Judicial administration was changed during British period. The current judicial
system of India is very close to the judicial administration as prevailed during
British period. The traditional institutions worked as recognised system of
administration of justice and not merely alternatives to the formal justice system
established by the British. The two systems continued to operate parallel to each
other.3

The system of alternate dispute redressal was found not only as a convenient
procedure but was also seen as a politically safe and significant in the days of
British Raj. However, with the advent of the British Raj these traditional
institutions of dispute resolution somehow started withering and the formal legal
system introduced by the British began to rule.

Alternate Dispute Resolution in the present form picked up pace in the country,
with the coming of the East India Company. Modern arbitration law in India
was created by the Bengal Regulations. The Bengal Regulations of 1772, 1780
and 1781 were designed to encourage arbitration.4 Bengal Resolution Act, 1772
and Bengal Regulation Act, 1781 provided parties to submit the dispute to the
arbitrator, appointed after mutual agreement and whose verdict shall be binding
on both the parties. Hence, there were several Regulations and legislation that
were brought in resulting considerable changes from 1772. After several
Regulations containing provisions relating to arbitration Act VIII of 1857
codified the procedure of Civil Courts except those established by the Royal
Charter, which contained Sections 312 to 325 dealing with arbitration in suits.
Sections 326 and 327 provided for arbitration without the intervention of the
court.

3
Sarvesh Chandra, ADR: Is Conciliation the Best Choice, in P.C. Rao and William
Sheffield (eds.), Alternative Dispute Resolution: What it is and How it Works,
Universal Law Publishing Co., New Delhi, (1997) p. 85
4
Nripendra Nath Sircar, Law of Arbitration in British India (1942), p. 6 cited in 76’th
Report of Law Commission of India, 1978, p. 6, para 1.14.
After some other provisions from time to time Indian Arbitration Act,1899 was
passed, based on the English Arbitration Act of 1889. It was the first substantive
law on the subject of arbitration but its application was limited to the Presidency
– towns of Calcutta, Bombay and Madras. Act, however suffered from many
defects and was subjected to severe judicial criticisms.

The Arbitration Act of 1940 was enacted replacing the Indian Arbitration Act of
1899 and section 89 and clauses (a) to (f) of section 104(1) and the Second
Schedule of the Code of Civil procedure 1908. It amended and consolidated the
law relating to arbitration in British India and remained a comprehensive law on
Arbitration even in the Republican India until 1996.

 ADR in Independent India

Bodies such as the panchayat, a group of elders and influential persons in a
village deciding the dispute between villagers are not uncommon even today. In
1982 settlement of disputes out of courts started through Lok Adalats. The first
Lok Adalat was held on March 14, 1982 at Junagarh in Gujarat and now it has
been extended through out the country. Initially, Lok Adalats functioned as a
voluntary and conciliatory agency without any statutory backing for its
decisions. By the enactment of the Legal Services Authorities Act, 1987, which
came into force from November 9, 1995, the institution of Lok Adalats received
statutory status. To keep pace with the globalization of commerce the old
Arbitration Act of 1940 is replaced by the new Arbitration and Conciliation Act,
1996. Settlement of matters concerning the family has been provided under
Order XXXIIA of the Code of Civil Procedure, 1908 by amendment in 1976.
Provisions for making efforts for reconciliation under Sections 23 (2) and 23 (3)
of the Hindu Marriage
Act, 1955 as also under Section 34 (3) of the Special Marriage Act, 1954 are
made. Family Courts Act was enacted in 1984. Under Family Courts Act, 1984
it is the duty of family court to make efforts for settlement between the parties.

Introduction of section 89 and Order X Rule 1A, 1B and 1C by way of the 1999
Amendment in the Code of Civil Procedure, 1908 is a radical advancement
made by the Indian Legislature in embracing the system of “Court Referred
Alternative Disputes Resolution”.

IMPACT/RESULTING ACTS OF ADR

The technique of ADR is an effort to design a workable and fair alternative to

our traditional judicial system. It is a fast track system of dispensing justice.
There are various ADR techniques viz. arbitration, mediation, conciliation,
mediation-arbitration, mini-trial, private judging, final offer arbitration, court-
annexed ADR and summary jury trial.

These techniques have been developed on scientific lines in USA, UK, France,
Canada, China, Japan, South Africa, Australia and Singapore. ADR has
emerged as a significant movement in these countries and has not only helped
reduce cost and time taken for resolution of disputes, but also in providing a
congenial atmosphere and a less formal and less complicated forum for various
types of disputes.

1. Code of Civil Procedure

The Code of Civil Procedure, 1859 in its sections 312 to 325 dealt with
arbitration in suits while sections 326 and 327 provided for arbitration without
court intervention. The Code of Civil Procedure (Act 5 of 1908) repealed the
Act of 1882. The Code of Civil Procedure, 1908 has laid down that cases must
be encouraged to go in for ADR under section 89(1).5 Under the First Schedule,
Order XXXII A, Rule 3 a duty is cast upon the courts that it shall make an
endeavor to assist the parties in the first instance, in arriving at a settlement in
respect of the subject matter of the suit.6

The second schedule related to arbitration in suits while briefly providing

arbitration without intervention of a court. Order I, Rule 1 of the schedule says
that where in any suit, all the parties agree that any matter in difference between
them shall be referred to arbitration, they may, at any time before judgment is
pronounced; apply to the court for an order of reference. This schedule, in a way
supplemented the provisions of the Arbitration Act of 1899.

The object of Section 89 of the Code of Civil Procedure is that settlement

should be attempted by adopting an appropriate Alternative Dispute Redressal
process. Neither section 89 nor Order X, rule 1A of the CPC is intended to
supersede or modify the provision of the Arbitration and Conciliation Act or the
Legal Services Authorities Act, 1987.

Section 89 of the CPC makes it clear that two of the ADR processes (i.e.
Arbitration and Conciliation) will be governed by the Act of 1996. And two
others i.e. Lok Adalat and mediation is governed by the Legal Services
Authorities Act, 1987. Section 89 of the CPC cannot be take recourse unless all
parties concerned give consent.

2. Indian Arbitration Act, 1899

5
Civil Procedure Code, 1908 as amended and implemented in 2002
6
Civil Procedure Code 1908, Order XXXII A Rule 3
This Act was substantially based on the British Arbitration Act of 1889. It
expanded the area of arbitration by defining the expression ‘submission’ to
mean “a written agreement to submit present and future differences to
arbitration whether an arbitrator is named therein or not”.

