Mediation, Conciliation and Arbitration

LL.B.
(Second Year) : Mediation, Conciliation and Arbitration 1
Q.1 What is the Need and Importance of Mediation?

Ans. Need for Mediation: Disputes can arise for any number of reasons
within a dental practice; from financial issues to personal or professional
disputes between practice personnel. The majority of disputes we see escalate
are caused by communication issues. Even the best of communicators or
those like myself who have taken courses on the subject can communicate
poorly and the fallout from a poor communication can be financially and
emotionally costly. Now that the pandemic is upon us the methods of
communication have been restricted to, in the most-part, remote
communications or with part of the face covered. Where we would have always
advised BDA members to speak to staff, associates and patients face-to-face
to resolve issues so that communication is clearer and miscommunication
easier to spot by both parties, we now advise members to do this over the
telephone, by video call or at a sufficient distance. These barriers make
communication more difficult, even for the most seasoned communicator, and
is one reason the need for mediation may increase now more than ever.
Currently many disputes arising between members are a result of the lack
of clear guidance as to how situations pertaining to COVID-19 should be dealt
with now and in the future. The very nature of the pandemic means that we do
not know what is coming next and along with contractual and financial
uncertainty facing practice owners, associates and staff alike, the emotional
strain this uncertainty causes is having a big impact on everyone. This situation
creates a hotbed for disputes and when combined with social distancing
2 According to Syllabus of Dr. Bhimrao Ambedkar Law University, Jaipur
makes conflict resolution challenging and increases the need for the assistance
of a mediator.
Mediation is a dispute resolution method that helps parties reach
agreements by opening up channels of communication between parties.
Mediators do not decide on the merits of arguments or impose solutions on
the parties but instead they encourage parties to express their problems and
potential solutions in a way that diffuses conflicts and allows parties to sort
their own conflicts. It is an attractive option for many who are seeking to
preserve relationships, solve problems quickly and avoid costly litigation.
Many disputes are best discussed with parties sitting in a room face-to-face
but at the time of writing this is not possible.
Importance of Mediations is as follows:
• Cost: The Court’s In-House mediation programs are covered by
your filing fees. While an outside mediator may charge a fee
comparable to that of an attorney, the mediation process generally
takes much less time than moving a case through standard legal
channels. While a case in the hands of a lawyer or a court may take
months or years to resolve, mediation usually achieves a resolution
in a matter of hours. Taking less time means expending less money
on hourly fees and costs.
• Confidentiality: While court hearings are public, mediation remains
strictly confidential. No one but the parties to the dispute and the
mediator(s) know what happened. Confidentiality in mediation has
such importance that in most cases the legal system cannot force a
mediator to testify in court as to the content or progress of mediation.
Many mediators destroy their notes taken during a mediation once
that mediation has finished. The only exceptions to such strict
confidentiality usually involve child abuse or actual or threatened
criminal acts.
• Control: Mediation increases the control the parties have over the
resolution. In a court case, the parties obtain a resolution, but control
resides with the judge or jury. Often, a judge or jury cannot legally
provide solutions that emerge in mediation. Thus, mediation is more
likely to produce a result that is mutually agreeable for the parties.
• Compliance: Because the result is attained by the parties working
together and is mutually agreeable, compliance with the mediated
agreement is usually high. This further reduces costs, because the
parties do not have to employ an attorney to force compliance with
the agreement. The mediated agreement is, however, fully enforceable
in a court of law.
• Mutuality: Parties to mediation are typically ready to work mutually
toward a resolution. In most circumstances the mere fact that parties
are willing to mediate means that they are ready to “move” their
LL.B. (Second Year) : Mediation, Conciliation and Arbitration 3
position. The parties thus are more amenable to understanding the

other party’s side and work on underlying issues to the dispute.
This has the added benefit of often preserving the relationship the
parties had before the dispute.
• Support: Mediators are trained in working with difficult situations.
The mediator acts as a neutral facilitator and guides the parties
through the process. The mediator helps the parties think “outside
of the box” for possible solutions to the dispute, broadening the
range of possible solutions.
Q.2 Describe in brief about development of Mediation in India?
Ans. The use of mediation, as an Alternative Dispute Redressal (ADR)
mechanism dates back to centuries before the British came to India. Back then
informal panchayats were used to resolve disputes between the parties where
the respected elderlies of the villages or the Mahajans were appointed as
mediators. Till date, Panchas or Pancha Parmeshwars, as neutral third parties,
are used to settle disputes informally between the erring individuals or groups,
by some tribes in India. However, with the onset of the British colonialism,
mediation began to be recognized as a formal and legalized ADR mechanism.
Mediation gained popularity as an ADR mechanism with the re-
introduction of Lok Adalats in the Indian Judicial system. Enacted in1987, the
Legal Services Authority Act gave a statutory status to the Lok Adalts in
India for the first time. Under this act, the decision of the Lok Adalats have
been awarded the same status as that of a civil court.
The terms ‘mediation’ and ‘conciliation’, whose usages were considered
to be synonymous previously, received significant distinctions in their usages
when the Arbitration and Conciliation Act was enacted in 1996. Not only did
the act lay down a clear definition for conciliation but also consolidated the
laws relating to domestic arbitration in India. The mediator, unlike the conciliator,
does not take an active part in the mediation process and thus, the terms
cannot be used as a substitute for each other.
The development of mediation as an ADR mechanism can also be
attributed to section 89 of the Civil Procedure Code(CPC), 1908 which was
inserted by the CPC (Amendment) Act, 1999 with prospective effect from 1/7/
2002. This particular development was due to the efforts of Hon’ble Mr. Justice
A M Ahmadi. Ahmadi, the then Chief Justice of India, had invited the Institute
for the Study and Development of Legal System (ISDLS) to India for a national
legal exchange programme between India and the USA. The ISDLS examined
the problems of institutional backlogs in the Indian judicial system and
suggested the ADR mechanisms and legislative and structural reforms of the
laws relating to these mechanisms following which, new reforms were
introduced in 2002 in the form of amendment of section 89 of the CPC. However,
the amendment was challenged by a group of lawyers following which the
Malimath Committee and the 129th Law Commission were constituted. In the
light of the reports submitted by the committees, the Hon’ble Supreme Court
in the case of Salem Advocates Bar Association vs. Union of India. made it
mandatory for the courts to refer cases to the alternative forums, if they were
so pleased. This case is a landmark one in the development of mediation in
India.
Since then, the judges of the Supreme Court have contributed significantly
towards the development of mediation as an ADR mechanism. Under Hon’ble
Mr. Justice R C Lahoti, a Mediation and Conciliation Committee was
established and in a Project on Mediation was also initiated in Delhi in the
year 2005. In the same year, A Permanent Mediation Centre was inaugurated at
the Tis Hazari court complex and judicial mediation was started at the
Karkardooma court complex. Two mediation centers were also inaugurated,
one at the Karkardooma court complex in Delhi and another at the Patiala
court in 2015.cant
Thus, mediation as an Alternative Dispute Redressal mechanism, has
received significant impetus over the years through the enactment of various
legislations and by the efforts of various judges of the Supreme Court.

Q.1 What do you understand by Alternative Dispute Resolution? What

are different modes of Alternative Dispute Resolution?
Ans. Most of us are well aware that the Indian judiciary is one of the
oldest judicial mechanisms in the world but it is also believed that it is dealing
with the burden of pending cases which is questioning efficiency. This is
because Indian courts are clogged with long unsettled cases. The situation
still remains despite of having loads of fast track tribunals and settling more
than millions of cases. Yet the pending cases are piling up. To deal with this
issue and check the burden on judiciary Alternative Dispute Resolution
mechanism was adopted to resolve a dispute in a peaceful manner in which
the verdict is desired by both the parties.
Dispute resolution is an indispensable process for making social life
peaceful. Dispute resolution process tries to resolve and check conflicts,
which enables persons and group to maintain co-operation. It can thus be
alleged that it is the sin qua non of social life and security of the social order,
without which it may be difficult for the individuals to carry on the life together.
Alternative Dispute Resolution (ADR) is a term used to describe several
different modes of resolving legal disputes. It is experienced by the business
world as well as common men that it is impracticable for many individuals to
file law suits and get timely justice. The Courts are backlogged with dockets
resulting in delay of year or more for the parties to have their cases heard and
decided. To solve this problem of delayed justice ADR Mechanism has been
developed in response thereof. Alternative dispute redressal method are being
increasingly acknowledged in field of law and commercial sectors both at
National and International levels. Its diverse methods can helps the parties to
resolve their disputes at their own terms cheaply and expeditiously.
What is Alternative Dispute Resolution? Alternative Dispute Resolution
(ADR) is a competent mechanism which serves as substitute to the
conventional mode of resolving disputes between parties. ADR intends to
offer and amicably resolve all type of matters including civil, commercial,
industrial and family etc. Mostly, where people are unable to initiate any
negotiation and reach the settlement. ADR involves an unbiased third party
who in bona-fide manner assists the involved parties to come together and
communicate, discuss the differences and eventually resolve the dispute.
This method enables individuals and group to maintain co-operation, social
order and provides opportunity to reduce hostility.
The goal of Alternative dispute redressal is enshrined in the Indian
Constitution’s preamble itself, which enjoins the state: “to secure to all the
citizens of India, justice-social, economic and political-liberty, equality and
fraternity”.
Why ADR is important in country like India? In a diverse and developing
country like India which has a huge population, it is inevitable to have
misunderstanding and disputes. Such differences call to be resolved amicably
and in fast track manner. Thus, ADR always plays a significant role in India by
its diverse techniques. Alternative Dispute Resolution mechanism provides
effective techniques which assists Indian Judiciary System to reduce the
burden of cases. ADR involves and includes various ways to settle the matter
like Arbitration, Conciliation, Mediation, Negotiation and Lok Adalat. The
negotiation involves self-counseling between the parties leading them to
resolve their dispute.
The intention is to provide social-economic, political justice and maintain
integrity in the society enshrined in the preamble. ADR is dedicated to achieve
equal justice and free legal aid provided under Article 39A of our constitution
referring to ‘Directive Principle of State Policy’.
Legislations of ADR in India:
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). 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.
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.
2. Indian Arbitration Act, 1899: 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. 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 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.
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 committee of law ministry felt that provisions of the Bill gave room
for excessive intervention by the courts in arbitration proceedings.
Perks of Alternative Dispute Resolution:
1. Efficient: Here people can resolve their dispute in short period as
compared to courts.
2. Very Cost effective: It is reasonable and saves lot of money against
expenses in litigation process.
3. Different technique It is different from the traditional practice in
courts and here informal ways are applied in resolving dispute.
4. Freedom to share: Here disputing parties are free to express
themselves without any fear of court of law. They can reveal genuine
facts without disclosing it to any court.
5. Efficient way: Here parties have chance of restoring the relationships
back as parties discuss their issues together on the same platform.
6. Prevents Conflicts: Here the parties reduce conflict and work to
maintain good relationship between each other. It also protects the
best interest.
Various Modes of Alternative Dispute Resolution:

1. Arbitration:
The Arbitration cannot be initiated without a valid arbitration agreement
prior to the emergence of dispute. The intending parties initiate to resolve the
dispute refer it to one or more persons called arbitrators. The decision of
arbitrator shall be binding to the parties and is called as ‘ an Award’. The
objective of the Arbitration is to provide a platform for fair settlement of
dispute outside of court without necessary delay and expense. The parties to
the contract with the arbitration may can enforce the arbitration clause by
himself or by their authorized agents to refer the dispute directly to the
Arbitration tribunal as per the Arbitration clause.
The Section 8 of Arbitration and Conciliation Act, 1996 states that if either
party has disrespected or has not complied with the arbitral agreement and
instead of moving to arbitration, moves that suit to civil court, other party can
apply the court for referring the matter to arbitration tribunal as per the
agreement but not later the submission of the first statement. It is essential
that the certified copy of arbitration agreement application is attached to
satisfy the tribunal where the matter will be referred for 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.
2. Mediation:
Mediation is the Alternative Dispute resolution where a third unbiased
neutral party assists two or more disputants to amicably reach arrangement.
This is an easy and uncomplicated party centered negotiation process where
third party acts as a mediator to resolve dispute amicably by using appropriate
communication and negotiation techniques. This process is totally controlled
by the parties. The Mediator facilitates and assists the parties to reach
acceptable settlement of their dispute. The Mediator never imposes his
thoughts and but guides one towards decision which leads to a fair settlement.
The Mediator merely discusses the perspective of the parties about the
possible outcome at litigation. It is also helpful for the mediator to work with
parties and their advocates to come to a proper understanding of the best,
worst and most probable outcome to the dispute through litigation as that
would help the parties to acknowledge the reality and prepare realistic, logical
and workable proposals.
Mediation is a process in which the mediator, an external person, neutral
to the dispute, works with the parties to find a solution which is acceptable to
all of them. The basic motive of mediation is to provide the parties with an
opportunity to negotiate, converse and explore options aided by a neutral
third party, to exhaustively determine if a settlement is possible.
Mediation is negotiation carried out with the assistance of a third party.
The mediator, in contrast to the arbitrator or judge, has no power to impose an
outcome on disputing parties.
Despite the lack of ‘teeth’ in the mediation process, the involvement of a
mediator alters the dynamics of negotiations. The concept of mediation is not
foreign to Indian legal system, as there existed, different aspects of mediation.
The Village Panchayats and the Nyaya Panchayats are good examples for
this. A brief perusal of the laws pertaining to mediation highlights that it has
been largely confined to commercial transactions. The Arbitration and
Conciliation Act, 1996 is framed in such a manner that it is concerned mainly
with commercial transactions that involves the common man rather than the
common man’s interest.
In India, mediation has not yet been very popular. One of the reasons for
this is that mediation is not a formal proceeding and it cannot be enforced by
courts of law. There is a lack of initiative on the part of the government or any
other institutions to take up the cause of encouraging and spreading awareness
to the people at large.
3. Conciliation:
Conciliation is a form of arbitration but it is less formal in nature. The
process conciliation is facilitate an amicable resolution to both disputing
parties, here the parties to the dispute engages a conciliator who meets to
hears both parties separately to settle their dispute. Conciliator meets
separately to ease tensions between parties intending to improve
communication and interpretation of issue in order to bring about the desired
settlement. No prior agreement is essential and nothing can be imposed on
the parties who is not intending for conciliation. It is different from arbitration
in that way.
Conciliation is “a process in which a neutral person meets with the parties
to a dispute which might be resolved; a relatively unstructured method of
dispute resolution in which a third party facilitates communication between
parties in an attempt to help them settle their differences”.
This consists in an attempt by a third party, designated by the litigants,
to reconcile them either before they resort to litigation (whether to court or
arbitration), or after. The attempt to conciliate is generally based on showing
each side the contrary aspects of the dispute, in order to bring each side
together and to reach a solution.
Section 61 of the 1996 Act provides for conciliation of disputes arising
out of legal relationship, whether contractual or not and to all proceedings
relating thereto. After its enactment, there can be no objection, for not
permitting the parties to enter into a conciliation agreement regarding the
settlement of even future disputes.
There is a subtle difference between mediation and conciliation. While in
meditation, the third party, neutral intermediary, termed as mediator plays
more active role by giving independent compromise formulas after hearing
both the parties; in conciliation, the third neutral intermediary’s role, is to
bring the parties together in a frame of mind to forget their animosities and be
prepared for an acceptable compromise on terms midway between the stands
taken before the commencement of conciliation proceedings.
4. Lok Adalat:
Lok Adalat is usually referred to as ‘People’s Court’ the bench comprise
of sitting or retired judicial officer, a social activists or members of Legal
profession as the chairman. National Legal Service Authority(NALSA) along
with other Legal Services Institutions conducts Lok Adalats on regular intervals
for exercising such jurisdiction. Any case pending in regular court or the
dispute which has never brought before any court of law can be referred to
Lok Adalat. There is no court fee or any rigid procedure to be followed, hence
making the process fast. If any matter pending in court is referred to the Lok
Adalat and gets settled subsequently, the entire court fee which was originally
paid in the court during filing of the petition is also refunded back to the
parties. Hence it is evident that ADR is more effective way to resolve disputes
between the parties.
Lok Adalat was a historic necessity in a country like India where illiteracy
dominated other aspects of governance. It was introduced in 1982 and the
first Lok Adalat was initiated in Gujarat. The evolution of this movement was
a part of the strategy to relieve heavy burden on courts with pending cases. It
was the conglomeration of concepts of social justice, speedy justice,
conciliated result and negotiating efforts.
They cater the need of weaker sections of society. It is a suitable alternative
mechanism to resolve disputes in place of litigation. Lok Adalats have assumed
statutory recognition under the Legal Services Authorities Act, 1987. These
are being regularly organized primarily by the State Legal Aid and the Advice
Boards with the help of District Legal Aid and Advice Committees.
Legal Services Authorities Act, 1987:
The Legal Services Authorities Act, 1987 was brought into force on 19
November 1995. The object of the Act was to provide free and competent legal
services to the weaker sections of the society to ensure that opportunities for
securing justice are not denied to any citizen. The concept of legal services
which includes Lok Adalat is a revolutionary evolution of resolution of disputes.
Though settlements were affected by conducting Lok Nyayalayas prior
to this Act, the same has not been given any statutory recognition. But under
the new Act, a settlement arrived at in the Lok Adalats has been given the
force of a decree which can be executed through Court as if it is passed by it.
Sections 19, 20, 21 and 22 of the Act deal with Lok Adalat. Section 20 provides
for different situations where cases can be referred for consideration of Lok
Adalat.
Honorable Delhi High court has given a landmark decision highlighting
the significance of Lok Adalat movement in the case of Abdul Hasan and
National Legal Services Authority v. Delhi Vidyut Board and Others [AIR
1999 Del 88]. The court passed the order giving directions for setting up of
permanent Lok Adalats.
5. Negotiation:
Negotiation-communication for the purpose of persuasion-is the pre-
eminent mode of dispute resolution. Compared to processes using mutual
third parties, it has the advantage of allowing the parties themselves to control
the process and the solution.
Essentials of Negotiation are:
• It is a communication process;
• It resolves conflicts;
• It is a voluntary exercise;
• It is a non-binding process;
• Parties retain control over outcome and procedure;
• There is a possibility of achieving wide ranging solutions, and of
maximizing joint gains.
In India, Negotiation doesn’t have any statutory recognition. Negotiation
is self counseling between the parties to resolve their dispute. Negotiation is
a process that has no fixed rules but follows a predictable pattern.
Q.2 What is meant by Restorative Justice in relation to Mediation?
How is Restorative Justice different from Mediation?
Ans. Mediation: Mediation is a way of resolving disputes which assists
the people involved to reach an agreement with the help of an impartial mediator.
The parties rather than the mediator, decide the terms of the settlement.
As this definition makes clear, the purpose and focus of mediation is the
resolution of a dispute or conflict.
What is Conflict or a Dispute? According to the Oxford English
Dictionary (OED), a dispute is “an argument” or “a disagreement”. To dispute
something is to “argue about” a statement of fact; it is to “question the truth
or validity of” that statement. A dispute can involve “competing for” something
or a “battle to win”.
The meaning of the term conflict is almost identical: it is defined by the

OED as a “serious disagreement or argument”. It can involve an “incompatibility
between opinions or principles”. To be in conflict is to be “incompatible with”
or “at variance with” something or someone. The word can also be used to
describe a “prolonged armed struggle”.
From these definitions, it seems clear that a ‘dispute’ or ‘conflict’ involves
a situation in which the opposing parties feel entitled to something, and they
are prepared to enter into a contest in order to obtain or ‘win’ that to which
they feel entitled. This contest may involve words only, but also actions -
even to the point of violence . But the core issue is that the parties have, or
believe they have, incompatible goals, values or beliefs; and that these goals,
values or beliefs are important enough that they are prepared to enter into
conflict rather than abandon them.
Why is mediation suited to resolving conflicts and disputes? In order to
prevent such a situation from escalating and to resolve the issues, what is
required is an approach in which no one feels that they have ‘lost’. In other
words, both parties need to come to an ‘agreement’ or ‘settlement’. They need
to find a ‘win-win’ outcome.
Mediation is designed to bring about precisely this kind of result. It does
this by using an approach in which both parties feel that they are being
treated as equals, they are given the same consideration, speaking time,
preparation, and so on. Most importantly, the mediator is, within ethical
boundaries, ‘morally impartial’: that is to say, the mediator does not ‘take
sides’ or speak or act as if one party is ‘in the right’ and the other ‘in the
wrong’. The mediator, in other words, is responsible for the process but has
no vested interest in the outcome.
Can mediation result in a restorative outcome? There are of course
cases in which mediation has led to a restorative outcome. For example, it may
turn out that one (or both) parties are, within the mediation process, honest
enough to admit that they are – in some respect – ‘in the wrong’. They may
even admit that their actions have ‘harmed’ the other in some way. In such
cases, one (or both) parties might even apologise to the other and offer to
make amends.
That is a restorative outcome, but it is crucial to note that this outcome is
a by-product of the process. Mediation is primarily motivated by the need to
resolve a dispute or conflict. It does not proceed on the assumption that
addressing harm or repairing a relationship is the - or even an - objective.
This is demonstrated by the fact that mediation is most frequently used
in situations where the parties disagree about where fault or blame lies. The
mediation process is not intended specifically to clarify this, although it may
do so. Its primary purpose is to establish agreement on how parties will relate
to or engage with each other in the future and how they can avoid subsequent
conflicts. Family Mediation and Community Mediation, together accounting
for over 90% of all mediations carried out in Scotland, are replete with this kind
of scenario. If one party to a dispute admitted sole responsibility in this
context, it would be a rare exception.
Restorative Justice: Restorative Justice is a system of criminal justice in
which the meeting is organised between the victim and the offender or the
community at large. This system focuses on the rehabilitation of offenders
and also on restoration and healing rather than retribution and punishment.
“Restorative Justice was originated in the 1970s as mediation on reconciliation
between victims and offenders”.
Restorative justice/practice, by contrast, is motivated primarily by the
need to address the harm done: it does not take place unless and until the
person who has caused the harm has fully and freely admitted to their actions
and is willing to take responsibility for them. That is what makes the purpose
of a restorative intervention entirely distinct from mediation.
Elements of Restorative Justice: It has five connected elements:
• Meeting: The victim, offender and community members meet to
decide ‘how to do that’
• Narrative: The victim get the opportunity to speak their self out and
to explain the real impact of the crime to the offender.
• Emotions: The emotions are shared by the parties over the matter
concerned.
• Understand and Accountable: The offender holds accountable to
what he has done and take the responsibility by agreeing upon the
terms.
Crime in which Restorative Justice is used: It is used for any type of
crime but it is more used in less serious offences as compared to crimes of
more serious nature. It is practiced in the Court system often with Juvenile
offenders.
Restorative Justice for Juvenile Justice System: In the Indian context, a
juvenile or child is any person who is below the age of 18 years . And the
juveniles of the age group 16-18 years involved in heinous crimes are tried as
adults.
The Restorative Justice Concentrates on transformation rather than on
punishment . So dealing with this practice , a juvenile can be kept out of the
system of Court but he will be hold accountable for his criminal behavior.
How is restorative justice different than mediation? There are quite a
few misunderstandings about restorative justice and the roles of practitioners
(e.g. we’re often compared to probation officers, counselors and mediators,
none of which are accurate and can be harmful if believed/applied), so we
want to distinguish these two related but distinct fields.
The focus on reparation: There are some services that call (or would like
to call) what they do ‘restorative justice’ and yet are designed to focus entirely
on agreements about restitution, compensation or reparative tasks. If mediation
is about securing an agreement, why not call these services ‘mediation’, or
even ‘mediation and reparation’? And if that is acceptable, then surely mediation
is, after all, a restorative practice, since these cases are dealing with harm?
This is a useful question, since it will help us to make a number of additional
clarifications.
• Firstly, it is likely that a service which focuses primarily on reparative
agreements originated (historically) within a mediation context: that
is, the practitioners or service- developers were probably trained in
mediation, and so are more familiar or comfortable with a process
that concentrates on producing agreements or settlements. However,
it does not follow that what they are doing can therefore be called
‘mediation’. As we have seen, mediation – by definition – is about
resolving conflict or disputes. If a process is designed primarily to
deal with the aftermath of a harmful incident, then – by definition –
that process is not mediation.
• Secondly, that this kind of service would also not count as a
restorative approach. If a process routinely and deliberately avoids
dealing with “underlying feelings” or the “ventilation and expression
of grievances”, and puts a higher value on an agreement or a
reparative task than on the full and free acknowledgement of
responsibility and an expression of sincere remorse, then it is missing
an essential element of restorative justice/practice. A more
appropriate term for such processes would be ‘reparative justice’ or
‘reparation schemes’. They have more in common with ‘reparation
orders’ and ‘community service’ than with restorative justice, and
so a clear distinction should be made.
Again, it is not necessarily the case that what we are calling ‘reparative
justice’ is just ‘restorative justice done badly’. There may be isolated cases in
which a restorative practitioner cuts corners in this way; but the key difference
is that a genuine restorative process is designed to provide much more than
mere reparation. By contrast, the primary objective of ‘reparative justice’ or a
‘reparation scheme’ is to reach agreement on and/or arrange reparation of
some kind. It is possible to tell whether a service is reparative or restorative
simply by looking at the kind of process their practitioners routinely and
deliberately deliver.
How Is Victim-Offender Mediation Different from Other Kinds of
Mediation?
Mediation is being used in an increasing number of conflict situations,
such as divorce and child custody cases, community disputes, commercial
disputes, and other civil court-related conflicts. In such settings, the parties
are called “disputants,” and the assumption made is that both are contributing
to the conflict and therefore both need to compromise to reach a settlement.
Often, mediation in these cases focuses heavily upon reaching a settlement,
with less emphasis upon discussing the full impact of the conflict on the
disputants’ lives.
In victim-offender mediation, the involved parties are not “disputants.”
Generally, one party has clearly committed a criminal offense and has admitted
doing so, whereas the other has clearly been victimized. Therefore, the issue
of guilt or innocence is not mediated. Nor is there an expectation that crime
victims compromise or request less than what they need to restore their losses.
Although many other types of mediation are largely “settlement-driven,” victim-
offender mediation is primarily “dialogue-driven,” with emphasis upon victim
empowerment, offender accountability, and restoration of losses. Most Victim
Offender Mediation result in a signed restitution agreement. This agreement,
however, is secondary to the importance of the initial dialogue between the
parties. This dialogue addresses emotional and informational needs of victims
that are central to both the empowerment of the victims and the development
of victim empathy in the offenders, which can help to prevent criminal behavior
in the future. Research has consistently found that the restitution agreement
is less important to crime victims than the opportunity to express their feelings
about the offense directly to the offenders. Restorative impact is strongly
related to the creation of a safe place for dialogue between the crime victim
and the offender.
Q.3 Explain the Theory of Restorative Justice?
Ans. Restorative justice is a procedure which can be applied to restore
and reduce conflicts between the parties, to help in sustaining a wholesome
environment through healthy communication to mend the harm caused. It
enables in restoring some basic questions such as, who has been hurt and
what are their requirements. Engaging the ones who are affected is extremely
required in order to bring out the essence of restorative justice.
Restorative justice magnifies the weakness of the offenders and
continuously strives to draw the strength of these individuals, helping in
discrediting their criminal behaviour. The concept that surrounds restorative
justice is respect, accountability, integrity, empathy etc. The International,
National and Local Justice System along with the correction departments,
help in administering and moulding policies which would be more relevant to
catering the requirements of crime victims and the community at large.
Restorative Justice indulges in mitigating the process of generating justice
and fostering accountability, which is actively developing throughout the
world.
Restorative Justice is a kind of surrogate procedure in order to achieve
justice, here the society addresses an offence being committed and seeks
reparation for the same. This is a considerably newer concept, which is gaining
acceptance in the society at quite a speed. It is a reaction which revolves
around the importance of restoring the loss suffered by the crime victim, the
offender is held accountable for the damage caused and helping in establishing
peace. The community and the crime victim strive to resolve the issue and
cure the damage caused thereby helping in restoration.
In the traditional justice perspective, an offence is considered to be a
violation of the justice system and would magnify the establishment of guilt
and stigmatizing and eventually imposing punishment, whereas if we look at
Restorative Justice, it provides an opportunity for the victim to vocalise, in
addition to this provides the offender to comprehend what crime the individual
has committed, regret for the damage caused and work towards reparation.
Definition of Restorative justice According to John Braithwaite – it is a
process ”where all stakeholders affected by an injustice have an opportunity
to discuss how they have been affected by the injustice and to decide what
should be done to repair the harm. With crime, restorative justice is about the
idea that because crime hurts, justice should heal. It follows that conversations
with those who have been hurt and with those who have inflicted the harm
must be central to the process.
Although law professionals may have secondary roles in facilitating the
restorative justice process, it is the citizens who must take up the majority of
the responsibility in healing the pains caused by crime. The process of
restorative justice thus shifts the responsibility for addressing crime.”
Carolyn Boyes-Watson defines it as – “a growing social movement to
institutionalize peaceful approaches to harm, problem-solving and violations
of legal and human rights. These range from international peace making
tribunals such as the South Africa Truth and Reconciliation Commission to
innovations within the criminal and juvenile justice systems, schools, social
services and communities. Rather than privileging the law, professionals and
the state, restorative resolutions engage those who are harmed, wrongdoers
and their affected communities in search of solutions that promote repair,
reconciliation and the rebuilding of relationships. Restorative justice seeks to
build partnerships to re-establish mutual responsibility for constructive
responses to wrongdoing within our communities. Restorative approaches
seek a balanced approach to the needs of the victim, wrongdoer and community
through processes that preserve the safety and dignity of all.”
Principles of Restorative Justice:
• Offence against individual relations is Crime
• Victims and Community are the core elements of the justice process.
• The primary priority in the attainment of justice is to assist the victim
• The secondary priority would be reinstating the community to the
degree possible.
• The offender has a personal liability towards the crime victim and
the community at large, for the crimes committed.
• Restorative Justice will lead to the development of the offender to
comprehend the gravity of the offence committed by him.
Restoration focuses on the victim; the victim possesses no right in the
criminal justice system. A victim is only considered as a witness to the
prosecution. The recent change in the responsibility of the system towards
for the right of the accused and victim so as to bring both of them at par is
necessary. The National Offender Management Service (NOMS) Restorative
Justice Capacity Building programme is an important development in the
Criminal Justice System in the recent years, which caters to fostering relations
and restoring victim and offenders to improve and amend conflicts arising
through the crime committed.
The Centre for Justice and Reconciliation conducted various successful
reform projects: Rwanda Project started in 2001-2003, where prisons who were
accused of genocide were made to meet their victims, survivors and community
members, in the community justice inspired court called Gacaca. Nine months
later the participation in these courts increase and more perpetrators wanted
to confess and at present the Prison Fellowship Rwanda looks after seven
“reconciliation villages” where these survivors and their perpetrators live
together in harmony.
In India, cases of convictions can be sent for appeal and revisions, reaching
to a conclusion in the judgement takes a considerable amount of time. The
victim is already being subjected to emotional trauma and mental agony. The
institution of the judicial system solely believes that disclosure, vindication,
and enforcement of truth is the core underlying purpose of achieving justice.
In the case of Babu Singh v. State of Uttar Pradesh [1978 SCR (2) 777],
the Supreme Court proposed that methods of restorative justice such as
community service, meditative drill or study classes should be initiated to
help in restoring the offender.
The routine in criminal proceeding revives back the trauma in the minds
of the victim of serious crime throughout the justice process and defeats any
scope of providing closure or repairment of emotional damages caused to the
aggrieved party. Different countries are enabling financial and legal help in
the sphere of restorative justice.
In 2002, the UN Commission on Crime Prevention and Criminal
Justice suggested to include Restorative Justice in the Criminal Justice System,
in order to keep the offender and victim at par. The offender confesses and
apologizes to the victim and the guilt of the offender guides him into non-
repetition of the offence. The offender is also obligated to mend the damage
caused to the victim
Restorative Justice and Indian Laws:

• Panchayats: After independence, the provisions of the constitution
helped in the establishment of Nyaya Panchayats, which was
considered as a dispute resolution mechanism on a community level.
Ever since there has been a constant push for the creation of
community-focused justice models which have the power to try civil
and criminal offences which are less grave in nature, thereby
minimizing the formal legal process of involving courts. Panchayati
Adalats, Gram Nyayalayas, Khap Panchayat also known as ‘kangaroo
courts’, Mahila Panchayats and Nari Adalat are some examples.
• Customary Laws: Customary Laws plays a very important role in
dispute resolution in India and believes in the principle of justice
being community-centric.
Article 13(3) of the Indian Constitution believes in acknowledging
customs as a source of law. For example, the tribes of the Garo Hills
consider the whole community accountable for an offence, rather
than stigmatizing and blaming a particular individual.
• Civil Cases: The timely approach regarding justice in civil and
compoundable criminal cases by the establishment of “People’s
Courts” or Lok Adalat. Formulation of Family Courts under Family
Courts Act, 1984, to resolve matters such as divorce, the validity of
marriage and restitution of conjugal rights by fostering dialogue
between parties to settle matters in the absence of legal professionals.
The Arbitration and Conciliation Act of 1996 is another example for
courts setting mediations centres to lessen the delay of cases in
courts and relying more on speedy resolutions by reaching to their
own solution.
• Criminal Cases: Section 320 of Criminal Procedure Code, 1973,
Settlement of a dispute between the victim and the offender can be
reached with Section 320 of the Criminal Procedure Code, 1973.
‘Compounding of offences’ has been one of the recognised
mechanisms to attain restorative justice. A process where both, the
offender and victim come to a consensus of not opting for litigation
this is known as compounding.
This provision enables to take recourse to ‘compounding of cases’ in a
few offences and does not require the consent of the court and in certain
cases the approval of the court. There are certain offences where a particular
person is affected and not the entire society. These offences can be
compounded without the consent of the court under 320 (1) of Criminal
Procedure Code, 1973. These offences would encompass a person’s feelings,
criminal trespass, hurt, confinement, adultery, defamation etc.
Subsection (2) under this section would comprise of offence which is
more severe in nature and affect a larger mass of people, these offences
cannot be held compounded without the court’s approval. Grievous hurt,
breach of trust which involve a huge amount, fraud, counterfeiting, wrongful
confinement, etc.
• Plea Bargaining (Sections 265A-L of the CrPC): Section 265 A-L
deal with the concept of lea Bargaining. In cases where the offence
is punishable with death or imprisonment of more than 7 years, further
exceptions will be socio-economical offence. The procedure of
application of the same is stated in Section 265-B and other relevant
provisions extend to 265 L
• Juvenile Justice Act, 2015: It is a well-established fact that in India,
child offenders are sent to rehabilitation centers. They aren’t awarded
punishment, rather are sent to get reformed under reformative practice
of justice. “As per section 18 of JJ Act, 2015, the JJB can pass orders
for CCL such as:
(i) direct the child to participate in group counselling and similar
activities;
(ii) order the child to perform community service under the
supervision of an organization or institution, or a specified
person, persons or group of persons identified by the Board.”
Q.4 How we resolve Conflict without War? Explain in context of
Gandhian Approach for Conflict Resolution?
Ans. “I realized that the true fiction of a lawyer was to unite parties… A
large part of my time during the 20 years of my practice as a lawyer was
occupied in bringing out private compromise of hundreds of cases. I lost
nothing thereby- not even money, certainly not my soul.”– Mahatma Gandhi
Mahatma Gandhi was born on 2nd October in 1869. He went to London
for the completion of his study in 1980. He was a lawyer. He used to spend his
life with simplicity. If we talk about the way of fighting or resolving conflict
then we can say the he started this journey from the South Africa. The way
which Gandhi had adopted for conflict resolution was a great change in the
world and complied to think over peace research and different techniques of
conflict resolution peacefully. His concept of conflict resolution is based on
nonviolent Satyagraha. He is also called the Father of Nation. In any conflict
he believes by mutual trust and bilateral negotiation any conflict can be resolve.
He knew very well that the process of conflict resolution non-violently takes
a time so it requires patience.
Only due to patience of conflicting parties can develop positive attitude
on each other or on any issues. There are so many examples of Mahatma
Gandhi’s technique of conflict resolution like he resolve the racial discrimination
which was prevailing in South Africa at that time. The labour contact issue
was also resolved peacefully at South Africa. Practicing of Indian Lawyer in

South Africa court issue was also resolve by him peacefully. He was a pure
vegetarian and a ritual person performing prayers and keeps worshiping to
God.
Conflict is a natural and it can be arise between any individuals if there
interest on any particular topic is not matching. Where there is a society then
there will be conflict, either it may be in hidden form or it may be seen to
everyone. For resolving conflict it is not compulsory that there will be war. It
can be resolve peacefully by adopting different techniques. Conflict defined
as a psychological condition in which two individuals started fighting or
quarreling over any issue and there interest is not matching on that issue.
Conflict is of different types like it may be social, religious, regional,
national or international. Gandhi played a critical and very important role in
developing different ways of conflict resolution without fighting. He was
influenced by many western thinkers and their ideas like Ruskin Bond, Tolstoy
and Thoreau. He had read all the religious book of all religion like Hinduism,
Buddhism, Christianity, Islam and Jainism.
Satyagraha: Satyagraha is the main weapon of Gandhi ji for fighting
against conflict without fighting. Satyagraha means holding truth i.e. fighting
against any problem non-violently and on the principle of truth. In resolving
conflict Mahatma Gandhi used to talk only truth and control himself in
maintaining peace. He used to say that without peace anyone never achieve
its target, so for proper development peace and truth is very important for any
individuals. Mahatma Gandhi used to say that peace should always consider
as positive approach rather than negative one. Johan Galtung is considering
as modern father in conflict resolution by fallowing the path of peace. He said
that peace is a absence of conflict via resolving conflict. Mahatma Gandhi
used to follow some other approach like he used to resolve conflict peacefully
and always tried to develop healthy environment between the conflicting
parties so that there should be no any conflict in future between them.
According to Mahatma Gandhi for Satyagraha you have to follow the
path of truth or soul force. Gandhi said that every human being should do
their work on the platform of peace and truth. He also said that path of truth
and peace is very hard so if any individual is following it then he/she must
have to keep patience. He also explained that without truth Gandhian Concept
of Conflict Resolution is impossible. In Hindi this non-violence is termed as
Ahimsa. Gandhi expressed that truth is the end and non-violence is the
means.
What is a conflict? A conflict may be said to be a serious disagreement
between the opinions or interests of two persons or two groups of persons
involved in an issue.
Types of conflict: Conflict can be classified into different categories like
• Interpersonal conflict: It means conflict between two individuals.
Usually such type of conflict occurs due to different nature of
different people. Every person has its own personalities which
usually lead to different choices and opinions. It is a natural
occurrence or we can say a natural phenomenon and these qualities
help in personal growth or development of any individuals.
• Intrapersonal conflict: Intrapersonal conflict means conflict within
an individual or him/herself. Such conflict takes place in the person’s
mind. We can say this conflict is a psychological in which individual
fight him/herself on the Individual’s thoughts, values, principles
and emotions. In Interpersonal conflict individual remain in confusion
either this work is right or wrong etc. Such type of conflict is very
difficult to handle because in this peoples have to come over from
its inner struggles.
• Intragroup conflict: Just like the intrapersonal conflict this intragroup
conflict is within a same group of different peoples. This conflict
usually happens among individuals within a team. It may be different
reason for the conflict like incompatibilities and misunderstandings
among the team members or individuals. Members of the same team
if have different ideas and thoughts on any particular issue it leads
to this intragroup conflict.
• Intergroup conflict. When conflict arises between the different
departments of same organization then is called intergroup conflict.
For example in a factory of industry have conflict between the HR
department and Sales department then this conflict is called
intergroup conflict. It may be different reasons for it like different
goals and interest of both department of a same organization.
Conflict resolution: Conflict resolution word itself define that resolving
conflict is termed as conflict resolution. It can also be defined as the situation
or condition in which the conflicting parties try to establish an environment
or agreement that there will be no any conflict/tension or problem
between them.
Gandhi’s different techniques of conflict resolution: The Gandhian
approach to conflict resolution is popularly known as Satyagraha, which is
essentially a nonviolent method. It is based on the premise that a committed
individual is capable of resolving conflicts in a creative and fruitful way but
for this to happen s/he needs to put maximum effort into it. It further assumes
that on a continuum conflicts can move from the competitive to the cooperative.
This happens not just between partners in close relationships but is a
possibility in distant relationships as well. The Gandhian approach further
emphasises on arriving at the truth – victory or winning is not important here;
satisfaction of all the parties to the conflict with the outcome is much more
important. This can only happen when something mutual is worked out
between the parties. When all the parties are satisfied with the outcome, the
resolution is sturdy and not fragile.
1. Types of Non-violent Action: Gene Sharp categorises nonviolent
action into three types:
a. “accommodation, where the opponent does not believe in the
changes made but nevertheless believes that it is best to give
in on some or all points to gain peace or to cut losses;
b. nonviolent coercion, where the opponent wants to continue
the struggle but cannot because they have lost the sources of
power and means of control; and
c. conversion, where the opponent has changed inwardly to the
degree that they want to make the changes desired by the
nonviolent activist (or indeed, the nonviolent activist themself
has so changed).
“Accommodation and nonviolent coercion have their basis in power;
these methods depend on power that the parties involved in the
conflict can exert on each other. Conversion, however, has nothing
to do with power; “the touching of the conscience” is the focus
here. For Gandhi, conversion is not only the most effective method
of conducting a struggle but it is also “the morally correct way to
conduct conflict because only through a dialectical process can
truth be arrived at, or at least approached, and such quest for truth
is, according to him, the aim of life.”
2. Application of Satyagraha in various kinds of conflicts: Violence to
human beings and property clouds the real issues of the conflict
while nonviolence results in a dialogue between the stakeholders
on the real issues of the conflict. Therefore, Gandhi warns us to
“Hate the sin and not the sinner.” The satyagrahi undergoes self-
suffering in the belief that the opponent can be converted to see the
truth by touching his/her conscience or that a clearer vision of the
truth will emerge out of the dialectical process for both the parties.
However, the satyagrahi should not only try to convert the opponent
but should also be open to persuasion. The main aim of Satyagraha
thus is to change the attitude of the opponent, which will result in a
change of behaviour.
Gandhi was of the opinion that Satyagraha could be used in domestic
situations as well as in broader fields, but “he who fails in the domestic sphere
and seeks to apply it only in the political and social sphere will not succeed.”
Thus, a satyagrahi had to start by solving small conflicts at the home front
before going out to resolve the larger issues, “For it will be by those small
things that you shall be judged.”
Gandhi wanted to evolve a revolutionary approach to political action and
social change. His originality lay in the formulation of a new technique of non-
violent non-cooperation or Satyagraha for social action. He believed that
Satyagraha is an infallible means for resolving all social, political, and economic
evils. As a technique of social action, Satyagraha may be applied to resolve
the following type of social conflicts:
(i) conflict between one individual and another individual
(ii) conflict between an individual and a group
(iii) conflict between one group and another group or between two
classes
(iv) conflict between a section of the community and the state
(v) conflict between one nation and another nation
Gandhi’s method of Satyagraha is based on three fundamental
assumptions:
(i) Man’s nature is not beyond redemption and it can be perfectible.
(ii) Human nature is one in its essence and responds to love, and
(iii) What is possible to do for one man is equally possible for all.
Types of Satyagraha/Types of conflict resolution on Gandhian Prospect:
Non-cooperation, Civil Disobedience, and Fasting are the some important
forms of Satyagraha.
(a) Non-cooperation: Non cooperation is a very important tool of
Satyagraha. Gandhi called it as Non-violent non-cooperation. The
main fact behind the non-cooperation, the satyagrahi will be ready
to accept the consequences of fight against injustice. Gandhi started
his non-cooperation movement in India in 1920. Non violent
noncooperation is a process in which satyagrahi refuses to take part
in the activities of his opponent’s. This involves boycotting the
opponents economic, political, social and educational institutions.
Noncooperation is distinguished into two types. In the first case,
opponent can achieve his objective without he satyagrahi’s
cooperation. The main intention of this movement is the self
purification of the satyagrahi. In the second case the opponent
cannot obtain his objective without the satyagrahi’s cooperation.
This type of movement in satyagrahi is to prevent the movement of
adversaries. The intention of the all these movements to maintain
non violence and love. The ultimate aim of all these movements is
the conversion of adversaries, not to pain him.
Michael J. Nojeim proposed the following method used in non-
cooperation movement.
• Boycotting government functions, surrender of titles and
resignation of official nominal government posts.
• Refusing the government awards.

