By Mahima Agrawal ~ Symbiosis Law School Pune
‘Justice delayed is Justice denied’ This saying is currently the harsh reality of the Indian Judiciary.
In the current times, huge pendency of cases in courts is one of the major reasons because of which we are increasingly witnessing a shift to alternate methods of dispute resolution. This recourse offers flexibility in procedural aspects while simultaneously keeping in check the expenditure and time spent of the disputing parties, thus effectively making it the need of the hour.[1] These Alternative Dispute Resolution methods include Negotiation, Mediation, Arbitration and Conciliation.
Mediation v Negotiation
Mediation is an ADR method wherein the discussion is stimulated and regulated by a neutral third party, the Mediator, who assists the parties in finding appropriate solutions to their dispute. Mediation is different than litigation and arbitration since it is less rigid in its procedural aspects and is also not binding on both parties. This makes the process more party centric, since it allows both parties to come to an agreement consensually while evaluating all possible consequences of their voluntary devised solutions.
Whereas in the process of negotiation, which is also voluntary and non-binding, the parties have the sole burden to resolve the dispute among themselves and therefore they often reach dead end since none of the parties is willing to compromise and both are oblivious to future consequences for not accepting realistic solutions. Intervention of a mediator, in such cases, helps the parties to find mutually acceptable solutions that might not otherwise emerge in any other processes. Mediators are trained to work out a settlement or agreement, that is fairly beneficial for both parties and they have full autonomy to accept or reject it. It is a complex process yet can effectively resolve legal disputes in the most efficient manner without the pressure of a trial.
Increasing need for Mediation as a Dispute Resolution
With increased global trade and emerging new businesses, in form of start-ups, sometimes the differences between both the parties are of humongous interests, that affect them financially and physically, hence none of them is able to reach any solutions and is unwilling to compromise. In such situation’s arbitration will also not be a righteous choice since no party will allow an arbitrator to select the other side’s final offer, thus not only delaying the process but also making it ineffective in the long run. Moreover, due to increased demands of mediation among corporate sectors, we are witnessing newer fields like business mediators, corporate mediators and mediators specialising in real estate, public and financial policies and mergers.
With widespread outsourcing of products and services, exclusive trade secrets and intellectual properties involved in businesses these days, they enter into numerous contracts and face disputes on daily basis. Spending valuable time and limited resources on the growth of professional ventures is the need of every business person on the planet.[2] Therefore, cost and time effective methods to resolve disputes are much required. Contracts are largely becoming highly complex and are even including ways to resolve any disputes, in form of conflict resolution agreements, which could arise in future so as to effectively ensure increased mutual party satisfaction.
Mediators- Experts in Particular Fields?
Choosing an informed, able and logical mediator is of immense importance since the mediation process has an edge over other ADR methods because of the presence of this authoritative logical empathic listener- the Mediator. Over the years, panellists and corporate pioneers have been asked whether expertise in the subject matter of the dispute is a key factor while choosing a mediator?
In popular opinion, people belonging to the same field are known to provide more realistic solutions due to their close association with ground factors and matters of dispute. People have conflicting opinions on this matter. Some prefer mediators with multi-disciplinary backgrounds prefer to heavily rely on their skills and experience to resolve the impending issue. Whereas others believe, involving non-experts would lead to unnecessary delays while bringing them up to speed moreover, they are to tend to rely on facts which might lead them to wrong conclusions. Moreover, the advantage of the mediation is in its less time-consuming process therefore most people prefer mediators who would be able to understand the issue speedily and provide authoritative and informed solutions.