3. Arbitration (Protocol and Convention) Act 1937

The Geneva Protocol on Arbitration Clauses 1923 and the Geneva Convention
on the Execution of Foreign Arbitral Awards 1927 were implemented in India
by the Arbitration (Protocol and Convention) Act, 1937. This Act was enacted
with the object of giving effect to the Protocol and enabling the Convention to
become operative in India.

4. The Arbitration Act of 1940

The Arbitration Act, 1940, dealt with only domestic arbitration. Under the 1940
Act, intervention of the court was required in all the three stages of arbitration in
the tribunal, i.e. prior to the reference of the dispute, in the duration of the
proceedings, and after the award was passed.

This Act made provision for- a) arbitration without court intervention; b)

arbitration in suits i.e. arbitration with court intervention in pending suits and c)
arbitration with court intervention, in cases where no suit was pending before
the court.

Before an arbitral tribunal took cognizance of a dispute, court intervention was

required to set the arbitration proceedings in motion. The existence of an
agreement and of a dispute was required to be proved. During the course of the
proceedings, the intervention of the court was necessary for the extension of
time for making an award.

Finally, before the award could be enforced, it was required to be made the rule
of the court. This Act did not fulfill the essential functions of ADR. The extent
of Judicial Interference under the Act defeated its very purpose.7 It did not
provide a speedy, effective and transparent mechanism to address disputes
arising out of foreign trade and investment transactions.

5. Arbitration and Conciliation Act, 1996

The government enacted the Arbitration and Conciliation Act, 1996 in an effort
to modernize the 1940 Act. In 1978, the UNCITRAL Secretariat, the Asian
African Legal Consultative Committee (AALCC), the International Council for
Commercial Arbitration (ICCA) and the International Chamber of Commerce
(ICC) met for a consultative meeting, where the participants were of the
unanimous view that it would be in the interest of International Commercial
Arbitration if UNCITRAL would initiate steps leading to the establishment of
uniform standards of arbitral procedure.

The preparation of a Model Law on arbitration was considered the most

appropriate way to achieve the desired uniformity. The full text of this Model
Law was adopted on 21st June 1985 by UNCITRAL. This is a remarkable
legacy given by the United Nations to International Commercial Arbitration,
which has influenced Indian Law. In India, the Model Law has been adopted
almost in its entirety in the 1996 Act.

This Act repealed all the three previous statutes. Its primary purpose was to
encourage arbitration as a cost-effective and quick mechanism for the settlement
of commercial disputes. It covers both domestic arbitration and international
7
Hon’ble Thiru Justice S.B.Sinha, Judge Supreme Court of India, ‘ADR and Access to
Justice: Issues and Perspectives’.
commercial arbitration. It marked an epoch in the struggle to find an alternative
to the traditional adversarial system of litigation in India.

The changes brought about by the 1996 Act were so drastic that the entire case
law built up over the previous fifty-six years on arbitration was rendered
superfluous. Unfortunately, there was no widespread debate and understanding
of the changes before such an important legislative change was enacted. The
Government of India enacted the 1996 Act by an ordinance, and then extended
its life by another ordinance, before Parliament eventually passed it without
reference to Parliamentary Committee.

Arbitration, as practiced in India, instead of shortening the lifespan of the

dispute resolution, became one more “inning” in the game. Not only that, the
arbitrator and the parties’ lawyers treated arbitration as “extra time” or overtime
work to be done after attending to court matters. The result was that the normal
session of an arbitration hearing was always for a short duration. Absence of a
full-fledged Arbitration Bar effectively prevented arbitrations being heard
continuously on day-to-day basis over the normal working hours, viz. 4-5 hours
every day. This resulted in elongation of the period for disposal.

Veerappa Moily also said in the ADR congress held in the year 2010 that the
1996 Act, although modeled along international standards, has so far proved to
be insufficient in meeting the needs of the business community, for the speedy
and impartial resolution of disputes in India.8

The Law Commission of India prepared a report on the experience of the 1996
Act and suggested a number of amendments. Based on the recommendations of
the Commission, the Government of India introduced the Arbitration and
Conciliation (Amendment) Bill, 2003, in the Parliament. The standing

8
ADR Congress India 2010.
committee of law ministry felt that provisions of the Bill gave room for
excessive intervention by the courts in arbitration proceedings.9

DIFFERENT TYPES OF ALTERNATIVE DISPUTE

RESOLUTIONS

The most common types of ADR for civil cases are Arbitration, Conciliation,
Mediation, Judicial Settlement and Lok Adalat. In India, the Parliament has
amended the Civil Procedure Code by inserting Section 89 as well as Order 10
Rule 1-A to 1-C. Section 89 of the Civil Procedure Code provides for the
settlement of disputes outside the Court. It is based on the recommendations
made by the Law Commission of India and Malimath Committee. It was
suggested by the Law Commission of India that the Court may require
attendance of any party to the suit or proceedings to appear in person with a
view to arriving at an amicable settlement of dispute between the parties and
make an attempts to settle the dispute between the parties amicably. Malimath
Committee recommended to make it obligatory for the Court to refer the
dispute, after issues are framed, for settlement either by way of Arbitration,
Conciliation, Mediation, Judicial Settlement through Lok Adalat. It is only
when the parties fail to get their disputes settled through any of the alternate
disputes resolution method that the suit could proceed further. In view of the
above, new Section 89 has been inserted in the Code in order to provide for
alternative dispute resolution.

9
Government proposes major changes in Arbitration Act, The Times of India, April 9, 2010.
It is worthwhile to refer Section 89 of the Civil Procedure Code, which runs as
follows: -

Sec. 89. Settlement of disputes outside the court. - (1) Where it appears to the
Court that there exist elements of a settlement which may be acceptable to the
parties, the Court shall formulate the terms of settlement and give them to the
parties for their observations and after receiving the observations of the parties,
the Court may reformulate the terms of a possible settlement and refer the same
for –

(a) arbitration
(b) conciliation
(c) judicial settlement including settlement through Lok Adalat
(d) mediation.

where a dispute has been referred –

(a) for arbitration or conciliation, the provisions of the Arbitration and

Conciliation Act, 1996 (26 of 1996) shall apply as if the proceedings for
arbitration or conciliation were referred for settlement under the
provisions of that Act;

(b) to Lok Adalat, the Court shall refer the same to the Lok Adalat in
accordance with the provisions of sub-section (1) of section 20 of the
Legal Services Authority Act, 1987 (39 of 1987) and all other
provisions of that Act shall apply in respect of the dispute so referred
to the Lok Adalat;
 (c) for judicial settlement, the Court shall refer the same to a suitable
institution or person and such institution or person shall be deemed to
be a Lok Adalat and all the provisions of the Legal Services Authority
Act, 1987 (39 of 1987) shall apply as if the dispute were referred to a
Lok Adalat under the provisions of that Act;

(d) for mediation, the Court shall effect a compromise between the parties
and shall follow such procedure as may be prescribed."