• Refusing from the government jobs.
• Conducting general strikes.
(b) Civil Disobedience: The next step of Satyagraha is civil disobedience
movement. When the non-cooperation movement failed, instead of
it, he started civil disobedience movement. It is the violation of
government law and non payment of taxes. When a government
imposed certain immoral laws against the people, people disobey
this law in a non-violent manner. In 1930 during Salt Satyagraha
Mahatma Gandhi started civil disobediences movement. John Rawls
is a peace researcher, expressed his concern in civil disobedience,
“it is a public, non violent, conscious yet political act, contrary to
law or policies of the government.
(c) Fasting: Fasting is the most effective weapon in a satyagrahi used
against injustice or evil force. Fasting is the suffering of self. Gandhi
insisted that, a Satyagrahi should fast only as a last resort when all
other ways have been explored and failed. Self purification is one of
the intentions of fasting. Gandhi conducted seventeen fasts on
different occasions and privately he conducted several fasts in his
Aashram. Gandhi s first public fast was conducted during a
Ahmadabad mill workers strike. He intervened, and he declared
that, he would not touch any food unless the strike is settled. Fasting
is a very serious and obviously life threatening form of resistance.
When a person fasts, he should have some qualities like stamina,
discipline, courage and complete fearlessness from death.
(d) Negotiation: In Gandhian concept of conflict resolution Negotiation
is one of the primary steps. In the process of negotiation, Gandhi
established certain ground rules for managing the conflict. He
sought to establish mutual respect with the opponent because he
knew this would go a long way towards a mutually satisfactory
resolution of the conflict.
(e) Persuasion: Persuasion comes when negotiations fail. In this type
of resolution both parties are willing to welcome opposition for
settlement but that not willing to go. This persuasion can get success
only due to ignorance of wrong thing or removing selfishness.
(f) Conversion: In the Gandhian concept of conflict resolution this
Conversion is the most important technique for conflict resolution.
In this technique both the parties are motivated to convert their
issues so that they both see each other on the same side of at the
same position. Gene Sharp has pointed out that conversion
means that the opponent, as the result of action of the nonviolent
person or group, comes around to a new point of view which
embraces the ends of the non-violent actor.
(g) Self suffering: lf suffering is the one of the important method in
Gandhian Satyagraha. In a Non-violent resistance, Satyagraha is
not a method of punishing or inflicting pain on others, but a
method of converting them by appealing to their better self through
a process involving self suffering70. When a party is failed to
convince the evildoer the reason of the strike or he is unwilling to
listen the argument.
(h) Nonviolent Action: Nonviolent action is the most important
method in the process of conflict resolution. It has a long history,
it was evolved not by Gandhi but it was widely used by Gandhi in
Indian freedom struggle.
Thus the basic aim of the Satyagraha movement is to educate the masses,
make them conscious of their exploitation, prepare them into a broad front,
provide them with a powerful organization and finally lead them in their struggle
against the exploiters. Gandhi’s satyagraha method fulfils all the necessary
requirements for a revolution, no matter, whether that revolution is nonviolent
or violent. Once the masses realize their strength and become conscious of
their exploitation they would certainly revolt against the existing social order.
Gandhi, as a man of practical affairs, visualized this possibility and rightly
predicted that:
I see coming the days of the rule of the poor, whether that rule be through
force of arms or of nonviolence.
Whether Satyagraha is a universal panacea or not, it served some positive
function in a specific historical context in India. On the political front it
contributed as a major share for achieving independence of the country, on
the social front it minimized the evils of untouchability and communal riots,
but it failed to bring results on the economic front.
Gandhi had the firm belief that human beings were basically good and
humanity essentially had a nonviolent nature. The underlying sources of
conflict are distrust and friction and therefore the Gandhian method of conflict
resolution does not focus on the immediate grievances of the conflict; it goes
beyond that to look at the underlying sources of the conflict as well. Satyagraha
essentially is a nonviolent method that touches all three aspects: the attitude,
the behaviour and the goal incompatibility and can be applied to smaller as
well as larger disputes occurring in different areas of human life. To conclude
in the words of Thomas Weber: “Satyagraha, then, from the Gandhian
perspective, is a viable, autonomy-producing method of conflict resolution.
Its stress on the shared humanity of all, including opponents, also makes it
ethically superior to other methods of conflict resolution.” Not only that,
even when Satyagraha fails to resolve conflicts, “the subjective benefits of
dignity that comes from leading a moral life, is always present and this is
missing with other methods.”
Q.5 What are traditional Mediation Practices in India and Abroad?

Ans. Mediation is not something new to India. Centuries before the British
arrived, India had utilized a system called the Panchayat system, whereby
respected village elders assisted in resolving community disputes. Such
traditional mediation continues to be utilized even today in villages. Also, in
pre-British India, mediation was popular among businessmen. Impartial and
respected businessmen called Mahajans were requested by business
association members to resolve disputes using an informal procedure, which
combined mediation and arbitration.
Another form of early dispute resolution, used by one tribe to this day, is
the use of panchas, or wise persons to resolve tribal disputes. Here, disputing
members of a tribe meet with a pancha to present their grievances and to
attempt to work out a settlement. If that is unsuccessful, the dispute is submitted
to a public forum attended by all interested members of the tribe. After
considering the claims, defenses, and interests of the tribe in great detail, the
pancha again attempts to settle the dispute. If settlement is not possible, the
pancha renders a decision that is binding upon the parties. The pancha’s
decision is made in accordance with the tribal law as well as the long-range
interests of the tribe in maintaining harmony and prosperity. All proceedings
are oral; no record is made of the proceedings or the outcome. Despite the lack
of legal authority or sanctions, such mediation processes were regularly used
and commonly accepted by Indian disputants.
Mediation bears a striking resemblance, in some respects, to the ancient
dispute resolution processes. In mediation the parties are encouraged to
participate directly in the process. The expanded framework of discussion in
mediation consists of both the applicable law and the underlying interests of
the parties. The mediator, an expert in the process of dispute resolution,
controls the proceedings, much like a tribal chief serving in the role of
peacemaker. But under the ancient methods if mediation failed, the same person
was authorized to render a binding decision.
After the British adversarial system of litigation was followed in India,
arbitration was accepted as the legalized ADR method and is still the most
often utilized ADR method. Mediation (as is now understood globally and
unlike the ancient methods, which is by definition non-binding, and encourages
the parties to voluntarily reach an agreement that meets all the parties’ needs)
has only in the past few years begun to become familiar to lawyers and judges
generally, except in traditional community settings and except where mediation
has been court-directed or statutorily-prescribed, such as in the intra-
governmental disputes between government agencies and undertakings, in
labor disputes and in public utility services disputes. So when we compare
the US and Indian system, over the last twenty (20) years, American lawyers
and judges have warmly embraced mediation as a primary tool for resolving
conflicts in court and out of court, while Indian lawyers and judges are still
warily examining mediation, discussing whether and in which types of cases
mediation should be used – similar to what was happening in the US in the
1980’s.
Mediation is no panacea, no magic solution to overcome the institutional
challenges of national court systems. Similar to other alternative dispute
resolution techniques, however, it does offer a cluster of features that differ
from the formal judicial systems of Europe that have had global influence over
the primary ways in which legal conflicts are resolved. In this regard, mediation
both builds and diversifies the capacity for resolving conflicts in society.
With many qualifications and exceptions, European-style courts are state
institutions, conducting public, formal proceedings, that presuppose literacy,
posture the parties in a conflictual, legal position-based, backward-looking
fact finding processes that result in binary, win-lose remedies, subsequently
enforced through social control over the losing party. In contrast, mediation
and other clusters of consensual dispute resolution techniques, except for
arbitration are private, informal, oral, more collaborative, facilitative, future-
looking, interest-based processes that bring parties to a calibrated, multi-
dimensional, win-win remedy that is more durable because of the parties
consent in the outcome.
Because of these basic contrasting features, for many non-European
legal cultures, mediation bears a comforting alternative and similarity to
traditional forms of dispute resolution that predate colonial influence. Reformers
have grown increasingly interested in reviving or extending traditional forms
of dispute resolution (such as the methods used by the traditional panchayats
in India) and integrating them into the formal litigation system.
Another dispute resolution process, lok adalat, has received more
favorable attention since its re-introduction in the 1980s. Originally, lok adalat
was an ancient method for dispute resolution used by tribal people. The Legal
Services Authority Act (1987) promoted the resurgence of lok adalat to provide
litigants with the means to resolve their disputes early and affordably. In
essence, lok adalat may be compared to settlement conferences as they are
traditionally conducted in the United States, except that the neutrals in lok
adalat are senior members of the Bar. These lok adalat “judges” preside in
panels over a lengthy calendar of cases that are set on a single day and are
usually heard in open court (in the presence of other parties and attorneys).
Customarily, lok adalat judges are highly evaluative from the outset of each
hearing. Represented parties do not play an active role in presenting or
negotiating their dispute. Instead, attorneys advocate on their behalf.
Importantly, litigants may participate in lok adalat without paying a fee, thereby
making it accessible to parties with limited financial resources. Historically,
lok adalat has been used primarily in personal injury cases and other injury
claims involving insurance companies. Parties have the right to decide whether
to submit their dispute to lok adalat. Because lok adalat has resulted in the
disposition of a measurable number of disputes and is considered to be an
effective and affordable alternative to trial, it will continue to be an important
dispute resolution tool.
The development of mediation in India holds enormous promise. In
particular, the neutralizing communication skills and powerful bargaining
strategies of facilitated negotiation can strengthen the system’s capacity to
bring justice to the society. Despite the demonstrable value of these
techniques, however, several large obstacles block the path to mediation in
India. Exposure to these facilitated negotiation processes, though spreading
rapidly, remains limited.
The Singapore Convention: The Singapore Convention aims to provide
a global framework for the enforcement of mediated settlement in international
commercial disputes arising from mediation. Putting it simply, it aims to do for
international mediation what the New York Convention did for international
arbitration. Upon its ratification and coming into effect, the Singapore
Convention is expected to provide impetus to mediation as a method of
resolving commercial disputes.
The treaty comes into effect six months after the ratification of 3 countries.
Thus far, more than 50 countries, including the United States of America and
China, have signed the Singapore Convention. This demonstrates the
widespread acceptance of the need of the treaty. It is truly the need of the
hour.
Initiatives to Promote ADR Mechanisms: The Government of India has
been proactively taking steps to improve the ease of doing business in India.
Improvement in the ability to resolve disputes is an important step in this. To
this end, several steps have already been taken with many more in the pipeline.
Amongst them the Government is (i) establishing the New Delhi International
Arbitration Centre (NDIAC) as a statutory body; and (ii) evaluating rolling
out a new law to safeguard foreign investment by speeding up dispute
resolution, which process reportedly includes appointment of a mediator as
well as setting up fast-track courts, to settle disputes between investors and
the government. Each of these initiatives are designed with a view to resolve
disputes utilizing alternative dispute resolution mechanisms instead of the
traditional court system, which is overloaded and where delays abound.
Mediation in India: Present Scenario:
While informal mediation in India is prevalent since time immemorial,
Indian law does not, till date, recognize a settlement arrived at in mediation
proceedings. It is for this reason that most parties prefer to have a mediated
settlement recorded as a consent decree or award. This grants it enforceability.
For India, signing of the Singapore Convention is expected to boost the
confidence of investors and also provide a positive signal to foreign investors
about India’s commitment to adhere to international practice on alternative
dispute resolution.
Even though mediation is extremely useful and is an excellent dispute
resolution mechanism, the fact that it is non-binding (and consequently
dependent on the volition of the disputing parties) makes it vulnerable to
misuse. In that sense, the rolling out of a law dealing with mediation is likely to
encourage the adoption of tiered dispute resolution clause, first providing for
mediation and then providing for arbitration. The upside of a dispute quickly
resolved by mediation is too alluring to not consider. One can expect the
Government to roll out a detailed framework within which mediation in India
and mediated settlements will operate
Development of Mediation via Statutes: After the enactment of the
Arbitration & Conciliation Act, 1996, even though conciliation was given
statutory recognition for the first time in India, the awareness of such an
option was very limited to lawyers and litigants. The term “conciliation” even
though considered synonymous and used interchangeably with “mediation”
in most countries, was given a slight difference in the statute. The concept of
mediation and conciliation was made familiar or given official court recognition
only in 1996 and by the amendment of the Civil Procedure Code (CPC) in1999
by inserting Section 89. The statutory language of the Arbitration and
Conciliation Act, 1996 and of Section 89 of the Civil Procedure Code,
demonstrates clearly the existence of differing definitions and meanings for
“conciliation” and “mediation”. Generally both mediation and conciliation is
the assistance of disputants by an impartial third party in resolving disputes
by mutual agreement. However, a conciliator can be a pro-active and
interventionist, because of his statutory power “to make proposals for
settlement of the dispute” and to formulate and reformulate the terms of the
settlement agreement. The definition of “conciliator” in the statute is consistent
with Rules for Conciliation promulgated by the United Nations Commission
on International Trade Law (UNCITRAL).
Development of Mediation via Courts: In 1994-95, the Indian Supreme
Court initiated an Indo-US exchange of information between high-ranking
members of the judiciary. As part of this effort, former Indian Supreme Court
Chief Justice A.M. Ahmadi met with US Supreme Court Justices Ruth Bader
Ginsburg and Antonin Scalia. Another integral member of the US team was
then Chief Judge J. Clifford Wallace, of the 9th US Circuit Court of Appeals.
In 1996, Ahmadi formed a national study team to examine case management
and dispute resolution as part of a joint project with the United States. This
Indo-US study group suggested procedural reforms, including legislative
changes that authorized the use of mediation. New procedural provisions
eventually were enacted in 2002, providing for case management and the
mandatory reference of cases to alternative dispute resolution, including
mediation (Code of Civil Procedure Section 89).
Even though the Arbitration & Conciliation Act, 1996 was enacted to
give impetus to conciliation and giving statutory recognition to conciliated
settlements, giving the same status of a court decree for its execution, no real
effort was taken by the courts or by the lawyers to utilize the provisions and
encourage the litigants to choose the method. Even though some mediation
training and familiarization programs were conducted it did not create the real
effect.
The amendment of the CPC referring pending court matters to ADR was
not welcomed by a group of lawyers and the amendment was challenged. The
modalities to be formulated for effective implementation of Sec. 89 also came
under scrutiny. For this purpose, a Committee headed by former Judge of the
Supreme Court and Chairman of the Law Commission of India, Justice M.
Jagannadha Rao, was constituted to ensure that the amendments become
effective and result in quick dispensation of justice. The Committee filed its
report and it was accepted and the Hon’ble Supreme Court of India has
pronounced a landmark decision “Salem Advocate Bar Association, Tamil
Nadu v. Union of India” (2005), where it held that reference to mediation,
conciliation and arbitration are mandatory for court matters. This judgment of
the Supreme Court of India will be the real turning point for the development
of mediation in India. But the growth of mediation should be carefully moulded
so that the system gains the faith and recognition of the litigants.

Q.1 Why is ADR preferred more than litigation?

Ans. Alternative Dispute Resolution is preferred more than litigation
because:
(a) ADR has gained a rapid popularity over the years. The business
disputes are resolved more by the arbitration process than the
litigation. The reason for acceptance of arbitration over litigation is
due to many reasons.
(b) Arbitration is more cost-effective. The cost of the process involved
in the dispute is much less than the cost involved in the litigation.
(c) The process is more informal as compared to the litigation process.
There are no lengthy procedures as that is present in the court.
(d) ADR process is flexible. The parties can withdraw their case anytime
they want which is not possible in court process.
(e) The dispute is resolved more quickly with the assistance of a third
person, who advises the parties according to their needs and
suitability. This is not same in case of the court process. The judges
do not give judgment according to suitability of the parties.
(f) The resolution of the dispute is made faster. On the other hand,
filing cases in the court take years and years to resolve one case.
(g) In ADR, an approach is made to balance the interest of both the
parties. Whereas, in the litigation, the other party loses the case.
(h) Discussions of the proceedings in ADR are confidential and no
public record is to be maintained. The discussions in the court involve
knowledge of the public. The venue and schedule are according to
the convenience of the parties.
Q.2 What are the nature, scope and limitations of Alternative Dispute
Resolution?
Ans. Indian judiciary is one of the few very old judiciaries throughout the
globe and is a carefully designated one under the Constitution of India. Even
after being efficient enough, the Indian courts are known worldwide for their
slow judicial procedure. More than 43 lakh cases are pending in the high
courts all over the country and it was reported to the Rajya Sabha in 2019 that
over 8 lakh of these cases are over a decade old. This is a big problem and the
major reason for it is the increasing population and with it the ‘unsatisfactory’
proportion of judges to citizens.
Long unsettled cases disturb the mental as well as the financial health of
both the parties. This problem persists long after establishing more than a
thousand fast track Courts but the filing of a case requires a day, but disposal
of cases take months. So, Courts alone efficiently handling pending cases
while disposing of new ones is possible only in a Utopian country.
Hence, dealing with such problems requires external help other than
judicial setups and in such Alternative Dispute Resolution (ADR) can be a
helpful one, it is an umbrella term for various methods that resolve conflict in
a peaceful manner acceptable to both the parties. ADR as a concept can be
substituted to the conventional methods in order to resolve disputes. ADR as
a process can efficiently resolve all type of matters – civil, commercial, family,
companies etc. ADR uses the assistance of a neutral third party who helps
both the parties to communicate as well as discuss the differences in order to
reach a settlement that will take into consideration the arguments of both the
parties. This includes Arbitration, Mediation, Negotiation as well as
Conciliation (the most popular ADR methods).
Nature of ADR: ‘Alternative dispute resolution’ as a word literally means
to solve the dispute by alternative mechanisms. As mentioned above, these
are techniques of dispute settlement outside of the government judicial process
and solve disputes by mutual understanding. ADR is extra supports the
judicial system by easing the burden on the same. It is less expensive and
time-efficient. According to Justice Mustafa Kamal, “it is a non-formal
settlement of legal and judicial dispute as a means of disposing of cases
quickly and inexpensively”
ADR process is:
• Settled with the assistance of a neutral third person
• the third person is familiar with the nature of the dispute
• involved with proceedings that are informal,
• consumed with lesser procedural technicalities
• cost and time-efficient
• efficient because the confidentiality of the subject matter (related to
the dispute) is maintained to a great extent
Scope of ADR: Most criticisms of the Indian legal system are derived
from the fact that it is expensive and time consuming. In recent years, there is
an enormous increase in the number of pending cases in Indian courts. In an
adversarial legal system like ours, legal practitioners are more bothered about
winning the case irrespective of whether or not justice has been delivered.
This leads to an increase in the conflicts that exists among the parties.
With all of these issues centering the failure of Indian legal system to
resolve conflicts in the most efficient manner, there emerged a new concept
which is now famously recognized as Alternate Dispute Resolution (ADR). It
has grown to be an alternate to the adversarial legal system of India and now
being addressed as the ‘consensual legal system’. ADR is a method of
resolution of conflicts between parties which is more cost efficient, speedy,
peaceful and satisfactory in nature.
There is an increase in the number of cases that ADR’s takes up and the
public has opted them for speedy and cost efficient incentives. There have
been recent developments in the arena of ADR such as the Online Dispute
Resolution and Gram Nyaylayas. These alternates would develop the scope
of ADR in India. In the coming years, Mediation would probably grow to be
the most efficient as it promises a win-win situation.
Limitations of Alternative Dispute Resolution: Numerous disadvantages
are blocking the approach of winning dispute resolution and often distressing
both parties attitude to reconcile for a comprised decision some of the
disadvantages are:
(a) Uneven Negotiating Command: In convinced situations, one side is
capable to have power over the other. For that reason, a noteworthy
discrepancy of power exists. E.g.: Employment and annulment cases,
making the courts an improved alternative for a weak party.
(b) Short of Legal Expertise: Where an argument involves complicated
legal points a mediator or arbitrator is doubtful to have the same
legal proficiency and knowledge as a judge. The dispute can be of a
range of situations such as viable conflicts, social conflicts, legal
conflicts, and many others which necessitate dedicated mediators.
Most of the cases, the mediator does not acquire a judge’s
perspective.
(c) No Organization of Specific mock-up: It is not easy to envisage the
conclusion of a dispute determined through ADR as there is no
method of precedent. Therefore, it is easier to get evidence from the
other party in a lawsuit. Short of system fallout in the restricted
prediction of outcomes.
(d) Enforceability: Usually, ADR is not lawfully compulsory making
any award complicated to implement Legal arbitration has some kind
of course of action for internal appeals, which enables the assessment
as an obligatory and only issue to the assessment of Court.
(e) Required Court Action: The arbitrator’s verdict can necessitate a
court action if one of the parties declines to acknowledge the
arbitrator’s conclusion. This would not only generate pandemonium
but also an obligatory review by the court. Thus, ADR occasionally
elevates the question of biasness of the arbitrator’s pronouncement.
Also, there is a very flawed panorama for judicial assessment of an

arbitrator’s decision.
(f) Limits Discovery Process: ADR normally happening without the
fortification obtainable parties in litigation, such as those rules
administrated during innovation. Courts commonly allocate an
enormous arrangement of leeway in the sighting procedure, which
is not vigorous in substitute dispute resolution.
Q.3 What is Principled Negotiations?
Ans. Principle negotiation: Inexperienced negotiators and even many
experienced negotiators tend to assume they have a choice between two main
strategies: negotiate in a tough, demanding manner or in a friendly,
accommodating manner. In fact, there’s a better, third way of negotiating- one
that doesn’t rely on toughness or accommodation, but that will improve your
likelihood of meeting your negotiation goals.
Elements of Principled Negotiation: In Getting to Yes, Fisher, Ury, and
Patton describe the four main elements of principled negotiation. By learning
these elements, you can significantly improve your negotiation skills.
1. Separate the people from the problem: Strong emotions can become
wrapped up with the substantive issues in a negotiation and
complicate it even further. In principled negotiation, negotiators work
to deal with emotions and personality issues separately from the
issues at stake. For example, if two department heads are locked in a
heated battle over resources, they or their leaders would confront
the strong emotions underlying their dispute through active listening
and other communication techniques. The goal is not to “win,” but
to reach a better understanding of each party’s concerns.
2. Focus on interests, not positions: Negotiators often waste time
arguing over who should get their way or, alternatively, trying to
find a compromise point in between the two firm positions they have
staked. In principled negotiation, negotiators look beyond such hard-
and-fast positions to try to identify underlying interests their basic
needs, wants, and motivations.
Imagine that two siblings disagree about where to host their parents’
anniversary party. One wants to have it at a restaurant, while the
other wants to have it in her home. They only make headway when
they identify their deeper interests: the former doesn’t have a lot of
time to devote to preparation, while the other is concerned about the
cost. Armed with this understanding of each other’s interests, they
do some research and decide to host the party at a relatively
inexpensive restaurant. This type of interest-based bargaining can
enable solutions that meet each party’s needs.
3. Invent options for mutual gain: Negotiators often settle for the first
agreement they reach, relieved to have hit upon an outcome that
both sides can live with. In principled negotiation, negotiators devote
significant time to brainstorming a wide range of possible options
before choosing the best one. In negotiation, options refer to any
available choices parties might consider to satisfy their interests,
including conditions, contingencies, and trades. For example,
imagine a job negotiation where the candidate values a higher salary,
while the hiring organization is concerned about being fully staffed.
If so, the job seeker might be willing to make a concession on vacation
days in return for the promise of a higher salary.
4. Insist on using objective criteria: It’s common in negotiation for
parties to argue back and forth about whose “facts” are correct.
This type of argument is likely to end in either impasse or an inefficient
compromise. A better way? In principled negotiation, negotiators
rely on objective criteria—a fair, independent standard—to settle
their differences. For example, they might agree to abide by standards
such as market value, expert opinion, industry protocol, or law.
Importantly, parties should agree in advance about which objective
criteria to consult and agree to abide by the outcome.

Q.1 Describe the evolution of ADR mechanism in India?

Ans. Human beings’ need for survival brought competition for resources,
which are limited in nature, with its fellow beings. And, with competition, came
disputes and conflict, which were resolved firstly and foremost, part of human
existence, by fighting or war. This instinctive phenomenon continues till today.
But for particular disputes, human beings have been able to come up with
other systems for resolving disputes; firstly, distribution of justice by the
king (in case of tribes by the tribal chief); secondly, the most prominent method
used in today’s world, litigation.
Litigation as a process involved to party contending of their rights, in
front of an impartial Judge, through their respective advocates. The Judge
after hearing the contention of both the parties delivers a judgment which
determines the rights and liability of the parties. No doubt, this method is
better than justice delivered by kings/queens (which can be on their whims
and fancies) or war (which leads to damage to both the parties on a massive
scale).
Litigation is a consequence of one of the human beings’ another instinct
i.e. evolution. War and arbitrary judgments evolved into litigation because of
limitations in those systems. Litigation, also, is not devoid of limitations,
hence, human being’s quest for a better way of resolving disputes lead them
to evolve an efficient and effective way of resolving the disputes i.e. the
alternative dispute resolution (hereinafter referred to as “ADR”) system.
ADR is an alternative to litigation; and, involves mediation, arbitration,
conciliation, negotiation, settlement by judiciary and any other process of
resolving dispute which does not involve court; and is governed by certain
rules. The result (or settlement) of the proceedings shall be enforceable in law.
With the passage of time, ADR is becoming a popular method of resolving
disputes between the parties, particularly, in commercial disputes. These
methods allow the parties to make choices with regard to law or rules which
will be applicable to these proceedings. All the methods in most of the
proceedings use a third party as an adjudicator or mediator (as per the method
chosen by the parties) chosen by the parties with their consent. This provides
satisfaction to the parties with regards to the process and adjudicator because
these processes make people feel empowered and in control of the proceedings.
After all, people desire certainty the most in life.
Evolution of Modern Arbitration Law in India: Though arbitration
prevailed in India, in the form of panchayats (which have been now given
recognition in the Constitution of India) before the Britishers came in and
established their authority. In 1923, the League of Nations gathered and agreed
to the Geneva Convention. The Geneva Convention also contained clauses
for arbitration. The first arbitration dedicated provision in the Civil Procedure
Code, 1908 which had Section 89 providing for arbitration but the same was
repealed by Section 49 and Schedule III to the Arbitration Act, 1940. Prior to
enactment of the Arbitration Act, 1940, the Britishers enacted Arbitration
(Protocol and Convention) Act, 1937 wherein the Preamble of the Act stated
that India was signatory as a State to the Protocol on arbitration as established
by League of Nations. The League of Nations intended to bring the world
closer through trade which made it realise the importance of arbitration. As a
result, the Protocol on Arbitration Clauses, 1923 came into existence. There
were several lacunae in the Protocol; hence, a need for amendment was felt.
The League of Nations came up with another Convention for Enforcement of
Foreign Arbitral Awards which was lacking in the 1923 Convention. This
Convention of 1927 is also known as the Geneva Convention of 1927. This
Convention formed the basis for other enactment i.e. the Arbitration (Protocol
and Convention) Act, 1937. Section 3 of the Arbitration (Protocol and
Convention) Act, 1937 refers to the existence of the Arbitration Act, 1899. The
Arbitration Act, 1940 came into picture repealing all the previous laws
governing arbitration. The Arbitration (Protocol and Convention), 1937 failed
to achieve its objective. Then after several years of work, in 1958, the world
came up with a convention i.e the New York Convention, which is still running
its course till date. Then, the Arbitration Act, 1940 was repealed and replaced
by the Arbitration Act, 1960. The New York Convention inspired another
legislation in the Foreign Awards (Recognition and Enforcement) Act, 1961
which was lacking in the Arbitration Act, 1960.
In 1981, in Guru Nanak Foundation v. Rattan Singh [(1981) 4 SCC
634], Desai, J. observed with regards to the 1961 Act that the arbitration
system has become ineffective. The point was that even in cases if the arbitrator
passed an arbitral award, the parties used the provisions of the Act to challenge
the award. This observation presented the 1961 Act as an additional layer
which party may choose or not, prior to the litigation process. The lacunae in
the provisions of the 1961 Act, made it redundant and people ended up
approaching the courts for litigation. Arbitration as a process was meant to be
cost effective and time efficient, but the 1961 Act failed miserably to achieve
this objective. This Act would be further repealed and replaced by the
Arbitration and Conciliation Act, 1996. In 1985, United Nations Commission
on International Trade Law (UNCITRAL) presented a comprehensive model
for arbitration. The present Arbitration and Conciliation Act, 1996 is based on
that UNCITRAL model. The Arbitration and Conciliation Act, 1996 has been
subjected to two more amendments in 2015 and 2019.
Conciliation: In 1987, prior to the enactment of the Arbitration and
Conciliation Act, 1996, the Government enacted another legislation for resolving
disputes i.e. the Legal Services Authorities Act, 1987. The proceedings under
this Act are in the nature of conciliation and the sitting Judge does not perform
any adjudicatory function or there is no determination of rights.
In P.T. Thomas v. Thomas Job [(2005) 6 SCC 478], the Court highlighted
the benefits of the legal Services Authorities Act, 1987 as following:
1. No court fee is charged and if any fee is already deposited, it is
given back on settlement of disputes.
2. It is very elastic as far as procedural law is considered and speedy in
resolution of dispute. There is no application of rigid traditional
procedural laws like the Civil Procedure Code, 1908 and the Evidence
Act, 1872.
3. The Act enables the parties to directly interact with Judges (retired
Judges who are appointed by the authorities concerned).
4. The proceedings cannot be conducted in an adversarial manner
similar to what is done in courts.
5. The most important part of this Act is that if the dispute is settled; it
is equivalent to a decree and enforceability of a court. The settlement
arrived at by the parties is not appealable. No civil appeal can be
made from this settlement.
In Bhargavi Constructions v. Kothakapu Muthyam Reddy [(2018) 13
SCC 480], the Court ruled that the settlement can be challenged on limited
grounds i.e. challenge on the grounds of fraud, through writ jurisdiction under
Article 226 or Article 227 of the Constitution of India.
The idea behind bringing the Legal Services Authorities Act, 1987 was
“legal technicalities” does not get precedence over the resolution proceedings.
The Arbitration and Conciliation Act, 1996 is another legislation which
formally provides for the conciliation process. The conciliation process is
mentioned in Part III of the legislation. The legislation also adopted as its rule
the United Nation Commission on International Trade Law (UNCITRAL)
Conciliation Rules. Section 66 of the Arbitration and Conciliation Act provides
that the proceedings would not be bound by the Civil Procedure Code, 1908
and the Evidence Act, 1872; no doubt this provision (and many other
provisions) is for streamlining the conciliation procedures.
Section 18 of the Micro, Small and Medium Enterprises Development
(MSME) Act, 2006, also provides for mandatory conciliation process by
referencing the dispute with regards to payment due under Section 17 of the
MSME Act. Section 18(2) provides that Sections 65 to 81 of the Arbitration
and Conciliation Act, 1996 should apply to seek conciliation as referred under
Section 18(1) of the Micro, Small and Medium Enterprises Development
(MSME) Act, 2006.
Mediation: In 1996, the Government brought an amendment to Section 89
of the Civil Procedure Code, 1908 which gave scope to the court to formulate
settlements, if it appears to the court that there is a possibility of settlement
between the parties and after receiving the referral from the parties to make
amendments in such settlement and refer the same to arbitration, Lok Adalat,
conciliation or mediation. Mediation in India is governed by the Mediation
Rules of 2003. These proceedings are more informal in nature as compared to
arbitration and conciliation. The role of the mediator is more of a person who
provides guidance and clears any misunderstanding that arises between the
parties. The parties reach settlement on their own. Mediator regulates the
settlement process. At the end of the process, a settlement is arrived between
the parties rather than a decision.
The Law Commission of India suggested establishment of commercial
courts, first, in the form of creating division in the High Court itself or
establishing separate commercial courts. The second suggestion resulted in
the passage of the Commercial Courts Act, 2015. In 2018, the present day
Government, in alignment of its policy of improving the ease of doing business,
came up with an amendment to the Commercial Courts Act, 2015. The President,
in May 2018, promulgated an Ordinance which amended the Commercial Courts
Act, 2015. As per this amendment, the Government introduced pre-litigation
mediation for all the commercial disputes. The provision concerned is Section
12-A(1) which states that in cases where no interim relief is required, the
matter would be referred to compulsory mediation. Section 12-A(2) empowers
the Central Government, through notification, to authorise the authorities
under the Legal Services Authorities Act, 1987 for pre-institution mediation.
Section 89 of the Civil Procedure Code: In 2002, Indian Parliament brought
an amendment to Section 89 of the Civil Procedure Code, 1908. The amendment
brought in a different alternative dispute resolution mechanism in Section 89.
The Bar at Salem was not satisfied by this and other amendments. In Salem
Advocate Bar Assn. v. Union of India [(2003) 1 SCC 49], the constitutionality
of Section 89 was challenged. The Court upheld the constitutionality of Section
89. The Court also observed that the availability of such provisions in foreign
countries have been very successful. The Court constituted a committee under
the chairmanship of Justice M. Jagannadha Rao (Retired) to review the
difficulty in workings of the amendments. The Court also ordered for the
formulation of rules with regards to meditation and ADR. As per the
Committee’s recommendation, the Supreme Court ordered all the High Courts
to formulate their own rules for ADR and mediation. The recommendations of
the Committee were accepted by the Court in another judgment.
Q.2 Distinguish between different modes of Alternative Dispute
Resolution?
Ans. The techniques or modes of ADR, though widely accepted all over
the world, may vary from region to region. This fluctuation depends on the
legal framework of a country. The following are the methods of settlement that
are widely accepted:
• Arbitration
• Mediation
• Conciliation
• Negotiation
Differences between Arbitration and Conciliation:
Basis For Arbitration Conciliation
Comparison
Meaning Arbitration is a dispute Conciliation is a method
settlement process in of resolving dispute,
which a impartial third wherein an independent
party is appointed to person helps the parties
study the dispute and to arrive at negotiated
hear both the party to settlement.
arrive at a decision
binding on both the
parties.
Enforcement An arbitrator has the A conciliator do not have
power to enforce his the power to enforce his
decision. decision.
Prior Required Not Required
Agreement
Available for Existing and future Existing disputes.
disputes.
Legal Yes No
proceeding
The difference between arbitration and conciliation can be drawn clearly
on the following grounds:
1. Arbitration refers to a method of resolving industrial disputes,
wherein the management and the labour present their respective
positions to the neutral third party, who takes a decision and imposes
it. Conciliation is a method of resolving the dispute, wherein an
independent person, who meet the parties jointly and severally and
helps them to arrive at negotiated settlement or resolve their
differences.
2. The decision made by the arbitrator is acceptable to the parties
concerned. On the other hand, the conciliator does not have the
right to enforce his decision.
3. Arbitration requires a prior agreement between parties known as
arbitration agreement, which must be in writing. As against this, the
process of conciliation doesn’t require any prior agreement.
4. Arbitration is available for the current and future disputes whereas
the conciliation can be adopted for existing disputes only.
5. Arbitration is like a courtroom proceeding, wherein witnesses,
evidence, cross examination, transcripts and legal counsel are used.
On the contrary, Conciliation is an informal way of resolving disputes
between the management and labour.
Differences between Mediation and Arbitration:
Basis For Mediation Arbitration
Comparison
Meaning Mediation refers to a Arbitration is a
process of resolving substitute of public trial,
disputes wherein an with no need of going
independent third court, wherein an
party, assist the parties independent third party
involved in arriving at analyses the entire
solution, agreeable to all. situation and makes a
decision binding on the
parties.
Nature Collaborative Adversarial
Process Informal Formal
Role of expert Facilitator Judge
Number of expert One One or more
Private Meeting between the Only evidentiary
communication parties concerned and hearings, no private
the counsel takes place meetings with the
jointly and separately. arbitrator.
Control over Parties Arbitrator
outcome
Basis of outcome Needs, rights and Facts and evidences
interest of parties
Outcome May or may not be Definitely reached.
reached.
Decision The mediator does not The decision of the
pass any judgement, but arbitrator is final and
makes settlement only binding upon the parties.
with the approval of
parties.
Conclusion When the agreement When the decision is
is reached or parties are handed down.
deadlocked.
The difference between mediation and arbitration can be drawn clearly

1. A process of conflict settlement wherein an independent third party,
assist the parties involved in arriving at decision, agreeable to all, is
known as mediation. Arbitration is a private trial, wherein a rational
third party analyse the dispute, hears the parties involved, gathers
facts and pass on decision.
2. Mediation is collaborative, i.e. where two parties work together to
arrive at a decision. Arbitration is adversarial in nature.
3. The process of mediation is a bit informal while Arbitration is a
formal process, which is much like a court room proceeding.
4. In mediation, the third party plays the role of facilitator, so as to
facilitate negotiation. On the contrary, the arbitrator plays the role of
a judge to render a decision.
5. There can only be one mediator, in the mediation. As against this,
multiple arbitrators or panel of arbitrators can be there in arbitration.
6. In mediation, along with the joint meetings, the mediators hears
both the parties in the private meeting. On the flip side, in arbitration,
the arbitrator remains neutral, and no such private communication
takes place. Thus the judgement is based on evidentiary hearings.
7. The parties concerned, have entire control on the mediation process
and the outcome. Unlike, arbitration, where the arbitrators have full
control on the process and the outcome.
8. The outcome in mediation relies on the needs, rights and interest of
the parties, whereas, the decision of arbitration depends on the
facts and evidence presented before the arbitrator.
9. Mediation may or may not result in a solution, but arbitration
definitely finds a solution to the matter.
10. The mediator does not pass any kind of judgement rather makes
settlement only with the approval of parties. As opposed arbitration,
the decision taken by the arbitrator is final and binding upon the
parties.
11. The mediation process is ended when the agreement is reached, or
parties are deadlocked. The arbitration is concluded when the
decision is handed down.
Differences between Arbitration and Negotiation:
Basis For Arbitration Negotiation
Comparison
Meaning Arbitration is a dispute Negotiation is where two
settlement process in parties in contention or
which a impartial third dispute (battle) arrive at
party is appointed to a settlement between
study the dispute and themselves that the two
hear both the party to of them can concur on.
arrive at a decision
binding on both the
parties.
Third Party In arbitration, the Negotiations are reached
arbitrator decides on the through conversations
outcome of the dispute made between the parties
after hearing both sides. or their delegates. A
The resolution is called facilitator allows both
an award, which is final parties talk to each other
and legally binding. about the dispute and
aids in making a
settlement.
Cost Decided by the Arbitrator Negotiator fee is split
or by disputing parties between two parties
Legality of Decision The arbitrator decides on The result of a negation
the outcome of the is called a memorandum
dispute after hearing of agreement. This
both sides. The resolution document is not as
is called an award, which legally binding as an
is final and legally binding. award.
Appointment Appointed by both parties. Facilitator oversees a
negotiation.
The difference between arbitration and negotiation can be drawn clearly
1. Both arbitration and negotiation are two forms of appropriate dispute
resolutions (ADR) and alternative processes to court litigation. Both
are private, speedy, less costly and ensure confidentiality. Other
forms of ADR are conciliation and mediation.
2. Negotiation and arbitration differ in function and the people who
play a part in each process. In arbitration, an arbitrator is appointed
by both parties while a facilitator oversees a negotiation.
3. In arbitration, the arbitrator decides on the outcome of the dispute
after hearing both sides. The resolution is called an award, which is
final and legally binding. Meanwhile, a facilitator allows both parties
talk to each other about the dispute and aids in making a settlement.
The result of a negation is called a memorandum of agreement. This
document is not as legally binding as an award.
4. Both facilitators and arbitrators are usually third parties. The

arbitrators solely and directly decide on the outcome of the dispute
while the facilitators let both parties come into their own agreement.
To sum up, a facilitator is a non-direct party in the process.
5. The costs of arbitration can be decided by the arbitrator or by both
disputing parties, depending on the situation. Meanwhile, the
negotiator’s fee is usually split between the two parties.
6. An award (in arbitration) cannot be appealed to a court. On the other
hand, a court can question or overturn a memorandum of agreement
that transpired as a result of negotiation.
7. Arbitrators are usually lawyers or people associated with the law
while facilitators may not have a law background.
Differences between Mediation and Conciliation:
Basis For Mediation Conciliation
Comparison
Meaning Mediation is a process Conciliation is a alternate
of resolving issues dispute resolution
between parties wherein method in which an
a third party assist them expert is appointed to
in arriving at an settle the dispute by
agreement. persuading parties to
reach agreement.
Regulated by Code of Civil Procedure, Arbitration and
1908 Conciliation Act, 1996
Basic element Confidentiality, that Confidentiality, whose
depends on trust. extent is fixed by law.
Third Party Acts as facilitator. Acts as facilitator,
evaluator and intervener.
Result Agreement between Settlement agreement
parties
Agreement It is enforceable by law. It is executable as decree
of civil court.
The difference between mediation and conciliation can be drawn clearly
1. The process of dispute resolution in which a third party intervenes
in an attempt to resolve it, by enabling communication between
parties is called mediation. On the other hand, conciliation implies a
process of settling the dispute between the parties, in which a neutral
third party provides potential solutions to the parties so as to resolve
the issue.
2. Mediation is governed by Code of Civil Procedure Act, 1908.
Conversely, Arbitration and Conciliation Act, 1996 regulates
conciliation.
3. Both mediation and conciliation are premised on confidentiality.
However, in mediation, confidentiality relies on the trust and in
conciliation; the law determines the extent of confidentiality.
4. In mediation, the role of the third party is a facilitator, who facilitates
interaction between the parties. As against, in conciliation, the role
played by the third party is beyond facilitator, who not only facilitate
communication but also provide solutions to their problem as an
expert.
5. Mediation process completes with an agreement between the parties
concerned, whereas conciliation ends with a settlement agreement
between the parties.
Q.3 What is Theory of Negotiations? What are Approaches for
Negotiations?
Ans. The general area of conflict management is concerned with the way
that interdependent people manage the opposition of goals, aims, and values
through communication. Communication plays an active role in shaping how
people experience and work through conflict, a task that is very challenging
given people’s interdependence where one party can interfere with the other
achieving a goal. Within the last 25 years, a great deal of attention has been
given to the methods we can use to manage conflict including bargaining or
negotiation, mediation, and arbitration.
Bargaining and negotiation have been defined as forms of conflict
management that involve two or more parties, who have a conflict of needs
and desires that choose to negotiate through a give and take process involving
proposals and counterproposals to search for a mutually acceptable agreement.
While some theorists and researchers distinguish between bargaining and
negotiation, saying that the former is a competitive activity between parties
and the latter is a cooperative process, the two terms will be used
interchangeably.
Bargaining and negotiation differ from mediation and arbitration. Both
mediation and arbitration emphasize the importance of an impartial third-party
to help manage the conflict. Mediation utilizes a thirdparty neutral, called a
mediator, who facilitates the two parties to talk and generate a mutually
acceptable agreement, but who has no decision power. Arbitration is similar to
a legal hearing where both parties present information regarding their position
to a third-party neutral, an arbitrator, who then makes a decision regarding the
best way to manage the conflict. Bargaining and negotiation do not rely on
third parties to facilitate the process and make decisions; rather, the process
and agreements are generated by the parties in conflict.Negotiation theory
finds that a cooperative approach is the surest path to understanding the

other party and discovering new sources of value.
Negotiation theory suggests you focus on interests, not positions;
separate inventing from committing; invest heavily in “What if?” questions;
insist on objective criteria; and try to build nearly self-enforcing agreements.
There are three negotiation theory principles that may be especially helpful
in efforts to negotiate solutions to many problems:
(i) Focus on interests. Interest-based bargaining, which involves
exploring the deeper interests underlying negotiators’ stated
positions, can help parties identify potential tradeoffs and
opportunities for joint gains.
(ii) Anticipate and address sources of bias. Under the best of conditions,
we are all prone to predictable biases and other cognitive errors. For
instance, in-group bias can keep us from allocating resources
equitably across groups.
(iii) Reach agreement within and across parties. For every agreement
we reach, a host of other agreements is often needed. Many crisis
and business negotiations often require multilateral bargaining.
At the other end of the spectrum, even though current negotiation theory
advises us to cooperate whenever possible, and reveal information to create
maximum value, you must calculate the risks and rewards of sharing
information with your counterpart.
This is why negotiation theory needs to factor in the current perspectives
of those at the table while also integrating other stakeholders. To achieve
sustainable deals, negotiators must anticipate everyone who would have to
bear any negative consequences of a deal, including their coworkers, children,
and communities.
Approaches of Negotiations:
All negotiations are similar in that they involve people taking initial
positions, offering proposals to help resolve the conflict, making counter-
proposals, offering concessions, and coming to agreement. However,
negotiations can be distinguished according to the strategy and tactics that
are used to conduct the negotiation. There are few general strategies and
clusters of negotiation tactics:
Distributive Bargaining: This type of bargaining emphasizes the
importance of maximizing individual gains and minimizing losses. It adopts a
“fixed” pie approach where resources are viewed as being limited and it
becomes important to claim one’s rightful share of the pie. Distributive
bargaining is competitive with each bargainer taking positions to achieve
victory over the other side. Distributive bargainers tend to use the following
kinds of strategies and tactics:
• Distributive bargainers try to keep the opposing side from gaining
information about their position or “bottom-line” while trying to
collect information about the resistance point of the other party.
• Distributive bargainers misrepresent and withhold information as
well as make exaggerated statements about their positions in order
to mislead people about their true objectives.
• Distributive bargainers may use bluffs, threats, and manipulation to
reduce the options of the other party.
• Distributive bargainers use threats, putdowns, demands, and blame
statements.
• Distributive bargainers develop their position by using more and
more facts to build the case for the validity of their proposals.
Integrative Bargaining: This type of bargaining emphasizes the
importance of maximizing joint gains. Rather than viewing bargaining from a
win-lose perspective, integrative bargaining adopts a win-win orientation where
parties try to create agreements where both can prosper. Integrative bargaining
assumes that both parties share multiple overlapping issues and that the best
way to deal with these multiple issues is to be flexible in one’s position and to
engage in cooperative problem solving. By engaging in cooperative problem
solving the pie becomes expandable, as the focus becomes on developing
creative solutions that expand the pie in ways that ensure both parties can get
what they need. Integrative bargainers tend to use the following kinds of
strategies and tactics:
• Integrative bargainers share their information openly and divulge
their needs and objectives. Information disclosure is viewed as
facilitating the problem-solving process as it allows bargainers to
define problems, identify causes, develop solutions, and evaluate
the merits of proposed solutions.
• Integrative bargainers tend to use soft rather than hard tactics. They
tend to make statements that support the other party and use
exploratory problem-solving messages.
• Integrative bargainers drop particular agenda items, separate issues,
and recombine issues in creative ways as they move through the
negotiation. This opens up the room for developing novel solutions
to the problem.
Positional Bargaining: is an approach that frames negotiation as an
adversarial, zero-sum exercise focused on claiming rather than creating
value. Typically in positional bargaining, one party will stake out a high (or
low) opening position (demand or offer) and the other a correspondingly low
(or high) one. Then a series of (usually reciprocal) concessions are made until
an agreement is reached somewhere in the middle of the opening positions, or
no agreement is reached at all.
Positional bargaining has several downsides:

• Negotiators who bargain over positions are typically reluctant to
back down and become interested in “saving face.”
• Negotiators often try to best their counterpart by opening with an
extreme position and then focus only on how to counteroffer without
budging.
• Positional bargaining often becomes a contest of wills, resulting in
anger and resentment.
• Parties tend to perceive concessions and compromise as signs of
weakness and vulnerability rather than as potential value-creating
moves.
As you can imagine, this win-lose situation is rarely ideal, and is especially
harmful to long-term business relationships. You can expand the pie of value
in a dispute by opening up about your key interests and preferences, which
can help you identify potential tradeoffs. Working to generate creative options
in contract and business negotiations can help you avoid positional bargaining
and achieve more beneficial and sustainable agreements.
Q.4 What is Interest Based Bargaining? What are its components?
Ans. Meaning of “Interest-based Bargaining” (IBB): Before getting to
the heart of the matter, the use of the term interest-based negotiation (IBB)
deserves an explanation that is never offered anywhere in articles or books
dealing with a “cooperative” type of negotiation. Indeed, we generally (or
almost generally) use as synonyms the terms interest-based negotiation,
rational negotiation, integrative negotiation, win-win negotiation, specific
target bargaining, to name only a few.
On a historical basis, integrative bargaining was the first terminology
used to describe a method inducing a cooperative negotiation approach where
the interests of the parties are common or complementary. According to Walton
and McKersi, it becomes relatively simple, using a classic problem-solving
process as proposed by Simon (identification, research for solutions, choosing
the best solution and determination of the implementation) to “integrate” the
interests of the parties. But for integrative negotiation is not a global
negotiation approach but rather a sub-process inherent to the overall process
of negotiation, used when negotiating issues whose interests are common
and convergent (training, health and safety, reorganization of work schedules).
The term is therefore not accurate to describe the whole process given the
negotiated issues and the comments of the authors who state that the
negotiation is not only integrative.
The principled negotiation term specifically refers to the impact of the
cooperative approach discussed in this article. But the term suffers from its
subjective qualifier and implies implicitly that more traditional forms of
negotiation do not appeal to protagonists’ thinking. However, anyone who
has worked in collective bargaining will confirm without hesitation the high
degree of rationality pertaining to the strategy and tactics to be used to
prepare claims, to present arguments and information, and to make the
necessary compromises to get to an agreement. But the situation has changed
and we increasingly use synonyms, which the most commonly used now is
“interest-based bargaining” (IBB). Moreover, we should probably not minimize
the “trends” phenomenon, which tends to favor one designation at some
point and to prefer another thereafter.
It seems that the American Federal Mediation and Conciliation Service
(FMCS) was the first to call IBB, the principled negotiation of Fisher and Ury.
The term IBB has the advantage of being more characteristic of the foundations
of the method when compared to the traditional process, which is then qualified
as negotiation based on positions. In this regard, the use of the term IBB is
objectively limited to clarifying the basis of the negotiation, i.e. how to address
the issues of negotiation, rather than implicitly predicting outcomes as do the
terms “win-win negotiation” or “mutual gain bargaining”. For the same reasons
of objectivity and analytical rigor, we also prefer to use IBB instead of
“cooperative negotiation” or “concerted negotiation”. Indeed, there is even a
certain amount of cooperation and consultation in traditional bargaining. To
that effect, remember that the system of collective negotiation as established
by the Wagner Act in the United States implies both a convergence and a
divergence of interests amongst the parties whose reconciliation passes
through an interaction process involving a conflicting dynamic that can be
regulated through the potential of cooperation between the parties that wish
to renew the terms of their interdependence.
IBB is a negotiation approach in which the parties negotiate based on
their interests and not their positions, as is the case in so-called traditional
bargaining. In this type of negotiation, meeting the respective interests and
maintaining a harmonious relationship between parties are equally important
issues. This approach to negotiation was developed by Roger Fisher and
William Ury in the early 1980s through the Harvard Negotiation Project. It
became an attractive option for unions and employers wishing to establish a
negotiation mechanism while supporting appeasement in their relationship.
Therefore, it should not be seen as a sort of far-fetched recipe that solves, or
even dissolves, the conflict arising from the employment relationship. This
impression that principled negotiation can be a kind of panacea is often the
result of a normative and angelic presentation of this type of bargaining, or of
a poor understanding of the nature of the employer-employee relationship.
For its part, our analysis aims to be objective and is exclusively limited to labor
relations.
This analysis helps to demystify this bargaining method and to understand
its actual scope and effects. In order to do this, we first present a brief analysis
of different processes that include collective bargaining. This allows us to
better position IBB, to understand the theoretical foundations and to

understand the practical applications as well as the implementation difficulties.
IBB is based on relatively simple principles. When used with discretion, taking
into account the reality of the particular dynamics of labor relations, it allows
the parties to reach smarter agreements that take into account, at a higher
degree, their respective interests.
Interest Based Bargaining and its Components: Interest Based
Bargaining is based on four pillars; the first three presented here refer to
debate discussions and the last to parts of the debate.
• Focus on interests and not on positions.
• Imagine a wide range of solutions before making a decision. Explore
solutions providing a mutual benefit.
• Resolve disputes and choose solutions based on objective criteria
to which everyone agrees
• Distinctly address people issues and substantive issues.
Although the four pillars are not questioned, some of the assumptions or
techniques proposed by Fisher and Ury are problematic when applied to labor
relations. The approach presented here therefore includes a few adjustments
to the original method.
• Focus on Interests and Not on Positions: This pillar of IBB is the
cornerstone. If the needs, concerns, fears, desires or patterns are
expressed directly, it is likely that they will be easier to meet than if
their expression is reflected in the form of a position. Even if it comes
necessarily from an interest or problem, it is in fact the solution that
is privileged by one of the parties and not necessarily the most
optimal, the best or the most appropriate. Additionally, the other
party can recognize the relevance of interest but disagree with the
proposed solution. Therefore, the source of many frustrations is
collective bargaining.
The expression of an interest by means of a position stops, or at
least delays direct negotiation to the satisfaction of the legitimate
needs of each party. In this perspective, the basic elements of the
problem that need to be solved are often obscured by the
susceptibility of the negotiators to being embarrassed with regards
to the position initially defended. In addition, negotiating from
positions leads inevitably to negotiation, manipulation of information
and the characteristic bluff of traditional negotiation no guarantee
as to the validity of the deal that arises with regards to the problems
experienced in the workplace.
Opposing positions often hide interests that can be reconciled.
Negotiation based on interests is made using the most open
communication possible whereby each party presents its interests
in relation to one or more specific problems. Thus, during a first
negotiation meeting, each party notifies the other of the problems
that need to be discussed and the interests underlying these
problems. The legitimacy of the interests of one party may not be
challenged by the other party. It becomes the responsibility of both
parties to find solutions that will meet their respective interests.
Note that there exist convergent interests, divergent interests and
different interests. They give negotiators degrees of difficulty
obviously very different in terms of conflict resolution- we will come
back to this later. At the very least, let us remember that the underlying
assumptions at this stage of the process make clear the hierarchy of
need/interest/solution and that on many points it conflicts with the
traditional negotiation process that rather induces a sequence of
solution/interest/need.
• Explore Solutions of Mutual Benefit: These are the interests that
are shared and mutually acceptable to both parties that will mainly
lead to the identification of solutions satisfactory for both sides and
others that will eventually allow the resolution of the problem or
problems. This is the crucial step of negotiation that will lead to an
agreement. Often, the parties involved in IBB move quickly at this
stage. They tend to think that there is only one possible solution, it
being different for each party. Once this solution is identified, it
becomes the privileged position and we fall back into the traditional
negotiation process, each party trying to convince the other that it
is the best solution.
To avoid this skidding, Fisher and Ury propose at this stage to
adopt a problem-solving approach. To do this, it is important to
separate the creator act from the criticism act. At first, for example,
by using the brainstorming technique, parties (together) can make
an inventory of possible solutions. At this phase, the only criterion
is that the proposed solution takes into account the interests of
both parts. Additionally, once set, the solution belongs to the group
and must be separated from the person who proposed it. Furthermore,
it is important that all attendees be actively involved in the process.
Consequently, and contrary to common practice in traditional
bargaining, public speaking should not be limited to the spokesmen
of the parties but rather create multiple and intersecting channels of
communication where all are called to intervene heavily. Regardless
of whether many of these solutions have significant deficiencies,
the objective of this first phase is to identify the largest number of
solutions possible. Thereafter, the most promising solutions are
emphasized, that is to say those that allow the best way to satisfy
the interests of the parties; and in many cases they deepen, they are
transformed, they are combined and then the best are chosen. It is
during this second phase that we become critics; we seek to test the
solutions. In many ways, the success of this stage follows from the
ability of people to participate and fully “play the brainstorm game”.
A third party speaker (leader or trainer) is certainly the most useful
at this time.
• Resolving Disputes and Choosing Solutions Based on Objective
Criteria: The first criterion used to assess the accuracy of the
solutions is the degree of satisfaction of the parties’ interests. Thus,
the solution should satisfy both employer interests and union
interests identified in the first step. It is possible that for some issues
it is difficult to find a solution that fully meets all expressed interests.
This is often the case for issues such as wages, subcontracting or
the number of days off. One should not give up too quickly on this
conflict of interests because it is sometimes possible to reconcile
interests that, at first sight, seem irreconcilable. For example, many
employers and unions in the private sector have come to reconcile
their profitability interests and employee safety by negotiating
innovative provisions around work organization. Thus, at the same
time, we improve profitability, jobs are preserved and we protect the
purchasing power of employees.
In traditional bargaining, when it is not possible to reach an agreement
on preferred solutions, one of the parties will attempt to impose its
solution on another by using its balance of power. In IBB, the parties
attempt to disregard this power relationship and choose instead to
rely on objective criteria mutually recognized, which will be used to
decide. An objective criterion can be, among others, something
existing elsewhere, the opinion of an expert or a reference point of a
neutral nature and perceived as such by the parties. In cases where
the parties fail to find such criteria with respect to a particular issue,
they may refer the matter to a third party who proposes the solution
The concept of objective criteria is presented here as an alternative
to the traditional balance of power. It is also important to choose
solutions suggested in the previous step. Indeed, each of the chosen
solutions should be evaluated and compared with equivalent criteria
established by the parties. We then ask if the solution satisfies the
interests of the parties. Is it a fair solution? How can we assess its
fairness? Does it have side effects? What are the costs versus
benefits? Does it aim at symptoms only or does it attack the real
causes of the problem? Is it sustainable? Is it acceptable to members?
Furthermore, evaluation through objective criteria will also explore,
beforehand, the validity and appropriateness of the chosen solutions,
thus reducing the risk of failure when implemented.
• Distinctly Address People Issues and Substantive: Issues While
other pillar issues aim at fundamental matters, we are interested in
the interpersonal psychodynamic relationships that are essential to
collective bargaining. Bad relationships make it difficult to identify
solutions to problems that are at the center of the negotiation. They
can block all process. We must find ways at the inception of the
process to negotiate them, to disaggregate interpersonal conflicts,
to better communicate and to promote conversation of healthy
relationship.
Collective bargaining is done by people about other people. The people
negotiating have feelings, personal goals, strengths and weaknesses that
mark their relationships with often complex issues. These idiosyncratic
elements, even if they are sometimes very explicit, are interwoven with
background issues. They may come from the history of the relationship
between the parties, simple rumors, miscommunication or a lack of confidence.
As important as it is to start the negotiation on the right foot, it may be
appropriate, even before the first formal meeting, to hold a meeting to discuss
confidence issues or interpersonal relations. It is also appropriate to hold
such a meeting when, under negotiation, one party or both parties feel some
“slippage” in terms of their interpersonal relationships. It should also be
considered, if necessary, to replace some of the people if attitudinal problems
seem unsolvable.
Problems related to interpersonal relationships come principally from
miscommunication. The essential elements of good communication are well
known: clarity of message, encoding that allows an unequivocal reception,
listening that causes a genuine truthful decoding and feedback to confirm
that the message is received. However, during traditional negotiation, these
elements are often dismissed for purely tactical reasons. To begin with, the
position expressed is not necessarily the true objective. We ask for more than
we desire and offer less than what we are willing to concede. The other party
attempts to decode through the expressed position the actual position because
they also know the game. It is likely they will try to avoid giving feedback that
will reveal their actual position on the garbled message they have just received,
and will focus throughout the discussion on the response to be provided.
This intentional jamming, accented by “noise” caused by a lack of confidence
or poor interpersonal relationships, makes the resolution of very complex
problems very difficult. While it is possible to improve communication and
interpersonal skills in traditional negotiation, some obstacles are difficult to
overcome because they are inherent in the approach of negotiation and
discounting tactics that arise.
Q.5 What are the basic Negotiating Concepts? Explain Negotiation
Tactics of Distributive and Integrated Negotiation?
Ans. Basic Negotiating Concepts are:
1. Positions: Positions are “what” the negotiators say they want. They
are really solutions that have been proposed by the negotiators.
Positions are based upon the interests of the parties; interests are
usually not disclosed, at least not in competitive negotiations. In
most negotiations people take and then give up a series of positions.
Behind every position lie many interests.
2. Interests: Interests are “why” the negotiators take the positions
they do. Interests lie behind the positions of the negotiators.
Interests represent the basic needs to be met. Money and price are
not interests in themselves. Money represents purchasing power,
the ability to acquire other needs, status, or power itself.
Understanding interests is the key to understanding “win-win”
negotiating. In many negotiations, the interests are never explicitly
discussed. In fact, interests are usually kept secret. Successful “win-
win” negotiating requires finding a way to disclose interests without
being taken advantage of.
3. Best Alternative to a Negotiated Agreement (BATNA): BATNA
represents the best result that a negotiator can get somewhere else
if an agreement cannot be reached with the other party. In other
words, a BATNA is the alternative that the party will select if they
must walk away from the negotiation. If the negotiation involves
finalizing a deal, the BATNA is to walk away to another party who
can offer you a better deal. If, however, the negotiation involves a
lawsuit, the BATNA is to go to court.
4. Bottom Line: The bottom line or reservation price is the position at
which the negotiator will walk away from the negotiation. Relative to
a purchaser, it is the highest price a purchaser is willing to pay for
goods or services. Relative to a seller, it is the lowest price at which
a seller is willing to sell the goods or services. The bottom line is
also known as the “reservation price.” If the negotiator cannot get
at least their bottom line in the negotiation, they will vote with their
feet and walk away from the deal.
5. Zone of Agreement: The zone of agreement represents the difference
between the bottom lines of the parties. If there is no overlap in the
bottom lines of the parties, no agreement is possible.
Distributive Negotiation: Distributive negotiation is also sometimes called
positional or hard-bargaining negotiation. It tends to approach negotiation
on the model of haggling in a market. In a distributive negotiation, each side
often adopts an extreme position, knowing that it will not be accepted, and
then employs a combination of trickery, bluffing, and brinksmanship in order
to give in as little as possible before reaching a deal. This is a “zero sum”
negotiation where the negotiator claims as much of the ‘pie’ as possible.
Usually there is just one issue for negotiation and more for one party means
less for the other. Although the goals of the parties are in direct conflict, a
negotiator can adopt either a competitive or cooperative negotiation style in
a distributive bargaining situation.
Distributive Negotiation Strategy Identifiers A distributive negotiation
strategy is generally appropriate where:
• Parties do not know each other very well
• Parties are unlikely to work together in the future
• Negotiation is over a limited number of things or issues (e.g., price
only)
Distributive Negotiation Tactics and Techniques:
• Early Anchoring: Anchoring is fixing or establishing the focus of
discussion around a certain point, whether it is a figure, a range, or
an issue, simply by asserting it. Early anchoring involves being the
first party to make an offer that is beyond or at the fair margin of the
range of credible or reasonable offers. This tactic has the effect of
fixing the apparent bargaining range around this point, which is
typically favourable to the person who anchors early.
• Feinting: Misleading the other party as to your true interests or
objectives by stressing goals or interests that are in fact unimportant
to you and then giving them up for concessions from the other side
that are important to you. Such feints help to disguise your true
bottom line and interests.
• Misleading Concession Pattern: It is common to make smaller and
smaller concessions as negotiations converge on a negotiator’s
bottom line. Knowing this, negotiators can mislead the other side by
using a concession pattern that converges at a point above the
actual bottom line. The other side, reading the concession pattern,
may mistakenly conclude the conceder has reached his/her bottom
line and therefore settle in order to save the deal.
• Splitting the Difference: When the parties are stuck at different
positions, one solution is to each compromise half the difference.
For example, with offers at $600 and $1000, the compromise would be
$800. This technique gives the “appearance” of fairness.
• Ultimatum (i.e. Take It or Leave It): This occurs where a party
claims to be submitting their final offer. The other side must take the
offer or the negotiation is over. In reality, nothing prevents any
party from making another offer at a later time.
• Walkaway: This is a classic tactic in bazaars and markets. If you
cannot get the price you want, walk away from the deal and maybe
the other party will follow you. This tactic is a bluff. To work
effectively, you have to be able to truly walk away from the deal and
exercise your BATNA.
• You Will Have To Do Better Than That: If the other side is told “you
will have to do better than that,” often, they will make you a better
offer. Some people claim not to even consider the first offer. They
just ask for a better offer, no matter what the first offer was. They
assume that the person who made the offer made an excessive
demand. This is a particularly useful technique when the other side
anchors first, forcing them to re-anchor negotiations around a point
closer to your own desired result.
Integrative Negotiation: Integrative negotiation is also sometimes called
interest-based or principled negotiation. It is a set of techniques that attempts
to improve the quality and likelihood of “win-win” agreements with parties
working together to increase the amount of resources to maximize mutual
gain. While distributive negotiation assumes there is a fixed amount of value
(i.e., a “fixed pie”) to be divided between the parties, integrative negotiation
often attempts to create value in the course of the negotiation (i.e., “expand
the pie”). Integrative bargaining often requires two or more issues so that
trades can be made. The theory is that parties often have different underlying
interests that can be integrated or reconciled to create joint gains that improve
the situation of both parties. A negotiator can adopt either a competitive or
cooperative negotiation style in an integrative bargaining situation.
Integrative Negotiation Strategy Identifiers: An integrative negotiation
strategy is appropriate where:
• Parties know each other
• Parties are likely to have further interactions in the future
Integrative Negotiation Tactics and Techniques:
• Focus on Interests not Positions: “Positions” are “what” negotiators
say they want; “interests” are “why” they take the positions. The
interests of the opposing party are discovered by asking questions
and putting yourself in the other’s shoes. This creates an opportunity
to devise solutions that address these underlying interests. Although
problem-solving negotiators may be willing to disclose their interests,
be aware that competitive negotiators will try to learn your interests
without revealing their own in order to gain an advantage.
• Expanding the Pie (i.e. Create Value): Sometimes it is possible to
brainstorm and increase the resources to be bargained for. If the
resources can be increased then perhaps both sides can get what
they want, or at least find a sufficiently satisfying alternative. For
instance, a cell phone retailer may not decrease the price but might
be willing to throw in voicemail and call display into a plan package
for the same cost.
• Open Information Exchange: This involves freely and honestly
disclosing information to help the other side understand your
underlying interests, objectives, and priorities. Sometimes something
critical to one side is a minor concession to the other, and vice versa.
• Log Rolling: If two or more issues are in dispute, the negotiators
may be able to do a series of trade-offs. One side gets their top
priority on the first issue and the other side gets their top priority on
the second issue.
• Objective Criteria: Instead of allowing the negotiation to be
determined by a contest of power or to become a battle of wills,
negotiators can select one or more objective criteria which can be
used as standards for a ‘fair’ settlement (e.g., market price).
Negotiation Styles: A negotiator can adopt either a competitive or
cooperative negotiation style in both distributive and integrative bargaining
situations.
1. Competitive Negotiation Style: Competitive negotiators want to
“beat” their opponents. They use high demands, threats, and make
few concessions. They generally try to undermine their opponent’s
confidence and seek the maximum for themselves.
2. Cooperative Negotiation Style: Cooperative negotiators want to shift
the nature of negotiations and “work with” their counterparts to
make it more collaborative. Instead of moving from position to
counter-position to compromise, negotiators try to identify their
interests prior to the development of solutions. They use reasonable
opening offers, show good faith, and initiate the exchange of mutual
concessions. Once interests are identified, the negotiators then
jointly develop a wide-ranging set of alternatives, and then choose
the best alternative. Cooperative negotiators seek a fair and just
settlement.

Q.1 State the Legislative Initiative for Court Annexed Mediation?

Ans. Mediation, Conciliation and Arbitration are historically more ancient
than Anglo Saxon adversarial System of law. Mediation was very popular
amongst businessmen during pre-British rule in India. The Mahajans – the
impartial and respected businessmen used to resolve disputes between
members of the business associations by the end of the day. This informal
procedure, once in vogue in the province of Gujarat, was a combination of
mediation and arbitration, now known in the western world as med-arb. This
type of mediation had no legal sanction in spite of its common acceptance in
the business world.
The concept of mediation got legislative recognition for the first time in
the Industrial Disputes Act, 1947. The conciliators appointed under Section 4
of the Act are “charged with the duty of mediating in and promoting the
settlement of industrial disputes”. A complete machinery for conciliation
proceedings is provided under the Act. The conciliators appointed under the
Act and the services provided by them are part and parcel of the same
administrative machinery provided under the Act.
Arbitration, as a dispute resolution procedure was recognized as early as
in 1879 and found its place in the Codes of Civil Procedure Code1879, 1882
and 1908. When the Arbitration Act was enacted in the year 1940, the provision
for arbitration made in Section 89 of the Code of Civil Procedure, 1908 was
repealed.
The Indian Legislature made headway by enacting The Legal Services
Authorities Act, 1987 by constituting the National Legal Services Authority
as a Central Authority with the Chief Justice of India as its patron in chief. The
Central Authority has been vested with duties to perform, inter alia, the
following functions:
1. To encourage the settlement of disputes by way of negotiations,
arbitration and conciliation.
2. To lay down policies and principles for making legal services available
in the conduct of any case before the court, any authority or tribunal.
3. To frame most effective and economical schemes for the purpose.
4. To utilize funds at its disposal and allocate them to the State and
District Authorities appointed under the Act.
5. To undertake research in the field of legal services.
6. To recommend to the Government grant-in-aid for specific schemes
to voluntary institutions for implementation of legal services
schemes.
7. To develop legal training and educational programmes with the Bar
Councils and establish legal services clinics in Universities, Law
Colleges and other institutions.
8. To act in coordination with governmental and non-governmental
agencies engaged in the work of promoting the cause of legal
services.
Arbitration and Conciliation Act, 1996 has made elaborate provisions for
conciliation of disputes arising out of legal relationship whether contractual
or not and to all proceedings relating thereto. It provides for commencement
of conciliation proceedings, appointment of conciliators and the assistance
of a suitable institution for the purpose of recommending the names of the
conciliator(s) or even appointment of the conciliators by such an institution
and submission of statements to the conciliator. It also provides that conciliator
is not bound by the Code of Civil Procedure or the Evidence Act. It defines the
role of the conciliator in assisting the parties in negotiating the settlement of
their disputes.
Finally the introduction of ADR mechanisms in the Code of Civil Procedure,
1908 is one more radical step taken in recent times by Indian legislature by
enacting Section 89 and Order X Rules 1A, 1B and 1C providing for ADR
machinery even in cases pending before the civil courts and has further
authorized the High Courts to frame rules for the purpose. Thus, now the
Indian legislature has made sufficient provisions in law to facilitate introduction
of court annexed mediation.
The introduction of ADR mechanisms in the Indian justice system has
raised great expectations and hopes in the minds of the litigants for a more
satisfactory, acceptable and early resolution of their disputes. Skeptics out
with their sharp tongued criticism pose a challenge to the visionaries by
raising questions, “Do we have the knowhow, wherewithal and the will to
implement the law reforms systematically and in right earnest?” As stated
above, legislative foresight in introducing ADR procedures and vesting ample
power in the judicial administration to carry out the reforms, are now required
to be supported by a strong will and administrative ability to provide for a
redressing machinery to utilize ADR procedures with advantage.
Q.2 What are the advantages and disadvantages of Mediation?

Ans. Advantages of Mediation: Mediation is a better and more lucrative
alternative to the court system as
• Control: It gives the parties control over the scope of the mediation
in terms of the issues discussed, and its outcome, with regard to the
terms of the settlement and to settle or not.
Control is vested not with a judge or jury, but the parties themselves
and helps them in reaching a mutually agreeable solution. By giving
control to the parties, it may also result in the settling of related and
connected issues and disputes.
It also allows the parties to satisfy their long-term and underlying
interests at each stage. This is immensely beneficial as it allows the
parties creativity in examining alternatives, evaluating options and
reaching a settlement. When the parties themselves agree to the
terms of the settlement, there is compliance with the terms.
• Consent-based: Based on voluntary consent, it allows any party to
opt out at any stage if they find mediation to be unhelpful.
• Participation: It allows the parties to directly participate in the
negotiation and present the case in their own perspective.
• Economical: Mediation takes less time to resolve disputes than
standard legal channels. While courts may take months or years to
pronounce judgments in cases, mediations take mere hours.
According to figures released by the Bangalore Mediation Centre,
while the mediation process can take a maximum of 60 days, the
average time taken to settle a case is a mere two hours.
If a settlement is reached, the parties also save money on their hourly
costs and no further litigation. Court fees are also refunded. Since it
takes less time, it is speedy, economical and efficient.
• Confidentiality: Mediations remain strictly confidential, with the
terms of the mediation being known only to the parties involved and
the mediator. This aids in better and effective communication between
the parties.
• Conducive to dispute resolution: By providing a procedure that is
simple and flexible, mediation can be modified to the demands of
each case and allows the parties to carry on with their day to day
activities. It thus created an informal, cordial and conducive
environment for dispute resolution.
• Mutuality: Since parties to mediation are amenable to mutually
working towards a solution, they are more receptive to the other
party’s side. This aids in restoring the relationship between the
parties and settles the dispute in a mutually beneficial manner.
• Support by mediator: As a neutral, impartial and independent third-
party, mediators ensure that the mediation remains a fair process.
They also guide the parties through the process as neutral facilitators,
encourage creativity in resolution and broaden the range of
solutions.
• Finality: Mediation promotes finality in dispute resolution as there
is no scope for an appeal, a revision or further litigation on the
successful conclusion of mediation.
• Refund of court fees: Court-referred mediation also allows for a refund
of court fees in cases of settlement.
Disadvantages of Mediation:
• Informality: In the informal setting of mediation, there are no formal
rules or procedures that have to be followed. Thus, mediators do
not have access to a lot of tools to get people to testify or produce
evidence to get to the truth of a matter.
• Unfairness: Moreover, the lack of formal rules means that there is
no way to ensure a fair procedure for the parties involved. An
aggressive party might be able to steamroll a timid one despite the
best efforts of the mediator.
• The imbalances of power that exist in a family may thus also lead to
unfairness in the mediation.
• Success not guaranteed: Mediation may also be unsuccessful and
not lead to a settlement between the parties involved. The parties
will then have to resort to the money and time intensive court system
after already wasting a significant amount of them in the mediation.
• Non-binding: The agreement reached in mediation is non-binding.
Parties to a settlement may also attempt to dispute the settlement
agreement in case the agreement is not made binding on them. They
can file another suit in court challenging the legitimacy of the
settlement, creating another dispute on top of the underlying one.
The only solution to this is to agree to make the settlement agreement
binding on both parties before signing it.
Q.3 What is an Arbitral Award?
Ans. Arbitral awards refer to the decision of an arbitral tribunal, whether
in a domestic or international arbitration. Arbitral awards include interim awards.
Domestic awards are governed by Part I whereas foreign awards are governed
by part II of the Arbitration and Conciliation Act of India. A domestic award is
an award passed under the provisions of Section 2 to 43 of the Act.
A domestic award is a result of domestic arbitration, hence it confines
itself to the territory of India, the parties should have a nexus or birth to Indian
origin, basically territory comes into play in order to asses a domestic
arbitration. Award given by an arbitral institution in India or an award even if

given by a foreign state for a dispute where both the parties are of an Indian
origin and the nationality is also governed by the Indian laws shall also come
within the purview of domestic arbitration.
A Foreign award as per section 44 means an arbitral award which relates
to differences relating to the matters considered as commercial under the law
in force in India. Hence it’s safe to say that a ‘Foreign Award’ means an arbitral
award made as a result of foreign arbitration not being a domestic one.
a. Further clarity was given in the case of Serajuddin v. Michael
Golodetz [AIR 1960 Cal.49]. where the Calcutta High court laid
down the necessary conditions for an arbitration to be called ‘foreign
arbitration’ or the essential elements of a foreign arbitration, where
the award could further be called as a foreign arbitral award, the
main points laid out were (must include all)-
Arbitration should have been held in foreign a foreign country.
b. by a foreign arbitrator.
c. Arbitration by applying foreign laws.
d. One of the parties consists of foreign nationals.
Q.4 What ethical practices must a Mediator should follow?
Ans. To understand the ethical standards applicable, one must also
understand the role of a mediator which includes:
• Facilitating voluntary resolution of a dispute between the parties;
• Communicating the view of each party to the other;
• Assisting parties in identifying issues;
• Reducing misunderstandings;
• Clarifying priorities;
• Exploring areas of compromise; and
• Generating options to solve the dispute.
A lot of importance is laid on a mediator treating all parties equally, as
also, the mediator must not impose any term(s) of settlement on parties. Trust
is the foundation in this entire process, which can be built only if a mediator
observes high ethical standards.
Some of these best ethical practices have been discussed in this piece
below:
(a) Confidentiality: Maintaining confidentiality is one of the key
elements. Parties must be assured of confidentiality of the documents,
statements and information revealed during mediation. Ensuring
confidentiality of the proceedings is the solemn duty of a mediator.
To meet this end, he must communicate the confidentiality obligations
to the parties, restrain from making any public statements about the
mediation and disallow requests for recording of the sittings. Indian
courts have recognised confidentiality in mediation and the Supreme
Court has stated that parties and mediator were to inform the court
only about the success or failure of the mediation and submit a copy
of the final agreement, if any, reached.
(b) Integrity and Impartiality: As they say, effective altruism consists
of honest and impartial attempt to work out what’s best for those
affected, and a commitment to do what’s best, whatever that turns
out to be. It goes without saying that a mediator should be objective,
impartial and a person with integrity. It is really hard to define integrity
in a short phrase as it consists of so many actions that form value.
Integrity is about doing the right thing; it is being incorruptible,
honest, and above all, doing all these things when no one is around
to see it. A mediator must disclose all possible conflict of interest,
which may cast a shadow over his impartiality and integrity to
mediate the dispute. One should avoid mediating in case there exists
any direct conflict of interest. This responsibility continues even
after being appointed as a mediator, in the sense that he must not
take any personal or professional engagement with any party that
would impact his impartiality.
He must refrain from privately communicating with either party or
their representatives. While private sessions with parties are not
barred, he must not disclose information communicated to him in
confidence and not bend the truth, even if it may seem in the interest
of settlement. In fact, communication by a mediator with the Court is
also limited to the extent of informing the Court of failure of a party
to attend the proceedings, settlement of dispute, etc., so as to ensure
neutrality of the mediator.
The ability to understand the dispute is corollary to the concept of
integrity and impartiality. Therefore, the mediator must also evaluate
his technical understanding of the subject-matter and his ability to
effectively resolve the dispute.
Biases, pre-existing notions, pre-existing knowledge in relation to
the parties or subject matter of dispute may cloud the ability of a
mediator to mediate the dispute. A mediator should either recuse
himself from proceedings or be removed if there exists any such
instance.
(c) Neutral Intermediary: Neutrality and impartiality are two sides of
the same coin. A mediator must clearly understand that he is not a
judge or an arbitrator who decides “who is right?” and “who is
wrong?”. His role is to assist parties in arriving at a resolution,
which is beneficial and acceptable to all stakeholders. His words,
manner, attitude, body language and process management must
reflect an impartial and even-handed approach. Any recommendation

regarding the settlement or its execution in court should be neutral.
(d) Ensuring informed consent of parties: The mediator must ensure
that parties are fairly informed and have an adequate understanding
of the procedural aspects of the mediation process, such as the role
and methods followed by the mediator and enforceability of the
settlement. For an effective mediation, the mediator ought to make
parties understand that they are required to make a self-determination
about the settlement and reach an agreement voluntarily without
any compulsion. Parties must be apprised of their right to withdraw
from the mediation at any point in time.
(e) Avoid harm to the parties or third parties: The mediator must ensure
that mediation does not ensue any harm to the parties or third parties.
If the relationship of the parties is deteriorating due to the conduct
of parties such as temperament, argument, etc., the mediator must
modify the procedure to be followed. When a settlement is likely to
impact a third party, the mediator must take information about the
third party and encourage parties to consider the interests of such
third parties
Q.5 Write a note on Mediation in India?
Ans. Mediation in India is traced back to the Panchayat system that
existed since the Vedic Ages. It is believed to be the oldest mode of out-of-
court settlements in India. However, the modern-day methods of alternative
dispute resolution in India cannot be directly linked to the Panchayat system
due to the colonization of the Indian subcontinent by the British. During the
colonial period, various legislations were passed by the British rulers to regulate
the locals, especially those that lived near the Presidency towns. Arbitration
was widely promoted as a means of settling disputes. The Civil Procedure
Code of 1859 and various Regulation Acts such as the ones in 1781, 1787 and
1793 laid down the procedure for arbitration in India with the objective of
arriving at a mutually-beneficial result between the parties. There are no reliable
records as to how successful these efforts were.
Later, the Indian Arbitration Act in 1899 based on the English Arbitration
Law of 1889. The Act of 1899 was repealed in the year 1940 and laws relating
to arbitration were redrafted and consolidated as the Arbitration Act, 1940
based on the English Arbitration Act of 1934.
After Independence, the word ‘arbitration’ was incorporated under Entry
13 of the Concurrent List of the Indian Constitution. Subsequently, the
Arbitration and Conciliation Act, 1996 was enacted based on the UNCITRAL
(United Nations Commissions on International Trade Law) Model Law to
keep up with the new challenges that liberalization, privatization and
globalization of the economy presented to the judiciary. The 1996 Act
superseded the Arbitration Act of 1940.
It is clear from the above paragraphs, that the development of alternative
dispute resolution was primarily restricted to Arbitration. Conciliation was
given some significance only in the year 1996. Despite this, however, these
developments indirectly allowed the legal minds of the country to understand
the need for mediation and although slow-paced, provide minimally for its
regulation.
Coming to Family Mediation, The Hindu Marriage Act and the Special
Marriage Act prescribe mediation as the desirable mode of dispute resolution.
This can be seen in sections 23(2) and 23(3) of the Hindu Marriage Act of 1955
which make it mandatory for the court in the first instance to try mediation in
every case where it is possible, in keeping with the nature of the case.
Corresponding provisions can be found in Section 34(3) and 34(4) of the
Special Marriages Act.
Q.6 What are the essential elements of Mediation?
Ans. Key elements of Mediation are:
1. Fast tracking the settlement process: Our court system is and has
been in a state of crisis for some time now. Attorneys are having to
jump through hoops to reach the steps of court and once there,
the allocation of a judge is dependent on availability. Our cluttered
court rolls regularly result in postponements at court as the
number of matters on the court roll significantly exceeds the number
of available judges on any given day.
Internationally, mediation has shown itself to be
a quick and successful method of achieving access to justice outside
of the court room. It is utilized extensively in inter alia the family
and labour law arenas already and the cost saving of averting a trial
situation is huge.
2. Voluntariness: While not always voluntary in its initiation, its
continuation and success is founded on a will by both parties to
curtail costs and genuinely attempt settlement.
Parties can be compelled by a contractual obligation or in recent
times there is even a possibility of court ordered mediation.
An order for mediation was recently handed down in the Gauteng
Division of the High Court with an alternative that the defendant
provides reasons for its refusal to refer. The success of the process
however depends largely on the will of the parties to embrace the
mediation process.
3. Control: The mediator manages the mediation process. The pivotal
element of control derives from the mediator’s decision to engage
the parties jointly or separately and to utilize both joint and side
meetings in order to achieve meaningful and constructive
engagement.
4. Outcome determined by the parties: The mediator has no control

over the outcome of the proceedings. While she controls the process,
the parties determine the issues raised for discussion as well as the
outcome of the mediation.
5. Confidentiality: Privacy is central to mediation. The process enables
parties to communicate confidentially with the mediator in private
meetings. The mediator is not entitled to relay information obtained
during these side meetings without the consent of the party
providing such information. The process is held in private and
conducted in confidence.
6. Neutrality of the mediator: The mediator is required to be impartial,
neutral and independent of the parties. Equal attention is given to
each party and specialist skill is utilized to assist the parties in their
negotiation. It is to be highlighted that the mediator has no decision
making power. Unless she adopts an evaluative mediation style, she
does not express views on the merits of the case nor is it her place to
suggest outcomes.
7. Without prejudice: Mediation is conducted on a without prejudice
basis. It is utilized as a dispute resolution strategy without the parties’
losing their rights to resort to court for relief.
8. Flexibility: While there is a structured process in which a mediation
operates, the parties decide on the subject content of the mediation,
who attends, where and when the mediation shall take place and
also on its outcome. The process is structured yet without the
formalities of a court trial.
9. Costs: Mediation is significantly cheaper than a court trial and can
be curtailed further by the length of the mediation process. The
length of time spent discussing the dispute is hugely curtailed by
the absence of court formalities and procedure.
Q.7 What are different dispute resolution institutions in India?
Ans. In India, arbitration proceedings are of two types: ad-hoc arbitration
and institutional arbitration. The parties have the option to seek recourse to
either of them depending on their choice and convenience.
Ad-hoc arbitration: It refers to an arbitration where the procedure is either
agreed upon by the parties or in the absence of an agreement, the procedure
is laid down by the arbitral tribunal. Thus, it is an arbitration agreed to and
arranged by the parties themselves without seeking the help of any arbitral
institution.
In Ad-hoc arbitration, if the parties are not able to nominate arbitrator/
arbitrators by consent, the appointment of arbitrator is made by the High
Court (in case of domestic arbitration) and by the Supreme Court(in case of
international commercial arbitration). In India, still most of the arbitrations are
Ad-Hoc Arbitrations.
Institutional arbitration: In an institutional arbitration, the arbitration
agreement may stipulate that in case of dispute or differences arising between
the parties, they will be referred to a particular institution such as:
• Indian Council of Arbitration(ICA)
• International Chamber of Commerce(ICC)
• Federation of Indian Chamber of Commerce & Industry(FICCI)
• World Intellectual Property Organisation(WIPO)
• The International Centre for Alternative Dispute Resolution(ICADR)
• London Court of International Arbitration(LCIA)
All these institutions have framed their own rules of arbitration which
would be applicable to arbitral proceedings conducted by these institutions.
Such rules supplement provisions of the Arbitration Act in matters of procedure
and other details as the Act permits. They may provide for domestic arbitration
or for international commercial arbitration or both and the disputes dealt with
by them may be general or specific in nature.
The Indian Council of Arbitration, being the apex body in arbitration
matters in the country, has handled the largest number of international cases
in India.
The Arbitral Institutions have fixed arbitrator’s fees, administrative
expenses, qualified arbitration panel, rules governing the arbitration
proceedings etc., which help in the smooth and orderly conduct of arbitration
proceedings. Some of the prominent institutions which conduct institutional
arbitration in India are:
• Delhi International Arbitration Centre (DIAC) – New Delhi
• Indian Council of Arbitration (ICA) – New Delhi
• Construction Industry Arbitration Council (CIAC)- New Delhi
• LCIA India – New Delhi
• International Centre for Alternative Dispute Resolution (ICDAR) –
New Delhi
• ICC Council of Arbitration – Kolkata