The European Legal resource Person, Wolf von Kumberg once mentioned that though he works for a company who primarily deals with disputes arising from It or technical issues, yet they usually prefer to choose a mediator with strong skills-set and experience rather than knowledge and expertise backgrounds. It is very rare that disputes about technical matters and interpretation of specifications require mediation hence mediators with the vast skill set and expertise are preferred. Other pioneers of business and the legal world have often stated that it is much more important to have logical, intuitive and realistic mediator rather than an expert in a particular field. Since mediation is a process wherein both the parties are negotiating their terms and rely on the mediator to provide them stimulating questions related to possible consequences for the ascertained in future. The primary function of a mediator is to ensure that the parties walk away after resolving the dispute in such a manner, that they do not have a dispute related to the same matter in the near future. Since most of the business deals are never limited to financial aspects alone, they also largely deal with personal matters like the risk of loss of face, the reputation of the personalities involved and other personal human attributes. Hence, the expert mediator will not be of many advantages here, rather a skilled mediator would certainly help resolve issues in a wholesome manner. However, certain specific industries like maritime, aviation and pharmaceuticals believe otherwise.
In India, Rule 5 clause C[3] provides the parties, autonomy to decide upon this issue whether their subject matter of dispute requires expert advice. If the answer is affirmative the parties have to incur cost so that the mediator can seek technical knowledge. Additionally, Article 14 clause (b)(ii)[4] provides expert advise and support on the discretion of the mediator.
Mediation Provisions and Procedures in India
Section 89 of the Civil Procedure Code, 1908 provides recourse from Court proceedings and allows the court to suggest a compromise between the parties through mediation procedure.
Delhi HC[5] acknowledged the importance of ADR and even suggested involving Early Neutral Evaluation (ENE), a form of ADR similar to mediation, through the consent of the parties for negotiating a settlement. They also actively encouraged the involvement of ADR methods in settling IP and family law disputes. Moreover, it was also asserted that any interference by judges in the form of setting terms of the future agreement should not be allowed since they will make the process redundant due to the interference of the judiciary in the pre-settlement stage.[6]
This judgement pre-empted the sea of changes in statutes concerning referral to mediation by judges. Now the courts can make a referral to mediation even without the consent of the parties. Yet the decisions or settlements are voluntary. In such scenarios, the conduct, skills and expertise of the mediator are the most important force for making this process fruitful. The surety of a settlement is largely driven and based on the mediator.
Conclusion
Mediation offers parties greater freedom to decide upon possible solutions for their disputed matter. However, this process derives its maximum benefits from the presence of a mediator, since they are the key persons in this process. Therefore, it is essential to decide upon the qualifications of a mediator along with the ethics and professional conduct. It cannot be conflicted that expertise provides an edge over understanding the dispute efficiently and much faster. Yet at the same time, it can also make the mediator disputed or favouring a certain side based on his experiences in the particular field. Moreover, it has been observed that parties willing to go for mediation are only able to reach solutions, those unwilling are highly likely to leave the procedure midway. Therefore, we certainly need further research and deliberation to ascertain whether the expertise of the mediator in the subject matter of dispute, serves as boon or bane and whether it affects the party’s willingness to reach possible solutions? Therefore, to make this process of dispute resolution effective, we need specific legislation, not just jurisprudence principles and some particular laws regulating ADR as a whole. Signing the Singapore Convention on Mediation is a way forward but effectively dealing with the intricacies of the process will only produce beneficial results. Mere codes of professional conduct, for mediators and rules for mediation, for the parties seeking remedy, will not be effective and fruitful in the long run.
Citations
- [1] The Malimath Committee submitted its report in August, 1990 and advocated the increased use of ADR. Based on these recommendations CPC was amended and Section 89 was inserted in 1997.
- [2]Law Commission of India, 129th Report, Urban Litigation : Mediation as Alternative to Litigation (1988)
- [3]Mediation Rules , Indian Institute of Arbitration & Mediation, https://www.arbitrationindia.com/pdf/rules_mediation.pdf
- [4]WIPO Mediation Rules, (Effective from January 1, 2020),https://www.wipo.int/amc/en/mediation/rules/
- [5] Bawa Masala Company vs. Bawa Masala Company Pvt. Ltd. (OS No.139 of 2002).
- [6] D.M. Popat, “ADR and India: An Overview”, The Chartered Accountant (December 2004)