On perusal of the aforesaid provisions of Section 89, it transpires that it refers to

five types of ADR procedures, made up of one adjudicatory process i.e.
arbitration and four negotiatory i.e. non adjudicatory processes such as
Conciliation, Mediation, Judicial Settlement and Lok Adalat. The object behind
Section 89 is laudable and sound. Resort to ADR process is necessary to give
speedy and effective relief to the litigants and to reduce the pendency in and
burden upon the Courts. Of course, Section 89 has to be read with Rule 1-A of
Order 10, which runs as follows: -

Order 10 Rule 1-A. Direction of the Court to opt for any one mode of
alternative dispute resolution.--After recording the admissions and denials, the
Court shall direct the parties to the suit to opt either mode of the settlement
outside the Court as specified in sub- section (1) of section 89. On the option of
the parties, the Court shall fix the date of appearance before such forum or
authority as may be opted by the parties.

Order 10 Rule 1-B. Appearance before the conciliatory forum or

authority.—Where a suit is referred under rule 1A, the parties shall
appear before such forum or authority for conciliation of the suit.
Order 10 Rule 1-C. Appearance before the Court consequent to the failure
of efforts of conciliation.--Where a suit is referred under rule 1A and the
presiding officer of conciliation forum or authority is satisfied that it would not
be proper in the interest of justice to proceed with the matter further, then, it
shall refer the matter again to the Court and direct the parties to appear before
the Court on the date fixed by it.

On joint reading of Section 89 read with Rule 1-A of Order 10 of Civil

Procedure Code, it transpires that the Court to direct the parties to opt for any of
the five modes of the Alternative Dispute Resolution and on their option refer
the matter.

Thus, the five different methods of ADR can be summarized as follows: -

1. Arbitration

2. Conciliation

3. Mediation

4. Judicial Settlement

5. Lok Adalat
ARBITRATION

Arbitration, a form of alternative dispute resolution (ADR), is a technique for

the resolution of disputes outside the courts, where the parties to a dispute
refer it to one or more persons – arbitrators, by whose decision they agree to
be bound. It is a resolution technique in which a third party reviews the
evidence in the case and imposes a decision that is legally binding for both
sides and enforceable. There are limited rights of review and appeal of
Arbitration awards. Arbitration is not the same as judicial proceedings and
Mediation.

Arbitration can be either voluntary or mandatory. Of course, mandatory

Arbitration can only come from s statute or from a contract that is voluntarily
entered into, where the parties agree to hold all existing or future disputes to
arbitration, without necessarily knowing, specifically, what disputes will ever
occur.

The advantages of Arbitration can be summarized as follows: -

a) It is often faster than litigation in Court.

b) It can be cheaper and more flexible for businesses.

c) Arbitral proceedings and an arbitral award are generally non-public, and

can be made confidential.
d) In arbitral proceedings the language of arbitration may be chosen,
whereas in judicial proceedings the official language of the competent Court
will be automatically applied.

e) There are very limited avenues for appeal of an arbitral award.

f) When the subject matter of the dispute is highly technical, arbitrators with
an appropriate degree of expertise can be appointed as one cannot choose
judge in litigation.

However, there are some disadvantages of the Arbitration, which may be

summarized as follows: -

a) Arbitrator may be subject to pressures from the powerful parties.

b) If the Arbitration is mandatory and binding, the parties waive their rights
to access the Courts.

c) In some arbitration agreements, the parties are required to pay for the
arbitrators, which add an additional cost, especially in small consumer
disputes.

d) There are very limited avenues for appeal, which means that an erroneous
decision cannot be easily overturned.
 e) Although usually thought to be speedier, when there are multiple
arbitrators on the penal, juggling their schedules for hearing dates in long
cases can lead to delays.

f) Arbitration awards themselves are not directly enforceable. A party

seeking to enforce arbitration award must resort to judicial remedies.

In view of provisions of Section 89 of the Civil Procedure Code, if the matter

is referred to the Arbitration then the provisions of the Arbitration and
Conciliation Act, 1996 will govern the case.

CONCILIATION

Conciliation is an alternative dispute resolution process whereby the parties to a

dispute use a conciliator, who meets with the parties separately in order to
resolve their differences. They do this by lowering tensions, improving
communications, interpreting issues, providing technical assistance, exploring
potential solutions and bring about a negotiated settlement. It differs from
Arbitration in that.

Conciliation is a voluntary proceeding, where the parties involved are free to

agree and attempt to resolve their dispute by conciliation. The process is
flexible, allowing parties to define the time, structure and content of the
conciliation proceedings. These proceedings are rarely public. They are interest-
based, as the conciliator will when proposing a settlement, not only take into
account the parties' legal positions, but also their; commercial, financial and /or
personal interests. The terms conciliation and mediation are interchangeable in
the Indian context. Conciliation is a voluntary process whereby the conciliator, a
trained and qualified neutral, facilitates negotiations between disputing parties
and assists them in understanding their conflicts at issue and their interests in
order to arrive at a mutually acceptable agreement. Conciliation involves
discussions among the parties and the conciliator with an aim to explore
sustainable and equitable resolutions by targeting the existent issues involved in
the dispute and creating options for a settlement that are acceptable to all
parties. The conciliator does not decide for the parties, but strives to support
them in generating options in order to find a solution that is compatible to both
parties. The process is risk free and not binding on the parties till they arrive at
and sign the agreement. Once a solution is reached between the disputing parties
before a conciliator, the agreement had the effect of an arbitration award and is
legally tenable in any court in the country.

Most commercial disputes, in which it is not essential that there should be a

binding and enforceable decision, are amenable to conciliation. Conciliation
may be particularly suitable where the parties in dispute wish to safeguard and
maintain their commercial relationships.

The following types of disputes are usually conducive for conciliation:

 commercial,

 financial,

 family,

 real estate,

 employment, intellectual property,

  insolvency,

 insurance,

 service,

 partnerships,

 environmental and product liability.