Q.1 What is Theory of Mediation? Also Explain the Models/Approaches

of Mediation?
Ans. Theories of Mediation:
According to Ury, Brett, & Goldberg, there are three methods that can be
used in conflict resolution. These three methods are applicable to mediation.
These three methods give rise to three different theories of conflict resolution.
The first and third theory is applicable to facilitative and transformative models
of mediation, while the second is applicable to evaluative and expert-advisory
mediation. They are:
The Theory of Power-oriented Conflict Resolution: A party using power
to resolve a dispute seeks to prevail over the other party by using force:
physical, economic, or psychological. An example of physical force would be
a civil rights group blocking access to a restaurant believed to be discriminating
in hiring; economic force would be the civil rights group organizing a consumer
boycott of the restaurant; psychological force would be a member of the civil
rights group refusing to talk to one of his friends until he stopped patronizing
the restaurant. Threats to take harmful action if one’s demands are not met are
another use of power. Determining which party is more powerful without
engaging in a potentially destructive power contest is difficult. This is because
power is largely a matter of perception and each party’s perception of its own
and the other party’s power may differ. Additionally, once a power struggle
has begun, it can easily spiral out of control as each party invests more and
more resources for fear of losing a decisive battle. The restaurant believed by
the civil rights group to be discriminating may, for example, engage high-
priced lawyers to seek millions of dollars in a defamation action designed to
bankrupt the civil rights group. The latter, in turn, may seek to persuade
suppliers not to do business with the restaurant. In the end, a power contest
results in costs for both parties, even if one capitulates.
The Theory of Rights-oriented Conflict Resolution: Another way to
resolve disputes is to rely on an independent standard with perceived
legitimacy or fairness, such as the law or a contract between the parties, to
determine which party is “right.” A problem with this approach is that rights
are rarely clear. One party relies on a law that supports its position; the other
party relies on a different law or a different interpretation of the first law. To
resolve the question of whose rights, standard or interpretation should prevail,
the parties often need to turn to a third party, an arbitrator or judge, to make a
binding decision. Involving a third party decision-maker is frequently a costly
and time-consuming procedure. Furthermore, the loser may only grudgingly
comply with the third-party’s decision, leading to further disputes. Finally, a
conclusion that one party is right and the other wrong may end their existing
relationship and the prospect of any future relationship. Think of the number
of divorced couples, who, after a bitter court fight over child custody, are
soon back in court because they cannot cooperate on some new child-related
issue.
The Theory of Interest-oriented Mediation: Interests are peoples’ needs,
desires, concerns, or fears, the things they care about or want. Interests
underlie people’s positions, the tangible items they say they want when they
make or reject claims. Reconciling interests is not easy. It involves probing for
deep-seated concerns, determining which interests are more important than
others, devising creative solutions that reconcile interests, and making trade-
offs and concessions. But, interest-based agreements are possible in many
disputes. Recall the quarrel between husband and wife about whether to
spend money on a new car. Suppose that his underlying interest was to impress
his friends and hers was reliable transportation. An interest-based solution
might be to buy a high end, but less expensive, used car with a long-term
warranty, so satisfying the wife’s interest in reliable transportation and the
husband’s interest in impressing his friends. In the land-use permit dispute,
both the government agency and the user groups may have an interest in
conserving the park for future use. As a result, the agency may agree to issue
a use permit if the users agree to leave the campsite in a pristine condition and
solicit volunteers for the annual park clean-up day.
Models/Approaches of Mediation:
There are four main Models/Approaches of mediation. They are:
1. Facilitative Mediation;
2. Evaluative Mediation;
3. Transformative Mediation and;
4. Expert-advisory Mediation.
They are differentiated on the grounds of objectives, procedures and
value assumptions.
1. Facilitative Mediation: In the facilitative style of mediation, the
mediator is in charge of the process, but the parties are in charge of
the result. This mediation model may be adopted where the parties,
on their own accord, cannot reach a conclusion as to what procedure
must be followed in conducting the mediation proceedings. This
type of mediation generally consists of joint sessions where all the
parties are present and importance is given to the interests of the
parties.
In facilitative mediation, caucuses are held on a regular basis. They
want the parties to have the major control on decisions made, rather
than the parties attorneys. This is the first and most common form of
mediation. The goal of this type of mediation is a win-win settlement

where the mediator helps all the parties achieve a mutually beneficial
result.
2. Evaluative Mediation: An evaluative mediator guides the parties in
reaching resolution by highlighting the weaknesses of their cases,
and predicting what a judge or jury would be likely to do. Evaluative
mediators are more concerned with the substantive legal rights of
the parties rather than focusing on positions and interests and
evaluate based on legal perceptions of fairness. The mediators meet
quite often in separate meetings with the parties and their attorneys,
practising shuttle diplomacy. The evaluative mediator is totally
responsible for organizing the process of the mediation, and also
directly influences the outcome of the mediation.
Evaluative mediation is oftentimes court-mandated or court-referred
mediation. Attorneys normally work with the court to decide the
mediator and are active participants in the mediation. The role played
by the parties are most often much less active here when compared
to facilitative mediation.
3. Transformative Mediation: This type of mediation came after
facilitative and evaluative types of mediation. It was propagated by
Professors Baruch Bush and Joseph Folger in 1994. According to
Leonard Riskin “in some ways, the values of transformative
mediation reflect those of early facilitative mediation, in its interest
in empowering parties and transformation.” In a transformative style
of mediation, the parties are responsible for the formulation of both
the process and outcome of mediation, and the mediator has to
follow the lead.
Both facilitative and transformative types of mediation are focused
on empowering the parties and their interests. This can promote
greater ownership of the agreed settlement by the parties, making
them more willing to abide by it. However, the said types can take
much longer to settle when compared with evaluative mediation.
They can also end without a settlement reached. Another issue that
plagues facilitative and transformative mediation is a power
imbalance. The party/parties with greater bargaining power (Access
to Legal and Technical Experts, Greater Spending Capability) can
dominate those with lesser bargaining power since the mediator
takes a backseat and it is up to the parties to play an active role in
negotiating a settlement. When the mediator is involved to a great
extent, the process has more credibility. Evaluative mediation too,
however, has its disadvantages. The positions of the parties will be
fixed as it is based on the party’s rights rather than interests. This
might lead to polarization. The parties in evaluative mediation may
be more reluctant to collaborate with each other to find a solution
and a win-win situation may become harder to achieve when
compared to facilitative and transformative styles of mediation.
4. Expert-Advisory Mediation: This type involves a high intensity of
mediators intervention in the problem. Expert Advisory mediators
are typically senior lawyers or other professionals chosen on the
basis of their expertise in the subject-matter of a dispute and their
pre-eminence, rather than their mediation practice skills. Parties are
generally accompanied by legal representatives. A positional
bargaining approach similar to that in evaluative mediation is adopted
rather than an interest-based one. That is, the parties hold a fixed
position regardless of underlying interests. The advantage is that
the parties focus on the issues common to all of them rather than the
interests specific to each of them.
Expert advisory mediation may be useful where there is a power
imbalance between parties. The party/parties with greater bargaining
power will not be allowed to dominate those with lesser bargaining
power because the mediation process and its results will be
respectively controlled and directly influenced by an expert mediator
who is concerned with the rights of the parties and not their
bargaining ability or interests. This type of mediation can be court-
mandated quite often.
5. Court-Annexed Mediation: Court-annexed mediation refers to court-
referred or court-mandated mediation proceedings under section 89
of the Civil Procedure Code where the referral judge oversees the
mediation proceedings conducted by the mediator. It is governed
by the Mediation Rules of 2015. It is one of the types of court-
annexed alternative dispute resolution mechanisms. The 129th Law
Commission of India report notes that:
When a court refers a case to a court-annexed mediation service,
keeping the overall supervision of the process, no one would feel
that the system parts with the case. This also gives a larger public
acceptance for the process, as the same time-tested court system,
which has acquired public confidence because of integrity and
impartiality retains its control and provides additional service.
Q.2 What is Private and Court ordered Mediation? Describe the
functions of a Mediator? Also state the statutory provisions dealing with
Court Ordered Mediation?
Ans. Mediation is a process of negotiation where a neutral and unbiased
third party assists the disputing parties in peacefully resolving their disputes.
Mediation is known to be a party-centered process. It means that the whole
process revolves around the concerned parties. They get the right to decide
the outcome of the whole process.
Mediation has found quite a bit of popularity in India, especially in the
cases of marital disputes. Nowadays the courts themselves ask the disputing
parties to try resolving the concerned matter through mediation so that they
can reach a more amicable solution. It has been found many times that couples
go to court to file for a divorce on grounds which are not maintainable under
law. The court has only to consider the facts that have been given to them,
and if the law supports the facts at that time, then the divorce can be granted.
More often than not, these type of situations can be easily resolved without
necessarily breaking off the sacred bonds of marriage. Sometimes the parties
only need an experienced person who can hear their problems out. This is
why Courts suggest these troubled married couples to go into mediation and
try to resolve the matter before getting a divorce.
Mediation is not only limited to matrimonial disputes. Even in the case of
a property dispute, mediation tries to resolve the matter in a manner, which
appeases to both the parties. Clearly, there are many advantages of pursuing
mediation rather than litigation. Regarding cost effectiveness, time
consumption and flexibility, mediation has the upper hand. In mediation, the
parties can even waive off their legal entitlements if it ultimately leads to an
amicable settlement.
It must be kept in mind that mediation does not and is not meant to solve
problems or disputes which on the face of it are illegal in nature. In such a case
mediation will be more beneficial to the law breakers, who intentionally break
laws for their benefit and seek mediation as an alternative to solve their
problems, which do not enjoy any form of solemnity in law or on facts.
Mediation thus attempts to resolve legitimate matters in a very peaceful
manner. In the whole process of mediation, a mediator has a very important
role to play as well.
Private Mediation: In private mediation, both parties agree to participate
and the parties must agree on the mediator. There are several mediators out
there with different experiences and areas of focus in their practice. Picking
the right mediator is a key decision and can affect whether the mediation is
actually successful. When using a private mediator you are able to schedule
the mediation when it is convenient for both parties’ schedules, but there is a
cost of the mediator’s time. When using private mediation it is recommended
that each party pay half of the cost of the mediation to ensure that both
parties are financially invested in the process and want to work toward
resolution.
Court Ordered Mediation: The Court may order this type of mediation
when the parties are appearing without attorneys or cannot afford private
mediation. It is commonly referred to as an Alternative Dispute Resolution/
Settlement Conference (“ADR”). Similar to private mediation, ADR is still with
a neutral third party mediator (in Maricopa County it is usually a lawyer
volunteering his/her time) and the goal is still that both parties will come to an
agreement. However, with ADR you will be given a date and time to go and the
mediator is not someone that you choose but rather someone that is randomly
drawn from the Court’s own list. The benefit of ADR, compared to private
mediation, is that it is free of charge to the parties.
Mediator and his/her functions: The mediator is a neutral and unbiased
third party who assists the feuding parties in their quest for a settlement. Even
though the last decision has to be taken by the disputing parties, it is the
mediator who first initiates a meeting, discusses the problem and then assists
the conflicting parties in finding possible solutions.
The main points that are kept in mind by a mediator are impartiality and
neutrality. He has to be completely unbiased all the time while he is resolving
a case. He doesn’t have to take any party’s side. His most important task is to
act as a catalyst between the conflicting parties. He must take necessary
steps to organize the talks between the disputing parties and act as a guiding
force while assisting them to reach a solution. He is not allowed to give his
personal opinions on the case. But he can assess the case; give the disputing
parties a fair idea of what the consequences might be if the said case is taken
to court. He can give the parties a few ideas or possible solutions that could
help in resolving the dispute.
In the case of litigation, there are a large number of scenarios where the
disputing parties choose to withhold some information, which if revealed, can
change the judgment in a very drastic manner. But in the case of mediation,
this can be avoided as the parties get a chance to sit in isolation with the
mediator and discuss their end of the concerned problem. Here, it is the
mediator’s job is to draw out the disputing parties from their defensive shell
and make them reveal the truth. While doing so, it is the mediator’s job to keep
the party reassured that the secrets revealed in his presence shall be kept
completely off the records.
A mediator hence facilitates communication between the disputing parties
and encourages interaction between them so as to arrive at an amicable
settlement. He also assists the concerned parties in evaluating the situation
and finding out the possible outcomes. Thus, we can see that the process of
mediation is a party-centered process; the mediator is a very important block
in the structure that is mediation.
Statutory Provisions dealing with Court Referred Mediation: Section
89[2] of the Code of Civil Procedure, 1908, laid down the foundation for the
Court-Referred Mediation process in India. As per Section 89[3], where it
appears to the court that there exist elements of settlement, the court shall
refer the matter for Arbitration; Conciliation; Judicial Settlement including
settlement through Lok Adalat or Mediation. The stage at which the court
should explore whether the matter should be referred to ADR processes is
after the pleadings are complete and before framing of issues, when the matter
is taken up for preliminary hearing for examination of parties under Order 10 of
the Code. However, if for any reason, the court had missed the opportunity to
consider and refer the matter to section 89 before framing of issues, and then
nothing stops the court from resorting to section 89 even after framing of
issues”.
In family disputes or matrimonial cases, the relationship becomes “hostile
on account of the various allegations in the petition against the spouse,
siblings. So, is the case in commercial disputes involving business partners or
co-workers. The hostility further gets aggravated by the counter-allegations
made by the respondent/defendant in their written statement. Therefore,
wherever relationship is involved, ideal stage for mediation is immediately
after service on the opponent more particularly before filing of response to
the petition.
Further, Section 442 of the Companies Act, 2013, which is to be read with
Companies (Mediation and Conciliation) Rules, 2016, provides the Central
Government to maintain a panel called the Mediation Panel consisting of
experts fulfilling such requirements or qualifications as are prescribed for the
process of mediation. Under Section 442, parties may voluntarily apply to the
National Company Law Tribunal or the Appellate Tribunal to refer their matter
to the mediation panel or the said authorities themselves may refer the matter
pending before them to the mediation panel. Companies Mediation and
Conciliation Rules 2016 provide for the appointment of the mediators,
conciliators,
For maintenance of a panel and for procedure for disposal of such matters,
The Insolvency and Bankruptcy Code 2016, provides for the dynamic role of
the “Insolvency professional” for the resolution of disputes relating to the
companies undergoing insolvency and bankruptcy proceedings. Under the
Real Estate (Regulation and Development) Act, 2016, popularly referred to as
RERA, the function of the Authority (Real Estate Regulatory Authority) is to
facilitate amicable conciliation of disputes between promoters and allottees.
The Commercial Courts Act, 2015, as amended by the Commercial Courts,
Commercial Division and Commercial Appellate Division of High Courts
(Amendment) Act 2018, provides for mandatory pre-institution mediation in
matters relating to commercial disputes where no urgent interim relief has
been prayed. The Act provides for extension of limitation period by five months
and also declares the settlement agreement to be an Award under the Act
itself. The Consumer Protection Act 2019, also provides for court annexed
mediation centers at the Central, State and District Levels.
Q.3 What are different types of Mediation? What cases are suited for
Alternative Dispute Resolution? Explain the process of Mediation?
Ans. Mediation is an alternative method of resolving disputes without
resorting to the courts. It is a structured, voluntary and interactive negotiation
process where a neutral third-party uses specialized communication and
negotiation techniques to help the parties in fulfilling their stated objectives.
As a party-centered process, it focuses on the interests, needs and rights of
the parties.
Types of Mediation: Mediation is of many kinds:
1. Statutory/Mandatory: There are some kinds of disputes that are
required by law to be subjected to the mediation process, such as
disputes in labour and family law. In India, Rule 5(f)(iii) of the Civil
Procedure- Mediation Rules, 2003 provide for mandatory mediation,
though recourse to it is rare.
2. Court Ordered: Some sort of alternative dispute resolution is
required by most jurisdictions in India before resolution through the
judicial process. As soon as a case is filed, the parties are provided
with a number of ADR options out of which they must select and
pursue one unless exempted by the court.
a. Court-Annexed: Under Court-Annexed Mediation, the
mediation services are provided by the court as part of the
judicial system.
The Court maintains a list of skilled and experienced mediators
who are available to the parties. The Court appoints a mediator
and sets a date by when the mediation must be completed. The
results of the mediation are confidential, and any agreement
reached is enforceable as a judgement of the court.
Since the case is referred to a court-annexed mediation service,
the overall supervision is kept on the process and there is no
feeling of abandonment by the system. The litigants, lawyers
and judges become participants in the system and it is felt that
the settlement is achieved by all the actors in the justice delivery
system.
The same lawyers who appeared in the case represent their
clients before a mediator and the litigants are also allowed to
participate. The popular acceptance for mediation also improves
as it is the integral and impartial court-system which is seen as
extending an additional service. The dispensation of justice
thus becomes well-coordinated.
b. Court-Referred: Under Court-Referred Mediation, the court
merely refers the matter to a mediator.
3. Private: In private mediation, mediation services are offered on a

private, monetary basis by qualified mediators to the Court, general
public, and the commercial and governmental sectors for dispute
resolution through mediation. Recourse may also be taken to private
mediation in pending cases or pre-litigation disputes.
• Contractual: Parties to a contract may include a mediation clause
to resolve disputes as part of the terms of their agreement as it
can effectively resolve contractual disputes before they turn
into a protracted legal battle. The conditions of the mediation
and the selection of the mediator are mentioned in the contract.
The results of the mediation may be enforced as judgments of
a court.
Voluntary Parties to a dispute may also decide to seek mediation off
their own accord, without being compelled by the law, the court or a contract.
This can be done at any time and is controlled by the parties.
Cases Suited for ADR: In Afcons Infrastructure Ltd. and Anr. V. Cherian
Varkey Construction Co. Pvt. Ltd. and Ors.[2010 (8) SCC 24], the Supreme
Court laid down guidelines pertaining to the kind of cases that would be
eligible for ADR and those not. It ruled that the following nature of cases
would be considered unsuitable for ADR:
1. Representative suits under Order 1 Rule 8 CPC which involve public
interest or interest of numerous persons who are not parties before
the court.
2. Disputes relating to election to public offices.
3. Cases involving grant of authority by the court after enquiry, as for
example, suits for grant of probate or letters of administration.
4. Cases involving serious and specific allegations of fraud, fabrication
of documents, forgery, impersonation, coercion etc.
5. Cases requiring protection of courts, as for example, claims against
minors, deities and mentally challenged and suits for declaration of
title against government.
6. Cases involving prosecution for criminal offences.
All other civil suits and cases were to be considered suitable for ADR,
such as:
1. All cases relating to trade, commerce and contracts, including:
• Disputes arising out of contracts (including all money claims);
• Disputes relating to specific performance;
• Disputes between suppliers and customers;
• Disputes between bankers and customers;
• Disputes between developers/builders and customers;
• Disputes between landlords and tenants/licensor and licensees;
• Disputes between insurer and insured;
2. All cases arising from strained or soured relationships, including:
• Disputes relating to matrimonial causes, maintenance, custody
of children;
• Disputes relating to partition/division among family members/
co-parceners/co-owners;
• Disputes relating to partnership among partners.
3. All cases where there is a need for continuation of the pre-existing
relationship in spite of the disputes, including:
• Disputes between neighbours (relating to encroachments,
nuisance etc.);
• Disputes between employers and employees;
• Disputes among members of societies/associations/Apartment
owners Associations;
4. All cases relating to tortious liability including claims for
compensation in motor accidents/other accidents;
5. All consumer disputes including disputes where a trader/supplier/
manufacturer/service provider is keen to maintain his business/
professional reputation and credibility or ‘product popularity.
Process of Mediation: Whenever any case is to be sent to mediation, the
following steps are followed:
Step 1: Convening the Mediation Process
The convening of the mediation is often the most difficult and challenging
part of the mediation process. It involves a varied range of procedures
Reference to ADR by the Court: The court is required to direct the parties
to opt for any of the five modes of alternative dispute resolution and to refer
the case for Arbitration, Conciliation, Judicial Settlement, Lok Adalat or
mediation under Section 89 and Order X Rule 1A of Code of Civil Procedure,
1908.
The Court must consider the option exercised by the parties and the
suitability of the particular case for the option chosen. The judge making the
reference, known as the referral judge, is required to acquaint himself with the
facts and the nature of the dispute, and objectively assess the suitability of
ADR.
This appropriate stage for making the reference in civil cases is after the
completion of pleadings and before framing the issues, while in cases
pertaining to family law, the appropriate time for making the reference would
be immediately after service of notice on the respondent and before the filing
of objections/written statements by the respondent.
Even if the court did not refer the cases to ADR at these times, nothing
prevents it from referring to it at a later stage.
Preparation for Mediation: The referral judge then has the crucial job of
bringing the parties together and motivating them to resolve their disputes
through mediation. This involves finding the reasons for any disinclination
on behalf of the parties to enter into mediation, along with explaining the
concept, process and advantages of mediation.
While the consent of parties is required for mediation, the court can also
apply external pressure to induce the parties to enter the mediation, to the
extent of ordering or forcing them to do so.
Referral Order: A referral order issued by the referral judge initiates the
process of mediation and s the foundation of a court-referred mediation. An
ideal referral order contains details like name of the referral judge, case number,
name of the parties, date and year of institution of the case, stage of trial,
nature of the dispute, the statutory provision under which the reference is
made, next date of hearing before the referral court, whether the parties have
consented for mediation, name of the institution/mediator to whom the case
is referred for mediation, the date and time for the parties to report before the
institution/ mediator, the time limit for completing the mediation, quantum of
fee/remuneration if payable and contact address and telephone numbers of
the parties and their advocates.
Step 2: Initiation of the Mediation Process
The mediator has to ensure that the parties and their counsels are present
at the commencement of the mediation process.
Introduction
• The mediator gives an introduction with his qualifications,
establishes his neutrality and reposes faith in the mediation process.
• The mediator requests the parties to introduce themselves, attempts
to develop a rapport with them and gain their confidence and trust.
• The motive is to create a constructive environment conducive to
negotiations and motivate the parties for an amicable resolution of
disputes.
• The mediator establishes control over the mediation process.
• There is no standard set of rules that have to be followed, making
the mediation procedure flexible.
Opening Statements
• The mediator’s opening statement is intended to explain to the parties:
(i) the concepts, processes and stages of mediation,
(ii) the role of the mediator, advocates and parties and
(iii) the advantages and ground rules of mediation.
• The mediator confirms that the parties have understood the process
and gives them the opportunity to get any doubts clarified.
• Statements are also sought from the negotiators. The parties articulate
their positions, enabling the other party to understand what they
want.
• This is followed by a restatement of the problem by the mediator
where an attempt is made to incorporate the differing perspectives.
Step 3: Setting the Agenda
• Setting the agenda is an important duty imparted on the mediator in
order to shed clarity on the mediation proceedings and remove
vagueness.
• It involves setting down the order in which negotiation is to proceed
and gives the parties a standard using which they can individually
evaluate the progress of the negotiations.
• The mediator may mention the time and venues for the negotiation
sessions, along with the issues before the parties, to be discussed
sequentially.
Step 4: Facilitation of Negotiation and Generation of Options
• Joint Session
(i) The purpose of the joint session is to gather information.
(ii) The mediator provides an opportunity for the parties to hear
and understand each other’s perspectives, relationships and
feelings.
(iii) The petitioner is allowed to explain their case in their own words,
followed by the presentation of the case by their counsel and
the statement of the legal issues. Similarly, the defendant is
allowed to explain their case, followed by the presentation of
the case and statement of the legal issues involved by the
defendant’s counsel.
(iv) The mediator attempts to understand the facts, issues, obstacles
and possibilities and ensures that each participant feels heard.
(v) The mediator encourages communication and asks questions
to elicit information.
(vi) At the completion of the joint session, the mediator may also
suggest meeting each party with their counsel separately.
• Separate Sessions
(i) The separate sessions are meant for the mediator to understand
the dispute at a deeper level.
(ii) It provides the parties with a forum to further vent their feelings
and disclose confidential information they do not wish to share
with the other parties.
(iii) It helps the mediator to understand the underlying interests of
the parties, the positions taken by them and the reasons for
these positions, identify areas of dispute, differential priorities

and common interests, and to shift the parties to a mood of
finding mutually-acceptable solutions.
(iv) The mediator is supposed to reaffirm confidentiality, gather
further information and challenge and test the perceptions and
conclusions of the parties in order to open their minds to
different possibilities. This is to be done by asking effective
questions and helping the parties understand the strengths
and weaknesses of their cases.
(v) The mediator offers options which he feels bests satisfies the
underlying interests of the parties.
Step 5: Reaching a Settlement
• By helping parties to understand the reality of their situation and
give up rigid positions, the mediator creates creative options for
settlement.
• The mediator can conduct as many separate sessions as necessary
and may even conduct sessions with groups on the same side with
diverging interests.
• The parties negotiate through the mediator until a solution mutually
acceptable to all the parties involved. The mediator directs the parties
to a solution which he believes will satisfy the underlying interests
of the parties.
• In case negotiations fail, the case is sent back to the referral court.
Step 6: Closing
• There is no fixed procedure that must be followed.
• Once the terms of the settlement have been agreed to, the parties are
reassembled.
• The mediator orally confirms the terms the terms of the settlement as
a procedural requirement.
• The parties, with the mediator’s aid, write down the terms of the
settlement and sign the agreement.
• The settlement has the binding nature of a contract and is enforceable
in a court of law.
• In his closing comment, the mediator thanks the parties for their help
and participation in the mediation process.
In case no settlement is reached between the parties, the case is
returned to the referral court stating failure to settle. The proceedings of the
mediation are kept confidential and cannot be revealed even to the court.
Q.4 Write a note on enforcement of Arbitral Award?
Ans. Enforcement in case of domestic awards: Prior to applying for
enforcement and execution of the award awarded by the tribunal, an award
holder will need to wait for a period of 90 days, and during this intervening
period the award maybe challenged in accordance with section 34 which
provides for the procedure for application for setting aside an arbitral award.
Post expiry of the period, if a court finds the award to be enforceable, at the
stage of execution, no further challenge will be permitted to question the
validity of the arbitral award. As per the new Amendment Act, a party
challenging an award would have to move a separate application in order to
seek a stay on the execution of an award.
Enforcement in case of foreign awards: India recognises foreign awards
under the New York Convention and the Geneva Convention as it is a signatory
to the abovementioned conventions. If a binding award is received by a party
from a country that is a signatory to the New York or the Geneva Convention
and the award is made in a territory which has been notified as a convention
country by India in its official gazette, the award would then be enforceable in
India.
As per section 47 of the Act a party seeking to enforce a foreign arbitral
award needs to make an application to the court, i.e. high court (having
jurisdiction) and provide the - original award or its certified copy, the original
arbitration agreement or its duly certified copy, and if the award or agreement
is in a foreign language, the party must produce a certified copy of a foreign
award translated into English or any other evidence in order to establish that
the award awarded is a foreign award
Conditions for enforcement of arbitral awards (domestic and foreign):
In order to challenge an award a party may resort to the following grounds.
Such an award would be rendered unenforceable in case the other party proves
that:
• The parties to the agreement under the law were under some
incapacity.
• The agreement in question was not in accordance with the law to
which the parties were subjected, or under the law of the country
where the award was made (especially in case of foreign awards).
• The party was not provided with a proper notice of appointment of
the arbitrator or of the arbitral proceedings or was otherwise unable
to present his case in the arbitral tribunal.
• Award deals with a difference not falling within the terms of the
agreement.
• Award contains decisions on matters beyond the scope of being
referred arbitration.
• Composition of the arbitral authority or the arbitral procedure was
not in accordance with the agreement.
• Composition of the arbitral authority or the arbitral procedure is not
in accordance with the law of the country where the arbitration took
place (in case of foreign awards).
• The award (specifically a foreign award) did not become binding on

the parties, or had been set aside or suspended by a competent
authority of the country in which, or under the law of which that
award was made.
• Subject matter of the dispute is not capable of settlement by
arbitration under the Indian law. Enforcement of the award would be
contrary to the public policy of India, or in conflict with morality or
justice.
Limitation period for enforcement of awards: In case of domestic arbitral
awards the limitation Act 1963 shall apply to arbitrations, as per section 21 the
arbitral proceedings in respect of a particular dispute commence on the date
on which a request for that dispute to be referred to arbitration is received by
the respondent. The Supreme Court in M/s Umesh Goel v. Himachal Pradesh
Cooperative Group Housing Society [(2016) 11 SCC 313] observed that
arbitral awards are deemed to be decrees. Though the Arbitration Act does
not provide any limitation for the enforcement of a foreign award, it is likely
that the normal period of limitation (12 years) would apply.
In case of foreign awards various high courts have given varying
interpretations on the limitation period within which a party can enforce an
award. In Noy Vallesina v Jindal Drugs Limited [2006 (5) BomCR 155] the
Bombay High court observed a foreign award to not be a decree, hence making
it non-binding on parties unless recorded as enforceable by a competent
court. The Madras High court on the other hand in Compania Naviera
‘Sodnoc’ v. Bharat Refineries Ltd [AIR 2007 Mad 2511]. referred to foreign
awards as deemed decrees. What sets the two apart is that when the court
considers an award to be a decree the foreign award would fall within the
residuary provision of the Schedule to the Limitation Act, making the limitation
period three years, whereas when a foreign award is deemed as a decree the
limitation period would be of three years.
It was in M/s. Fuerst Day Lawson Ltd v. Jindal Exports Ltd, [2001 (6)
SCC 356], where the Supreme Court held that a single proceeding can have
different stages. A court can, in the first proceeding, decide upon the
enforceability of the award. Once the enforceability is decided, it can take
further effective steps for execution of the same.
In case of enforcement of a foreign award, the party cannot appeal against
any decision of the court rejecting objections to the award. Only in case the
court holds the award to be non-enforceable, an appeal can be made. Hence
once cannot appeal against a decision which upholds the award. However,
the party can look forward to a discretionary appeal to the Supreme Court of
India under Art 136 of the Constitution of India. Such kinds of appeals are
entertained only in case the court feels that a question of fundamental
importance or public interest exists.
Enforcement of foreign judgments in India (reciprocating and non-
reciprocating countries): Firstly, for a foreign judgement to be applicable, it
needs to satisfy the grounds given in Section 13 of the CPC, failing which the
judgement will be inconclusive.
Execution proceedings are required to be filed in India by the party seeking
enforcement of a decree of a court of a reciprocating country. Foreign judgments
from superior courts of a reciprocating territory can be directly enforced by
virtue of section 44A of the Civil Procedure Code by filing an execution
application. Post which section 51 and order XXI of CPC will come into play.
In case the foreign judgment is given by a non-reciprocating country, a
fresh suit will need to be filed in a court of competent jurisdiction in India,
where the foreign judgement will be treated as evidence. The time limit for
filing a suit for enforcement of such foreign judgments is three years from the
date on which the judgment has been delivered
Challenges in executing foreign arbitral awards in India: Getting an
award from a foreign arbitral tribunal in your favour is somewhat a half battle
won as it still needs to be enforceable in India. There have been various cases,
where, despite of receiving a favourable award in a foreign arbitral tribunal,
the party failed in getting it enforced in competent Indian courts. Hence, no
way out exists in order to get an arbitral awards imposed than to get into
litigation, from which both the parties refrained from at the first place. As it is
time consuming an order which has already been passed by a foreign arbitral
tribunal will take more time to actually become effective rendering the process
to take more time in application of justice. But this route cannot be avoided as
it provides more of a structured process and ensures due scrutiny on behalf
of the courts is applied making the award enforceable.
Pressure by local governments, especially local parties which have more
political power may try to annul the award or the total effect of the award,
which carries a potential to frustrate the award issued by the international
arbitration seat.
Part II of the Indian Arbitration & Conciliation Act, 1996, deals with
Enforcement of foreign awards whereas Chapter I (Section 44-52) deals
particularly with Convention related awards. As per Section 44(b) , a “foreign
award” must be made in one of such territories as the Government of India,
upon being satisfied about the existence of reciprocal provisions, may by
notification in its Official Gazette, declare it to be the particular territory where
the convention shall be applicable. However, there is a reason why this
requirement of getting gazetted mention needs to be removed, in order to
bring India’s arbitration regime into sync with the standards of the convention.
The requirement of gazetting creates unnecessary ambiguity with respect to
enforcing foreign awards made in countries which are contracting states to
the Convention but have not yet been notified in the gazette
Upon Overall Conclusion, India does not pose to be a jurisdiction carrying

anti-arbitration bias. Previously there were no rules and regulations on
enforcement of foreign awards in India. Hence, it can easily be argued that the
legal system of India strives towards creating a facilitative environment for
enforcement of foreign awards. A major problem with the Arbitration and
conciliation Act, 1996, is regarding enforcement, it treats foreign arbitral awards
and foreign court decisions similarly. Because of lack of distinction between
foreign arbitral awards and court decisions, issues particularly relating to
foreign awards are not properly addressed in Indian Law. Some improvements
such as bringing in clarity on convention countries carrying reciprocal
provisions that are yet to be listed on the official gazette is required and a
legislation which directly deals with foreign arbitral award will make it possible
to provide more structure to the arbitral process and keep India in line with
advanced legal regimes across the world.
Q.5 What are ethics in ADR? Specifically explain in context of Mediation
and Conciliation?
Ans. It often happens when we face tough choices in life, and most of the
time, we are stuck between the right path and the wrong one. Both paths have
equally compelling reasons to choose from. However, sometimes those reasons
are not enough to decide the right choice. An ethical dilemma arises when
there is a ‘choice of competing values (ideas of goodness)’which suggests ‘a
variety of alternative and contradictory courses of action. Lawyers every day
faces the same dilemma while deciding between ethical practice which may
prove to be not as much fascinating as the easy choice of manipulating the
law itself and choosing a wrong path of unethical behavior. Deciding our
judgments on the basis of what is ethically right can sometimes prove to be a
very difficult choice and here enters the role of ethical decision making.
ADR involves more complicated legal issues than litigation matters. The
most plausible reason is ADR being a newly developed field and does not
have a wide area of legal practice like litigation matters. Legal practitioners
while dealing with ADR disputes often face a lot of challenges while becoming
habitual to a totally new and non- litigious role. This often leads to practitioners
facing a tough time with various ethical issues arising out of their role from
ADR. Clients face more risk in litigation matters as it involves extended
cumbersome processes, more financial cost, and emotional instability for years
until the matter is settled. ADR is often a quick and speedy process and is
relatively a new one. Therefore, while working ethically in such a new field can
often lead to loss of wealth, cases, and clients to the practitioner. These lose
can prove to be very vital for especially those who have just stepped in this
new field and have very little or even no experience.
Ethical values associated with ADR: ADR is growing rapidly and is now
pursued by various people having different goals. There was a time when
legal advisors who were associated with ADR were often considered to be
having a good, moral, and ethical conscience. The reason being that one
strand of ADR (the one with which I identify-”qualitative”-better processes
and solutions) which has always associated itself with pursuing “the good”
and the “just,” but as the time has changed the other strand of
ADR(quantitative, efficiency concerned, cost-reducing, docket clearing) which
has produced institutionalized forms of dispute resolution in the courts and in
private contracts is taking over the former one.
Lawyers now interact with their clients while having different behavior
and intentions which are inconsistent with the original idea and goals of ADR.
In order to win the case, they use their tactful skills to manipulate the dispute
resolution process. Take for instance negotiation strategies of arriving late to
throw off the other side, “take it or leave it” offers, and creating calendar
conflicts are all adversarial tactics that may keep the meter running, and usually
do not serve the client’s best interests. This often leads to dilution of qualitative
and good and just values associated with ADR. The most appropriate ethics
which a lawyer should follow is by keeping their client’s interest over their
own, by ensuring fairness and honesty in their approach and lastly, by leaving
behind their tactful and adversarial bargaining strategies. The lawyer should
not only behave ethically responsible towards their client but also hold respect
towards the legal process as a whole. The crucial challenge which is presented
in front of the ADR practitioner is to carefully create a balance between the
process and outcome in such a way that doesn’t prejudice or create any loss
towards the client.
Arbitration Ethics in India: All codes duly emphasize at the postulate
that arbitrators should be neutral and independent. The independence and
neutrality of arbitrator, although, emerges as a fundamental postulate that it
unquestionably goes beyond ethics. It is strongly inculcated in the arbitration
law and in the arbitration norms of the arbitral institutions all over the globe.
In some arbitral institutions, such as the International Chamber of Commerce
(ICC), arbitrators even required to officially sign a proclamation of
independence before they can acknowledgment an appointment in the post
of the arbitrator. In all circumstances, courts and arbitration institutions will
eliminate arbitrators who are observed not to be neutral and independent.
A Code of Ethics specifies practices that should be adhered to in order to
maintain the arbitration process. They are concerned with various facets of
arbitration proceedings.
1. Appointment of arbitrators: Codes of Ethics stipulates sometimes
that the party may discuss with an arbitrator but in such a discussion,
the benefits of dispute should not be discussed. These codes do
not specify any duty on the arbitrator to reveal about the discussion
to the fellow arbitrator.
An arbitrator should not give consent to his appointment when he

cannot assign time and attention the parties fairly require to spend
on the dispute. Before giving consent, he should specify his
availability. Moreover, he should not be given consent to an
appointment when he does not possess the necessary language
and technical skills – or discuss this honestly with the parties or
with the arbitral institution.
2. The beginning of the arbitral proceedings: The arbitrators have to
ensure that the parties know the arbitration procedure. They have to
impress upon the parties not to contact their arbitrator but to address
all questions and arguments about the proceedings to the tribunal,
and duly served copies to other parties.
3. The supervision of the arbitral proceedings: The arbitrator has not
only an obligation towards parties but also towards the arbitration
procedure and business community in general, for which arbitration
is a sufficient mechanism of dispute settlement.
4. Compensation: In many arbitration institutions, the arbitrator’s
compensation is fixed by the institution under a fee schedule. In
certain arbitration institutions, like the London Court of International
Arbitration or Netherlands Arbitration Institute, the arbitrators,
however, have to mention their hourly rate. In all the circumstances
with so-called ‘ad hoc’ arbitrations, i.e. arbitration performed outside
arbitration institutions, arbitrators have to specify their own
remuneration.
Arbitrators should use their best endeavor to conduct fair and expedient
proceedings. However, they should proceed with the mechanism in a manner
that assists the parties to resolve the dispute if they wish to do so. The
decision that arbitrators give, does not only have to be proper in fact and in
law but has also, to meet the requirement of parties as far as possible. Actually,
very frequently the law permits a range of solutions from which the arbitrator
has to select the one that best resembles parties’ requirements and possibilities.
Mediation Ethics in India: Starting with the expression “Ethics”, it is the
process of deciding whether any particular action is fair or not. Although it
seems quite effortless, it is confounding when it comes to applying it
pragmatically. This is because of the reason that what’s right and wrong may
vary from person to person depending upon their own perspective. Various
other factors such as the circumstances the person is into during that time,
the culture, beliefs, or mindset of the person also come into play while deciding
what’s right and wrong. So, it boils down to the reasoning of what a party
considers to be the right principle can be totally wrong for some other. To get
through this uncertainty and vagueness, certain ground rules need to be set
so that uniformity can be maintained.
Mediation can be understood as a means of conflict resolution. It is the
resolution of disputes being facilitated by an unprejudiced third party i.e. a
mediator where he strives to foster an unforced and a voluntary agreement by
the parties who are in dispute. The keystones of mediation are primarily
negotiation, communication, facilitation, and, the approaches (that have been
taken to solve the disputes). Nevertheless, compliance with the highest
professional ethics such as independence, honesty, and integrity are equally
important.
Following are the ethical issues typically associated with mediation:
1. The responsibility of the third person who is a neutral party to the
whole course of mediation to keep the whole mediation process
completely confidential.
2. He shouldn’t have a conflict of interest with either of the parties.
3. Both the parties should adhere to the certain ground that would
facilitate them in reaching to compromise.
Ethics plays an important role in mediation; it works as a trust factor on
which both the parties to a dispute rely on. Ethics are those moral principles
which should be followed by the mediator and the parties, but it is the work of
the mediator to maintain or to run the mediation on ethical ground. There are
certain ethics that need to be followed everywhere such as confidentiality,
justice, fidelity, and others.
Confidentiality makes the parties comfortable in sharing their part alone
with the mediator. It also ascertains that whatever that has been disclosed
would remain in the closed doors.
In India with the increasing importance of mediation Supreme Court has
itself initiated to refer certain cases for mediation and has also made certain
rules for the same. Arbitration and Conciliation Act 1996 of India also works in
line with the UNCITRAL model, Section 75 of this Act has made certain
provisions regarding confidentiality in mediation and conciliation (and most
often Mediation and conciliation both are used interchangeably in India). It
provides that conciliator or mediator and the parties shall keep all the matters
confidential unless it is necessary to disclose the matter.
India is maintaining ethics with the help of these laws by keeping
confidentiality which binds the parties to be loyal to each other. The importance
of ethics can be further studied through certain case laws which shows how
the Supreme Court itself is promoting mediation because of the backlog of
cases by recommending disputed parties to opt for mediation. Further, Apex
court has also made it secure by making Laws (Arbitration and Conciliation
Act 1996, Court-connected Mediation under the Supreme Court (Civil
Procedure) Rules, 2005) to secure parties’ trust in mediation.
In the case of Moti Ram and Anr. v. Ashok Kumar and Anr. ([2010] 14
(ADDL.) SCR 809), parties were in dispute of a property that Supreme Court
directed to be settled through mediation to resolve the dispute. Subsequently,

the mediator sent a report to the court which included various settlement and
proposals made by the parties which were regarded as confidential. The
Supreme Court took a stand on this by saying “If the mediation succeeds, by
both the parties to the Court without mentioning what transpired during the
mediation proceedings. If the mediation fails, then the mediator should only
state the outcome in his report and give it to the court mentioning that the
`Mediation has been unsuccessful’. Besides that, the mediator should not
mention anything which was reviewed, suggested, or done at the time of the
mediation proceedings. This is because in mediation, very often, offers,
counteroffers, and proposals are made by the parties but until and unless the
parties reach an agreement signed by them, it will not amount to any concluded
contract. If the proceedings in the mediation proceedings are revealed, it will
ruin the privacy of the mediation procedure.”
In the case of Rama Aggarwal v. PIO, Delhi State Legal Service
Authority (2015), that came up before the Central Information Commission
(CIC), it held that a party cannot seek information pertaining to mediation
proceedings as per the Right to Information Act, 2005 as the same attracts
exceptions under provisions of the said Act. The CIC observed that:
“Information regarding the negotiation, mediation, conciliation, and
counseling will fall under the exempted clause of information of another spouse,
being personal and given in fiduciary capacity and, no public interest is
established in disclosure, while there is the larger public interest in protecting
that information like that would help mediation to flourish, hence such
information shall not be disclosed.”
The overall analysis shows that the rules prescribed by the Supreme
Court and the functioning of Mediation in India in conformity with the
international standards. Judiciary in India has played an important role in
strengthening confidentiality and loyalty in mediation. This should help
mediation to grow further as a dispute resolution mechanism and to help build
people’s trust over it.
Conciliation and Ethics in India: The conciliator plays a very significant
role in the resolution of Industrial disputes. The conciliator has to adopt
various kinds of methods and has to perform different types of roles. The
conciliator can carry out his obligations in a more effective way if he holds
particular Qualifications. Thus, it becomes vital to find out the qualifications
of an efficient conciliator.
.Q.6 Write a short note on judicial interpretation of Alternative Dispute
Resolution in India?
Ans. The concept of Mediation is ancient and deep rooted in India. From
Lord Krishna mediating between Kauravas and Pandavas in the Mahabharata,
to family elders resolving domestic issues, to the resolution of disputes at the
community level through Panchayats, there exists a strong culture of mediation
in India. With the passage of time, there are certain statutes which provide for
mediation as a mode of settlement of disputes between the parties. Such
statutes comprise of, but not limited to the following:
• Section 4 of the Industrial Disputes Act, 1947: Conciliators
appointed are assigned with the duty to mediate and promote
settlement of industrial disputes with detailed prescribed procedures
for conciliation proceedings.
• Section 89 read with Order X Rule 1A of the Code of Civil Procedure,
1908: The insertion of Section 89 in the CPC is in itself a welcome
step towards promoting mediation and other means of alternate
dispute resolution. As per Section 89 read with Order X Rule 1A of
the CPC, after recording the admission and denial of documents, the
Court shall direct the parties to the suit to opt for any of the modes
of settlement outside Court as specified in Section 89 (1) of the CPC
that is arbitration, conciliation, judicial settlement including
settlement through Lok Adalat or mediation. Therefore, it provides
for the reference of the cases pending before the courts to the
aforesaid modes of dispute resolution.
• Order XXXIIA of CPC: Order XXXIIA of CPC recommends
mediation. This is evident from Rules 3 and 4 of Order XXXIIA. The
legislators have very thoughtfully inserted this provision because
the matters comprising of, but not limited to, personal, family,
matrimonial, guardianship, custody and maintenance matters can be
more aptly resolved through non- adversarial means. There may be
divergent positions by the parties but the effort has to be to protect
the underlying interest, which can be done through mediation.
• Legal Services Authority Act, 1987 read with Section 89 of CPC:
Legal Services Authorities at the centre, state and taluka level are
statutory authorities established by the Legal Services Authorities
Act, 1987 with the object to provide free and competent legal service
to the weaker services of the society and to ensure that justice is not
denied to any citizen on account of economic or any other disability.
As per Section 89 (2) of CPC, where a dispute has been referred to Lok
Adalat, the Court shall refer the same to the Lok Adalat in accordance with the
provisions of Section 20 (1) of the Legal Services Authority Act, 1987 and all
other provisions of that Act shall apply in respect of the dispute so referred to
the Lok Adalat.
Further, it has been provided under Section 21 of the Legal Services
Authority Act, 1987 that a settlement before a Lok Adalat is enforceable as a
court decree.
• Section 442 of the Companies Act, 2013 read with the Companies
(Mediation and Conciliation) Rules, 2016: Section 442 of the
Companies Act, 2013 provides that the Central Govt. shall maintain
a panel of experts called the Mediation and Conciliation Panel
consisting of such number of experts, having such qualifications, as
may be prescribed for mediation between the parties during the
pendency of any proceedings before the Central Government or the
Tribunal or Appellate Tribunal under this Act.
Rule 3 of the Companies (Mediation and Conciliation) Rules, 2016
provides for a Panel of Mediators or Conciliators.
The aforesaid provisions provide for referral of disputes pending
adjudication before the National Company Law Tribunal and
Appellate Tribunal, to mediation.
• Section 18 of the Micro, Small and Medium Enterprises (MSME)
Development Act, 2006: It has been clearly provided under Section
18 of the aforesaid Act that any party to a dispute with regard to any
amount due under Section 17 (disputes regarding the payment of
amount to MSMEs), make a reference to the Micro & Small Enterprises
Facilitation Council. On receipt of a reference, the Council shall either
itself conduct conciliation in the matter or seek the assistance of
any institution or centre providing alternate dispute resolution
services by making a reference to such an institution or centre, for
conducting conciliation and the provisions of Sections 65-81 of the
Arbitration and Conciliation Act, 1996 shall apply.
• Section 14 (2) of the Hindu Marriage Act, 1955 and Section 29(2)
of Special Marriage Act, 1954: As per Section 14 (2) of the Hindu
Marriage Act, 1955, in disposing of any application under Section 14
for leave to present a petition for divorce before the expiry of one
year from the date of marriage, the court shall have regard to the
reasonable probability of a reconciliation between the parties before
the expiry of one year. Therefore, the intent of the legislators is that
the court should in the first instance attempt mediation between the
parties.
Similar provision is contained in Section 29 (2) of the Special Marriage
Act, 1954.
Unlike the adversarial system in which the competing claims of parties
are represented by legal representatives who have interest in the
outcomes of dispute, in matrimonial and family matters, it is important
to visualize and analyse the underlying interest of the parties, no
matter however diverse may be their positions. It is the skill of the
mediator to facilitate the parties to try to arrive at an amicable
settlement.
• Section 32 (g) of the Real Estate (Regulation and Development) Act,
2016: Section 32 of the aforesaid Act provides for the functions of
the Authority for the promotion of real estate sector. Sub clause (g)
of Section 32 of this Act states that the Authority shall in order to
facilitate the growth and promotion of a healthy, transparent, efficient
and competitive real estate sector make recommendations to the
appropriate Government of the competent authority as the case may
be, to facilitate amicable conciliation of disputes between the
promoters and the allottees through dispute settlement forums set
up by the consumer or promoter associations.
• 129 th Law Commission of India Report: The aforesaid Law
Commission Report recommends courts to refer disputes for mediation
compulsorily.
• Section 12A of the Commercial Courts Act, 2015: Section 12A of
the aforesaid Act under Chapter IIIA deals with Pre-Institution
Mediation and Settlement. Chapter IIIA has been inserted by 2018
amendment to the aforesaid Act. Section 12A clearly states that a
suit, which does not contemplate any urgent interim relief shall not
be instituted unless the plaintiff exhausts the remedy of pre-
institution mediation in accordance with such manner and procedure
as may be prescribed by rules made by the Central Government.
It is therefore, mandatory for parties to exhaust remedy of pre-
institution mediation under the Act before the institution of a suit.
• The Commercial Courts (Pre- Institution Mediation and Settlement)
Rules, 2018: The Central Government has framed and thereafter
notified these Rules on July 3, 2018 in exercise of its powers conferred
by sub-section (2) of Section 21A read with sub-section (1) of Section
12A of the Commercial Courts Act, 2015.
• Sections 37-38 and Chapter V of the Consumer Protection Act,
2019: The aforesaid provisions provide for disputes covered under
this Act to be first referred to mediation. It has been clearly provided
under Section 37 (1) of the aforesaid Act that at first hearing of a
complaint after its admission or at any later date, if it appears to the
District Commission that there exist elements of a settlement which
may be acceptable to the parties, it may direct the parties to give in
writing within 5 days, their consent to refer the matter to mediation
and the provisions of Chapter V of the Act shall apply.
• Mediation and Conciliation Rules, 2004: In exercise of its powers
under Part X and Section 89 (2) (d) of CPC, the Hon’ble High Court
of Delhi has framed these rules.
It is further pertinent to note that India is a signatory to the United Nations
Convention on International Settlement Agreements Resulting from Mediation
(Singapore Mediation Convention) which gives mediation settlements the

force of law.
On the analysis of the aforesaid statutory provisions, it cannot be said
that India does not have provisions concerning mediation or use of conciliation.
But the discrepancies between mediation and conciliation impede these
provisions from being successful. A uniform legislation concerning mediation
would create legal sanctity and avoid the inconsistencies between the various
pieces of existing legislations. Even though various statutes have given the
parties the autonomy to get their disputes resolved via mediation and there
exist court referred as well as private means of engaging in mediation, there is
lack of procedural guidance in this regard.
The Hon’ble Supreme Court of India has, through a unique step, set up a
panel to have a draft legislation to give a legal sanctity to disputes settled
through mediation, which would then be sent to the government as a suggestion
from apex court. An ‘Indian Mediation Act’ as suggested by the Hon’ble
Supreme Court is indeed a promising proposal in India.
Relevant Case laws:
(1) Bharat Aluminium Co. v. Kaiser Aluminium Technical Services
Inc., [(2012) 9 SCC 552]
In the landmark cases of Bhatia International and Venture Global
Engineering, the Supreme Court had held that Part I of the Arbitration and
Conciliation Act, 1996 set out the procedures, award, interim relief and appeal
provisions with respect to an arbitration award and held that it would apply to
all arbitrations held out of India, unless the parties by agreement, express or
implied, exclude all or any of its provisions. The Supreme Court held that there
is a clear distinction between Part I and Part II which applies to completely
different fields and with no overlapping provisions.
The Court in this case also drew a distinction between a ‘seat’ and ‘venue’.
The arbitration agreement designates a foreign country as the seat/place of
the arbitration and also selects the Act as the law governing the arbitration
proceedings. The Court also clarified that the choice of another country as
the seat of arbitration inevitably imports an acceptance that the law of that
country relating to the conduct and supervision of arbitrations will apply to
the proceedings. Therefore, it can be understood that Part I applies only to
arbitrations having their seat/place in India.
The Court disagreed with the observations made in Bhatia International
case and further observed on a logical construction of the Act, that the Indian
Courts do not have the power to grant interim measures when the seat of
arbitration is outside India. Therefore, the arbitral proceedings prior to the
award contemplated under Section 36 can only relate to arbitrations which
take place in India. The Court further held that in foreign-related international
commercial arbitration, no application for interim relief will be maintainable in
India, either by arbitration or by filing a suit.
(2) K.K Modi v K.N Modi AIR 1998 SC 1297
This case talks about the attributes that make an agreement, an arbitration
agreement. According to the Court, a clause will amount to an arbitration
clause only if it contemplates that the decision of the tribunal will be binding
on the parties to the agreement. The Court further went on to say that only if
the parties consent to go with the procedure of arbitration for dispute resolution
or if the Court or a statute enables the tribunal to conduct the arbitration
process, only then must the jurisdiction of the arbitration tribunal may be
exercised.
The agreement must also agree to it that the substantive rights of the
parties will be determined by the agreed tribunal. To be enforceable in law, the
agreement of the parties to refer their disputes to the decision of the tribunal
must be intended. The agreement must also contemplate that the tribunal will
make a decision upon a dispute which is already formulated at the time when
a reference is made to the tribunal.
Other important factors include whether the agreement contemplates that
that tribunal will receive evidence from both sides and give the parties
opportunity to put forth their issues and hear their contentions; whether the
wording of the agreement is consistent with the view that the process was
intended to be an arbitration; and whether the agreement requires the tribunal
to decide the dispute according to law.
(3) J&K State Forest Conservation vs. Abdul Karim Wani, AIR 1989
SC 1498
The issues, in this case, were that how should an arbitration clause
construed in a Contract and whether a dispute between parties can be referred
to arbitration or not? The Supreme Court, in this case, held that the Court
should refrain from expressing an opinion on the merits of the dispute. The
Court should find out the intention of the parties, and that intention has to be
found out by reading the terms broadly, clearly, without being circumscribed.
The Supreme Court held that the interim measures can be granted to aid
the arbitration proceedings and not to frustrate them. The court further held
that in the guise of granting an interim measure, the Court cannot resolve the
substance of the dispute – that task belongs to the arbitral tribunal and not
the Court.
It was further held in this case that the jurisdiction of Court to make
interim order is only ‘for the purpose’ of arbitration proceedings and a court
should not to frustrate the same.
(4) Puri Construction Company v Union Of India, AIR 1986 SC 777
It was held by the SC that when the court is called upon to decide the
objections raised by a party against an award, the jurisdiction of the court is
limited, as expressly indicated in the act and it has no jurisdiction to sit in

appeal and examine the correctness of the award on merits.
The Court also held that if there is no legal proposition either in the award
or in any document annexed with the award which is erroneous and the alleged
mistakes or alleged errors, are only mistakes of fact and if the award is made
fairly, after giving adequate opportunity to the parties to place their grievances
in the manner provided by the arbitration agreement, the award is not amenable
to corrections of the Court.
(5) Datar Switchgears Ltd vs. Tata Finance Ltd., 2000 (3) RAJ 181
(SC)
What is the role of the Chief Justice if a party does not act as per the
arbitration clause? The issue, in this case, was about the appointment of an
arbitrator under Section 11(6). It was held that Section 11(5) can be invoked by
a party who has requested the other party to appoint an arbitrator and the
latter fails to make an appointment within 30 days from the receipt of the
notice. An application u/s 11 (6) can be filed when there is a failure of the
procedure for the appointment of the arbitrator. This failure can arise under
different circumstances.
It can be a case where a party who is bound to appoint an arbitrator
refuses to do so or where the 2 appointed arbitrators fail to appoint the 3rd
arbitrator. If the appointment of an arbitrator is entrusted to any person or
institution and such person or institution fails to discharge such function, the
aggrieved party can approach the Chief Justice for the appointment of the
arbitrator. In this case, it cannot be said that there was a failure of the procedure
as prescribed by the Act.
(6) Narayan Prasad Lohia vs. Nikunj Kumar Lohia, 2002(1) RAJ 381
(SC)
The Court in this case discussed whether an arbitration agreement
becomes invalid on the ground that it provided for the appointment of only
two arbitrators, considering that the act requires an odd number of arbitrators.
It was held that even if the parties provided for the appointment of 2 arbitrators,
the agreement does not become invalid. Under Section 11(3) the two arbitrators
should then appoint a third arbitrator who shall act as the presiding arbitrator.
However, such an appointment should preferably be made in the
beginning, even though the two arbitrators may also appoint a third arbitrator
at a later stage if such a situation arises when the two arbitrators differ in
opinion. This ensures that on a difference of opinion the arbitration
proceedings do not reach a stalemate. However, there would be no need for a
third arbitrator when both the arbitrator so appointed agree and give a common
award.
(7) In Mohd. Mushtaq Ahmad v. State (2015) 3 AIR Kant R 363.
It was contended that marriage between a couple was solemnized after
the commutation of their marriage the couple gave birth to a girl child further
the dispute arose between husband and wife, the marriage between them was
irretrievably broken down, which leads to the filing of the divorce petition by
wife alongside an FIR against the husband under Section 498A of IPC. The
Karnataka High Court directed the parties to mediation under Section 89 CPC.
The matter was settled amicably through mediation after which the wife decided
to quash the FIR. The Court allowed this stating, “The court in the exercise of
its inherent powers can quash the criminal proceedings or FIR or complaint in
appropriate cases in order to meet the ends of justice.”
In Gurudath K. v. State of Karnataka (2014). the facts are identical to
the case above. Here the court stated, “Even if the offences are non-
compoundable if they relate to matrimonial disputes and the Court is satisfied
that the parties have settled the same amicably … Section 320 CrPC would not
be a bar to the exercise of the power of quashing of FIR or criminal complaint
in respect of such offences.” Thus, the court allowed for the offences to be
compounded on coming to the conclusion that the wife was under no threat
or coercion for the same.
The court’s intention to settle matters as amicably as possible is clear.
The intention of the court matches the ideology of the advocates of mediation,
which is to safeguard family relationships and provide speedy justice.
The apex court in the case of M/s Guru Nanak Foundation v. M/s Rattan
Singh & Sons (1982 SCR (1) 842) stated that “Interminable, time consuming,
complex and expensive Court procedures impelled jurists to search for an
alternative forum, less formal, more effective and speedy for resolution of
disputes avoiding procedural claptrap and this led them to Arbitration Act,
1940 (Act for short). However, the way in which the proceedings under the
Act are conducted and without an exception challenged in Courts has made
lawyers laugh and legal philosophers weep. Experience shows and law reports
bear ample testimony that the proceeding under the Act has become highly
technical accompanied by unending prolixity, at every stage providing a legal
trap to the unwary. Informal forum chosen by the parties for expeditious
disposal of their disputes has by the decisions of the Courts been clothed
with ‘legalese’ of unforeseeable complexity.”

Q.1: What are the components of Effective Communication?

Ans. Components of Effective Communication are:
• Listening: a good communicator is a good listener: “swift to hear,
slow to speak.” Empathic listening is probably the most important
skill of the mediator- the ability to listen in a way that makes a party
feel that he has been listened to and understood. It builds the
confidence of the parties in the mediation exercise. It also encourages
them to trust the mediator, which is a prerequisite to letting him into
their real concerns and needs, which in turn is necessary towards
generating realistic options for settlement and a holistic resolution.
• Understanding: this flows from good listening and generates respect
and trust. When we say we understand someone, we are in effect
saying we know the person’s perspective and situation. This builds
a rapport between us.
• Inquiry: Assumption leads to frustration. It is crucial to ask questions
to ensure that one understands what the other person perceives as
reality.
• Timing: it is not only what is said that matters in effective
communication. When it is said, to whom it is said and how it is said
determine whether or not the correct message is transferred to the
target or ultimate recipient and, more importantly, it determines how
the speaker is perceived- either as foolish or wise- which perception
may either promote a discussion or constitute a distraction.
• Sincerity: a bitter or prejudiced mind cannot communicate
effectively. There must be a desire to reach out to and hear the other
person in good faith and without prejudice. A mediator has an attitude
of complete respect, openness and empathy to BOTH parties in a
conflict based on a commitment to help ascertain the problem behind
their conflict. A mediator never sees the party as the problem but
rather as the joint-problem-solvers. This approach makes it very
easy to listen to them, to hear them, to understand them and,
consequently, to transfer to them these qualities which are
indispensable for effective communication, integrative negotiation
and holistic conflict resolution which is what mediation is all about.
This requires a gentle and open spirit on the part of the mediator. A
gentle spirit does not meet a brick wall: it is met with openness. The
mediator needs to provoke this openness on the part of the parties
before he can get a durable resolution.
Q.2 What is the Code of Conduct of Mediators?
Ans. Mediation is a method of non-binding dispute resolution mechanism,
with the assistance of a neutral third party who helps in dissolving the dispute
in hand. A mediator is a neutral third party who assists the parties in the
mediation process. The functions of the mediator are:
a. to communicate between the two parties
b. identify the dispute in hand
c. come up with a possible settlement option
d. help the parties in dissolving the dispute
Code of Conduct of Mediators:
• Impartiality: it is important for the mediator to be unbiased. He
cannot favour one particular party. He should hear both the sides
and come up with a possible settlement which is agreed by both the
parties.
• Conflict of interest: the parties should me no way related to the
mediator. It might lead to conflict of interest.
• Principle of self-determination: self-determination is the right of
the parties in mediation to make their own voluntary decision
regarding the possible resolution. The mediator is to provide the
parties with the solutions to the dispute in hand and assist them
throughout the process.
• Confidentiality: the mediator should not be disclosing the information
of the mediation to any third parties without the consent of the
parties. He may disclose information about the mediation with a
written consent of the parties.
• Quality of process: the mediator should make sure that the parties
understand the mediation proceedings before the mediation starts.
Mediators have an obligation to acquire and maintain professional
skills and ability to uphold the quality of the mediation process.
• Agreement to Mediate: the mediator must come up with an agreement
between both the parties and he must ensure that both the parties
understand the terms and condition of the process. Confidentiality
must be maintained while communication. The mediator has the right
to terminate or suspend the process.
• Termination or suspension of mediation: mediator should come up

with an agreement which is both impartial or there is no conflict of
interest. He shall suspend or terminate the process upon the request
of either one of the both parties. He may also suspend the process in
case he finds out the either one of the parties are not acting in good
faith.
Q.3 What is pre-institution Mediation?
Ans. To make India a global destination for business and investment and
accordingly, to improve its ease of doing business rankings, the Government
of India took note of the observations made by the Law Commission of
India and established the Commercial Courts and the Commercial Division
and the Commercial Appellate Division in the High Courts for speedy disposal
of commercial disputes above a specified value. To take this a step further, in
2018, the Government introduced a provision in the law to make it mandatory
for disputing parties in commercial disputes to attempt mediation before filing
a claim in court. In furtherance of this provision, the Government introduced
rules for pre-institution mediation and settlement but authorised only the
District and State Legal Services Authorities to conduct these mediations.
Mediation, in its simplest avatar, is a method to resolve disputes amicably
with the help of an expert mediator and without the intervention of courts.
This move by the Government was welcomed by stakeholders across the
board as it was believed that this would ensure timely resolutions of disputes
while retaining business relationships between the parties, a win-win for all –
the Government, the overburdened judiciary and the business community.
However, a recent judgment of the Bombay High Court has raised the
brows of many from the business and legal fraternity. In the judgment delivered
on 16-2-2021, the Court observes that the provision that “compulsorily”
requires disputing parties to attempt an amicable settlement via mediation is
procedural and there is no absolute prohibition to file a suit before attempting
mediation. The reasoning behind such an observation is three-fold:
The very purpose of putting in place such a mechanism was for speedy
disposal of commercial disputes for their early resolution which would in turn
create a positive image for the investor world about the independent and
responsive Indian legal system. Routinely referring parties to compulsory
mediation would run counter to the very purpose for which the law was brought
into force. It would have the effect of delaying the proceedings rather than
having a quick resolution of the dispute.
The provision itself contemplates that where any urgent interim relief is
applied for, the party seeking relief is not required to exhaust the remedy of
mediation before approaching the court. According to the Court, the purpose
of the law appears to be that parties should try and resolve their disputes
before coming to court. This is for the simple reason that if parties resolve
their disputes, they need not approach the court at all. However, when parties
have tried to resolve their disputes unsuccessfully, it would be futile to still
drive the parties to pre-institution mediation.
The counterparty must object to non-compliance regarding pre-institution
mediation at the earliest opportunity. If not, it would be presumed that he does
not want to resolve his dispute through mediation.
One can hardly disagree with the rationale by which the Court has justified
the interpretation of mandatory pre-institution mediation as procedural keeping
speedy disposal of commercial cases at the helm of its observations. On the
contrary, such a mindset can be seen as forward-looking as disputing parties
need not routinely approach the already burdened District and State Legal
Services Authorities for the purpose of pre-institution mediation, and can
rather undergo mediation privately. In fact, world over online mediation through
online dispute resolution (ODR) platforms has become the go-to mechanism
for parties that want to settle their disputes amicably.
However, there is one observation that is concerning and will face flak by
those well-acquainted with the concept of mediation, and this is the Court’s
reliance on doctrine of substantial compliance in an attempt to drive its point
home. The Court says:
‘Take a case, where through correspondence, the parties have tried to
resolve their disputes before approaching the court without any success. Can
it then be contended that parties are still to be referred to mediation to resolve
their disputes when an attempt has already been made and failed? I think not.
To my mind, one has to interpret this provision to see that there is substantial
compliance, namely, that an attempt has been made to resolve the disputes
amicably which has failed, and therefore, the plaintiff is constrained to approach
the court for redressal of his grievances.’
On a plain reading, one may wonder what is wrong with this particular
observation of the Court, but on a careful reading, one will realise that this
greatly undermines the process of mediation and the skills of a mediator. A
standard or private attempt at an amicable resolution of a dispute by the
parties or their representatives substantially differs from routing a dispute
through the process of mediation and seeking an early and amicable resolution
with the support of a competent and well-trained mediator.
Virtually every dispute goes through one (if not more) round of informal
negotiations before it is escalated to a more serious forum. However, driving
a dispute through the tunnel of mediation is wholly different from such informal
negotiations and the chances of a successful settlement increases due the
involvement of an independent and skilled mediator. This finds support in the
fact that less than 5% of cases raised in courts across the US result in a full
trial taking place. A substantial factor in that statistic is the successful use of
mediation, which is estimated to result in a positive resolution of roughly 80%
of cases[7]. A similar success story of mediation in India may not see the light
of day if courts come to a conclusion that equates any form of correspondence
between parties for amicable settlement with the process of mediation.
A well-balanced view could be such where so long as mediation is
conducted through the State machinery or privately, online or in-person with
the involvement of an accredited mediator or institution be looked at through
the lens of the doctrine of substantial compliance. Perhaps, this could be the
ground for challenge of the Bombay High Court judgment before the Supreme
Court of India, unless of course, the matter is settled amicably.
Q.4 Suggest few ways to improve mechanism of ADR in India?
Ans. The evolution of ADR mechanisms was not of that much success.
Thereby, the trend is the imposition of responsibility and duty on Court.
(i) Courts are authorized to give directives for the adoption of ADR
mechanisms by the parties and for that purpose Court has to play
important role by way of giving guidance. Power is also conferred
upon the courts so that it can intervene in different stages of
proceedings. But these goals cannot be achieved unless requisite
infrastructure is provided and institutional frame work is put to place.
(ii) The institutional framework must be brought about at three stages,
which are:
Awareness: It can be brought about by holding seminars, workshops,
etc. ADR literacy program has to be done for mass awareness and
awareness camp should be to change the mindset of all concerned
disputants, the lawyers and judges.
Acceptance: In this regard training of the ADR practitioners should
be made by some University together with other institutions.
Extensive training would also be necessary to be imparted to those
who intend to act as a facilitator, mediators, and conciliators. Imparting
of training should be made a part of continuing education on different
facets of ADR so far as judicial officers and judges are concerned.
Implementation: For this purpose, judicial officers must be trained to
identify cases which would be suitable for taking recourse to a
particular form of ADR.
(iii) ADR Mechanisms to be made more viable: The inflow of cases
cannot be stopped because the doors of justice cannot be closed.
But there is a dire need to increase the outflow either by
strengthening the capacity of the existing system or by way of finding
some additional outlets.
(iv) Setting up of Mediation Centers in all districts of each state with a
view to mediate all disputes will bring about a profound change in
the Indian Legal system. These Mediation centers would function
with an efficient team of mediators who are selected from the local
community itself.
(v) Not many Indians can afford litigation. This kind of state of affairs
makes common people, especially rural people, cynical about judicial
process. We must take the ADR mechanism beyond the cities. Gram
Nyayalayas should process 60 to 70 percent of rural litigation leaving
the regular courts to devote their time to complex civil and criminal
matters.
(vi) More and more ADR centers should be created for settling disputes
out-of-court. ADR methods will achieve the objective of rendering
social justice to the people, which is the goal of a successful judicial
system.
(vii) The major lacuna in ADR is that it is not binding. One could still
appeal against the award or delay the implementation of the award.
“Justice delayed is justice denied.” The very essence of ADR is lost
if it is not implemented in the true spirit. The award should be made
binding on the parties and no appeal to the court should be allowed
unless it is arrived at fraudulently or if it against public policy.

Q.1 Why is communication important in process of Alternative Dispute

Resolution?
Or
What is meant by Communication? Explain its types and Styles?
Ans. Communication is a crucial aspect in our everyday lives. But it
assumes a greater role in resolving disputes. Communication can either make
our argument strong or make it vulnerable to outside influence. Alternative
Dispute Resolution is one such method of resolving disputes which depends
solely on communication. If your communication skills are good, then you
automatically gain an edge over the other counsel. Communication is as
important in ADR as food is for our body. Just like we won’t be able to survive
without food for long, similarly without communication, disputes cannot be
resolved or even heard till the judgment day. Communication becomes more
important in ADR because in courts, evidences plays a part in deciding the
outcome of the case but while resolving disputes through ADR,
communication is the whole and soul of the mediation/arbitration and other
processes.
In layman’s language: ADR refers to an informal way of dealing with
disputes outside the domain of court by using various techniques. It is a more
preferable and an easier way to deal with disputes.
By definition: Alternative dispute resolution (ADR) refers to a variety of
processes that help parties resolve disputes without a trial.
Typical ADR processes include mediation, arbitration, neutral evaluation, and
collaborative law.
One of the most important elements of this is Communication. It refers to
way in which we express ourselves, our thoughts and emotions to the other
party by way of speaking, writing, non-verbal techniques etc. Communication
is necessary because unless and until we do not communicate to the other
party, there will be higher chances of someone being sued.
“Communication is not only the essence of being human, but also a vital
property of life.” – This is a quote by John A. Piece, depicting how important
communication is for a human being. Communication is not only the crux of
human lives, but also plays a huge role in determining our personal and social
life. It’s like riding a bicycle; the more we work on our communication skills the
more we progress in life. Communication is a tool by which we, as social
creatures can express ourselves and establish relations with others, either
formal or informal. An effective communication is must for any sort of work, be
it a contract or resolving an issue. It eases off, prevents and eliminates the
barriers that hamper effective transfer of ideas, thoughts, emotions etc and
acts as a mediator in resolving conflicts that occur at various steps.
Types of communication:
• Verbal communication: refers to the use of spoken language to
convey a message to the listener. The speaker produces sounds
that are then transmitted to the other person. The message is encoded
by the sender, is transmitted via air using sound, then received by
the listener who decodes the meaning to understand the message.
• Non–verbal communication: This is also an integral part of
communication. Sound may or may not be present but the way it is
used indicates or communicates a message (A person shouting –
depicts he is angry or annoyed, etc). The uses of Facial expressions,
actions, body language, etc, are examples of non-verbal
communication.
• Written communication: With the advancement in print media and
technology, writing has become a popular mode of communication.
In the present world, people use written communication more than
other form of communication because of its advantages. It’s easier
to spread the message in written form rather than verbal or non-
verbal methods (Ex – Email, invitations, cash memo etc).
• Listening: “One of the best ways to persuade others is with our
ears – by listening to them” This is a famous quote by Dean Rusk
(Secretary of state under Presidents John F. Kennedy & Lyndon
Baines Johnson) provides us with one of the most important aspect
of communication i.e. Listening . Many people will ignore this but in
actual practice, effective listening is as important as effective
speaking or non-verbal methods. It basically refers to decoding the
information received by various means in order to interpret it as
accurately as possible. Even a slightest misinterpretation may change
the actual meaning which may cause various other difficulties.
• Visual communication: This is often the most ignored form of
communication but it’s as important as any other form. Visual
communication refers to a form of communication wherein there are
no words or sound or anything like this. Only the picture or the art
work is the one communicating. We have to use our prior knowledge
in order to understand what the creator is trying to tell us.
Importance of Communication in process of Alternative Dispute
Resolution: “The problem with communication is the illusion that is has
occurred.” — quoted by George Bernard Shaw clearly depicts the importance
of effective communication. We often assume that whatever we wanted to say
to others has been properly conveyed. But sometimes this assumption is
misleading & in reality nothing much has been conveyed. This encourages
the need for effective communication.
So far we have discussed about the definition and components of

Communication & ADR. But here we will talk about why communication is
necessary for resolving disputes through ADR. Communication is the key
factor in ADR, without it, disputes & conflicts cannot be solved. Every method
of ADR requires one or other form of communication, be it mediation/arbitration
or any other form.
Slightest misunderstanding can change the understanding & outcome of
the case, that is why clear and efficient communication is must. Here are the
steps of communication that are required in ADR:
1. Active Listening with empathy: the key aspect of communication is
listening to others with empathy. Empathy refers to putting your
foot in someone else’s shoe. This means trying to understand the
situation from other’s perspective as well. This will lead to a better
judgment of the situation , hence helping us in deciding the matter
more clearly.
2. Body language: This refers to non-verbal signs & gestures that we
often use to convey our thoughts, emotions etc. This has a huge
impact on others in assessing the situation. A person with a confident
body language is more likely to create an impact & persuade the
others to decide in their favor.
3. Commonly used techniques in ADR:
• Summarizing: refers to giving a brief statement highlighting
the main points & the subject matter. It is extremely important
for effective communication which is often accompanied by
paraphrasing about the subject matter.
• Reflecting: This confirms that we have heard the other party
well and deciding on the matter keeping in mind the views of
other party. This depicts that whatever decision is being taken
is in accordance with the interests of the concerned parties.
• Acknowledgement: refers to acceptance of truth or existence
of something. This is important as to win the trust of the
concerned parties while making decision. Also
acknowledgement is a sign of effective communication.
Styles of Communication: These techniques of communication are very
essential in ADR. A slightest misunderstanding and everything can go wrong.
Communication is a medium of exchange which uses both verbal & non-
verbal sensory channel. We encode the information, transmit it and wait for
others to decode it. There are 3 styles of communication:
1. Passive style: refers to a mode of communication wherein an
individual tries to avoid excessive feeling, opinions, and thoughts
etc keeping in mind the needs they have. Those using passive
communication often has low self esteem & behavior depicts lack of
action, refusal of anger, aggressive behavior. All this behavioral
elements transform a person into being an introvert. This passivity
of communication leads them to isolate themselves physically and
emotionally.
2. Aggressive style: refers to a way of communication in which an
individual strongly expresses his opinions & thoughts to others
speaking on behalf of their needs in a way that violates the right of
persons who come in contact with them. These persons are
aggressive (verbally/physically) in nature, are always on alert and
do not focus about the impact they have on others. These people
have low self esteem because they have experienced some kind of
emotional or physical abuse, feeling helplessness and unhealed
emotional wound. They always try to dominate the others by way of
aggression causing stress to those in direct contact.
3. Assertive style: is a mixture of passive and aggressive style in which
individuals express their opinion and thoughts clearly and in correct
terms for their rights and needs keeping in mind the needs of other
parties as well. Person using assertive style has high self esteem
and is confident. They are extroverts and can talk for themselves
confidently and accept other’s point of view. In this, they establish
a relation with good terms and deal with the situation effectively
without resorting to aggression or court trial.
Mediation and ADR have been present in our society. In olden days,
there used to be wise person who acts as a mediator, arbitrator in case of
disputes. This wise person is considered as a neutral mind that will decide on
the matter from an unbiased point of view and decide on the matter that suits
best for both the parties. All this is possible because of effective communication
that seems as the best solution to the problem and to decide in such a manner
that it will be a win-win situation for the parties.
In conclusion, it can be said that clear and effective communication is not
something which we are born with. We have to work hard to achieve success
in the field of communication which comes with patience, practice and hard
work. A person who works on his communication skills gets an edge from its
counterparts. Good, clear & effective communication is the need of the hour.
From legal perspective, we communicate primarily for two reasons: – to
flee or to fight. The style of communication can vary but the ultimate aim
always circles around these two. In Alternative Dispute Resolution,
communication is the most important medium of exchange. Direct, open, simple
& honest method of communication helps in clear understanding of the
situation and prevents misinterpretation of the message. Also clear, effective
& efficient communication helps the party to win trust of others and to convey
their stand on a particular matter. This establishes a long term relation which
is beneficial in many ways.
Also communication process should be open for criticisms & scope of

improvement with better understanding because criticisms and conflicts are
constructive in nature and helps in overall development. The main motive of
ADR is to settle dispute outside court by employing various means/methods.
We can conclude that effective communication is a vital, necessary & the
most important tool in Alternative Dispute Resolution (ADR).
Q.2 What is meant by Communication as a process? How can it be made
effective and ineffective?
Or
Is effective communication necessary and useful tool in conflict
Mediation?
Ans. Communication as a Process: The function of effective
communication is to relay a particular message in such a way that results in a
mutual understanding. There is a process of encoding and decoding involved.
Encoding information is the transmission from a communicator and decoding
is the interpretation of a recipient. Decoding is where communication most
often breaks down. If communication is ineffective it has the power to hurt,
confuse and misinform the listener. Understanding communication as a process
rather than a simple behavior is the first step in becoming an effective
communicator.
Communication Channels: Technology has expanded the number of
available communication channels exponentially, creating even more
opportunities for ineffective communication. Even with the increased
technology, there are a few primary ways to communicate. Verbal
communication is the oral use of words to send a message. Nonverbal
communications are messages that are sent and received without the use of
words such as gestures, vocal tone, eye contact and facial expressions. Written
communication is the use of written words to communicate, such as an email
or memo. Communication channels that provide richer levels of information
have a great chance of being effective. This is the reason why a face to face
conversation is more memorable than an email.
Effective Communication: We can define the mediator as a person who
“facilitates communication between the parties to promote reconciliation,
settlement or understanding.” I think the mediator who has opened an effective
line of communication between the parties can be deemed to have succeeded
at his task. Communication itself is an art, an art of passing information across,
of transferring one’s thoughts meaningfully without being blocked by or
degenerating into an argument.
There are two types of communication- verbal (speaking) and non-verbal
(body language). Effective communication comes from a proper use of verbal
and non-verbal communication. Parties will learn to communicate effectively
between themselves when their mediator is himself an effective communicator.
This is because it is through effective communication that the mediator
demonstrates his skill, generating trust for the disputants to open up to the
mediator and, eventually, to themselves.
When effective communication is in place, then the need for a third party
is ruled out precisely because third parties such as judges, arbitrators and
even mediators only come in the absence of effective communication. Effective
communication therefore solidifies relationships, be they political, diplomatic,
contractual or social.
Effective communication between two people leads to harmony between
them, as the mediator helps the parties arrive at a successful and acceptable
resolution. The mediator only becomes useful when the parties open up to
him, enabling him to understand the root of the conflict, since once you
understand the root of the conflict, you would have largely resolved the
conflict. The mediator, as well as the parties involved, therefore need effective
communication to satisfactorily resolve the conflict.
Effective communication means there is mutual respect and appreciation,
which translates to freedom of expression. A party can only express himself
fully and freely when there is effective communication. And as we mentioned
above, when effective communication has been built, the parties free
themselves from future third-party intervention in their relationship.
The effects of successful communication are understanding, education,
empowerment and respect. Effective communication provides people with
information they need to become educated and enlightened. When people
feel like they are in the know, they are motivated to perform at their best level
of productivity and performance. An effective communicator understands
how to communicate with their audience and how to use a communication
channel to make a meaningful impact. If you have ever looked at your friend
and read her expression without saying a word, that is an example of effective
nonverbal communication. Telling stories can be a powerful way to effectively
communicate with an audience you may not know as well as your friend.
Barriers to Effective Communication: The primary misconception about
effective communication is that it is simply saying what a person feels. Simply
expressing ideas, thoughts and emotions does not make communication
effective. Communication can only be considered effective when the listener
understands the message the individual is attempting to send. Using the
wrong communication channel or conveying nonverbal communication that
contradicts the verbal message are all barriers to effective communication. For
example, giving a strongly worded speech, while using body language that
lacks confidence, will cause people to doubt the entire message.
Ineffective Communication Creates Barriers: Any disruption or failure
in the process can create ineffective communication. Language is an obvious
example; if you as a sender speak in a language the receiver doesn’t understand,
the communication fails. Writing a message to a person who has difficulties

reading is also ineffective communication. These are called barriers, and they
are not all so obvious.
For example, if you have an idea but lack confidence to speak up, that is
a barrier. Body language, such as slouching in a chair so that it looks like you
are bored, is also a barrier.
Removing Barriers to Increase Effectiveness of Communication:
Removing barriers will increase your odds of communicating effectively. Both
senders and receivers should pay attention to others in the process, making
eye contact, listening intently and avoiding distractions.
By being empathetic, you are imagining what it is like to be in the other
person’s situation, which helps the communication process. Stereotypes,
generalizations and inaccurate perceptions are also barriers, and are harder to
remove since you must be aware of them. Watching and listening to others
can help you gauge your stereotypes and perceptions in relation to others
and help you improve your communication.
Effective Communication as a necessary and useful tool in conflict
Mediation:
Communication is seen as a complex and dynamic system, with the help
of which people interact with each other continuously changing through
different sensory channels, both verbal and nonverbal messages. In this sense,
we pass through codes, interrelated ideas, information, thoughts and feelings.
It is important that between verbal and nonverbal messages that we sent, to
have an agreement like a perfect overlap. We can speak of effective management
of an impression by an individual when his actions meet a functional
requirement of the communicative act, not only when interlocutors correctly
received the real and undistorted message the transmitter sends. In practice it
was found that when there is a discrepancy between verbal and nonverbal
message or an expressive distortion, we tend to think rather that the nonverbal
message is most times the most suggestive. Taking into consideration the two
forms of interpersonal communication, used in human interactions, we meet
three welldefined communication styles: passive, aggressive and assertive.
The passive communication style is a style in which individuals develop
a communication model that avoids expressing opinions or feelings, trying to
protect the needs and rights they have. Those that use passive communication,
usually have a low sense of self esteem. The behavioral attitudes of individuals
who use this style of communication is characterized by the lack of action,
fear of offenses brought against them by others, refusal of expressing their
anger and aggression, the desire to be perceived by people as individuals
interacting as charismatic, pleasant and extroverted. All these behavioral
elements transform them, in time, in introvert persons. Their passivity in
communication causes them to feel more acutely their frustrations, feelings of
stress and tension, ultimately reaching to the point in which they isolate
physically and emotionally.
Aggressive communication is a style of communication in which
individuals express their feelings and opinions strongly advocating for the
needs they have, in a way that violates the rights of those with whom they
come in contact. These communicators are aggressive verbally and/or
physically, being in a permanent state of alert, perseverance and desire to
achieve their goals by any means often resorting to forcing things, not being
interested in whether their actions affect others. Typically these individuals
have low self-esteem due to physical or emotional abuse experienced in the
past, have unhealed emotional wounds and feelings of helplessness. They
act with anger, having a dominant behavioral style that produces stress for all
those involved in direct interactions with them, which will lead in time to
breaking the relationships they have.
Assertive communication style is a combination of passive and
aggressive style, being a style in which individuals express their opinions and
feelings clearly, strongly advocating for their rights and needs without violating
the rights of others. Assertive communication is characterized by high self-
esteem, by honesty and power. Assertive people are extroverted, relaxed and
talk openly about their feelings and needs, they know how to listen and
accept the views of those with whom they come in contact. In this way they
provide good long-term relationship without resorting to aggression, being
able to adapt effectively to conflict situations.
In any organization, communication takes on new dimensions of efficiency
and effectiveness if there is an organizational climate open to listening,
dialogue and understanding, avoiding communication blockages that could
cause conflicts. From this point of view, we conclude that assertive effective
communication will be the best solution in the conflict mediation process.
Mediation and alternative dispute resolution (ADR) is not just a procedural
amendment of justice, but is a beneficial change in the level of mentality and
culture/organizational culture. Mediation has always existed in traditional
societies consisting of small groups of people in which a wise person, as an
authority, was meant to act as mediator when the appearance of a conflict
situation require it. Thus, mediation can resolve a lot of conflicts with the sine
qua non condition as parties to want it. Mediation can be used successfully in
litigation pending civil courts, family disputes, inheritance, criminal cases,
divorces, collective labor disputes etc., by establishing a correct
communication, system allowing parties or organizations involved in the
conflict to reach a win-win agreement.
Regarding the common objective of these processes of mediation, we
face “consciously or not, almost daily, the objective is clearly the conciliation
or reconciliation of relations between the conflicting parties. The difference
that arises when we assess the mediation process concerns the techniques
more or less developed that those conflicts are discussed with, techniques
that take into account, of course, the character, nature and extent of each
conflict meditated.” If the traditional conflict resolution focus is primarily on
the legal aspects of the dispute, mediation aims, in line with the law, to find a
convenient and realistic solution for both parties to the conflict.
The mediator can’t help resolve a conflict unless he understands and
analyzes the real causes, objectives that led to the conflict. The source of the
conflict is determined after collecting more complete information about the
parties, which is possible only if the mediator is accepted and fails to win the
confidence of the parties. The mediation, unlike traditional justice process,
doesn’t have as a final the determination of guilt or innocence of the conflicting
parties. Participation in mediation is voluntary. The mediator’s role is merely
procedural, to create conditions and guidance to parties who can find solution
to the problems raised.
The mediator has no decision-making power, he provides procedural
information, stimulates interpersonal communication, facilitating the exchange
of information and views between parties, assists the parties to clarify
misunderstandings, needs and interests, to overcome communication barriers
and reach to solve problems by finding mutually beneficial solutions.
If the parties encounter difficulties in finding solutions, the mediator may
suggest several variants of resolution without imposing a particular solution.
The mediator assists the parties in drafting the final mediation agreement
stating the commitments of each party to the conflict settlement.
Q.3 What skills should a mediator possess for resolving and managing
conflicts?
Ans. In any civilised community, a fair and effective mechanism for
resolving disputes is essential for safeguarding and defending citizens’ rights.
The “Court brings disputes to a close and ensures that citizens can enforce
their rights.” However, in most parts of the world, rising litigation costs,
overburdened court schedules, and delays in case resolution have cast doubt
on the system’s efficacy.
This is reflected in a Supreme Court of India judgment, which states that
“interminable, time- consuming, complex, and expensive court procedures
compelled jurists to seek an alternative forum that is less formal, more effective,
and can speedily resolve disputes without procedural claptrap.”
Mediation, unlike arbitration or litigation, is a relatively recent process
that has been utilised to resolve labour, business, community, and divorce
cases. Mediation is a method that can be tailored to a variety of different
types of disagreements. Although arbitration is probably the most popular
form of alternative dispute resolution (ADR) outside of the courtroom, mediation
is becoming more common because of the recent development of arbitration
contract clauses. Commercial disagreements frequently emerge between parties
that, by necessity, must be able to work together amicably. This article focuses
on mediation as a mode of resolving disputes and conflicts by exploring the
benefits of using mediation over all other modes of conflict resolution that are
available to us today.
Mediation: Mediation is the participation of a neutral third person to
support and assist individuals involved in a disagreement in reaching a
resolution. Negotiation differs from mediation in the sense that the parties
involved work out the issues of their own accord. They have the assistance of
a third party, the mediator, in the case of mediation to help them reach an
agreement. Mediation, whether official or informal, can often assist in resolving
issues that have progressed beyond the stage of negotiation.
Characteristics of Mediation: One of the most important aspects of
mediation is that the mediator does not ‘sort things out’ for the parties involved.
Instead, he or she assists the parties in collaborating to create their own
agreement. Although there are many professional mediators working to mediate
problems, anyone can act as a mediator in a dispute between co-workers or to
reconcile two feuding friends or neighbours. Mentioned below are a few
important characteristics of mediation:
• Participation is entirely voluntary.
• Face-to-face meetings between the conflicting parties
• An unbiased mediator with no decision-making power assists those
involved in reaching an agreement by helping them comprehend
one other’s perspectives.
• All participants have an equal opportunity to speak and clarify their
point of view.
• All pertinent data is being shared.
• An agreement can be reached by both sides without being coerced/
patronized in any manner.
Mediation skills to resolve and manage conflicts: A mediator must
possess a diverse set of abilities, including the following:
• Listening abilities that are active.
• Emotional intelligence to understand the underlying emotions;
questioning and clarifying skills to grasp both the facts and the
areas of debate.
• Summarising skills are used to lay out the key areas of contention
and underlying emotions, as well as to assist participants in
rephrasing topics in a less emotionally charged language.
• Empathy allows each side to put themselves in the shoes of the
other and understand their viewpoint.
Most importantly, a mediator must avoid taking sides or do things that
might portray him as acting unfairly. As a result, you’ll need to respect all
parties’ perspectives and devote equal time to each individual or problem. It