 Apart from commercial transactions, the mechanism of Conciliation

is also adopted for settling various types of disputes such as labour
disputes, service matters, antitrust matters, consumer protection,
taxation, excise etc

Conciliation proceedings:

Either party to the dispute can commence the conciliation process. When one
party invites the other party for resolution of their dispute through conciliation,
the conciliation proceedings are said to have been initiated. When the other
party accepts the invitation, the conciliation proceedings commence. If the other
party rejects the invitation, there are no conciliation proceedings for the
resolution of that dispute. Generally, only one conciliator is appointed to resolve
the dispute between the parties. The parties can appoint the sole conciliator by
mutual consent. If the parties fail to arrive at a mutual agreement, they can enlist
the support of any international or national institution for the appointment of a
conciliator. There is no bar to the appointment of two or more conciliators. In
conciliation proceedings with three conciliators, each party appoints one
conciliator. The third conciliator is appointed by the parties by mutual consent.
Unlike arbitration where the third arbitrator is called the Presiding Arbitrator,
the third conciliator is not termed as Presiding conciliator. He is just the third
conciliator. The conciliator is supposed to be impartial and conduct the
conciliation proceedings in an impartial manner. He is guided by the principles
of objectivity, fairness and justice, and by the usage of the trade concerned and
the circumstances surrounding the dispute, including any previous business
practices between the parties. The conciliator is not bound by the rules of
procedure and evidence. The conciliator does not give any award or order. He
tries to bring an acceptable agreement as to the dispute between the parties by
mutual consent. The agreement so arrived at is signed by the parties and
authenticated by the conciliator. In some legal systems, the agreement so arrived
at between the parties resolving their dispute has been given the status of an
arbitral award. If no consensus could be arrived at between the parties and the
conciliation proceedings fail, the parties can resort to arbitration. A conciliator
is not expected to act, after the conciliation proceedings are over, as an
arbitrator unless the parties expressly agree that the conciliator can act as
arbitrator. Similarly, the conciliation proceedings are confidential in nature.
Rules of Conciliation of most of the international institutions provide that the
parties shall not rely on or introduce as evidence in arbitral or judicial
proceedings, (a) the views expressed or suggestions made for a possible
settlement during the conciliation proceedings; (b) admissions made by any
party during the course of the conciliation proceedings; (c) proposals made by
the conciliator for the consideration of the parties; (d) the fact that any party had
indicated its willingness to accept a proposal for settlement made by the
conciliator; and that the conciliator shall not be produced or presented as a
witness in any such arbitral or judicial proceedings.
Conciliation has received statutory recognition as it has been proved useful that
before referring the dispute to the civil court or industrial court or family court
etc, efforts to concile between the parties should be made. It is similar to the
American concept of court-annexed mediation. However without structured
procedure & statutory sanction, it was not possible for conciliation to achieve
popularity in the countries like USA & also in other economically advanced
countries

Justice M. Jagannadha Rao has, in the article “CONCEPTS OF

CONCILIATION AND MEDIATION AND THEIR DIFFERENCES”, stated as
under:

“In order to understand what Parliament meant by ‘Conciliation’, we have

necessarily to refer to the functions of a ‘Conciliator’ as visualized by Part III of
the 1996 Act. It is true, section 62 of the said Act deals with reference to
‘Conciliation’ by agreement of parties but sec. 89 permits the Court to refer a
dispute for conciliation even where parties do not consent, provided the Court
thinks that the case is one fit for conciliation. This makes no difference as to the
meaning of ‘conciliation’ under sec. 89 because; it says that once a reference is
made to a ‘conciliator’, the 1996 Act would apply. Thus the meaning of
‘conciliation’ as can be gathered from the 1996 Act has to be read into sec. 89
of the Code of Civil Procedure. The 1996 Act is, it may be noted, based on the
UNCITRAL Rules for conciliation.

Now under section 65 of the 1996 Act, the ‘conciliator’ may request each party
to submit to him a brief written statement describing the “general nature of the
dispute and the points at issue”. He can ask for supplementary statements and
documents. Section 67 describes the role of a conciliator. Sub-section (1) states
that he shall assist parties in an independent and impartial manner. Subsection
(2) states that he shall be guided by principles of objectivity, fairness and
justice, giving consideration, among other things, to the rights and obligations of
the parties, the usages of the trade concerned and the circumstances surrounding
the dispute, including any previous business practices between the parties.
Subsection (3) states that he shall take into account “the circumstances of the
case, the wishes the parties may express, including a request for oral
statements”. Subsection (4) is important and permits the ‘conciliator’ to make
proposals for a settlement. It states as follows:

“Section 67(4) - The conciliator may, at any stage of the conciliation

proceeding, make proposals for a settlement of the dispute. Such proposals need
not be in writing and need not be accompanied by a statement of the reasons
therefor.”

Section 69 states that the conciliator may invite parties to meet him. Sec. 70
deals with disclosure by the conciliator of information given to him by one
party, to the other party. Sec. 71 deals with cooperation of parties with the
conciliator, sec. 72 deals with suggestions being submitted to the conciliator by
each party for the purpose of settlement. Finally, Sec. 73, which is important,
states that the conciliator can formulate terms of a possible settlement if he feels
there exist elements of a settlement. He is also entitled to ‘reformulate the
terms’ after receiving the observations of the parties. Subsection (1) of sec. 73
reads thus:

“Sec. 73(1) settlement agreement. (1) When it appears to the Conciliator that
there exist elements of a settlement which may be acceptable to the parties, he
shall formulate the terms of a possible settlement and submit them to the parties
for their observations. After receiving the observations of the parties, the
Conciliator may reformulate the terms of a possible settlement in the light of
such observations.
The above provisions in the 1996 Act, make it clear that the ‘Conciliator’ under
the said Act, apart from assisting the parties to reach a settlement, is also
permitted to make “proposals for a settlement” and “formulate the terms of a
possible settlement” or “reformulate the terms”. This is indeed the UNCITRAL
concept.

MEDIATION

Now, worldwide mediation settlement is a voluntary and informal process of

resolution of disputes. It is a simple, voluntary, party centered and structured
negotiation process, where a neutral third party assists the parties in amicably
resolving their disputes by using specified communication and negotiation
techniques. Mediation is a process where it is controlled by the parties
themselves. The mediator only acts as a facilitator in helping the parties to reach
a negotiated settlement of their dispute. The mediator makes no decisions and
does not impose his view of what a fair settlement should be.

In the mediation process, each side meets with a experienced neutral mediator.
The session begins with each side describing the problem and the resolution
they desire – from their point of view. Once each sides’ respective positions are
aired, the mediator then separates them into private rooms, beginning a process
of “Caucus Meeting” and thereafter “joint meetings with the parties”. The end
product is the agreement of both the sides. The mediator has no power to dictate
his decision over the party. There is a win – win situation in the mediation.

The chief advantages of the mediation are: -

1. The agreement which is that of the parties themselves;

 2. The dispute is quickly resolved without great stress and
expenditure;

3. The relationship between the parties are preserved; and

4. The confidentiality is maintained.

JUDICIAL SETTLEMENT

Section 89 of the Civil Procedure Code also refers to the Judicial Settlement as
one of the mode of alternative dispute resolution. Of course, there are no
specified rules framed so far for such settlement. However, the term Judicial
Settlement is defined in Section 89 of the Code. Of course, it has been provided
therein that when there is a Judicial Settlement the provisions of the Legal
Services Authorities Act, 1987 will apply. It means that in a Judicial Settlement
the concerned Judge tries to settle the dispute between the parties amicably. If at
the instance of judiciary any amicable settlement is resorted to and arrived at in
the given case then such settlement will be deemed to be decree within the
meaning of the Legal Services Authorities Act, 1987. Section 21 of the Legal
Services Authorities Act, 1987 provides that every award of the Lok Adalat
shall be deemed to be a decree of the Civil Court. There are no written
guidelines prescribed in India as to judicial settlement.

LOK ADALAT:

The concept that is gaining popularity is that of Lok Adalats or people’s

courts as established by the government to settle disputes through conciliation
and compromise. It is a judicial institution and a dispute settlement agency
developed by the people themselves for social justice based on settlement or
compromise reached through systematic negotiations. The first Lok Adalats was
held in Una aim the Junagadh district of Gujarat State as far back as 1982. Lok
Adalats accept even cases pending in the regular courts within their jurisdiction.

Section 89 of the Civil Procedure Code also provides as to referring the pending
Civil disputes to the Lok Adalat. When the matter is referred to the Lok Adalat
then the provisions of the Legal Services Authorities Act, 1987 will apply. So
far as the holding of Lok Adalat is concerned, Section 19 of the Legal Services
Authorities Act, 1987 provides as under: -

Section 19 Organization of Lok Adalats . (1) Every State Authority or District

Authority or the Supreme Court Legal Services Committee or every High Court
Legal Services Committee or, as the case may be, Taluka Legal Services
Committee may organise Lok Adalats at such intervals and places and for
exercising such jurisdiction and for such areas as it thinks fit.

(2) Every Lok Adalat organised for an area shall consist of such
number of:-

(a) serving or retired judicial officers; and

(b) other persons, of the area as may be specified by the State

Authority or the District Authority or the Supreme Court Legal
Services Committee or the High Court Legal Services Committee,
or as the case may be, the Taluka Legal Services Committee,
organising such Lok Adalat.

(3) The experience and qualifications of other persons referred to in

clause (b) of sub-section (2) for Lok Adalats organised by the Supreme
 Court Legal Services Committee shall be such as may be prescribed by
the Central Government in consultation with the Chief Justice of India.

(4) The experience and qualifications of other persons referred to in

clause (b) of sub-section (2) for Lok Adalats other than referred to in sub-
section (3) shall be such as may be prescribed by the State Government in
consultation with the Chief Justice of the High Court.

(5) 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 -

(i) any case pending before it; or

(ii) 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 any case
or matter relating to an offence not compoundable under any law.

The Lok Adalat is presided over by a sitting or retired judicial officer as the
chairman, with two other members, usually a lawyer and a social worker. There
is no court fee, thus making it available to those who are the financially
vulnerable section of society. In case the fee is already paid, the same is
refunded if the dispute is settled at the Lok Adalat. The Lok Adalat are not as
strictly bound by rules of procedure like ordinary courts and thus the process is
more easily understood even by the uneducated or less educated. The parties to
a dispute can interact directly with the presiding officer, which is not possible in
the case of normal court proceedings.
Section 21 of the Legal Services Authorities Act, 1987 is also required to be
referred to here which runs as follows: -

Section 21 Award of Lok Adalat. (1) Every award of the Lok Adalat shall be
deemed to be a decree of a civil court or, as the case may be, an order of any
other court and where a compromise or settlement has been arrived at, by a Lok
Adalat in a case referred to it under subsection (1) of section 20, the court-fee
paid in such case shall be refunded in the manner provided under the Court Fees
Act, 1870 (7 of 1870).

(2) Every award made by a Lok Adalat shall be final and binding on all
the parties to the dispute, and no appeal shall lie to any court against the
award.

In view of the aforesaid provisions of the Legal Services Authorities Act, 1987
if any matter is referred to the Lok Adalat and the members of the Lok Adalat
will try to settle the dispute between the parties amicably, if the dispute is
resolved then the same will be referred to the concerned Court, which will pass
necessary decree therein. The decree passed therein will be final and binding to
the parties and no appeal will lie against that decree.

On the flip side, the main condition of the Lok Adalat is that both parties in
dispute have to be agreeable to a settlement. Also, the decision of the Lok
Adalat is binding on the parties to the dispute and its order is capable of
execution through legal process. No appeal lies against the order of finality
attached to such a determination is sometimes a retarding factor for however be
passed by Lok Adalat, only after obtaining the assent of all the parties to
dispute. In certain situations, permanent Lok Adalat can pass an award on
merits, even without the consent of parties. Such an award is final and binding.
From that, no appeal is possible.10

This is not to the say that Lok Adalat don’t have many advantages. Lok Adalat
are especially effective in settlement of money claims. Disputes like partition
suits, damages and even matrimonial cases can also be easily settled before a
Lok Adalat as the scope for compromise is higher in these cases. Lok Adalat is a
definite boon to the litigant public, where they can get their disputes settled fast
and free of cost. The appearance of lawyers on behalf of the parties, at the Lok
Adalats in not barred. Lok Adalat are not necessarily alternatives to the existing
courts but rather only supplementary to them. They are essentially win-win
systems, an alternative to ‘Judicial Justice’, where all the parties to the dispute
have something to gain.

There are certain hybrids of Alternative Dispute Resolution that also deserve a
mention. These processes have evolved in combination of various Alternative
Dispute Resolution mechanisms with the ultimate objective of achieving a
voluntary settlement. The purpose of many of these hybrids is that the principle
objective of achieving a settlement is kept in mind and all permutations and
combinations should be utilized towards that objective to reduce the burden of
the adjudicatory process in courts. The different Alternative Dispute Resolution
processes and their hybrids have found solutions to different nature of disputes
and thus the knowledge of these processes can be a significant aid.