will never help to point out that someone is being unreasonable, but you may
assist them in conducting a “reality check” by asking what they consider a
reasonable outcome and whether they believe the other party would agree.
1. Investigation: A mediator must conduct extensive research to
comprehend the issues, “facts,” and views of the parties in a case.
This investigation, which usually takes the form of a series of
questions posed in public and private sessions, peels back the layers
of the dispute and aids in determining which facts, interests, and
sentiments are relevant to resolving the case. A mediator evaluates
which lines of inquiry are fruitful and puts each party’s concession
or compromise range to the test. These investigations allow the
mediator to get a feel of what kinds of agreements are conceivable.
2. Managing the interaction: The interaction between parties is
complex and can turn more adversarial if not controlled and mediated.
The number of parties involved, of course, increases the complexity.
The mediator must also serve as the facilitator in order to keep the
meeting focused and fruitful. This includes the following:
• Creating a set of communication guidelines,
• Active listening is encouraged,
• Preparing for and dealing with intense emotions,
• Choosing a time and who to meet in private caucus,
• When parties are joined by a representative, managing
relationships becomes more difficult.
3. Invention/problem solving: Invention and problem solving are two
methods for breaking a deadlock and increasing cooperation. A
mediator can help you come up with new ideas in two ways:
• The mediator can establish an environment that allows the
parties to come up with their own solutions (via empathy,
investigation, and persuasion).
• The mediator might make suggestions or thoughts that the
parties may not be aware of. In either situation, the mediator
and the parties are likely to employ fractionation strategies.
4. Persuasion: Mediators must have strong persuasion skills – the
capacity to convey impressions or ideas that change others’
perception of a situation or proposition – as well as the discernment
to know when to employ them. When persuading a party to
realistically analyse his or her alternative to no agreement or providing
packages to test the rationality of both sides’ proposals, mediators
frequently utilise increasingly convincing tactics as the case
advances.
5. Realistic assessment of alternatives: Parties to a dispute frequently
do not consider what will happen if the case is not resolved. The
mediator will normally assist the parties in sorting out these
alternatives to settlement, evaluating the costs and advantages of
non-settlement with as much precision as feasible.
6. Creating options: When it comes to prospective settlements, parties
in a conflict frequently have tunnel vision: they think that they
already know the appropriate answer. The mediator will usually assist
the parties in exploring various aspects of a settlement, such as
“expanding the pie” to include issues for discussion that the parties
had previously overlooked.
7. Reformulating or reframing the problem: In most cases, parties in
a dispute characterise “the problem” as the other party’s fault. It is
difficult for a party to be flexible in seeking an agreement when they
see the problem purely in terms of the other party’s responsibility.
Fortunately, many appropriate definitions of “the problem” exist,
and the mediator will usually assist the parties in finding meanings
that they are comfortable with and divert them from being focused
on blaming the other party. The mediator can take into account all
the facts of the case and reframe the problem in terms that would
help in better facilitating the solution that is being sought by the
parties.
8. Managing anger and frustration: In most negotiations, both parties
want more than they can obtain. This can cause frustration, which
can then turn into rage. Sometimes the rage is visible, and other
times it is hidden. The mediator will usually assist the parties in
dealing with their anger so that it does not prevent them from reaching
an agreement.
9. Distributing the pie: Most agreements entail the act of dividing up
a set of resources, in some form or another. Parties, with rare
exceptions, demand what they perceive to be a “fair” share of the
distribution. The mediator can take the responsibility to ensure that
both the parties are recipients of a fair percentage of the settlement,
as per their role in the issue at hand.
10. Strategic decision: Overlapping all of her/his responsibilities, the
mediator must design and pursue a strategic path that will assist the
parties in reaching an agreement. It’s critical to separate meaningful
data from noise, establish each party’s basic criteria for agreement,
“coach” the parties’ negotiating process, and appreciate the parties’
relative flexibility.
Although a little humility never hurts, it’s vital to remember that mediation
doesn’t always work and that it’s not always the mediator’s responsibility if it
doesn’t. It will be impossible to mediate a shared solution if members do not

come prepared to discover one. Cross-cultural conflicts will always be difficult
to resolve because what is accepted in one culture may be completely
objectionable in another.
A skilled mediator will always endeavour to be aware of what else is
going on, looking for hidden agendas and obstacles to effective problem
solving. At the same time, a successful mediator will be able to separate
themselves from the issue. The mediator’s job is to assist others in reaching
mutually acceptable solutions to their problems without becoming engrossed
in the issue themselves.
Q.4 What is Confidentiality in Mediation proceedings?
Ans. Mediation is a procedure in which the parties discuss their disputes
with the mediator who is a trained impartial third person(s) who assists them
in reaching a settlement. It may be an informal meeting among the parties or a
scheduled settlement conference. The dispute may either be pending in a
court or potentially a dispute which may be filed in court.
Generally, the disputes suitable for mediation are as follows:
• Dispute of Commercial Transaction
• Personal Injury
• Construction workers, laborers and community relations
• Divorce
• Domestic Relations etc.
A mediator is a person with patience, persistence and common sense.
Mediator has an arsenal of negotiation techniques, human dynamics skills,
and powers of effective listening, articulation, and restatement. The mediator
is a facilitator who has no power to render a resolution to the conflict. The
parties will fashion the solution as the mediator moves through the process.
Need of Confidentiality in Mediation: To comprehend the focal issues,
the inspirations, the weight focuses and the dangers of the case, the members
must be guaranteed the discourses can’t and won’t be unveiled to others so
they can talk straightforwardly. Every now and again, a portion of the rousing
powers behind claims are lawfully insignificant but then outstandingly vital
to understanding the contention and encouraging determination. As often as
possible, customers uncover private occasions, observations or issues in
mediation they would not need revealing to anybody. Clarifying their worries
and fears is frequently basically critical to them so as to determine the
contention. In the event that discourses with the middle person are not private
and special, the intervention procedure, the mediator part and the potential
for determination are fundamentally lessened.
Confidentiality is essential:
• To Strengthen the level of trust
• To Increase Confidence in the Impartiality of the Mediator
• To Increase the Integrity of the Mediation
• To Beseech Full and Frank Disclosure
• To Release Parties from the Strict Confines of the Rules of Law
Mediators often tell the parties at mediation that the mediation process is
private and confidential. This may be generally reinforced by a mediation
agreement, which is usually prepared by the mediator, and signed by the
parties and the mediator. However, is this clause or section in the mediation
agreement, enforceable? What if the court orders for such information to
impart justice? There are no easy answers to these critical questions.
How Mediation Agreement Ensures Confidentiality?
Mediation is a shut entryway private issue and the prime preferred
standpoint related to intervention is privacy. Not at all like court procedures,
third parties don\’t approach mediation procedures. The mediator intervention
is private regardless of whether it brings about the settlement and determination
of the question.
Eventually, the parties are likewise expected to keep private, all issues
identifying with the mediation procedures. Notwithstanding amid the
procedures when one party gives data to the mediator subject to a particular
condition that it is to be kept classified, the middle person is blocked from
unveiling that data to the other party.
On the off chance that intervention is unsuccessful, what unfolded in the
mediation procedures isn’t to be revealed. This is in spite of the reality that
privacy in intervention has no statutory sponsorship in light of the fact that
the procedure of mediation is naturally thought to be secret. In case of court-
annexed mediation conducted by the mediation centers at Delhi also,
confidentiality has been accorded due importance. The courts have also
emphasized upon the aspect of confidentiality in mediation proceedings
Rules on confidentiality in Mediation: International Chamber of
Commerce
While parties are allowed to concur on terms relating to privacy in a
mediation agreement, principles of most establishments that manage mediation
cases make arrangements for the same. For instance, the Mediation Rules of
the International Chamber of Commerce (ICC) give that unless generally
concurred by the parties or required by pertinent law, the intervention (yet not
the way that it is occurring, has occurred or will happen) is private and
classified. Therefore, entries made by another party or by the mediator in
mediation may not be delivered as confirmation in any intervention, prosecution
or comparable procedures, unless they can be gotten autonomously by the
party looking to create them in those procedures. The same is made appropriate
to sees communicated, recommendations made in regards to the settlement,

or any confirmations made by another party in mediation.
What does the Arbitration and Conciliation Act, 1996 mentions on
confidentiality in Mediation
India ordered the Arbitration and Conciliation Act, 1996 in accordance
with the UNCITRAL Model Law. Article 75 of the said Act gives that the
mediator and the parties should keep secret all issues identifying with the
pacification procedures including the settlement understanding, aside from
where its revelation is essential for reasons for usage and requirement.
Section 89 of Code of Civil Procedure Code, 1908 on Confidentiality in
Mediation: Need to Reform
Section 89 of the Code of Civil Procedure, 1908 as amended by the Code
of Civil Procedure (Amendment) Act, 1999 enunciates provisions for the
settlement of disputes outside Court.
The difficulty with the provisions of Section 89 lies in the fact that it
commands that where it appears to the Court that there exists a component of
settlement which might be satisfactory to the parties, the Court should detail
the terms of settlement and in the wake of accepting remarks of the parties
may reformulate the terms of conceivable settlement after which parties might
allude to arbitration, conciliation, judicial settlement or mediation.
The necessity that the Court must detail the terms of conceivable
settlement puts a critical weight on the Court even before alluding the parties
to intervention. The Court in such a case might be required to invest an
impressive level of energy and exertion in begging parties to settle their debate
and to draw up the terms of a conceivable settlement.
The very object of mediation or conciliation is to put the parties under the
facilitative capacity of a mediator who will then empower them to investigate
their interests and to think about different alternatives for arranging settlements.
Putting the weight of planning the terms of a conceivable settlement on the
Court even before the parties allude to mediation is in this way not proper in
light of the fact that it is just when parties have taken recourse to mediation
that the full range of option can be explored by them.
Can Courts Demand the Confidentiality Agreement, undergone in
Mediation Proceedings?
Indian courts and quasi-judicial bodies have upheld the important role
that confidentiality plays in mediation. Take the interesting case of Moti Ram
& Anr. v. Ashok Kumar & Anr. [(2011) 1 SCC 466], the Supreme Court of
India, in this case, had referred the matter for mediation to a Mediation Centre
to attempt to resolve the dispute between the parties. Subsequently, a report
by the Mediator was placed before the Court that mentioned the various
settlement proposals made by the parties, among other things. As a result, the
Supreme Court stressed that mediation proceedings are strictly confidential.
It observed that when successful, the mediator should send the settlement
agreement signed by the parties to the Court without mentioning what
transpired during the mediation proceedings. When unsuccessful, the mediator
should simply state that mediation has been unsuccessful. The Supreme Court
was of the view that any disclosure of the happenings in a mediation proceeding
destroys the confidentiality of the mediation process.
Salem Advocate Bar Association v. Union of India [AIR 2003 SC
189], this case led to the formation of Mediation and Conciliation Rules of
Delhi 2004. Under Rule 19 of Mediation and Conciliation Rules, 2006,
Confidentiality is mentioned which states that- Parties shall maintain
confidentiality in respect of events that transpired during mediation/
conciliation and shall not rely on or introduce the said information in any
other proceedings as to:
• “views expressed by a party in the course of the mediation/
conciliation proceedings
• documents obtained during the mediation/conciliation which were
expressly required to be treated as confidential or notes, drafts or
information given by parties or mediator/conciliators
• proposals made or views expressed by the mediator/conciliator
• the admission made by a party in the course of mediation/
conciliation proceedings
• the fact that a party had or had not indicated willingness to accept a
proposal.”
NOTE- There shall be no stenographic or audio or video recording of the
mediation/conciliation proceedings.
Confidentiality in Mediation – Is there an Exception?
In the case of Rama Aggarwal v. Delhi State Legal Service Authority
[2015], which came up before the Central Information Commission (CIC), the
CIC held that a party cannot seek information pertaining to mediation
proceedings under the Right to Information Act, 2005 as the same attracts
exceptions under provisions of the said Act. The CIC observed that
“Information regarding negotiation, mediation, conciliation, and counseling
will fall under exempted clause of information of another spouse, being personal
and given in fiduciary capacity and, no public interest is established in
disclosure, while there is larger public interest in protecting that information
as that would help mediation to flourish, hence such information shall not be
disclosed.”
Q.5 What are Mediated Settlements? Are Mediated Settlements
enforceable in India?
Ans. Mediated Settlements is a settlement agreement in simple words
can be understood as a contract that is reached by the parties which resolve
their disputes. Now, as mediation is a process in which the parties voluntarily
decide to engage in, a mediated settlement agreement can be reached after

mediation by both parties. In other words, in a mediated settlement agreement
whatsoever the parties have decided mutually is reduced in writing. It is a
document that binds the parties to cohere to the agreed terms and conditions
as an outcome of mediation.
In most cases, there is no court intervention required as the settlement
agreement is reached by the parties voluntarily and mutually. The agreement
is then signed by the parties in the presence of the mediators enabling the
mediation and also legal counsels of both parties. Nevertheless, mediation is
still considered by most parties in divorce and family law to be a favourable
alternative to litigation because it is cost-effective and flexible. Agreements
which are entered into in the course of mediation are acceptable and stand the
greatest chance of being implemented because the outcome of mediation is
not imposed by a third party adjudicator but represents a solution that has
been voluntarily agreed to by mutual agreement.
Importance of mediated settlement agreements: Mediated settlement
agreements are important because they can turn risks, delays into decisions
of the parties. A good settlement agreement can help the parties to remove
misunderstandings and conflicts. It also lessens the burden on courts and
also reduces legal expenses.
At the end of a successful mediation, one must obtain the basic terms of
the agreement in writing before completing the mediation process. Without a
signed document, it may be difficult to implement the agreement reached
during the mediation process. The process of mediation is confidential, which
is one of the best things about the process. If the parties do not sign a
document containing at least their main terms, it is difficult to prove the
agreement reached during the mediation. The parties must sign a final
agreement if they settle because the parties may have second thoughts about
their decision after time away from mediation. To remove the possibility a
mediated settlement agreement is always encouraged by professionals. Thus,
a mediated settlement agreement should be detailed, even-handed, and not
conditional, using clear and familiar wording, emphasizing position action,
and lastly should also address any pending proceedings for the future.
Legal enforceability of mediated settlement agreements in India: There
isn’t any law in India defining ‘mediation’ however there are diverse references
to it. Most applicable in the context of commercial mediations are the Code of
Civil Procedure 1908, and the Commercial Courts Act, 2015. Under Section 89
of the Code of Civil Procedure, 1908, which empowers the court to refer
disputes for agreement out of courtroom doors, which includes mediation.
The problem with Section 89 lies in the fact that it mandates that where it
appears to the court that there exists an element of settlement which may be
acceptable to the parties, the court shall draft the terms of settlement and after
receiving comments of the parties may reformulate the terms of possible
settlement after which parties may be referred to arbitration, conciliation, judicial
settlement or mediation. In cases of settlements in court-annexed mediations,
the settlement is enforced through the courts as the court passes an order or
decree in terms of the written settlement.
When we move to Section 30 of the Arbitration And Conciliation Act,
1996, which encourages settlement of the disputes is only effective when the
parties have chosen to settle a dispute after they have initiated arbitration
proceedings. In case the parties have opted for private mediation with regards
to a mediation clause or otherwise, settlement agreements cannot be treated
as arbitral awards. They are just and forced as contracts between parties. This
raises various issues because the settlement agreement cannot be enforceable
as a decree of the court, but it may form the basis of a civil suit, and then it
would dilute the whole purpose of opting for alternate dispute resolution. It
can happen even though the parties have settled the matter. As a result, the
weak compliance mechanism negates the purpose of mediation, making the
whole process ineffective. As a result, in India, private mediation is not
preferred.
In some cases, the parties tried to enforce the settlement agreement in
accordance with the law. In Shri Ravi Aggarwal v. Shri Anil Jagota
[2009], both the parties agreed to conduct private mediation and requested
that the agreement is so reached, be implemented in accordance with Section
30, Section 73, and Section 74 of the Arbitration and Conciliation Act, 1996.
The court refused because Part III of the Arbitration And Conciliation Act was
only applicable to settlement agreements drawn with mutual consent by duly
constituted conciliation proceedings.
Section 74 of the Arbitration and Conciliation Act, 1996 provides that a
settlement agreement has the same effect as an arbitral award on agreed terms.
The position in the Commercial Courts Act is also the same as a settlement in
a pre-institution mediation proceeding under the Act and is given the same
status as that of an arbitral award under the Arbitration And Conciliation Act.
Such an arbitral award is enforceable as a decree of court as per Section 36 of
the Arbitration and Conciliation Act, 1996.
Apart from the Code of Civil Procedure Act 1908 and the Arbitration and
Conciliation Act 1996, the Commercial Courts Act also to a certain degree
encourages mediated settlement agreements in commercial cases. The
Government of India by way of an ordinance amended the Commercial Courts
Act 2015. This amendment made pre-institution mediation necessary before a
commercial suit is instituted for matters that do not require immediate interim
relief. Through this process, any settlement agreement which will be reached
shall be reduced into writing and signed by the parties and the mediator. This
settlement agreement shall have the same status as an arbitral award on agreed
terms.
Essentials of a settlement agreement to be enforceable: The settlement

includes the main content of the contract and various other requirements for
making the contract effective because the settlement is a special type of
contract. The essential elements of a valid contract are proposal, acceptance,
review, the legal capacity of the parties, the legality of the subject, etc. The
Arbitration and Conciliation Act stipulates that a written settlement agreement
must be drafted and signed under Section 73. When the settlement agreement
is being signed, the parties must also confirm it. This is final and legally
binding on the parties requesting it. It is necessary that the mediator
authenticates the settlement agreement and provides a copy of it to the parties.
If an agreement or court agreement is reached during the court mediation
process, it must be submitted in writing and submitted to the court. It is the
authority that approves an order or decree.
Can mediated settlement agreements be challenged?
As per the Arbitration and Conciliation Act and the Commercial Court
Act, mediation agreements have the same standing as an arbitral award, and
therefore can be challenged under the same reasons as arbitration awards.
Fatal factors include fraud, coercion, corruption, political party incompetence,
or agreements that violate the basic principles of public order or Indian law. In
India, mediators are not required to provide mediation evidence or so-called
agreements in litigation or arbitration. This provision helps in maintaining the
confidentiality of the whole proceedings.
On Conclusion, As the Indian regime separates mediation from arbitration;
the law will inevitably bring them to the same level in terms of uniform
applicability and acceptance. If mediation is compared with arbitration,
mediation can only be used as a viable alternative dispute resolution procedure.
Until and unless the government enacts a law on mediation there will remain
gaps that will require court’s intervention periodically. Even if the government
enacts a law on mediation, India has still a long way to go from realising the
true potential of alternative dispute resolution.
Finally, when formulating law on a mediated settlement agreement, the
legislature must also ensure that the scope of the challenge is limited to the
mediation agreement. Otherwise, even if they are considered to be arbitration
awards, they will fail. The Indian government is actively taking steps to
facilitate business in India. Improving the ability to resolve disputes is essential
to promote business practices, and the signing of the Singapore Mediation
Convention guarantees Indian foreign investors’ commitment to alternative
international dispute resolution practices.
Q.6 What are the dimensions of Drafting Mediated Agreements?
Ans. Mediation is a new language. Its development relies on the process
itself: each case and its dynamics, circumstances and expectations, and the
needs and interests of the parties. Therefore, a standardized agreement form
for all mediations is not as effective and, in fact, is contrary to the essence and
spirit of the process.
While the construction of any mediation agreement is a product of a
successful mediation, it is not always the case that a successful mediation
entails a formal agreement (whether provisional or final).
A written agreement is not necessarily the barometer of a successful
mediation. Sometimes, a certain dynamic develops that leads the parties to
bridge their differences so profoundly that they do not feel the need for a
written agreement.
A mediation agreement must stem from the mediation process itself. The
operative term here is agreement, not contract. An agreement, as we use the
term, reflects the joint effort of all parties. Based on the case studies and
agreements in our hands, we can offer instructions to mediators how to ferret
out the critical information, how to classify it and identify pivotal points. With
the aid of these instructions, the mediation agreement will faithfully reflect the
process that the parties themselves entered into.
The agreement will be intelligible and credible to all parties and stand up
to the hard experience of reality.
The mediation agreement needs to respect the mediation process’s
dynamic and fundamental principles. The mediation agreement is a product of
the interaction of two parties willingly coming together to resolve their dispute
under the guidance of a skilled mediator. The parties come to understand and
then accept their own needs, to protect their common interests, and to rebuild
communication, recognizing that this is the key to effective and successful
agreements, both in the short and long term.
The mediation agreement is fundamentally different in content, style and
language from a legal (or any other) agreement. This is due to the unique
nature of each agreement since it is created by the parties themselves as a
result of their specific conflict and the mediation process as they experienced
it. There is a lack of professional, academic and technical guidance in this
area. The crafting of a mediation agreement is an acquired skill, sharpened and
improved by continued involvement in the work. At the same time, a focused
article accelerates the mastery of the necessary technical skills. With the
experience we have gained over the past six years, we have identified seven
dimensions that reappear throughout the mediation process in its different
guises and forms. Embedded in these dimensions are the tools for writing the
agreement.
Negotiation is based on seven basic elements. Often, when parties begin
to stake out their positions in negotiation, the positions dissolve into the
conflict. Therefore, to identify and understand these seven elements is
essential, since they organize the negotiation process.
Parallel to negotiation, the mediation process proceeds in seven stages
(Harvard University model 1976) that detoxify the atmosphere, build trust,
and address the misunderstanding in such a way that helps generate options
for consensus and reaches joint solutions. When writing mediation agreements,
there are seven dimensions to be identified as well. The same dimensions that
carry us through the entire process have a significant importance that come to
expression when writing the mediation agreement. The dimensions are
presented sequentially; however, in reality they are employed in a more
integrated manner.
Dimensions of Drafting Mediated Agreements are:
(1) Identifying and naming the parties:
It is important to distinguish between private mediations and those dealing
with companies and institutions. In private mediations, such as those involving
family conflicts, business disputes, partnership dissolutions, or conflicts
between neighbors, the identification of the parties is relatively simple. The
parties represent themselves and are identified as such by their own names in
the written agreement. They obligate themselves to the agreement by signing
it.
The mediator’s obligation is, first and foremost, to clarify the capacity of
the parties. Sometimes, from the outset, the mental or emotional capacity of
one or both of the parties seems limited. Often, this is due to the stress
generated by the conflict. Although the diminution of their capacity is caused
by their conflict and may be temporary, they nonetheless magnify emotions of
fear, rage, excitement and general insecurity. However temporary, these
emotions are pervasive, as they are real to the dissenting parties. A limitation
in capacity may not reveal itself until a later stage in the mediation. Occasionally,
such a limitation may warrant a brief hiatus in the mediation process.
For organizations and companies represented by an employee in the
mediation, it is important to clarify the employee’s authority. He may be a
negotiator, without authority to make final decisions; he may need to check
with a superior. In such a case, the mediator is obligated at the outset to
identify the precise scope of the negotiator’s authority. This must be done
during the first meeting, gently and diplomatically, by asking simple, direct
questions, such as: “If we should reach an agreement, would you be able to
sign off on it?” or “Is there someone else who needs to confirm your
decisions?”
The mediator must investigate this representative’s position within and
even prior to the conflict. Is the negotiator the sales person who reached an
agreement? The CEO of the company? The legal counsel? All this will color
the mediation process. It is important to ask these questions in a
straightforward, non-judgmental manner, as opposed to stating the questions
in a manner that arouses suspicion. It is a good idea to precede, or elucidate
the questions with a clarifying comment such as: “ The reason we are asking
this is because, if and when we should reach agreement, it is critical to the
mediation process that the people at the table have the power and ability to
implement agreements that are reached here in mediation.”
The mediation process is begun with this focus on the identity of the
parties, because the beginning will dictate whether at the conclusion of the
process they will have both the stability and authority to reach an agreement,
as well as the power to sign it. Additionally, by the parties identifying and
expressing themselves as individual, negotiating entities in the process, it
empowers them to accept the outcome. This empowerment is the sine qua non
of a successful conclusion to the writing of a mediation agreement.
It is vital for a mediation agreement to take on a personal tone. This is
done by listing the negotiator’s personal names, whether they are the actual
parties to the conflict or their representatives. Even more: If a negotiator is
usually referred to by a nickname, use that in the agreement. This personal
tone, so different from the formality of other agreements, increases the
negotiator’s sense of responsibility for the process. Terms like “the company”
put distance between the party representing the company and the process,
and should therefore be avoided. On the other hand, the use of nicknames or
other informal terms favored by a party allows the mediation agreement to
begin to develop. This phase fosters an environment in which the parties can
get comfortable with the mediation setting. This personal climate helps lead to
effective and productive negotiating.
As an alternative process, mediation is intrinsically less formal than more
traditional processes. As such, its internal manners are less formal. In many
western cultures informality is signaled by use of first names. This signals
intimacy and familiarity, which is conducive to mediation. This is not to suggest
that in all cultures the use of first names has the same meaning. Within the
context of each culture it is up to the mediator and the parties to find appropriate
means of creating a more relaxed and informal environment. When we suggest
the use of first names it is meant as a proxy for informality. Meaning, in each
culture, whatever expresses and communicates personalization and informality,
should be incorporated into the mediation.
Personalization reinforces the obligation that the negotiators feel for any
conclusions or resolutions. Personalization-not least the name of the negotiator
on the agreement itself-serves to recall for the negotiator the experience, time,
investment and spirit of the mediation process. The negotiator is an essential
cog in all that transpires: he influences the outcome, and is influenced by the
others present; he is the one who agreed to all the relevant settlements.
Thus, when the time comes to execute the terms of the agreement, first by
presenting it to the company’s higher-ups, the negotiator personally bears all
of the give-and-take that made the agreement possible, thereby committing
him to the agreement.
Personal names and other such informal references in the language of the
agreement make it unique. Mediation agreements “belong” to the parties,
adding a new dimension to each of their original positions and attitudes.
Mediation agreements should “feel” different from a labor contract, a real
estate title policy, or a divorce settlement.
(2) Presenting the Framework of the Agreement:
A framework is necessary not only in order to define the main points of
the conflict. Equally important is the relations between the parties. These
must be framed in such a way as to make both parties comfortable. The
framework contains the basic points of the dispute that created the need for
mediation.
The framework must be introduced at the very beginning of the formulation
of the mediation agreement. The purpose of the framework is merely to outline
the central and relevant points in dispute, to highlight the mutual interest of
both parties to resolve it , and to include a general statement that resolution
has been reached. All this should be stated simply and factually without
entering into the details of the conflict itself. To be omitted at this stage is the
history of the conflict and all the details. It is valuable to be clear about what
is being dealt with right at the beginning. This assures the parties are aligned
to the common goal.
The parties themselves define the framework of the mediation. They are
the ones who explain why the mediation is taking place, what the dispute is
about, and what their respective interests are. They are the ones who establish
the issue at hand. The framework arises from the details that unfold in the
mediation process.
The framework is short and to the point, containing all the facts to which
both parties already concur. The framework is separate from the complete
agreement, which will emerge only as the mediation process continues. Simply:
What is the dispute that must be resolved?
It is useful for a number of points to appear in any mediation framework;
the sooner they are agreed to and formulated, the better.
• The circumstance or catalyst of the present conflict. Often this is a
misunderstanding or existing dispute.
• A statement that both parties have a common interest in resolving
the conflict.
• A statement that the mediation agreement will be a by product of the
present mediation process..
3. Identifying Topics and Interests In the dispute:
What came first? What is relatively important, and relatively unimportant?
The answers must be put in the context not only of the parties and the
mediators, but of the law and any existing practices. It is important to establish
a hierarchy of points in the dispute (thus also to prioritize the points of the
mediation agreement). When writing the agreement, the most difficult, more
contentious, points should be dealt with first.
In the mediation process, the mediator enables the parties to understand
and realize their respective interests; it becomes the mediator’s job to crystallize
what is most important to them in order to rank the points in the dispute. A
ranking may become clear in conjunction with interim agreements the parties
themselves reach as mediation proceeds.
A ranking of points in dispute responds to two questions. First, from the
perspective of the parties themselves, what do they perceive as most
important? For example, in a workplace dispute, an apology may need to
precede any evaluation of the points in dispute, not to mention any decisions
on financial compensation or other resolutions. Second, what do logic, law,
and social norms say? For example, in a marital dispute governed by Jewish
law, the actual granting of the get (formal bill of divorce) may need to precede
the resolution of matters of custody and property settlement.
It is important that the mediator responsibly balance and harmonize the
parties needs and priorities with the legal reality.
In the prioritization of points, mediators sometimes find subtitles or outlines
useful. They may aid the full construction of the mediation agreement by
assuring that no point is overlooked.
4. The Interim Agreement:
During the course of mediation, various ideas and solutions come up.
These may reflect agreement among the parties themselves, or, the parties
may express the ways in which they want the dispute to be resolved. All such
suggestions and declarations should be agreed to in writing. They are vital.
Using them, it is possible to configure a provisional agreement. They are
stepping stones to progress. They become the concrete material that the
parties discuss as potential resolutions and are a powerful tool in furthering
the termination of the dispute.
A provisional agreement is just what it says-provisional. It does not bind
the parties past the duration of time designated for a trial basis agreement. It
makes no difference how insignificant any interim resolution or concession
may seem. It advances the process, cultivating a receptivity toward a more
conciliatory attitude, and can lead to further agreement. Provisional agreements
are a fundamental methodological tool of mediation. Just as the mediation
process itself should endeavor to be as transparent as possible, so should the
provisional, as well as, final agreement. With this in mind, the written language
of the agreement should be simple, clear, detailed and future oriented.
Whenever possible, it is a good idea to try to capture the words of the parties
themselves. This can circumvent the parties from feeling the mediator is
possibly inserting, or reflecting any personal agenda or bias he/she may
have.. Furthermore, this helps reinforce the parties connection and commitment
to the agreement.
A provisional agreement helps clarify for the parties themselves their
actual goals in the mediation. This, in turn, enables them to consult with
friends or legal advisors productively. A provisional agreement - to which
details may be added to or subtracted from - gives the parties a sense of
flexibility. This helps them embrace the process and may liberate them from
rigid postures. This may also calm their fears of being coerced into agreeing to
something they are averse to. A provisional agreement conveys the message
that this is their agreement, that the decisions they reach are, in fact, their
own, thus increasing the parties sense of ownership of the agreement.
A provisional agreement builds or renews trust and gives a tangible
indication as to whether a final agreement is really possible. To sustain a
provisional agreement is the litmus test of whether it is possible to sustain
trust between the parties, and thus to reach a final agreement that holds water.
Part of reaching the stage of drafting a provisional agreement is self-
scrutiny by the parties themselves. What, precisely, can they commit to
writing? How closely have they moved toward resolution?
The ideal situation is for the final agreement to come from the parties
themselves. Unfortunately, this does not often happen. This is the power of
the provisional agreement: It gives the parties the tools with which to develop
a final agreement that will satisfy them both.
5. Revisions:
Revisions to a provisional agreement requested by the parties give the
mediator an important tool - an understanding of the parties’ underlying
intentions toward each other, and of how they really feel about the mediation
process thus far.
Throughout the drafting of the agreement, it is important to constantly
revise - to view the agreement as fluid and fungible -until it is final. Formulation
of the revisions is best done at a separate meeting with each party individually.
Only afterwards should both parties meet to decide which clauses should be
incorporated into a final agreement.
Whenever a party expresses an interest in changing an agreement, it is
important to understand whether it fundamentally changes or merely “tweaks”
the agreement. Further, it is important for the mediator to know the source of
the proposed change. Does it express a fuller understanding of the agreement
-or does it pose a new problem, or reflect regret, or a change of mind? Is it an
expression of fear of going through with the agreement? It is vital to understand
a party’s motivation for a revision - does it advance the process or impede it?
Another consideration: Should a mediator attribute the revision to the party
himself, or as a joint idea of the party and the mediator?
To address necessary changes and revisions in the agreement can alleviate
fears for the parties. The possibility of revision shows that it is possible to
alter that which has been set. This reinforces the notion that mediation is not
coercive. Revision adds credibility to the process. Revision can also show
whether the ultimate agreement will stand the test of time by unveiling a
party’s true intentions.
6. Reading the Agreement Aloud and Other Final Steps:
The mediator must be certain that each of the parties has read the
agreement separately. If it seems necessary for the mediator to read the
agreement with each party separately, this should be done. Subsequently, the
agreement should be read while both parties are present, in order to confirm
the accuracy of the settlements heretofore agreed upon. Moreover, during the
reading after each section, the mediator should affirm that both parties
understand the provisions in the same way and that there is a meeting of the
mind.
It should be clear to the parties that this is the critical time to decide
whether they will terminate the dispute by agreeing to sign the final agreement
and comply to it.
A provision should appear at the conclusion of every mediation agreement
that provides for resolving any future conflict between the two parties. This
clause should envision a possible change of circumstances that would make
the present agreement obsolete, but that also commits the parties to attempt
further mediation before taking legal action.
Since the mediators do not serve as legal advocates for either party, but
as neutral facilitators that advance each party’s interests, the parties should
consult with their legal representative prior to signing the final agreement.
This helps ensure that nothing in the agreement violates or ignores their legal
rights. The mediator should confirm that each of the parties has done this.
Each party is encouraged to consult his legal advisor of choice; the mediation
center’s attorney need not be used, although it is an option for any interested
party. When consulting a private attorney, it is important that the attorney be
someone who understands and appreciates the mediation process. This is so
he may effectuate and support the agreement, rather than sabotage the work
that was accomplished during the mediation, as is reflected in the resulting
agreement. Nevertheless, the possibility of necessary legal revisions is normal,
and should be expected.
7. Ceremonial Signing:
This final step brings the process full circle and it’s purpose is twofold:
First, the active signing on behalf of the parties is a declarative action of
closure to all that transpired throughout the process in order to reach this
point. Second, the signature of the parties attests to their understanding and
recognition that this final written agreement is the product of a participatory
process and reflects the best resolutions they have arrived at in light of the
contextual circumstances.
The parties signature to the agreement now ensures that the agreement’s
status becomes that of a binding legal document and can be approved by a
court of law.
At this juncture, the mediator explains to the parties the significance of
their signatures and the various logistical details that attend to giving this
agreement the force of judgement. Moreover, it is essential to clarify to the
parties that while this agreement is meant to resolve the present conflict, they
nevertheless have the option of returning to mediation should future conflicts
arise.
On a more personal note, now is the time for the mediator to acknowledge
the parties efforts invested in the process that led to this resolution.
Furthermore, the mediator should express the hope that this experience and
newfound awareness of conflict resolution be internalized in such a way that
will empower the parties with the skills and motivation to deescalate and
resolve future conflicts that may arise within their lives.
Q.7 What is the enforcement Laws and Procedures Important
Developments in Mediation? Describe the measure for effective
implementation and growth of Mediation in India?
Ans. Over the years, mediation has been recognised as the fastest growing
method to resolve disputes worldwide. Mediation allows parties to relook at
mutual interests and rights of each other, and to come up with amicable and
innovative solutions. This helps in maintaining cordial relations between the
parties.
The role of courts or arbitrators is adjudicative and more formal in nature.
In contrast, the nature of mediators or the process of mediation is very practical
and flexible. Many a time, it can prove to be speedier, more effective and
economical than the other adjudicative processes.
Mediation needs to be promoted as a mechanism that complements the
judicial process. To achieve acceptance and popularity of Mediation as the
first step before approaching the court or any other Alternative Dispute
Resolution (ADR) method, it is crucial to develop confidence in the process
of Mediation. Court-annexed mediation, to a certain extent, has been adopted
as a measure of docket management and must go hand in hand with promotion
of mediation as a successful, revolutionary, economical and time-saving method
for all the stakeholders.
Current Scenario of Mediation under Statutory provisions:
1. Conciliators appointed under Section 4 the Industrial Disputes Act,
1947 are assigned with the duty to mediate and promote settlement
of industrial disputes with detailed prescribed procedures for
conciliation proceedings. If used appropriately, it’s a cheap and quick
process. However, only a few cases have been resolved and the
very intent of having such provision has been frustrated.
Unfortunately, large numbers of matters which ought to have been
resolved by this provision are still pending in courts and new matters
are filed every day.
2. In 2002, an amendment to the Code of Civil Procedure, 1908 (CPC)
was brought in. Section 89 read with Order X Rule 1A provided for
reference of cases pending in the courts to ADR. In addition, Order
XXXIIA of the CPC recommends mediation for familial/personal
relationships, as the ordinary judicial procedure is not ideally suited
to the sensitive area of personal relationships. Though many courts
in India now have mediation centers, there is no accurate data
available to show that this provision has been utilised successfully.
3. Even Section 442 of the Companies Act, 2013, read with the
Companies (Mediation and Conciliation) Rules, 2016, provides for
referral of disputes to mediation by the National Company Law
Tribunal and Appellate Tribunal.
4. The Micro, Small and Medium Enterprises (MSME) Development
Act, 2006 mandates conciliation when disputes arise on payments
to MSMEs.
5. More particularly, family and personal laws including the Hindu
Marriage Act, 1955 and the Special Marriages Act, 1954 require the
court in the first instance to attempt mediation between parties.
6. Section 32(g) of the Real Estate (Regulation and Development) Act,
2016 provides for amicable conciliation of disputes between the
promoters and allottees through dispute settlement forum, set up by
consumer or promoter associations.
Success of the mediation-conciliation mechanism prescribed under
several laws: Despite having the above stated statutory recognition, mediation
has not been able to achieve great success in India. The Mediation and
Conciliation Project Committee (MCPC) was established by the Supreme Court
in April 2005 to oversee the effective implementation of mediation. The
endeavour of the MCPC was to give a boost to court-annexed mediation and
to help mediation in growing not as an ‘alternative resolution mechanism’, but
as ‘another effective mode of dispute resolution’.
From the websites of several High Courts, it can be ascertained that most
High Courts have their separate set of rules governing Mediation and
Conciliation. Barring for a few High Courts, there is no data available to show
the status of mediation cases referred, successes/failure of matters, and number
of settlements arrived at and effectively implemented.
If the object of the MCPC was to reduce backlog, more attention is required
towards framing of a national policy with an appropriate legal framework. The
success and popularity of mediation is restricted and there is a need for

urgent measures to promote and support its effective implementation.
The following are the important developments of in the field of mediation:
1. The 129th Law Commission of India Report recommends courts to
refer disputes for mediation compulsorily.
2. In the landmark case of Afcons Infrastructure Ltd v. Cherian Varkey
Construction Co. (P) Ltd. [2010 (8) SCC 24], the Supreme Court
observed that that all cases relating to trade, commerce, contracts,
consumer disputes and even tortious liability could normally be
mediated.
3. The 2018 amendment to the Commercial Courts Act 2015 (Section
12A), made it mandatory for parties to exhaust the remedy of pre-
institution mediation under the Act before instituting a suit. The
Commercial Courts (Pre-Institution Mediation and Settlement) Rules
2018 (the PIMS Rules) have been framed by the government.
Settlements arrived at in this process are enforceable by law. The
period of mediation would not be computed for the purposes of
limitation under India’s Limitation Act. Effective implementation of
this provision can be major boost for economic growth.
4. In the matter of MR Krishna Murthi v. New India Assurance Co.
Ltd. [2019 SCC OnLine SC 315], the Supreme Court, asked the
government to consider the feasibility of enacting an Indian
Mediation Act to take care of various aspects of mediation in general.
The Court further directed the government to examine the feasibility
of setting up a Motor Accidents Mediation Authority (MAMA) by
making necessary amendments in the Motor Vehicles Act. In the
interregnum, NALSA was directed to set up Motor Accident
Mediation Cells, which can function independently under the aegis
of NALSA or can be handed over to MCPC.
5. The new Consumer Protection Act, 2019, under Section 37-38 and
Chapter V, provide for disputes to be first referred to mediation and
the procedure to be followed as per Section 74(3) of the Act read
with Section 101(2)(zf) and Section 102(2)(p) of the Act. The Central
government and the state government, respectively, have been
empowered to make rules for providing for the persons in the
consumer mediation cell.
6. As regards international disputes, India is a signatory to the United
Nations Convention on Mediation (the Singapore Convention),
which gives mediation settlements the force of law.
Measures for effective implementation and growth of Mediation in India:
There is an urgent need for a uniform statue exclusively governing the
mediation process in India. Mediation legislation exists in more than 18 other
jurisdictions, including Singapore, Malaysia, and Ireland (plays regulatory
role). The Singapore International Arbitration Centre (SIAC) and the Singapore
International Mediation Centre (SIMC) have framed SIAC-SIMC Arb-Med-
Arb Protocol (AMA Protocol) to mange disputes in accordance with an “Arb-
Med-Arb” clause for commercial contracts.
In India, parties mainly opt for court annexed-mediation, for which the
respective High Courts have their own set of Rules. Private mediation is less
preferred due to lack of recognition.
As the above provided enactments have been introduced or are being
introduced in our country, what we simultaneously need is a quick evolution
of the mediation mechanism. For this, the mediation process, be it private or
court-annexed, would require practical recognition by the legislature and the
judiciary.
The judiciary mostly deals with matters that require adjudication, but
there are situations where mediation techniques would be more appropriate
and beneficial to the parties. Therefore, identification of such matters and
situations by parties, lawyers and judges becomes extremely crucial and
important in the promotion of mechanism.
The following steps may be taken:
1. Grassroots level awareness of public at large (particularly parties,
lawyers, judges and other stakeholders) and easy access to the
Mediation.
2. Legislative framework on Mediation and its practice (many other
countries have already adopted this and India is now signatory to
the United Nations Convention on International Settlement
Agreements).
3. Mediation Centres need good infrastructure and a standard pattern
to make parties comfortable.
4. Mediation must develop into a full-time profession (efforts by senior
lawyers, members of the judiciary and all state bar councils will be
required for promotion of this mechanism) as it gives lawyers an
excellent opportunity to demonstrate their legal, analytical and
professional skills.
5. Incentives and recognitions to lawyers to educate parties about the
inner workings of the mediation process in order to make such
informed choices.
6. High ethical standards (code of ethics and conduct) to be followed.
7. Theoretical as well as practical training in mediation to be included
in syllabi of law colleges and introduction to mediation course to be
conducted for all practicing lawyers. Structured mediation training
with accreditation for specialising in mediation should be provided
in a cost effective manner all over India. Continued skill enhancing

courses should be conducted from time to time for lawyers and
other professionals who wish to take up mediation as a profession,
8. Multiple Mediation drives should be conducted by courts on various
levels, be it at the district level or the national level. These drives
can prove to be extremely successful and can help in clearing a large
backlog of cases pending before various courts. During the recently
conducted Family Courts Mediation Drive conducted by the Delhi
High Court, out of the 2,884 cases referred to mediation by the Family
Courts, 2,171 cases were successfully disposed of, which resulted
in the disposal rate of 75.27%. This clearly indicates that the judicial
system requires heavy promotion of the process of mediation.
9. The selection process of mediators and adequate training standards
for the mediators should be developed. There is a need to ensure
standardised training programmes for potential mediators and details
about the professional and educational background of the mediators,
including previous mediations conducted, areas covering the issues
involvement in prior mediations, expertise in other discipline(s), if
any, etc. need to be maintained.
10. For mediation to develop as a significant practise area, mediators
shall be required to be attached with extremely transparent and
eminent professional bodies under the active surveillance of the
government and the judiciary.
Mediation in the wake of COVID-19: As already discussed in the
introduction, this pandemic has placed us in a situation where we are forced
to adapt to survive. Slowly and gradually, we are shifting from the traditional
ways to modern and innovative ways.
Mediation provides a viable alternative to resolve disputes. Under the
current circumstances, it would be beneficial for the parties to act in cooperation
instead of being adversarial, as an adversarial approach may not always yield
a beneficial outcome.
In light of the virus outbreak, jurists contemplate that a number of disputes
will arise on the interpretation of force majeure clauses, material adverse effect
clauses and termination clauses. While doing so, it is not always advisable to
knock on the doors of the courts to seek justice, especially when such key
clauses are missing or inadequately drafted. Therefore, while the courts are
grappling with the existing backlog of cases, the restrictions in its functioning
due to the lockdown and the fresh set of disputes arising due to the current
scenario, we feel there might be a shift in the manner in which commercial
disputes are or will be resolved, with increased reliance on mediation.
Several Indian High Courts, including the High Court of Judicature at
Bombay, Delhi High Court, Kerala High Court, etc., and various international
organisations like the Singapore International Arbitration Centre, London
Court of International Arbitration, International Chamber of Commerce have
already formulated mediation rules. These rules are comprehensive, extensive
and can be adopted by parties to deal with the procedural aspects of mediation.
Parties also have the option of opting for Ad-hoc arbitration, allowing them to
decide on the procedure to be followed during mediation.
Keeping in mind the above benefits and the role mediation can play in the
times to come, Singapore International Mediation Centre has launched the
SIMC COVID-19 Protocol, providing business with an effective solution by
way of expedited mediation for dispute resolution. A similar project has been
launched by Georgian International Arbitration Centre in collaboration with
Resolve and with assistance of European Union and United Nations
Development Programme, allowing the parties to either refer their dispute to
facilitation or mediation. These moves show the preparedness of various
organisations in accepting that mediation will bring the new dawn in dispute
resolution, during and even after the pandemic.
Q.8 Can Online Dispute Resolution (ODR) be a compelling option for
seeking Justice in pandemic times?
Ans. In the era of globalization, people in 21st century have witnessed
the ultimate impact of Information and Communication Technology on social,
economic, legal and cultural arena of globe. Technological revolution brought
by internet has altered the scale according to which human affairs are being
conducted and has fostered a new medium that has impacted well-established
legal conceptions especially with respect to resolution.
The acceleration of change, increasing complexity of relationships,
transactions and the lowering cost of publication accompanied by disputes
and in response, there is growing need for the kinds of creative technology-
assisted dispute resolution process.
Justice delayed is justice denied, by William E. Gladstone a legal maxim
which means if justice is not administered in time then it is effectively equal to
no redress at all. Indian Judiciary is overburdened with pending litigation.
Delay in administration of justice and high cost of litigation are its pitfalls.
These factors have resulted in loss of faith of people in Indian judicial system.
Thus, with advent of Alternative Dispute Resolution emphasis has been shifted
from traditional rigid method of solving the disputes through litigation to
ADR.
Tremendous development in ICT in 20th and 21st century resulted into
online cross-border interactions and e- commerce activities on large scale
leading to e-disputes such as domain name disputes, hacking, privacy invasion,
e-stalking, e-purchase and sell of goods etc. which called for dispute resolution
mechanism to resolve the same.
Online Dispute Resolution (ODR) is a branch of dispute resolution which

uses technology to facilitate the resolution of disputes between parties. It
primarily involves negotiation, mediation or arbitration, or combination of all
three. In this respect it is often seen as being the online equivalent of
ADR. Essentially, it is the process of dispute resolution on a digital platform
using digital technology (video conferences). It is an amalgamation of
advancing technology with alternate dispute resolution mechanisms (ADR)
such as mediation, conciliation and arbitration, for the purpose of resolving
conflicts, particularly in small and medium value cases. Moreover, considering
the times of pandemic that we are living in today, the option of ODR has just
become more compelling, safe and cost efficient.
Characteristics of ODR:
• Voluntary: Parties are allowed to choose to participate in ODR as a
dispute resolution mechanism; however, they may pursue their claim
through a different forum too. Similarly, parties are at a liberty to
withdraw at any time as they desire.
• Informal: The tone and set up of the entire proceeding is informal
and casual as against ADR proceedings such as mediation or
arbitration.
• Confidential: Unless otherwise agreed by the parties, the entire
process of ODR is strictly confidential.
Strengths and Challenges:
A. Strengths:
ODR has number of advantages over traditional courts system where
parties have autonomy over proceedings. Such as:
(i) Time and Cost Management: ODR obviates the need for travelling
and substantially reduces cost. It allows for better time and cost
management, greater flexibility in procedure and more creative
solutions.
(ii) Flexible and Informal: ODR promotes speedy resolution in flexible
and informal manner if compared with rigid court procedure followed
since ages.
(iii) Trust and Confidence: ODR enhances trust and confidence in e-
commerce environment due to its speedy access to justice, flexibility,
time and cost management which promotes e-commerce and
overcomes geographical barriers.
(iv) Asynchronous communication: The asynchronous Internet
communications have advantage of being edited in contrast to
impulsive responses that often can take place in real time face-to-
face mediation discussions.
(v) Communication through Video conference: Lodder and Zeleznikow
argued that it can happen for disputes in which the emotional
involvement of the parties is so high that it is preferable that they do
not see each other. It has been taken as the most significant
disadvantage of ODR due to lack of face-to-face communication.
But it’s been argued that videoconferencing is an “obvious solution
to the lack of face-to-face encounters” in online dispute resolution.
(vi) Easy to Access: ODR can be accessed anywhere at any time wherever
internet is available as per the convenience and necessity of parties.
(vii) Data Storage: Document storage being one of the most usual
problems faced in Indian courts has got replaced by ODR mechanism
where data storage is secured for saving and transmitting documents
as and when necessary without any hassle.
B. Challenges:
ODR faces various obstacles in its way of growth in India such as lack of
human interaction and communication, lack of literacy, inadequate
confidentiality and secrecy of proceedings, lack of trust and confidence, limited
range of disputes, cultural, educational and language barriers, negative mindset
of lawyers. But one of crucial and pivotal challenge is the admissibility of
ODR.
a. Challenges as To Admissibility:
i. Mutual Consent and Writing: For invoking ODR process,
mutual consent of parties is essential, whether through an
explicit clause in contract or by separate mutual agreement
between parties, otherwise any decision rendered by neutral
shall not be legally valid and binding on parties. Another
essential condition is agreement between parties must be in
writing. Article 2 of New York Convention and Article 7(2) of
UNCITRAL Model Law requires the agreement must in writing.
But at the same time New York Convention is silent upon
agreements entered into through electronic communications.
Whereas UNCITRAL Model law recognizes the arbitration
agreements entered into by electronic communications and the
same has been followed by India its 2015 Amendment to Act of
1996.
ii. Place of Proceeding: In adjudicatory process, place of
arbitration is geographically determined which constitutes a
core element on which numerous legal implications depend. If
proceedings are conducted entirely online with parties and
neutral in distinct places, prima facie, it seems impossible to
determine place of proceedings. This observation led some
scholars to conclusion that virtual arbitration has no situs
b. Jurisdiction: When disputes are resolved online, question as to
applicable substantive law to disputes arises. In case of international
arbitration it is important to distinguish four choices of law issues,
• Substantive law governing merits of parties’ contract and claim

• Substantive law governing parties’ arbitration agreement
• Law applicable to arbitration proceedings (curial law or lex
arbitri) Conflict of law rules applicable to each of forgoing laws.
c. Pre-trial Stage: Important elements of pre-trial stage are discovery,
interrogatories and collation of evidence in support respective
contentions of parties may be minimized in ODR for speedy resolution
leading to failure to discover true and correct state of facts.
d. Awards: Taking New York Convention as a starting point for analysis
of whether electronic arbitral awards are admissible within current
legal framework, it can be noted that convention does not explicitly
provide for an arbitral award signed and in writing. Further, Article 8
of UNCITRAL Model Law on Electronic Commerce explicitly states
that requirement to present information in its original form can be
met by an electronic data message. Article 31 (1) of UNCITRAL
Model Law, requires “award shall be made in writing and shall be
signed by arbitrator.” Followed from Model Law, in India section 31
of Arbitration and Conciliation Act, 1996 requires the same. But,
traditional concept of writing and signature now has been replaced
by Information and Technology act, 2000 which has given legal
recognition to electronic records and digital signature.
e. Enforcement: It is the single most important pillar upon which edifice
of international arbitration rests. If Act of 1996 is considered following
points to be considered
• In adjudicatory process decisions are to be enforced through
the courts of law.
• Orders in execution are subject to appeal
• Intervention of court during and after pronouncement of
decision.
This may give rise to issues like jurisdictions or law applicable
or place of proceedings for which there is need to apply the
conflict of rules or proper laws to avoid forum shopping.
f. Judicial Pronouncement: Landmark cases such as Tata Sons v. The
Advanced Information Technology Association [2000], and Maruti
Udyog Limited v. Maruti Software Pvt. Ltd, [2006], Wherein WIPO,
the Arbitration and Mediation center was made the medium to solve
the Domain name dispute.
In State of Maharashtra v. Dr. Praful B. Desai [(2003) 4 SCC 601],
Supreme Court held that video-conferencing could be resorted to for taking
evidence of witnesses by stating that recording of evidence satisfies the
object of Section 273 of the Code of Criminal Procedure that evidence be
recorded in the presence of the accused.
In Trimex International FZE Ltd. v. Vedanta Aluminum Ltd. [(2010) 3
SCC 1], the Hon’ble Supreme Court held the online arbitration agreement is
the most important document of arbitration and since parties do not meet
personally but rather virtually, it is pertinent that the agreement clearly defines
all particulars of dispute resolution mechanism. There must be meeting of
minds and the agreement must be according to Section 7 of the Arbitration
and Conciliation Act 1996.
In Shakti Bhog Food Ltd. v. kola Shipping Ltd. [2012], communication
and acceptance by telex, telegram and other mode of communication has been
accepted as valid mode of communication.
Scope of ODR in India:
1. The applicability of ODR in a developing nation like India is still in a
primitive stage. However, owing to the pandemic outbreak, ODR is
starting to acquire increased prominence. On a conjoint reading of
the provisions of the Indian Evidence Act, 1872, with the Arbitration
and Conciliation Act, 1996 and the Information Technology Act,
2000, it is evident that the Indian laws provide for legality and
technical viability of the ODR mechanisms. Additionally, common
issues in ADR pertaining to jurisdiction and other issues pertaining
to geographical limitation seem to be eliminated along with ensuring
automated administrative tasks, promotion of eco-friendly processes
and improved productivity of professionals.
2. That being said, the three branches of governance have been taking
initiatives to make our legal and judicial system more technology-
friendly, in order to ensure speedy delivery even during the times of
a crisis.
3. Recently, the Supreme Court of India in a suo-moto writ petition
captioned ‘Expeditious trial of cases under Section 138 of N. I. Act,
1881, took note of the observations in Meters and Instruments
Private Limited & Anr. vs. Kanchan Mehta [2017 TaxPub (CL)
0840 (SC)], that “Use of modern technology needs to be considered
not only for paperless courts but also to reduce overcrowding of
courts. There appears to be need to consider categories of cases
which can be partly or entirely concluded “online” without physical
presence of the parties by simplifying procedures where seriously
disputed questions are not required to be adjudicated.”
4. In times of Digital India, when there has been rampant advancement
of technology not in urban and sub-urban cities and also in remote
villages, it is fair to say that with effective use of such technology,
access to justice and equity can be ensured and brought to each
and every Indian irrespective of their geographical limitation.
5. It is noteworthy that on an average every judge in India is allocated
1,350 cases, whereas his counterpart in the US is required to deal
with only 388 cases. Therefore, promotion and enhancement of a

technology driven dispute resolution mechanism not only seems
promising for the lawyers but would also lead to substantial easing
of courts’ burden as well as improving the efficiency of the Indian
legal ecosystem.
6. Lastly, ODR also entails environmental impact- 11 billion sheets of
paper are used every year in Indian courts. The green cost of this
usage is 1.3 million trees and 109 billion liters of water every single
year. A swift yet smooth transition to digital platform would also
benefit the environment, make our judicial and extra judicial system
more eco-friendly, thereby, curbing climate change and many more
issues.
On Conclusion it can be said that ODR involves various methods of
dispute resolution including e-Negotiation, e-Conciliation, e- Mediation, e-
Arbitration and hybrid mechanisms such as Medola, Mini trial, Med Arb, Fast
track arbitration, Neutral Listener Agreement, Rent a Judge, Concilio-
Arbitration etc. It may adopt either adjudicatory or non adjudicatory process
to have its decision binding or non-binding upon parties. The need of the
hour is to maximize the reach of access to justice delivery system to all the
sections of the society. A strong infrastructure for easy access and for ensuring
that justice must be delivered in minimal time and in adequate manner by
increasing literacy rate, reducing language and cultural barriers, and easy
access to e-courts might be the stepping stone towards achievement of the
same. Thus, the step to advance ODR is a key to facilitate global harmony and
to encourage international relationship in cross-border disputes.
Q.9 What is UNCITRAL Model Law on International Commercial
Arbitration
Ans. The UNCITRAL is the essential legal body of the United Nations in
the area of international trade law. It was established by the United Nations
General Assembly after the realization that differences in national laws
governing international trade are creating hurdles to the free flow of trade.
Hence, this commission was established with the view to play an active role in
reducing or removing these hurdles. The UNCITRAL Model law has been
designated to assist the states to establish their domestic law and modernize
their laws on arbitral procedure with due consideration of the specific features
and the needs of international commercial arbitration. It highlights worldwide
consensus on the key aspects of international arbitration practices adopted
by states, of different parts of the states and different legal or economic
systems of the world. The Model Law comprises 8 chapters, 36 Articles and is
to be adopted by different nations into their national laws or to adapt their
national laws of arbitration based on the principles of this model law.
Salient features of UNCITRAL Model Law: Some features of the Model
Law are as follows:
• It lays down certain rules and provisions intending to create
uniformity in international commercial arbitration.
• Article 1 of the Model Law states the substantive part of international
commercial arbitration which defines arbitration as international if
while concluding the arbitration agreement, the parties’ place of
business were in different States or one of the places is located
outside the state in which the party of the agreement have their
place of business:
• Or the place where the commercial relationship has been performed.
• Or where the subject matter of the dispute has occurred.
• Or the parties to the arbitration agreement have jointly agreed to
include more than one place for the subject matter of the agreement.
• It reflects the composition of an arbitral tribunal and the enforceability
provision of an arbitral award. It would be enacted in a State if the
seat of arbitration is within the territory of the particular State and
the arbitral award would have global enforcement. However, the
principle of ‘party autonomy’ proclaims the parties in a dispute to
independently choose laws to conduct the arbitration process.
• It limits the interference of the court in the process of arbitration,
thereby only allowing judicial intervention for the appointment of
arbitrators, challenge and termination of an arbitrator, jurisdiction of
an arbitral tribunal, and the setting aside of an arbitral award.
Moreover, it allows court assistance in recording evidence,
recognition of the arbitration agreements and enforcement of the
arbitration awards.
• It highlights the essence of the arbitration clause or agreement that
must be present if parties to a dispute choose arbitration as a means
to solve their dispute. The Model Law also states the matter of the
clause and gives recognition to these clauses even through the
judiciary.
• Concerning the arbitral tribunals, it states the number, appointment,
procedure of the arbitration, thereby safeguarding the freedom of
the tribunal and the will of the parties.
• It sets out the rules to be followed for the pronouncement of the
award, the enforcement of the award, and the grounds for challenging
the award.
Hence, these essential features are provided in the Model Law to reduce
difficulties in the process of international arbitration by providing uniformity
in procedural and substantive practices of arbitration.
Difference between UNCITRAL law and UNCITRAL rules:
• The UNCITRAL Arbitration Rules (Rules) states a comprehensive
set of procedural rules which entails the parties to agree for the
conduct of arbitral proceedings arising out of their commercial

relationships. It also provides provisions dealing with multiple-party
arbitration, joinder, liability, arbitral proceedings and procedures to
appoint experts by the arbitral tribunals. It aims to provide efficiency
in the procedures of arbitration by providing provisions for the
requirement of the reasonableness of costs and a review mechanism.
One of the most essential parts of the Rules is that it is selected by
parties on how to govern the conduct of arbitration and resolve the
dispute by themselves.
• The UNCITRAL Model Law, on the other hand, provides a set of
patterns that law-makers in national governments can adapt by being
a part of their domestic legislation on arbitration.
History of the Arbitration and Conciliation Act, 1996: The Indian
Government, with the motive of addressing the increasing number of disputes
and encouraging arbitration as a flexible, cost-effective and speedy mechanism
for the settlement of commercial disputes, introduced the Arbitration and
Conciliation Act, 1996. The Act is based on UNCITRAL Model Law on
International Commercial Arbitration, 1985 and secures both domestic and
international commercial arbitration. The principal motive behind the Act is to
control delayed indiscretion and provide parties finality in their disputes. The
Act also consists of three significant parts as below-mentioned:
• Part I of the Arbitration and Conciliation Act, 1996 is concerned
with domestic arbitrations and international commercial arbitration
when the arbitration is in India.
• Part II of the Arbitration and Conciliation Act, 1996 is concerned
with foreign awards and their enforcement under the Convention on
the Recognition and Enforcement of Foreign Arbitral Awards,
1958 (also known as New York Convention) and Convention on the
Execution of Foreign Arbitral Awards, 1927 (also known as Geneva
Convention).
Salient features of Arbitration and Conciliation Act, 1996: The lawmakers
in India, while enacting the Act, have taken due consideration of the
UNCITRAL Model Law and this has been highlighted in the Preamble of the
Act, which states that the provisions of the Act are in connection to and
based on the UNCITRAL Model Law. Thus, most of the provisions in the Act
are consistent with the Model Law. Some of the features of the Act are as
follows:
• It applies to both national and international commercial arbitration
and has a similar definition clause as that provided in the Model
Law.
• It provides for the existence of an arbitration agreement between
parties before the commencement of arbitration proceedings. It lays
down the specific clause for the arbitration agreement and the
intervention of the courts with the arbitration agreement whenever
the tribunal is not working efficiently.
• It states the composition and jurisdiction of the arbitral tribunals
similar to that of the Model Law. It empowers the tribunals to rule in
their jurisdiction and allows the tribunal to issue final awards with
limited intervention from the courts.
• It provides provisions on the conduct of arbitral proceedings
considering the freedom of arbitrators and the will of the parties, as
similar as that of the Model Law.
• It provides the rules for the pronouncement of the award, the
enforcement of the award and setting aside or challenge of the award.
It is essential as it allows for the intervention of the court only in
certain circumstances as mentioned under Section 34(2) of the Act.
In addition, it has been noticed that the latest developments in arbitration
through the recent judicial decisions reflect the support of the government to
make India a hub of institutional arbitration for both domestic and international
disputes. The courts have also adopted a pro-arbitration approach and this is
evident from the rulings of the higher courts in India.
Relation of UNCITRAL Model Law in India: Section 9 of the Act has
been updated from Article 9 of the Model Law which talks about arbitration
agreement and interim measures by the court. The Model Law provides that a
party can approach a court for an interim measure of protection during the
arbitral proceedings. However, the Indian Act empowers the court beyond
Article 9 and provides that a party can approach courts to go further even
after the arbitral award is enforced. Section 9 of the Act states interim measures
by the court and it cannot be invoked after the institution of an arbitral tribunal
in foreign seated arbitrations when there is a speedy remedy available to the
parties. This has been inserted under Section 9(3) of the Act through the
Arbitration and Conciliation (Amendment) Act, 2015, and has been
commendable. The 246th Law Commission Report stated in its report, “to reduce
the intervention of the judiciary concerning the grant of interim measures
once the Arbitral Tribunal has been constituted”. The objective of this 2015
amendment is that once the tribunal is given the matter, it is suitable for the
tribunal to hear all interim applications. This amendment is in line with the
spirit of the UNCITRAL Model Law as amended in 2006. Thus, the court has
given the primary power to tribunals in India.
However, it is noted that the UNCITRAL Model Law on International
Commercial Arbitration, 1985 (Model Law, 2006) has not clearly stated whether
the court power should be a secondary option available where an arbitrator
cannot act effectively. The proposal that the courts can only act in
circumstances where the arbitral tribunal has not acted effectively was kept
for consideration in the later stage. Thus, reliance on the Model Law for the
adoption of this approach is not clearly expressed. Interestingly, the courts in
India through its various judicial precedents have shifted the primary power
to the arbitral tribunal, only if it is not efficacious is commendable as already
stated above. This principle is also applicable to foreign-seated arbitration as
well.
The Model Law does not state any fixed definition for the term
‘commercial’, hence it connotes a wide interpretation and changes with the
judicial decision. The term should be broadly constructed as it forms the main
part of international trade all around the world. In the case of R.M. Investments
and Trading Co. v. Boeing Co. (1994), the Supreme Court of India interpreted
the term ‘commercial’ to include all ‘commercial relationships’ in support of
relationships consisting of family, cultural, social, economic or political nature.
The court, in this case, stated that the contract for a consultancy service is
included within the ambit of ‘commercial’ and therefore, the arbitration clause
in the contract should be applied.
It is to be noted that in Article 7(1) of the Model Law, no changes have
been made by the Amendment in 2006 and the original definition of arbitration
prevails. One of the main features of an ‘arbitration agreement’ is its binding
nature on the parties. In the case of Jagdish Chander v. Ramesh Chander &
Ors. (2007), the Supreme Court observed that the words used in the agreement
should state a determination and obligation to go for arbitration and not the
possibility of the parties to arbitration in future. Any agreement made with the
possibility rather than an obligation will not be a valid and binding arbitration
agreement. Article 9 of the Model Law is not provided for the parties but to the
courts of a given State and it states the principle of interim measures of
protection that may be exercised from the courts. In the case of, Max India
Ltd. v. General Binding Corporation (2009), the Delhi High Court observed
that the parties by agreeing to take the arbitration in Singapore and follow the
procedures as per the Singaporean Court for the subsidiary matter of the
agreement. Consequently, they have excluded the power of the Indian courts
which would have otherwise granted an interim measure of protection in respect
of a foreign arbitration to the party.
Article 11 of the Model Law provides the provision for the appointment
of the arbitrators and also states the principle of ‘party autonomy’ which
provides the party to the agreement to choose their arbitrator freely. The term
necessary measures have not been clearly stated, hence the Indian court, in
the case of Ministry of Railway New Delhi v. Patel Engineering Company
Ltd. (2008), stated that the word ‘necessary’ connotes things that are
reasonably required to be completed to complete it. The word ‘necessary
measures’ connotes reasonable steps that should be taken while
accomplishing the intended act.
Q.10 What is Singapore Convention on Mediation? State its Applicability
and its limitations?
Ans. The United Nations International Convention on Settlement
Agreements for Mediation (Singapore Convention) was taken up for signature
in Singapore on the 7th of August, 2019, and the same came into force on the
12th of September 2020. The Singapore Convention, if read in entirety
corresponds to the growing demand from a body of users who rely on
mediation as an enforcement mechanism that is applicable to settlement
agreements in case of cross border disputes. Technically, it is an international
convention that aims to help businesses resolve cross border disputes and
further facilitate international trade.
This convention looks to give global businesses with some amount of
certainty in resolving cross border disputes by way of mediation and making
it possible for them to apply directly to the courts of countries that have
ratified the convention in question. As per the latest data, there are 53 signatory
countries to the convention and this convention is also called the United
Nations Convention on International Settlement Agreements Resulting from
Mediation, including India, China and the United States.
Applicability of the Singapore Mediation Convention: As it stands, a
settlement agreement executed in country A has no legal force in country B. A
party looking to enforce a mediated settlement agreement in a different country
or multiple countries for that matter will have to initiate legal proceedings in
each of those countries. This can be very costly and time heavy, especially for
settlement agreements that are of international nature. Now, after this
convention has come into effect, one of the parties to the dispute looking for
enforcement of a cross border mediated settlement agreement can do so by
applying to the courts of the signatory countries that have also ratified the
treaty/convention. This can save time and money for all signatory countries
and adds to their convenience index as well. Another big advantage of this
convention is that it can always help the signatory countries during times of
uncertainty like the current time of the pandemic.
Before this convention came into force, the settlements which are reached
through mediation were enforceable through contracts. The only deviation
from this settled procedure is where mediation is undertaken as a part of
arbitration or litigation proceedings and an agreement is reached through
mediation which can be enforced as an arbitral award or a decree. The
convention and the accompanying Model Law intends to introduce a legal
framework wherein mediated settlement agreements resulting from international
commercial disputes can seek enforcement. Ergo, it can be concluded that it is
similar to the New York Convention on the Recognition and Enforcement of
Foreign Arbitral Awards1.
Now, moving towards the basics of this convention, the primary
applicability criteria of this convention is that that it is applicable to two
parties who have their place of business in two different countries. Certain
kinds of settlement agreements that are excluded from the scope of the
Singapore Convention are settlement agreements that have been approved
by a court or concluded in court proceedings and those which are enforceable
as a judgment in the state of such a court, or those that have been recorded
and are enforceable as part of an arbitral award. Settlement agreements that
pertain to a few particular subject matters are also excluded which are
inheritance or employment law and those of disputes arising from transactions
engaged in by a consumer purely for personal purposes.
Significance of the Convention:
• The Convention has been designed to become an essential
instrument in the facilitation of international trade and in
the promotion of mediation as an alternative and effective method
of resolving trade disputes.
• It will ensure that a settlement reached by parties becomes binding
and enforceable in accordance with a simplified and streamlined
procedure.
• Businesses seeking enforcement of a mediated settlement
agreement across borders can do so by applying directly to the
courts of countries that have signed and ratified the treaty, instead
of having to enforce the settlement agreement as a contract in
accordance with each country’s domestic process.
• The harmonised and simplified enforcement framework will save time
and legal costs, which are of crucial importance in uncertain times
posed by pandemics like Covid-19.
• Businesses in India and around the world will now have greater
certainty in resolving cross-border disputes through mediation, as
it provides a more effective means for mediated outcomes to be
enforced.
Limitations of the Convention: There are a limited number of grounds
under the Singapore Convention based on which a state party may refuse to
grant relief as requested by a party to a settlement agreement. As per Article
5(1) of the Convention, relief may be refused only if the party opposing relief
can furnish proof of any of the following:
• A party to the settlement agreement was somehow incapacitated;
• The settlement agreement is frustrated, declared void ab initio or
incapable of being performed under the applicable law;
• The settlement agreement is not binding or final according to its
terms; it has been subsequently modified; the obligations under the
settlement agreement have either already been performed or are not
clear or comprehensible, or granting of relief would be in
contravention of the terms of the agreement;
• There was a breach of serious nature by the mediator in absence of
which breach that party would not have entered into the agreement;
• There was a failure on the part of the mediator to disclose
circumstances to the parties’ which raise significant doubts as to
the mediator’s impartiality or independence and such a failure to
disclose had a material impact or undue influence on a party in
absence of which failure that party would not have entered into the
agreement.
Further, as per Article 5(2) relief may be refused if the competent authority
where relief is sought finds:
1. Granting relief would be in contravention of public policy;
2. The subject matter of the dispute at hand is not capable of settlement
by mediation under the law where the relief is being sought;
3. It is noteworthy to mention the fact that these grounds are by and
large similar to the grounds enumerated under New York Convention.
Singapore Convention & India: In 2019, India was among the first group
of signatories to the United Nations Convention on International Settlement
Agreements which we know as the “Singapore Mediation Convention” today.
To deeply engrave the results of this convention, India needs to ratify this
convention. The convention is designed in such a manner that each and
every signatory is required to work with their own domestic processes and
procedures in order to bring them in conformity with the required protocols
for ratification.
A treaty can be ratified by obtaining the instrument of ratification under
the signature and seal of the President of India. Now, after analyzing the
scheme of this convention, one thing which is very clear is that it is not going
to have a substantial effect on the contracts which will be signed by Indian
businesses having their business in India with other companies which are
located in a different state who is a signatory to this convention and are doing
business somewhere else. The key change which this convention will bring is
regarding the dispute resolution because the conventional method of resolving
the dispute which we all know is arbitration will be changed and one has to
incorporate the settlement of dispute by way of mediation after this convention
has come into force. In addition to this, the enforcement aspect of the settlement
reached through mediation is the most attractive feature of this convention
which will have its own advantages to the parties who are contesting their
claim and effecting an amicable settlement through mediation and saving their
time and money.
Mediation in India: Though unlike arbitration, mediation has never been
dealt with by any separate legislation in India and it is mentioned under
Section 89 of the Civil Procedure Code and it says that whenever there is an
element of settlement in a dispute, judges are required to give the parties an
option to resolve their disputes through either Arbitration, Mediation,

Conciliation, Lok Adalat or Judicial settlement. The landmark case on this
point is the case of Afcons Infrastructure and Ors. v. Cherian Varkey
Construction and Ors [2010 (8) SCC 24], wherein the Hon’ble Apex Court
clarified that Courts can suo moto order parties to go for mediation and listed
out the categories of suitable cases. The court stated that mandating parties
participating in mediation does not prejudice the “voluntariness” of mediation
as the extent of participation and the outcome of mediation is left entirely to
the free will of the parties.
As it stands, almost all High Courts in the country have a Court Annexed
Mediation program that is set in place. Some of the courts including the
Supreme Court, refer cases to private mediation when they feel the need to do
so. The Companies Act 2013, the Real Estate (Regulation and Development)
Act 2016 and the Consumer Protection Act, 2019 include mediation. The
Commercial Courts Act, 2015 has a mandatory requirement for pre-institution
mediation.
Conclusion: It is indeed a good sign that India is one of the first signatories
to this convention however it remains to be seen how India ratifies this
convention and how it equips its judicial system to accommodate litigation
arising from this convention. Nonetheless, in the current scenario, this move
adds weightage to India’s ease of business initiatives and goes a long way in
ensuring that foreign businesses coming to India or working with Indian
Businesses are protected by this convention when it comes to mediation.
Q.11 What are the contemporary developments of ADR in India?
Ans. The ADR has been helping so many parties to resolve their disputes
with the help of a third party, with the help of the various means of ADR. Due
to the pandemic from last year, the court system has made a big revolution in
its procedure of hearings. This revolution has been beneficial and helpful for
so many but also not as much beneficial for some. ADR saves time, money,
mental and physical disturbance which usually happens during court matters.
ADR has been a big time-saver for all the parties as well as to the legal system.
As it helps the parties in dispute and provides them resolution without going
to court.
Virtual ADR:
• The virtual ADR provides a hassle-free resolution to the parties and
it doesn’t require any party or attorney to travel from one place to
another.
• Both parties can communicate with each other through video
conferencing, which allows them both to hear and see each other.
• In the case of mediation, the mediator can easily communicate with
parties separately using an easy method and can come to an agreeable
settlement.
• Just like any new initiative faces so many challenges, virtual ADR
will also face some troubleshooting in starting. But it is certainly a
step in a great and right direction.
• ADR is now not an alternative platform for dispute resolution but it
has become the first way to resolve disputes in a speedy, fast, and
cost-effective way.
However, it should be noted that as ADR is hassle-free and one of the
money and time-saving mechanisms it also possesses some obstacles before
it. It is not a big secret that lawyers have always been contrary to technology.
However, in times like these, it is the need of the hour to learn and adopt
technology but it’s sort of critical for some people as well as lawyers. It needs
rigorous and continuous training for lawyers to transit from offline to online
mode. It is one of the hard tasks to provide an internet connection to all the
courts of India and some of the courts also have poor network issues. Adequate
security protocols must be implemented to ensure that sensitive data is not
compromised or tampered with in any way.
Impact of COVID-19 on the alternative dispute resolution: In the present
circumstances where the spread of Corona-virus (COVID-19) has put
everything on hold, it is important to address its impact on ADR.
COVID-19 has caused havoc on the global economy and corporate
relationships, causing unprecedented disruptions. A large number of
commercial conflicts are arising as parties struggle to fulfill their contractual
obligations. Hence there is a great possibility that the crisis will increase
litigation, delaying the resolution of pending court cases, which will
consequently result in more burden over the judiciary, and this way the parties
can steer towards ADR for a speedy resolution to the disputes raised. Hence
because of this pandemic, virtual hearing in ADR has come into existence.
Amendment of 2021: One of the recent amendments in the Arbitration
and Conciliation Act, 1996 is Arbitration and Conciliation (Amendment) Act
2021. This is the third time the Act of 1996 has been amended in the last six
years, indicating the legislative intent to amend the Act of 1996 and make
India a more arbitration-friendly country. The said amendment has made two
major changes in the Act and those are:
The first is to allow automatic stay on awards in some cases where the
court has prima facie evidence that the contract on which the award is based
was tainted by “fraud” and “corruption.” The other major change in the Act of
1996 is the omission of the 8th schedule from the main Act. It specifies the
qualifications, experience, regulations, and norms that should be followed for
accurate mediation of arbitrators.
2021 Amendment’s effects on India’s arbitration:
1. The impact of the automatic stay on awards:
The amendment made in Section 34 of the main Act is the most substantial
change done to the provision of Arbitration Awards in the Amendment Act of
2021. In the main statute in Section 34, it has been stated that a party can file
an application before the court for setting the arbitration award aside. Hence,
after the Amendment Act of 2015, it has been stated that an automatic stay
would not be granted on the operation of awards only after mere filing of an
application for setting aside the award. Now the Amendment of 2021 has
introduced a material change by adding a provision under Section 36(3) so
that the court can be assured that if the prima facie evidence shows that the
case is based on either the arbitration contract or the agreement that forms the
basis of the award, or that the award was formed or has been affected by fraud
or corruption. It should have to stay the award completely pending the disposal
of the challenge. It has a retrospective effect which will be deemed to effectuate
from October 23 of 2015.
In Parliament, the complete or unconditional stay has been criticized so
many times during the introduction of the Bill in the Lok Sabha. Various
experts have pointed out that this unconditional stay on awards is like a
blanket stay that will plunge the efforts of India towards the pro-arbitration
regime. Primarily this was said because the party will easily lose to alleged
corruption and the automatic stay in the enforcement of arbitral awards.
It has been also said that this will defeat the main purpose of alternate
dispute mechanisms by bringing parties to the courts and by making this
prone to litigation. The other important concern with this amendment is that
the legislation does not define either corruption or fraud. It will automatically
create an ambiguous situation where the defendant party may suffer the rigid
procedure of litigation even if the party is right and it will also open the gate of
courts for a high wave of litigations by overburdening the court system.
2. Expanding the scope of qualification of the arbitrators:
This area includes two amendments, including the Amendment of
2019 which is interlinked with the amendment of 2021. The amendment made
in the original or main Act that added Section 43(j), stated the qualification,
eligibility, and norms for accreditation. The said section further directed the
8th schedule of the Act, which provided an exhaustive list of qualifications for
the persons who want to possess the position of arbitrator. The schedule
included the minimum requirements of a person having the educational
qualification at degree level including 10 years experience in technical or
scientific stream. After the professional level qualification, the said schedule
also provided the general norms which would apply to an arbitrator for reaching
accreditation such as integrity, fairness, being impartial, neutral, etc.
These qualifications and the general norms were broad that this section
among the other things limited the qualified foreign lawyer’s ability from acting
as an arbitrator within India. It seemed like a significant hurdle as compared to
arbitration-friendly regions such as France etc.
The 2021 Amendment has given substitution to Section 43(j) of the Act
and also deleted the 8th schedule from the main Act. It stated that the parties
can appoint the arbitrator regardless of their qualifications. The Lok Sabha
appreciated the Bill by stating that it will attract eminent arbitrators from
foreign countries and will also add to making India a global hub of International
Arbitration.
3. Emergency arbitration:
The concept of emergency arbitration provides emergency arbitrators
who can be utilized when urgent relief is needed and during the period of the
pandemic, people used this provision. There has been uncertainty in India
regarding the enforceability of the emergency awards and the orders for
arbitrations that have taken place in India. The LCI (Law Commission of India)
In Its 246th report has mentioned a recommendation by recognizing the
concept of the emergency arbitrator by widening the definition of the arbitral
tribunal under Section 2(d) of Arbitration and Conciliation Act for including
emergency arbitrators. However, this recommendation was not incorporated
in the 2015 amendment Act.
The said issue again came into the lead during the earlier widely disclosed
dispute in Future Retails v. Amazon (2021), where the parties
are Amazon, Future Group, and Reliance. In this Amazon managed to get the
interim order from the Emergency Arbitrator under the rules of SIAC. It
restrained Future Group from proceeding with a deal worth Rs. 24,700 crore for
monetization of retail business. At that time the question was raised about
whether the passing of interim order is enforceable in India or not.
Hence, Reliance stated its intention publicly to go ahead with the sale.
Currently, the position of emergency arbitration in India is that such orders of
emergency arbitration cannot be passed against non-parties and the orders
passed by emergency arbitrators especially in cases where the arbitration
took place outside India cannot be enforced directly. However, except for only
this limitation, the orders by emergency arbitrators have been quite famous
and useful.
In this case, Future Retails argued that the order of Emergency Arbitrator
is not valid in India. Because the Arbitration and Conciliation Act doesn’t
recognize Emergency Arbitrators. Hence the order given by EA doesn’t comply
with Section 17(1) of the Act, making it unenforceable under Section 17(2) of
the said Act. However, this point has been prosecuted before the High Court
of Delhi, involving two different but interlinked cases Future Retails v. Amazon
and Amazon v. Future Coupons. The court after observing the issues, the
validity of the order/award given by EA, gave its decision in favour of
recognizing emergency arbitrators as legitimate arbitrators under Indian law.
Views of Justice D.Y. Chandrachud on Decentralization of Justice: The
Honourable Justice Chandrachud has mentioned in one of the events organized
on Online Dispute Resolution (ODR) that the online hearings have made a
great impact on the justice system in last year’s virtual hearing. They have
made the process even more efficient due to various simple changes in the
process such as the use of digital files by all the parties, the ability to make
digital notes, and having all the files in one place.
The future of Arbitration in India: India is a global powerhouse of the
economy and in the interest of incorporating with the business communities
all over the globe, the laws of India have been always amended to keep up
with the legal regime of other leading commercial law jurisdictions. Arbitration
being one of the methods of dispute resolution has been there in working for
a long time. The Arbitration and Conciliation Act, 1996 has been on the line of
the United Nations Commission on International Trade Law (UNCITRAL) for
the framework of the laws with the idea of modernization of Arbitration law in
India, and for bringing it in a line with the leading global practices and also for
making India a global centre for arbitration.
Even though arbitration has taken the first place over litigation due to its
speedy and simple process it should be taken into account that most of the
arbitration in India is ad hoc arbitration with institutional arbitration being a
minor proportion of all arbitration performed. Hence presently, India is lacking
in having institutions that can reach the level of some reputed nations
institutions such as the International Court of Arbitration (ICC), London Court
of International Arbitration (LCIA), Singapore International Arbitration Centre
(SIAC), Hong Kong International Arbitration Centre (HKIAC), etc. Oftentimes
it has been seen that many companies making commercial transactions or
contracts with India prefer foreign international arbitration centers.
ADR is one of the most important legal institutions that will succeed
greatly in the future. As time changes, its form and mechanism are also
developed in different ways to resolve disputes and make it easier for the
parties to the dispute. Different emerging provisions in ADR help in the
improvement of its facets. The new amendments have provided a broad
framework and exposure to the mechanism of ADR so that the procedure can
take place effectively.

Q.1 What is meant by Arbitration? What are its types?