NEGOTIATION

Negotiation doesn’t have any statutory recognition i.e through way of

legislation. Negotiation is self counseling between the parties to resolve their
10
ADR – Its Facets, by Snajay Kishan Kaul. J. Chairman, Overseeing Committee Delhi High
Court
dispute. The word "negotiation" is from the Latin expression, "negotiatus", past
participle of negotiare which means "to carry on business". "Negotium" means
literally "not leisure". Negotiation is a process that has no fixed rules but
follows a predictable pattern. Negotiation is the simplest means for redressal of
disputes. In this mode the parties begin their talk without interference of any
third person. The aim of negotiation is the settlement of disputes by exchange of
views and issues concerning the parties. There is an ample opportunity for
presentation of case in this mode of redressal. If there is understanding and
element of patience between the parties this mode of redressal of dispute is the
simplest and most economical. Negotiation is a dialogue intended to resolve
disputes, to produce an agreement upon courses of action, to bargain for
individual or collective advantage, or to craft outcomes to satisfy various
interests. It is the primary method of alternative dispute resolution. It is very
much like a sporting event of two contesting wills, complete with advance game
plans, strategic ploys, and bursts of brilliant open-field running. Unlike most
contents, though, a negotiation doesn’t have to end up with a winner and loser.
At the end there may not even be a score to tally. A well-conducted negotiation
may allow both sides to win by expanding the total pot, making the sum for both
sides greater than either could possess alone. In the language of academics this
is called “synergy”. Basically the Advocate whenever participates by hearing
the brief patiently and negotiating with the client and required opponent parties,
it reflects an impression in the mind of client or party. In future, despite of the
Advocate efforts if the case is in the favour of other party, there are very less
chances to Advocate the loser may not lose the Advocate. The reason is earlier
the concept of ‘Negotiation’. To become a successful negotiator, it needs a
refining of several decades of practical experience and presentations. The
person who tastes the success always is a successful negotiator. In the advocacy
approach, a skilled negotiator usually serves as advocate for one party to the
negotiation and attempts to obtain the most favorable outcomes possible for that
party. In this process the negotiator attempts to determine the minimum
outcome(s) the other party is (or parties are) willing to accept, then adjusts their
demands accordingly. A "successful" negotiation in the advocacy approach is
when the negotiator is able to obtain all or most of the outcomes their party
desires, but without driving the other party to permanently break off
negotiations, unless the best alternative to a negotiated agreement (BATNA) is
acceptable.

Traditional negotiating is sometimes called win-lose because of the assumption

of a fixed "pie", that one person's gain results in another person's loss. This is
only true, however, if only a single issue needs to be resolved, such as a price in
a simple sales negotiation. This is nearly always the case, although often how
they go about getting what they want is so delicate it isn’t readily obvious. The
negotiators were in different attitudes as follows:

1. one may be meticulously polite.

2. one may be dull and to the point.

3. one may seem to have been born negotiators.

4. one may be have had to learn to be comfortable in the tug-and-pull of a

conflict resolution.

The important capsule to be successful negotiator is to refuse to be intimidated.

Even the odds are most unlikely, few situations in life are rigidly fixed. Voicing
a demand can’t insure success, but failure to make a request guarantees it won’t
be realized. The golden rule to keep in mind, the mantra upon which to silently
meditate as you enter into negotiation, is “Ask and you shall receive”.

Whenever we need the cooperation of another person to do something, however

small, we have to engross in a negotiation. Almost everything we do-from
deciding with a friend where to go to lunch to buying a new car to interviewing
for a job- involves negotiating. The media portray negotiations as complicated,
dramatic affairs involving powerful politicians or mighty business leaders or
high-priced lawyers. But often negotiations involve ordinary folks who, if they
felt less intimidated by the process, would find themselves considerably more
empowered in their lives.

During a negotiation, it would be wise not to take anything personally. If you

leave personalities out of it, you will be able to see opportunities more
objectively. Either we're going to solve this by realistic negotiation or there will
be blood on the border. If you come to a negotiation table saying you have the
final truth, that you know nothing but the truth and that is final, you will get
nothing. Let us move from the era of confrontation to the era of negotiation.
Negotiation in the classic diplomatic sense assumes parties more anxious to
agree than to disagree. The most difficult thing in any negotiation, almost, is
making sure that you strip it of the emotion and deal with the facts. And there
was a considerable challenge to that here and understandably so. There's no road
map on how to raise a family: it's always an enormous negotiation. Negotiation
in the classic diplomatic sense assumes parties more anxious to agree than to
disagree. Let us never negotiate out of fear. But, let us never fear to negotiate.
The most difficult thing in any negotiation, almost, is making sure that you strip
it of the emotion and deal with the facts. And there was a considerable challenge
to that here and understandably so. The single biggest danger in negotiation is
not failure but to be successful without knowing why you are successful.
Flattery is the infantry of negotiation. Effective negotiators have a style that
those whom they are trying to influence, relate to and admire. Negotiations are a
euphemism for submission if the shadow of power is not cast across the
bargaining table. The ‘Negotiation’ can be invoked at any time, even if the
matter is pending in the Court of Law. Similarly it can be terminated at any
time. Finally, the mode of ADR through Negotiation provides flexible
procedure, strict procedure of law is not applicable. It is the option of the parties
to decide their fate and Advocate can also negotiate with other parties for
amicable settlement. Here negotiation is nothing but discussion to arrive to a
settlement. This mode can be availed by parties themselves or on behalf of
parties the Advocate can use the weapon of negotiation also.

MINI TRAILS

The mini-trial uses elements of negotiation, mediation and adjudication to

facilitate settlement. Parties or their representatives are exposed in the non-
binding mini-trial to the theories, strengths and weaknesses of each side of the
controversy. The goal of the mini-trial is to facilitate settlement negotiations
between top officials of the parties.

The procedure for a mini-trial is usually negotiated in each case. The typical
mini-trial involves a stay of court proceedings and limited discovery. At the
mini-trial, the lawyers present their abbreviated version of the case to the panel
members. The party officials then conduct settlement negotiations facilitated by
the neutral panel member. The neutral member may be asked to present a
written opinion stating the strengths and weaknesses of each party’s position.
The mini-trial was developed to encourage the settlement of business disputes.
It is especially useful in large and complex cases where negotiations are stalled,
and, take the summary jury trial, the parties need to see for themselves the
strengths and weaknesses of their cases in order to reopen negotiations. Cases
that would take months or years of litigation can take place in a few days in a
mini-trial. The process is much less expensive than litigation and provides
confidentiality not found in a trial. The parties are free to be practical and
creative in their settlements, unlike traditional resolution of issues by the court.
The use of the mini-trial may save a business relationship between parties that
might otherwise be destroyed by bitter litigation.
The risks of using mini-trials are the possible disclosure of trial strategies and
the added expense and delay if a trial is ultimately needed. The mini-trial can be
an efficient and cost-effective method of resolving complex litigation and
should be considered when an impasse to negotiations has occurred, but the
parties are still interested in settlement of their dispute.

DIFFERENCE BETWEEN THE MEDIATION AND OTHER

DISPUTE RESOLUTION PROCESS

The alternative dispute resolution procedures can be broadly classified into two
groups, first those that are adjudicative and adversarial, and second those, which
are consensual and non-adversarial. The latter group includes mediation.11 Sir
Robert A. Baruch Bush and Joseph P. Folger, in, “The promise of mediation”
say that, in any conflict, the principal objective ought to be to find a way of
being neither victims nor victimizers, but partners in an ongoing human
interaction that is always going to involve instability and conflict.

There are several types of different dispute redressal methods that have evolved
owing to the different needs and circumstances of the society. The study of the
differences between them will help the disputant in choosing the best and the
apt method of resolving their disputes according to their needs. The dominant

11
Manka, ADR: What Is It And Why Do You Need To Know? 47 J Mo Bar 623, 625.
form of dispute redressal method that is broadly adopted for the resolution of a
dispute is, by filing of case before the Court of law. With the bird eye view, it
can be said that, in the process of adjudication through Court of law, someone
has to lose among the disputing party. The litigation route has now become
slow, expensive, and uncertain in its outcome. The Courts and Tribunals do not
'resolve' a dispute, but they only “decide” a dispute or “adjudicate” on them.
Whereas, in the case of mediation, the parties can try to agree with one another,
were a mediator acts as a facilitator. Mediation has the advantage as it can lead
to finality because, it allows for informed and un-coerced decisions to be taken
by everyone involved. Disputes are resolved in the process of mediation through
consensual interaction between the disputants.54 The mediator in promoting or
in other words, facilitating resolution of the dispute by the parties themselves
does not purport to decide the issue between them. Mediation is more flexible,
quick and less expensive than the process of adjudication through Court of Law.
Thus, the study reveals that, litigation produces provides for fair and just results,
but it is procedurally disadvantages as compared to mediation. Mediation
affords a far greater degree of flexibility, relative informality, confidentiality
and control over its resolution.

Comparative study of the process of ‘mediation’ and ‘arbitration’ shows

that, mediation is a form of expedited negotiation. The parties control the
outcome. Mediator has no power to decide. Settlement in the dispute is done
only with party approval. Exchange of information is voluntary and is often
limited. Parties exchange information that will assist in reaching a resolution.
Mediator helps the parties define and understand the issues and each side's
interests. Parties vent feelings, tell story, and engage in creative problem
solving. Mediation process is informal and the parties are the active participants.
Joint and private meetings between individual parties and their counsel are held
in this process. Outcome based on needs of parties. Result is mutually
satisfactory and finally a relationship may be maintained or created. Mediation
when compared with arbitration is of low cost. It is private and confidential.
Facilitated negotiation is an art. Mediator is not the decision maker. Mediator is
a catalyst. He avoids or breaks an impasse, diffuse controversy, encourages
generating viable options. He has more control over the process. The process of
mediation gives the parties many settlement options. Relationship of parties is
not strained in the process of mediation. There is a high degree of commitment
to settlement. Parties’ participation is there in the decision making process.
Thus, there is no winner and no loser in this process, only the problems are
resolved. In this process the disputed parties maintains the confidentiality of
proceedings.

The Arbitration and Conciliation Act, 1996 has provided for the legislative
framework of the processes of arbitration and conciliation in India. The process
of ‘arbitration’ is adjudicative in nature as the arbitrators control the outcome.
Arbitrator is given power to decide. Arbitration award is final and is a binding
decision. Often extensive discovery is required in this process. Arbitrator listens
to facts and evidence and renders an award. The parties present the case, and
testify under oath. The process of arbitration is formal. The attorneys can
control the party participation. Evidentiary hearing is given in this process. No
private communication with the arbitrator is possible. Decision is in the form of
award based on the facts, evidence, and law. The process of arbitration is more
expensive than mediation, but less expensive than traditional litigation. It is a
private process between the arbitrator and the disputed parties but in some
cases, decisions are publicly available. Thus, it is an informal procedure, which
involves decision-maker impasse when it is submitted to an Arbitrator. The
parties have less control in the proceedings and the final award, as the decision
making process is with the arbitrator.
 The ‘Conciliator’ under the Arbitration and Conciliation Act, 1996, apart
from assisting the parties to reach a settlement, is also permitted to make
“proposals for a settlement” and “formulate the terms of a possible settlement”
or “reformulate the terms”. ‘Conciliation’, is a procedure like mediation but the
third party called the conciliator, takes a more interventionist role in bringing
the two parties together and in suggesting possible solutions to help the disputed
parties to reach a settlement. The difference between the process of mediation
and conciliation lies in the fact that, the ‘conciliator’ can make proposals for
settlement, ‘formulate’ or ‘reformulate’ the terms of a possible settlement, while
a ‘mediator’ would not do so but would merely facilitate a settlement between
the parties. Under Section 30 and Section 64(1) and Section 73(1) of the
Arbitration and Conciliation Act, 1996, the conciliator has a greater or a pro-
active role in making proposals for a settlement or formulating and
reformulating the terms of a settlement. A mediator is a mere facilitator. The
meaning of these words in India is the same in the UNCITRAL and Conciliation
Rules and in UK and Japan. Conciliation and Mediation process is
distinguishable from Arbitration as the parties’ willingness to submit to
mediation or conciliation does not bind them to accept the recommendation of
the conciliation or mediator but an arbitrator’s award, by contrast, is binding on
the parties.

THE DIFFERENCE BETWEEN CONCILIATION AND

MEDIATION

Under our law and the UNCITRAL model, the role of the mediator is not pro-
active and is somewhat less than the role of a ‘conciliator’. We have seen that
under Part III of the Arbitration and Conciliation Act, the ’Conciliator’s powers
are larger than those of a ‘mediator’ as he can suggest proposals for settlement.
Hence the above meaning of the role of ‘mediator’ in India is quite clear and
can be accepted, in relation to sec. 89 of the Code of Civil Procedure also. The
difference lies in the fact that the ‘conciliator’ can make proposals for
settlement, ‘formulate’ or ‘reformulate’ the terms of a possible settlement while
a ‘mediator’ would not do so but would merely facilitate a settlement between
the parties. Brown quotes, which offers a range of dispute resolution processes,
facilitative, evaluative and adjudicative. It is there stated that conciliation “is a
process in which the Conciliator plays a proactive role to bring about a
settlement” and mediator is “a more passive process”. This is the position in
India, UK and under the UNCITRAL model. However, in the USA, the person
having the pro-active role is called a ‘mediator’ rather than a ‘conciliator’.
Brown says that the term ‘Conciliation’ which was more widely used in the
1970s has, in the 1970s, in many other fields given way to the term ‘mediation’.
These terms are elsewhere often used interchangeably.

Where both terms survived, some organizations use ‘conciliation’ to refer to a

more proactive and evaluative form of process. However, reverse usage is
sometimes employed; and even in UK, ‘Advisory, Conciliation and Arbitration
Service’ (ACAS) (UK) applies a different meaning. In fact, the meanings are
reversed. In relation to ‘employment’, the term ‘conciliation’ is used to refer to
a mediatory process that is wholly facilitative and non-evaluative. The
definition of ‘conciliation’ formulated by the ILO (1983) is as follows:

“the practice by which the services of a neutral third party are used in a dispute
as a means of helping the disputing parties to reduce the extent of their
differences and to arrive at an amicable settlement or agreed solution. It is a
process of orderly or rational discussion under the guidance of the conciliator.”
However, according to the ACAS, ‘mediation’ in this context involves a process
in which the neutral “mediator takes a more pro-active role than a conciliator for
the resolution of the dispute, which the parties are free to accept or reject. (The
ACAS role in Arbitration, Conciliation and Mediation, 1989). It will be seen
that here, the definitions, even in UK, run contrary to the meanings of these
words in UK, India and the UNCITRAL model.

The National Alternative Dispute Resolution Advisory Council, (NADRAC),

Barton Act 2600, Australia in its recent publication (ADR terminology, a
discussion Paper, at p 15) states that the terms “conciliation” and “mediation”
are used in diverse ways. ( The ‘New” Mediation: Flower of the East in Harvard
Bouquet: Asia Pacific Law Review Vol. 9, No.1, p 63-82 by Jagtenbury R and
de Roo A, 2001). It points out that the words ‘conciliation’ and ‘counselling’
have disappeared in USA. In USA, the word ‘conciliation’ has disappeared and
‘mediation’ is used for the neutral who takes a pro-active role. For example:

“Whereas the terms ‘conciliation’ and ‘conselling’ have long

since disappeared from the literature in reference to dispute resolution services
in the United States and elsewhere, these terms have remained enshrined in
Australian family laws, with ‘mediation’ grafted on as a separate dispute
resolution service in 1991.”

Conversely, policy papers in countries such as Japan still use the term
‘conciliation’ rather than ‘mediation’ for this pro-active process report of Justice
System Reform Council, 2001, Recommendations for a Justice System to
support Japan in the 21st Century. NADRAC refers, on the other hand, to the
view of the OECD (The Organisation for Economic Co-operation and
Development) Working Party on Information, Security and Privacy and the
Committee on Consumer Policy where ‘conciliation’ is treated as being at the
less formal end of the spectrum while ‘mediation’ is at the more formal end.
Mediation is described there as more or less active guidance by the neutrals.
This definition is just contrary to the UNCITRAL Conciliation Rules which in
Art 7(4) states

“Article 7(4). The conciliator may, at any stage of the conciliation proceedings,
make proposals for a settlement of the dispute….”

In an article from US entitled “Can you explain the difference between

conciliation and mediation”, a number of conciliators Mr.Wally Warfield, Mr.
Manuel Salivas and others treat ‘conciliation’ as less formal and ‘mediation’ as
pro-active where there is an agenda and there are ground rules. In US from the
informal conciliation process, if it fails, the neutral person moves on to a greater
role as a ‘conciliator’. The above article shows that in US the word ‘mediator’
reflects a role which is attributed to a pro-active conciliator in the UNCITRAL
Model. In fact, in West Virginia, ‘Conciliation’ is an early stage of the process
where parties are just brought together and thereafter, if conciliation has not
resulted in a solution, the Mediation programme is applied which permits a
more active role. The position in USA, in terms of definitions, is therefore just
the otherway than what it is in the UNCITRAL Conciliation Rules or our
Arbitration and Conciliation Act, 1996 where, the conciliator has a greater role
on the same lines as the ‘mediator’ in US.

I have thus attempted to clear some of the doubts raised as to the meaning of the
words ‘conciliation’ and ‘mediation’. Under our law, in the context of sec. 30
and sec. 64(1) and sec. 73(1) of the 1996 Act, the conciliator has a greater or a
pro-active role in making proposals for a settlement or formulating and
reformulating the terms of a settlement. A mediator is a mere facilitator. The
meaning of these words in India is the same in the UNCITRAL and Conciliation
Rules and in UK and Japan. But, in USA and in regard to certain institutions
abroad, the meaning is just the reverse, a ‘conciliator’ is a mere ‘facilitator’
whereas a ‘mediator’ has a greater pro-active role. While examining the rules
made in US in regard to ‘mediation’, if we substitute the word ‘conciliation’
wherever the word ‘mediation’ is used and use the word ‘conciliator’ wherever
the word ‘mediator’ is used, we shall be understanding the said rules as we
understand them in connection with ‘conciliation’ in India.

CONCLUSION

Alternate dispute resolution involves methods of resolving disputes other than

through litigation. The methods are in addition to litigation and are by no means
intended to replace litigation. Even the strongest proponents of ADR agree that
certain matters must be resolved through the courts. However, there are other
methods for resolving dispute which offer many advantages over the adversarial
route, which should be explored before litigation is commenced or proceeds too
far.

BIBLIOGRAPHY

 legalservicesindia.com/article/224/ADR-Mechanism-in-
India.html

 lawctopus.com/academike/arbitration-adr-in-india

 Legaldesire.com/learn-law-the-concept-of-alternative-dispute-
resolution