Ans. Arbitration: The definition of ‘arbitration’ in section 2(1) (a) verbatim
reproduces the text of article 2(a) of the Model Law-‘arbitration means any
arbitration whether or not administered by a permanent arbitral institution’. It
is a procedure in which the dispute is submitted to an arbitral tribunal which
makes a decision (an “award”) on the dispute that is binding on the parties.
It is a private, generally informal and non-judicial trial procedure for
adjudicating disputes. There are four requirements of the concept of arbitration:
an arbitration agreement; a dispute; a reference to a third party for its
determination; and an award by the third party.
The essence lies in the point that it is a forum chosen by the parties with
an intention that it must act judicially after taking into account relevant evidence
before it and the submission of the parties. Hence it follows that if the forum
chosen is not required to act judicially, the process it is not arbitration.
Types of arbitration are:
1. Ad Hoc Arbitration: An ad hoc arbitration is one which is not
administered by an institution and therefore, the parties are required
to determine all aspects of the arbitration like the number of
arbitrators, manner of their appointment, etc. Provided the parties
approach the arbitration in a spirit of cooperation, ad hoc proceedings
can be more flexible, cheaper and faster than an administered
proceeding. The advantage is that, it is agreed to and arranged by
the parties themselves. However, the ground realities show that
arbitration in India, particularly ad hoc arbitration, is becoming quite
expensive vis-à-vis traditional litigation.
2. Institutional Arbitration: An institutional arbitration is one in which
a specialized institution with a permanent character intervenes and
assumes the functions of aiding and administering the arbitral
process, as according to the rules of that institution. It is important
to note that these institutions do not arbitrate the dispute, it is the
arbitrators who arbitrate, and so the term arbitration institution is
inapt and only the rules of the institution apply.
Incorporation of book of rules in the “arbitration agreement” is one

of the principle advantages of institutional arbitration. Institutional
Arbitration, throughout the world, is recognized as the primary mode
of resolution of international commercial disputes. It is an arbitration
administered by an arbitral institution.
Further, in many arbitral institutions such as the International
Chamber of Commerce (ICC), before the award is finalized and given,
an experienced panel scrutinizes it. As a result, the possibilities of
the court setting aside the award is minimal.
3. Statutory Arbitration: When a law specifies that if a dispute arises
in a particular case it has to be referred to arbitration, the arbitration
proceedings are called “statutory arbitration”. Section 2(4) of the
Arbitration and Conciliation Act 1996 provides, with the exception
of section 40(1), section 41 and section 43, that the provisions of
Part I shall apply to every arbitration under any other act for the time
being in force in India.
4. Fast track arbitration: Fast track arbitration is a time-bound
arbitration, with stricter rules of procedure, which do not allow any
laxity for extensions of time, and the resultant delays, and the reduced
span of time makes it more cost effective. Sections 11(2) and 13(2) of
the 1996 Act provides that the parties are free to agree on a procedure
for appointing an arbitrator and choose the fastest way to challenge
an arbitral award respectively. The Indian Council of Arbitration
(ICA) has pioneered the concept of fast track arbitration in India and
under its rules, parties may request the arbitral tribunal to settle
disputes within a fixed timeframe.
Q.2 Explain the process of Arbitration in India? What is the Need of
Arbitration?
Ans. The arbitration arises due to a dispute between the two parties. So,
to start an arbitration procedure, the contract or the agreement that is executed
between the parties must have an arbitration clause. The arbitration procedure
will be carried on in the following manner:
• Arbitration clause: A contract or agreement that was entered by the
parties must contain an arbitration clause in order to resolve the
disputes through arbitration. An arbitration clause can be a separate
agreement or an agreement in an agreement. That means the
arbitration clause may be in the form of a separate agreement or in a
contract. An arbitration clause says that when a dispute arises
between the parties, it must be resolved through the process of
arbitration. The parties shall also mention the seat and venue of the
proceedings in the arbitration clause itself.
• Notice for commencement of arbitration: The provision for notice
for commencement of arbitration was given in section 21 of the 1996
Act. When the dispute arises and the party has opted for arbitration,
the aggrieved party will send a notice to the other party for invoking
the arbitration proceedings. It contains the names of the parties and
their representatives, a brief description of the dispute, a statement
of relief sought etc.
• Appointment of arbitrator: After the respondent receives the notice
from the applicant about commencement of arbitration, both the
parties will appoint an arbitrator in a manner that is described in the
arbitration clause. This provision is given under section 11 of the
1996 Act.
• Statement of claim and defence: This provision is given under section
23 of the arbitration and conciliation Act, 1996. After the
commencement of arbitration and appointment of arbitrator by the
parties, the claimant drafts a statement of claims which contains all
the documents which they think are relevant to the case and also all
the evidences proving their statements.
The respondent may also submit a counter claim or a statement of
defense in support of his case which shall be examined before the
arbitral tribunal.
• Hearings and written proceedings: The arbitral tribunal will hear
both the parties and examine the evidences. The Tribunal will decide
whether the documents or the evidences produced are valid or not
and proceed the case further. This provision is given under section
24 of the 1996 Act.
• Arbitral award: After hearing the parties and examining all the issues
a final award will be given by the arbitrator. This award shall be made
in writing and shall be signed by all the members of the Tribunal.
This award shall be final and binding on both the parties. However,
an appeal cannot be filed before the Arbitral tribunal but the parties
can appeal against the arbitral award before the court. Form and
contents of the arbitral award are described under section 31 of the
Act.
• Enforcement of arbitral award: After the award is passed by the
arbitral tribunal it has to be executed. The provision related to the
finality and enforcement of arbitral award is given under sections
35 and 36 respectively.
Need for Arbitration: Advancement, liberalisation and globalisation of
international business relations necessitated the invention of a flexible,
reasonable, favourable and time saving method of resolution of disputes
without making the parties to go through the rigorous, time consuming and
resource exhausting procedure of the traditional justice delivery system
Q.3 Describe in brief about the main features of Arbitration and

Conciliation Ordinance, 2020?
Ans. The Arbitration and Conciliation (Amendment) Ordinance, 2020 was
promulgated on November 4, 2020. It seeks to amend the Arbitration and
Conciliation Act, 1996. The Act contains provisions to deal with domestic
and international arbitration and defines the law for conducting conciliation
proceedings. Key features of the Ordinance include:
Automatic stay on awards: The 1996 Act allowed a party to file an
application to set aside an arbitral award (i.e., the order given in an arbitration
proceeding). Courts had interpreted this provision to mean that an automatic
stay on an arbitral award was granted the moment an application for setting
aside an arbitral award was made before a court. In 2015, the Act was amended
to state that an arbitral award would not be automatically stayed merely because
an application is made to a court to set aside the arbitral award.
Section 36 deals with the enforcement of arbitral awards. The ordinance
seeks to amend Section 36 of the Arbitration and Conciliation Act, 1996, to
introduce a new second proviso to sub-section (3) of Section 36 of the
Arbitration Act.
The proviso states, “Provided further that where the court is satisfied
that a prima facie case is made out, (a) that the arbitration agreement or contract
which is the basis of the award; or (b) the making of the award, was induced or
effected by fraud or corruption, it shall stay the award unconditionally pending
disposal of the challenge under section 34 to the award.
The ordinance has been introduced ”to ensure that all the stakeholder
parties get an opportunity to seek unconditional stay of enforcement of arbitral
awards where the underlying arbitration agreement or contract or making of
the arbitral award are induced by fraud or corruption.”
As per the proposed amendment, if a prima facie case is established that
the arbitration agreement or the contract or the making of the award is based
on fraud or corruption, then court will grant an unconditional stay during the
pendency of the appeal, if it has been challenged under Section 34 of the
arbitration law.
The ordinance further clarifies that the newly inserted second proviso to
Section 36(3) of the Arbitration Act shall also be applicable to all court cases
arising out of or in relation to arbitral proceedings, irrespective of whether the
arbitral or court proceedings have commenced prior to or after the
commencement of the 2015 Amendment. Thus, the said provision will come
into effect retrospectively from October 23, 2015. Section 43J of the Act states
the norms of accreditation of arbitrators. The ordinance seeks to substitute
Section 43J of the Arbitration Act by laying down that the qualification,
experience, and norms for accreditation of arbitrators shall be such as may be
prescribed by the regulations. Consequently, the Eight Schedule of the
Arbitration Act has also been omitted.
It is pertinent to note that vide the 2015 amendment to Section 34 (1)(b) of
the Arbitration Act, it has already been clarified that an arbitral award would
be regarded to be in conflict with the public policy of India if the making of the
award was effected by fraud or corruption.
An applicant under Section 36(3) of the Arbitration Act, as on date, is
anyway eligible to file an application seeking stay on the enforcement of the
arbitral award pleading the grounds already enumerated under Section 34 of
the Arbitration Act. The ordinance additionally entitles an applicant to seek
an unconditional stay on the enforcement of an arbitral award under Section
36(3), during the pendency of the Section 34 application; by pleading that the
contract or arbitration agreement which is the basis of the award was induced
by fraud or corruption.
Qualifications of arbitrators: The Act specified certain qualifications,
experience and accreditation norms for arbitrators in a separate schedule.
The requirements under the schedule include that the arbitrator must be: (i)
an advocate under the Advocates Act, 1961 with 10 years of experience, or (ii)
an officer of the Indian Legal Service, among others. Further, the general
norms applicable to arbitrators include that they must be conversant with the
Constitution of India. The Ordinance omits the Schedule for arbitrators and
states that the qualifications, experience, and norms for accreditation of
arbitrations will be specified by regulations.
Q.4 What is International Commercial Arbitration?
Ans. Section 2 (1) (f) of the Arbitration and Conciliation Act 1996 defines
International Commercial Arbitration as under:
“an arbitration relating to disputes arising out of legal relationships,
whether contractual or not, considered as commercial law in force in India and
where at least one party is:
(a) An individual who is a national of, or habitually resident in, any
country other than India
(b) A body corporate which is incorporated in any country other than
India
(c) A company or an association or a body of individuals whose central
management and control is exercised in any country other than India
(d) The government of a foreign country
International Commercial Arbitration is a means of resolution of disputes
that arise under the commercial contracts, which are international in nature.
Arbitration is often an alternative to litigation wherein the parties to the
arbitration mutually control the terms thereby avoiding their national legislation
or rules of procedure. An arbitration to resolve cross border disputes without
having to file in national courts thereby avoiding long and technical procedures
of national courts.
As per the Article 1 (3) United Nation Commission on International Trade

Law (UNCITRAL) arbitration is international when:
(a) Parties to the arbitration agreement have at the time of the conclusion
of the agreement, their places of business in different states
(b) One of the following places is situated outside the State in which
parties have their places of business.
(i) The place of arbitration, if determined in or pursuant to, the
arbitration agreement, is situated outside the State in which
the parties have their place of business
(ii) Any place where a substantial part of the obligations of the
commercial relationship is to be performed or the place with
which the subject matter of the dispute is most closely
connected
(iii) The parties have expressly agreed on the subject matter of the
arbitration agreement, relates to more than one country.
Q.5 What are the general provisions of Arbitration Law?
Ans. Following are the general principles of the arbitration:
• Arbitration is Consensual: Arbitration is a mutual process that
requires the consent of both parties. Arbitration can only be initiated,
if parties have agreed to initiate it. Parties can insert any arbitration
clause if it is relevant utilizing a submission agreement between
parties. The parties are also not allowed to unilaterally withdraw
from the arbitration.
• Arbitration is Neutral: Arbitration is a neutral process hence it
provides equal opportunity to the parties such as; Arbitrator,
Arbitration Panel, applicable law, language, and venue of the
arbitration. This also ensures that no parties should enjoy the home-
court advantage.
• Arbitration is a confidential procedure: The arbitration rule
specifically protects the confidentiality of the matter. The arbitration
process provides privacy and restricts unnecessary controversies
regarding the case and parties. Any disclosure made during the
procedure may result in decisions and awards. In some
circumstances, the parties are allowed to restrict the access of trade
secrets and other confidential information submitted to the arbitration
tribunal.
• The parties choose the arbitrator: Each party has the right to choose
their arbitrator to whom they think will fit to handle their case. If the
parties have chosen a three-member arbitration tribunal, then each
party appoints one of the arbitrators. Then the two selected
arbitration shall agree on the presiding arbitrator. The center can
also suggest the potential arbitrator with relevant expertise or may
directly appoint members of the arbitration tribunal.
• The decision of the arbitral tribunal is final and easy to enforce: The
decision of the arbitral tribunal is final and known as Award. The
decision of the arbitration tribunal must be final and binding on both
parties. Arbitration awards can be easily enforced in other nations
than court proceedings.

Q.1 Give an overview of Arbitration and Conciliation Act, 1996? Give

insight of Evolution of Arbitration? Also explain which disputes are not
Arbitrable?
Ans. In earlier days, even before the establishment of courts, people used
to resolve their issues with the help of a third party when a dispute arises
between them. Later, courts were established and a proper procedure was
followed for resolving the disputes. Eventually, population was increased
and a lot of cases were pending before the court and also the cases were piled
up and the justice was served after so many days of filing a case. This resulted
in the delay of justice to the people.
Due to raise in the population, industries also developed significantly
and as a result of it, commercial disputes also increased. To balance this,
different techniques were developed to solve the disputes outside the courts.
This method of resolving the disputes outside the court or without the court’s
involvement is called as Alternate Dispute Resolution (ADR). There are various
techniques in Alternate Dispute Resolution. They are:
• Arbitration
• Mediation
• Conciliation
• Mini trial
• Mediation-arbitration etc.
Due to the delay in justice by the court, some of these techniques
developed significantly. One of the techniques that developed rapidly is
Arbitration. The main purpose of arbitration is to provide a speedy justice to
the parties.
The Arbitration and Conciliation Act, 1996 contains the law relating to
arbitration. This Act came into force on January 25th 1996. This act gives the
provisions for International Commercial arbitration, domestic arbitration and
also enforcement of foreign Arbitral awards. It is based on the UN model law
so as to equate with the law adopted by the United Nations Commission on
International Trade Law (UNCITRAL).
The preamble of the Act is interpreted as follows: It is an act to integrate
and amend the law relating to:
• Domestic arbitration.
• International commercial arbitration.
• Enforcement of foreign arbitral award.
Law relating to conciliation and related to the matters connected
therewith.
Evolution of arbitration in India: In India, arbitration was known even
before the British rule but in the form of ‘Panch’ and ‘Panchayat’ which are
now known as ‘Arbitration’ and ‘Arbitrators’ respectively. Panchayat means
a proceeding before a person who was considered to be the head of the
village and he used to adjudicate the dispute between the parties amicably
and his decision was considered to final and binding upon both the parties.
Later, the 1787 regulation provided the rules for referring a suit to
arbitration if both the parties agreed to it. But those rules were vague and did
not provide a clear structure to the parties on how to regulate the proceedings
of arbitration. Then, a regulation was enforced in order to promote only a
certain nature of dispute to arbitration and also encouraged the people to act
as arbitrators under Regulation XVI of 1793. Subsequently, several regulations
were made in order to promote arbitration. Finally the 1996 Act was enacted
and it was repealed three times to achieve its objects. The object of the 1996
act is to amend and to unite the domestic arbitration, international commercial
arbitration and also to enforce the foreign arbitral awards. There were also
amendments to this act in the years 2015 and 2019 in order to reduce the
court’s involvement in the arbitration proceedings.
Section 89 of the code of civil procedure also gives importance to
arbitration. It states that the parties can opt for the arbitration proceedings to
settle a dispute, provided that both the parties must agree to it. The award
given by the arbitrator must be considered as a decree given by the court and
the parties must abide by the award given by the arbitrator.
Disputes that are not Arbitrable in India: Usually all the disputes in
which the civil rights of a citizen are infringed and the disputes falling within
the jurisdiction of civil court can be referred to arbitration. But, the disputes
which are related to morality, public policy, status and religious rights are not
arbitrable in India. The agreements which call for the adjudication of the
following matters cannot be executed validly:
• Matters connected with conjugal rights and matrimonial matters.
• Disputes related to industries.
• Revenue matters.
• The proceedings which are of criminal in nature.
• Matters relating to the determination of guardianship or wards.
• Matters related to the testament or will under the Succession Act.
• The matters related to Indian Trust Act, trusteeship of charitable
institutions, public charity.
• Matters within the purview of Restrictive Trade Practices Act and
Monopolies.
• Issues related to Companies Act like Insolvency, dissolution and
winding up proceedings.
Q.2 What are the Key Amendments brought by the Arbitration and
Conciliation Amendment Act, 2015? Explain it in context of Act of 1940 and
1996.
Ans. Unfortunately, the biggest malady with the 1996 Act was that it
departed from the 1940 Act, which fixed the time period for completion of
arbitration proceedings. The time frame for completion of the arbitration
proceedings was done away with, without assessing the grave consequences.
The intent might have been to give greater autonomy to the arbitrators, but
the reality is quite different. Arbitrators, who are mostly retired judges, usually
treat the arbitration proceedings in the same manner as traditional litigations,
and are willing to give long and frequent adjournments, as and when sought
by the parties.
The delay of time in arbitral proceedings was not the only malady plaguing
arbitration of India, another equally daunting challenge was Court interference
in arbitration under Section 9 and awards being set-aside by Courts. Probably
the most criticised aspect was setting aside of awards under the “Public
Policy” doctrine.
In case ONGC Vs SAW Pipes [(2003) 5 SCC 705], the Supreme Court of
India expanded the scope of public policy by taking a wider view than
Renusagar Power Co Vs General Electric Company [1994 Supp (1) SCC
644] and held that Pubic policy means the statutory provisions of Indian law
or even the terms of the contract. This was further expanded ONGC Vs Western
Geo International Ltd [(2014) 9 SCC 263]. In the context of these issues the
Hon’ble President of India, promulgated the said ordinance.
Key Amendments under Act of 2015: The Amendment Act has brought
some of the major changes to the principal Act. A brief summary of the
amendment are as follows:
• Amendment to section 2(e): Definition of the term ‘court’ is amended
to provide certain provisions of the Part I of the Act such as interim
relief (Section 9), court assistance in taking evidence (Section 27)
and appeal to interim relief under Section 9 (Section 37) shall also
apply to International Commercial Arbitration, even if the place of
arbitration is outside India, subject to an agreement to the contrary
between the parties to the dispute. In such cases, the High Court
will act as the ‘court’ in relief to such disputes.
• Amendment to Section 7: An arbitration agreement in the way of
electronic means will also be considered as an arbitration agreement
in writing.
• Amendment to Section 8: If the judiciary finds that prima facie no
valid arbitration agreement exists; the judicial authority may refer
the parties to the arbitration on the action brought by the party to
arbitration agreement on the person claiming through or under him.
If the party is not having original or certified copy of arbitration
agreement or is retained by the other party, the party can make an
application to the court to call upon the other party to produce the
said documents before the court.
• Amendment to Section 9: The arbitral proceedings shall commence
within a period of ninety days from the date of order. Once the
arbitration tribunal is constituted, the court shall not entertain an
application for interim measures unless it finds circumstances that
may render remedy provided under Section 17 ineffective.
• Amendment to Section 11: Appointment of an Arbitrator shall be
made by the Supreme Court of India or the High Court instead of a
Chief Justice of India or Chief Justice of High Court. The High Court
is empowered to frame rules for the determination of fees according
to the Fourth Schedule of the Act.
• Amendment to Section 12: Ensuring neutrality of arbitrators, when
a person is approached for an appointment as an arbitrator, he must
disclose any information to prove his neutrality. A person having
any such relationships as mentioned in the Seventh Schedule of the
Act is not eligible for appointment as an arbitrator.
Section 12(1) of the Arbitration and Conciliation Act (Principal Act)
has been amended to include certain conditions such as:
(a) Disclosure by the arbitrator in writing of certain information
such as any direct or indirect interest in the subject matter in
dispute or to any of the parties.
(b) Circumstances which might hinder the Arbitrator for giving
sufficient time to the arbitration to complete the arbitration
within 12 months.
• Amendment to Section 14: Termination of an arbitrator as well as the
substitution of another arbitrator.
• Amendment to Section 17: The Arbitral Tribunal has all the powers
to grant interim measures which the court is empowered to have
under Section 9 of the Act. Any order issued by the Tribunal will be
deemed to be an order of the court for all purposes and shall be
enforceable under the Code of Civil Procedures, 1908.
• Amendment to Section 23: The respondent, in support of his case,
may submit a counterclaim or a set-off, within the scope of the
arbitration agreement.
• Amendment to Section 24: The Tribunal shall hold an oral hearing
for the presentation of evidence on day to day basis and shall not
grant any adjournments without sufficient cause.
• Amendment to Section 25: The right of the respondent to file the

statement of defense have been forfeited, if he fails to communicate
such a statement within the timeline agreed by the parties or the
Tribunal without reasonable cause.
• Amendment to Section 28: The Arbitral Tribunal while deciding and
making an award, shall take into account the terms of the contract
and trade usages applicable to the transaction.
• Insertion of new provision – section 29A – The Tribunal shall ensure
speedy completion of arbitration proceedings within a period of
twelve months from the date of reference. However, the parties may
extend the time not exceeding six months. If the award is made within
six months, the Tribunal is entitled to receive additional fees as
parties agree. The mandate of the arbitrator may be terminated if the
award is not being made within the term of six months unless the
court extends the time.
• Section 29B: The new provision provides for fast-track procedures
for conducting arbitral proceedings if the parties agree to such
proceedings. In such cases, the award must be made within six months
from the date of reference.
• Amendment to Section 31: A sum directed to be paid by an arbitral
award shall, unless the award otherwise directs, carry interest at the
rate of two percent higher than the current rate, and shall be payable
from the date of award to the date of payment.
• Insertion of new subsection 2(A) in section 34: It provides an
additional ground of patent illegality to challenge an arbitral award
other than International Commercial Arbitrations.
• Insertion of new subsection (5) in Section 34: An application for
setting aside of an award is to be filed after issuing a prior notice to
the other party.
• Insertion of new subsection (6) in Section 34: A period of one year
has been prescribed for disposal of an application for setting aside
an arbitral award.
• Amendment to Section 36: Mere filing of an application for setting
aside an arbitral would not render that award unenforceable unless
the court orders to stay on the operation of the said award on a
separate application made for that purpose.
While looking into various judgments held by the Supreme Court of
India, it will be clear that the judgments were much effective in implementing
the said provisions of the Act. One such case was the Bharat Aluminium
and Co. v. Kaiser Aluminium and Co. (BALCO) [(2012) 9 SCC 552], wherein
the Court held that Part I of the Act was mandatorily applicable to all arbitrations
held in India. Also, Part I applied to arbitration conducted outside India unless
it was expressly or impliedly excluded.
This provision was applied in many cases till BALCO case’s judgment. In
this case, the Court decided that Part I and Part II of the Act are exclusive of
each other, and the Parliament intended that the Act must be territorial in
nature, and section 9 and 34 will be applicable only when the seat of arbitration
is in India. Even though this judgment was favorable for reducing judicial
interference but it also led to some unwanted results. A foreign party would
obtain an award in its favor only to realize that the other party or company has
stripped its assets and converted themselves into a shell company. Parties to
arbitration proceedings outside India will be able to approach Indian courts
for interim measures even before the commencement of arbitration
proceedings.
The Supreme Court further expanded the scope of public policy in the
case of Renusagar Power Co. v. General Electric Company [1994 Supp (1)
SCC 644] by stating that Public policy means statutory provisions of Indian
Law or even the terms of the contract. This was further expanded on ONGC v.
Western Geo International Ltd, [(2014) 9 SCC 263], wherein the Court
assumed the power to modify the subject matter of an award for violation of
the ground of fundamental policy of the Indian Statute under Section 34(2)(b)(ii)
of the Arbitration and Conciliation Act, 1996. The Court held that if the
arbitrators failed to make an interference which should have been made, or
has made a prima facie inference, “then the adjudication made by an Arbitral
Tribunal that enjoys a considerable latitude and play at the joints in making
awards will be open to challenge and may be cast away or be modified…”
There is a very recent judgment on the neutrality of arbitrators by the
Delhi High Court in the case of Assignia-Vil JV v. Rail Vikas Nigam Ltd.
(2015), wherein the Court held that Section 12(5) of the Act “mandates” that
if the arbitrator and the parties enjoy any of the relationship mentioned under
the Seventh Schedule of the Act, they cannot be appointed as an arbitrator.
Despite major efforts to consolidate the law and make effective changes
to the previous legislation for achieving effective alternative disputes
resolution, the 1996 Act paved the way for unprecedented litigation on the
arbitration process. The process suffered substantial delay. In this background,
the 2015 amendment aims to achieve two primary objectives. First, to expedite
the arbitration process and second, to lay down certain guidelines and
provisions for the judiciary to abide by, while disposing of applications
before it.
Alternative dispute resolution, mainly focusing on arbitration, conciliation
as well as mediation, has been an effective alternative to the traditional judicial
system. In India, the prevailing system is that avoiding fast track judicial
proceedings, the effective alternative way in the field of International
Commercial Arbitration (ICA), etc. has been seen familiar. In this context, the
changes affected by the new amendment may be considered as an opportunity
lost to the lawyers as they find it useful in dealing with cases concerning
commercial arbitration as well as defeating ICA in such cases. Today, we are
experiencing unprecedented transactions across the borders, jurisdictions,
and countries, with the advancement of Information Technology; therefore,
International Commercial Arbitration needs greater importance. The amendment
ought to have considered setting up quarantined international arbitration
centers so that India can be an example in the line of certain other countries
dealing with the same.
The Arbitration Act of 1940 had a provision under Section 28 where the
courts only could enlarge the time for making awards unless the arbitration
agreement is provided with the consent of both the parties. At times, the
parties request for a time extension, and it’s mostly during the last hours of
the time of expiry of such an award. This results in uncertainties, delays, and
additional costs. The amendment of Section 29A mandates that court alone
can extend the time. The courts have also been empowered to make certain
additional directions while extending the time including the substitution of an
arbitrator without annulling previous proceedings. This is an area where there
is an increase in the court’s intervention in arbitral proceedings.
The amendment brought to the 1996 Act is a positive step towards making
the process of arbitration cost-effective, expeditious and a ‘party-friendly’
process. The new amendment leads to sort out certain practices leading to
wastage of time, money and energy of both parties as well as to the arbitrators.
The new amendment also brings a sense of independence and impartiality to
the arbitrators when compared to the previous practices in the field of
arbitration. It also ensures that the process of arbitration does not go beyond
a reasonable limit of time and checks whether it is within the capacity of the
arbitrator to make a possible solution. Such steps will provide self-discipline
as well as a control on the case amongst the arbitrators. It must also be stated
that the current amendment has travelled a lot more distance by reducing the
excessive interference of the court in arbitral proceedings that has been a
consistent effort by the legislature since the passing of the 1996 Act.
Q.3 Analyze the provisions of the 2019 Amendment? What is the impact
of recent amendments in Arbitration Law?
Ans. Arbitration in India is governed by the Arbitration and Conciliation
Act, 1996 (“the 1996 Act”). The Act is centered on the UNCITRAL Model Law
on International Commercial Arbitration, 1985 and the UNCITRAL Arbitration
Rules, 1976. The UNCITRAL Model Law was embraced in 1985 with the
unbiased to assist contracting states in upgrading and streamlining their laws
on arbitral means to reflect on the needs of International Commercial Arbitration.
The Indian Legislature enacted the Arbitration and Conciliation Act in 1996
with the object to unite and amend the law relating to domestic arbitration,
international commercial arbitration and enforcement of foreign arbitral awards
to define the law relating to conciliation and for matters connected therewith
or incidental thereto.
Analysis of provisions of 2019 Amendment:
(1) The designation and grading of arbitral institutions:
The 2019 Amendment introduces Section 11(3A) to the Act whereby the
Supreme Court of India and the High Court shall have the power to designate
arbitral institutions, which have been graded by the Arbitration Council of
India (“ACI”) under Section 43-I (also introduced by the 2019 Amendment).
The underlying idea is that instead of the court stepping in to appoint
arbitrator(s) in cases where parties cannot reach an agreement, the courts will
designate graded arbitral institutions to perform that task (per Sections 11(4)–
(6) of the Act, as amended by the 2019 Amendment).
The 2019 Amendment introduces Part 1A to the Act, which is titled as
‘Arbitration Council of India’ (Sections 43A to 43M) and which empowers the
Central Government to establish the ACI by an official gazette notification
(Section 43B). The ACI shall be composed of (i) a retired Supreme Court or
High Court judge, appointed by the Central Government in consultation with
the Chief Justice of India, as its Chairperson, (ii) an eminent arbitration
practitioner nominated as the Central Government Member, (iii) an eminent
academician having research and teaching experience in the field of arbitration,
appointed by the Central Government in consultation with the Chairperson,
as the Chairperson-Member, (iv) Secretary to the Central Government in the
Department of Legal Affairs, Ministry of Law and Justice and (v) Secretary to
the Central Government in the Department of Expenditure, Ministry of Finance
– both as ex officio members, (vi) one representative of a recognised body of
commerce and industry, chosen on rotational basis by the Central Government,
as a part-time member, and (vii) Chief Executive Officer-Member-Secretary, ex
officio (Section 43C(1)(a)–(f)). The ACI is inter alia entrusted with grading of
arbitral institutions on the basis of criteria relating to infrastructure, quality
and calibre of arbitrators, performance and compliance of time limits for disposal
of domestic or international commercial arbitrations (Section 43I).
The main drawback of this scheme is that it limits party autonomy in
international arbitration through governmental and court interference. The
ACI is a government body which shall regulate the institutionalization of
arbitration in India and frame the policy for grading of arbitral institutions.
The fact remains that the court’s choice in designating an arbitral institution
will be limited by the options presented to it by the ACI. Consequently, the
choice of a foreign party appearing before the Supreme Court and seeking
appointment of an arbitrator will be limited to institutions which have ACI
accreditation and to such arbitrators who may be on the panel of such arbitral
institutions. The court will be equally handicapped in designating an ungraded
institution – which has a global reputation for its facilities and quality of
services and which wants to simply establish its local office in India, without
going through the administrative hurdles of being graded by the ACI.
The 2019 Amendment, albeit aimed at institutionalizing the arbitration
scene in India, leaves the discretion in the hands of courts and executive to
decide who gets to be a part of this reform. Another problem associated with
this governmental control over the institutionalization process is the (possible)
nepotism, red-tapism, lack of objectivity and lack of transparency in the grading
process. In my experience, a foreign party often prefers to stay away from an
arbitration regime with significant degree of court or governmental interference.
However, it is nonetheless a welcome move by the government to acknowledge
that institutional arbitration is the only way ahead to attract foreign parties to
include India as the seat in their arbitration agreements.
(2) Timely conduct of proceedings:
As per the newly introduced Section 23(4), the statement of claim and
defence shall be completed within a period of six months from the date of
appointment of the arbitrator(s) and as per Proviso to the amended Section
29(1), the award in the matter of international commercial arbitration may be
made as expeditiously as possible with an endeavour to deliver it within 12
months from the date of completion of pleadings under Section 23(4).
Whilst it is a welcome step – certainly with the right intent – it may lead to
conflicts with the rules of an arbitral institution as it overlooks the procedural
aspects inherent to a complex international arbitration. In international
arbitration, the arbitrators routinely hold a case management hearing, and
after consultation with the parties, issue an order on the procedural timetable
for completion of pleadings, conduct of hearings etc. (e.g., see Rule 24 of the
2017 ICC Arbitration Rules). However, if Section 23(4) restricts a tribunal from
being in control of its proceedings, then it may be impossible to effectively
conduct complex multi-party arbitrations involving massive documents, where
it may be practically impossible to complete pleadings in six months. Similarly,
the autonomy of parties to decide on a more flexible procedural schedule will
be severely limited. Most importantly, the parties will always be wary of the
fate of an award where the time requirements of Section 23(4) are not strictly
abided.
(3) Confidentiality:
As per the newly introduced Section 42A, the arbitrator, the arbitral
institution and the parties to the arbitration agreement shall maintain
confidentiality of all arbitral proceedings except award, where its disclosure is
necessary for implementation and enforcement of award.
The ICC recently released updates to its Note to Parties and Arbitral
Tribunals on the Conduct of Arbitration under the ICC Rules of Arbitration,
effective 1 January 2019 in which it stated that all awards made as from 1
January 2019 may be published, no less than two years after their notification,
based on an opt-out procedure. Per the opt-out procedure, any party may at
any time object to publication of an award, or request that the award be
sanitized or redacted. In such a case, the award will either not be published or
be sanitized or redacted in accordance with the parties’ agreement.
This shows at the outset that India’s practice in publishing the award is
in line with globally established arbitral institutions. However, by not
incorporating an opt-out scheme in Section 42A, the legislature missed the
opportunity to bring clarity to the fate of an award in terms of its publication.
Who will decide that the disclosure of an award is necessary for its
implementation? Will it mean full disclosure or will parties be allowed to agree
on a redacted award? These uncertainties, in my view, only add to the suspense.
(4) Qualification of arbitrators:
The ACI is also entrusted with the function of reviewing the grading of
arbitrators (Section 43D(2)(c)). The qualifications, experience and norms for
accreditation of arbitrators shall be such as specified in the Eighth Schedule,
as introduced by the 2019 Amendment (Section 43J). The Eighth Schedule
stipulates nine categories of persons (such as an Indian advocate or cost
accountant or company secretary with certain level of experience or a
government officer in certain cases inter alia) and only those are qualified to
be an arbitrator.
Thus, a foreign scholar or foreign-registered lawyer or a retired foreign
officer is outrightly disqualified to be an arbitrator under the 2019 Amendment.
For obvious reasons, foreign parties will be discouraged to opt for Indian
institutional arbitration where the choice of candidates as their potential
arbitrators is limited by nationality, likelihood of lack of experience and
specialization – both academic and professional – in handling international
arbitrations.
Impact of recent amendments:
Since the time of enactment, the Act has gone a couple of amendments,
the newest being published only recently. The Arbitration and Conciliation
(Amendment) Act, 2019 postulates significant modifications to the 1996
Act while meaningfully modifying some of the proposals introduced by
the Arbitration and Conciliation (Amendment) Act, 2015.
Retrospective nature of the 2015 Amendment: The retrospective nature
of the 2015 Amendment as it related to the court proceedings had further been
conclusively determined by the Hon’ble Supreme Court by way of its
judgments in two matters in the context of Section 36 of the 1996 Act1and in
the context of Section 34 of the 1996 Act.
The Hon’ble Supreme Court had also expressed its discontent with the
then pending proposal to render the 2015 Amendment prospective in nature
and had advised re-evaluation in this regard. However, the Parliament has
explicitly overlooked the advice of the Hon’ble Supreme Court, and through
the 2019 Amendment explicitly made the 2015 Amendment prospective in

nature i.e. the provisions of the 2015 Amendment would only apply to cases
where the arbitration was raised post 23.10.2015. The language makes the
applicability of the 2019 Amendment perspective not only to arbitration
proceedings but also related court proceedings.
Timeline: The 2019 Amendment relaxes the strict time-period for the
conclusion of arbitration proceedings as suggested by the 2015 Amendment
to a certain extent.
The 2019 Amendment releases international commercial arbitrations from
a pre-determined time-period, although retaining a provision for completion
thereof within a period of 12 months from the date of completion of pleadings.
In the case of domestic arbitration, the time period of 12 months
(extendable by 6 months subject to consent by the parties) for the conclusion
of the proceedings is now to be calculated from the date of completion of
pleadings instead of the date of constitution of the arbitral tribunal.
Further, a period of six months’ time has been prescribed for the filing of
the Statement of Claim and Defence. But it is uncertain as to what are the
consequences of a breach of the six-month period by the parties.
Mandate of the Arbitrator(s): The 2019 Amendment stipulates that when
the parties have approached the Court with an application under Section 29A
for extension of time for the conclusion of the arbitration proceedings, then
the mandate of the arbitrator(s) shall continue till the disposal of the said
application.
This guarantees the continuation of the arbitration proceedings for the
period when the said application is pending before the Court, whereas
previously the arbitrator could only revive the proceedings once the court
would allow such application. Till that time, the period during which the
application is pending would be a complete waste of time.
Yet further, it has also been provided in the 2019 Amendment that if a
Court deems it fit to effect a reduction in the fees of the arbitrator(s) while
considering such an application, it shall do so only after giving the arbitrator(s)
concerned an opportunity of being heard in the matter.
Confidentiality of Arbitration Proceedings: The 2019 Amendment
incorporates a precondition for the arbitrator, the arbitral society involved
and the parties themselves to maintain the confidentiality of all arbitration
proceedings, except where disclosure of the award is necessary for the purpose
of its implementation and enforcement.
Interference with an Award under Section 34: A modification brought
about by the 2019 Amendment is in relation to the manner of substantiating
the pre-requisites for intervention with an award under Section 34. Whereas
the provision in the 1996 Act required a party to ‘furnish proof’ of the existence
of conditions that would validate an interference with the award, the 2019
Amendment elucidates that the said circumstances have to be established on
the basis of the record of the arbitral tribunal. Not only does this removes the
ambiguous requirement of furnishing proof, yet it expressly clarifies that the
demonstration must be made by the party concerned based on the record of
the arbitral tribunal alone.
Power of Arbitrators to make orders under Section 17: The 2015
Amendment had permitted the parties to obtain interim procedures from an
arbitral tribunal under Section 17 of the 1996 Act during the pendency of the
arbitration proceedings or at any time after the making of the award, but
before it was enforced in accordance with Section 36.
This period for which the arbitral tribunal can order interim relief has now
been reduced in the 2019 Amendment, by the removal of the said power after
the making of the arbitral award. This means that after the making of an award
and before its enforcement, it is the concerned Court only which can be
approached for interim measures under Section 9 of the 1996 Act. This ties in
with the general prescription that the arbitral tribunal is by and large functus-
officio after the passing of the award except for certain limited functions such
as those mentioned in Section 33 of the 1996 Act.
Protection for Arbitrators: The 2019 Amendment also gives security for
arbitrators and elucidates that no legal proceeding shall lie against an arbitrator
for anything done in good faith or intended to be done under the 1996 Act.
Arbitral Institutions and Delegation of Crucial Functions: The 2019
Amendment executes the idea initiated by the 2015 Amendment towards setting
up and establishing arbitral institutions in the country. The 2019 Amendment
expressly empowers the Supreme Court and the High Courts to appoint arbitral
institutions for performing critical functions, including the appointment of
arbitrators.
The function of appointing arbitrators has now by the 2019 Amendment
been permitted to be delegated to an institution to be so elected by the Court
concerned. The applications for an appointment which were up till now to be
filed before the Supreme Court, in the case of international commercial
arbitration, and the High Court, in the case of domestic arbitration, are now to
be filed before the institution designated by the Supreme Court and the High
Court respectively.
An arbitral institution is required to dispose of the application within a
period of 30 days from the date of service of notice on the opposite party,
though there is no clarity on the mandatory enforceability of this provision. If
the High Court concerned is unable to designate an arbitral institution for lack
of availability, then the High Court shall maintain a panel of arbitrators for
discharging the functions and duties of the arbitral institution and any
reference thereof would be deemed to be an arbitral institution.
Applicability of the Fee Provisions: The 2019 Amendment proposes that
in the absence of a designated arbitral institution, the High Court is required
to maintain a panel of arbitrators and if a party were to appoint an arbitrator

from such a panel then the fee as stipulated in the Fourth Schedule shall be
applicable to the arbitrator appointed.
Establishment of the Arbitration Council of India: With the introduction
of arbitral institutions, another provision is the creation of the Arbitration
Council of India which has been moulded as an arbitration regulator performing
various functions for promoting, improving and progressing the practice of
arbitration in the country. To achieve this goal, the Arbitration Council of
India has been given powers for grading arbitral institutions, recognizing
professional institutes providing accreditation of arbitrators, maintaining a
database of arbitral awards made in India etc.
The central government has been given the power to constitute the
Arbitration Council of India. It needs to be seen what the relevant regulations
in this regard would be set up for clarity on the scope of powers and functions
of the council.
Specific Qualifications: Until now, there were no specific qualifications
prescribed for being appointed as an arbitrator, apart from the general
requirements of independence and impartiality. The 2019 Amendment has
introduced the Eighth Schedule which provides that only a certain specific
class of persons holding certain qualifications would be qualified as an
arbitrator including advocates, chartered accountants, cost accountants and
company secretaries [all with 10 years of experience] or officers of the Indian
legal service, or officers with a law degree or an engineering degree [both in
the government and in the private sector with 10 years of experience], officers
having senior level experience of administration [both in the government and
in the private sector with 10 years of experience], or a person having
educational qualification at the degree level with 10 years of experience in a
technical or scientific stream in the fields of telecom, information technology,
intellectual property rights or other specialized areas [both in the government
and in the private sector].
The ability to be an arbitrator is expressly tied-in with qualification and
experience. Further, any person having been convicted of any offence
involving moral turpitude or an economic offence would fall afoul of these
norms. However, both these qualifications and norms are introduced by the
2019 Amendment in relation to Section 43J which pertains to accreditation of
arbitrators by the Arbitration Council of India.
Conclusion: While the aim of the 2019 Amendment Act is to promote
arbitration, and strengthen institutional arbitration in India, the proposed
changes to the Act may force India to take two steps back as an arbitration-
friendly jurisdiction. Some of these issues may be resolved over time through
judgments of the court. Foreign parties may not be inclined to seat their
arbitrations in India, till such time that these issues are resolved.
Q.4 What are the laws applicable to Arbitration? What is Seat and
Venue of Arbitration? Describe the evolution of laws governing seat of
Arbitration?
Ans. In international commercial arbitration, since the parties or the
corporations involved are from different countries, different laws are applicable
for conducting the arbitration in an effective manner. Arbitration agreement
will contain the name of the place where the arbitration will be conducted so
as to make the law of that place relevant to the arbitration. In Naviera
Amazonica Peruana SA v. Compania Internacional de Seguros del Peru
(1988), the Court of Appeal in England summarised the relevant laws applicable
to an arbitration agreement. The laws are as follows:
1. Law governing the agreement to arbitrate, i.e., juridical seat or lex
arbitri.
2. Law governing the substantive contract, i.e., an applicable/governing
law.
3. Law governing the procedure of the arbitration, i.e., curial law.
Law of the place of arbitration: Parties who wish to settle their dispute
through arbitration have to mention the place of arbitration either at the time
of entering into the contract or in the submission agreement that they form
when the dispute has arisen, if not mentioned earlier. One of the fundamental
characteristics of the arbitration is that the parties will often choose a neutral
venue as the place of the arbitration. They will choose a country, which is not
their place of residence or neither is it the one in which they have some
commercial business running. This means that, in practice, the law of the
place of arbitration, the lex arbitri, will often be different from the law that
governs the substantive matters in dispute or in other words actual issues in
the dispute. If the arbitration agreement provides that the seat of the arbitration
is London and the substantive law is the Indian law, it means that the arbitral
proceedings will be conducted according to English law, however, the main
issues between the parties will be decided according to the Indian law. This
difference between the lex arbitri and the law governing the substance of the
dispute is well established in international commercial arbitration.
It is important that the parties mention the place of arbitration. If the
parties have not mentioned the place of arbitration, the choice will have to be
made for them, either by the arbitral tribunal itself or by a designated arbitral
institution, if they have mentioned the name of the institution to conduct their
arbitral proceedings.
It is firmly established that arbitration is governed by the law and the
place of the arbitration which is the ‘seat’ or lex arbitri of arbitration is not
merely a matter of geography. It is the territorial link between the arbitration
itself and the law of the place in which that arbitration is taking place or in
other words, provisions of the law of the place of the arbitration will be applied
while conducting the arbitration.
By choosing a particular country as the seat or the place of arbitration the

parties have not restricted the movement of the tribunal. The tribunal can
conduct the proceedings out of that country, but it cannot change the
procedural law. Since in international commercial arbitration, parties are in
different countries, and in these circumstances, it is common for an arbitral
tribunal to hold meetings or hearings in places other than the designated
place of arbitration. It may be for the convenience of the parties, witnesses
and also for the purpose of taking evidence. However, each move on the part
of the arbitral tribunal does not in itself mean that the seat of the arbitration
changes. The seat of the arbitration remains the place initially agreed by or on
behalf of the parties.
Law applicable to the substance of the dispute: Procedure as to how
arbitration has to proceed is regulated by the law of the place of the arbitration
but the law that will deal with the core issues in the dispute will also have a
very important impact on the arbitral process. Therefore, it is imperative to
know what choice has been made by the parties. In case the dispute relates to
the parties living in the same country, the domestic law of that country will be
the applicable law. In the case of the international commercial contracts, parties
from different countries are involved, moreover, since the choice has to be
made by the respective parties they can choose the national law of the particular
country or they can blend the laws of two countries to regulate their agreement.
There may be two or more different national systems of law that may be
applicable and it is also possible that these different national systems may
contain contradictory rules of law on the particular point or points in issue.
Law dealing with the capacity of the parties to enter into an agreement:
Law that will deal with the capacity of the parties will be the law of the country
of their domicile or residence. In international commercial arbitration, the
capacity of the parties to enter into an arbitration agreement should also be
checked under the law that will deal with the substantive issues in the dispute.
In the case of the corporation, capacity will be seen according to the place
where the corporation or the company has been constituted. In case one of
the parties to the arbitration agreement is the state or the state agency, then it
should be checked that the state is allowed to resolve its disputes through
arbitration or there is a need for the authorisation before the state can resolve
its issues through arbitration.
Law governing the arbitration agreement: An agreement to arbitrate is
incorporated in the submission agreement or in the arbitral clause. Where an
arbitration clause is written into a contract, it is not usually laid down as to the
law which will govern that clause. For instance, the standard ICC Arbitration
Clause, which is set out in twelve languages, including Arabic, Chinese,
Japanese and Russian, does not refer to any specific law governing the
arbitration clause itself. So, if it is not expressly laid down as to what law will
deal with the arbitration agreement, the presumption is that it will be the same
law that will deal with the core issues in the dispute. This presumption is
based on the assumption the arbitration clause is part of the main contract so
it should be regulated by the same law as that is dealing with the core issues.
Seat and Venue of Arbitration: It is important to distinguish the term
“seat” from “venue” and “place”. The term “seat” is of utmost importance as
these terms determine many crucial aspects of the arbitration proceedings,
the term “seat” connotes the situs of the arbitration or the center of gravity of
the arbitration proceedings. The selection of a certain location as the seat of
arbitration will come with consequences as such a selection of a geographical
location as a seat will mean that the courts of that jurisdiction will have
supervisory jurisdiction over the arbitral process and the procedural law or
curial law of the arbitration proceedings will be law of that jurisdiction. Parties
often select the seat in absence of a choice of governing law clause in the
arbitration agreements and therefore often the law of the seat becomes the law
governing the arbitration proceedings. Renowned scholars in the field of
international arbitration often refer to the law of seat as the lex arbitri. Many
leading arbitration jurisdictions often place emphasis on the seat of the
arbitration to determine the lex arbitri and also propound a territorial link
between the arbitration proceedings and the seat of the arbitration. The term
“venue” may often be interlined with the term “seat”, but this may not
necessarily be the correct approach. The term “place” often refers to a
convenient location selected by the parties to carry out the arbitration
proceedings and should not be confused with the seat or venue. It is without
doubt that the term “seat” carries more weight than venue or place.
At this juncture it is also important to note that the Act does not define
the term “seat” or “venue”. Section 20 of the Act merely defines the “place of
arbitration” which is being used interchangeably with the terms “seat” and
“venue”. It is also true that parties that often conclude arbitration agreements
do not realise the repercussions of selecting a particular location as a seat and
due to this there is often unnecessarily litigation between the parties. However,
it appears that although Indian courts have laid extensive emphasis on the
term “seat”, it has often associated seat with venue and used these terms
interchangeably leading a controversy that is yet to be conclusively resolved
by the Supreme Court.
The Seat-Venue Saga: To begin understanding the principle adopted by
the Indian courts to divide the concepts of seat and venue in the context of
international arbitration it is important to note the ratio laid down by the
England and Wales High Court in Roger Shashoua v. Mukesh Sharma (2009),
commonly referred to as the Shashoua Principle by Indian courts. In this case
the parties had selected London as the venue of arbitration but had not
selected it as a seat. Cooke, J. employed a ratio that laid down that when
parties had selected a venue of arbitration without designating a seat of
arbitration, it is safe to conclude that the venue is the seat of arbitration

provided that the parties have selected a supranational body of rules to govern
the arbitration and there is no other indication to the contrary. It is pertinent to
note here, that the Constitutional Bench in BALCO [(2012) 9 SCC 552] had
approved the Shashoua Principle. The Shashoua Principle was further followed
in Enercon (India) Ltd. v. Enercon GmbH [(2014) 5 SCC 1]. Therefore it
appeared that this position in India is well settled
However, in 2018, there appeared room for uncertainty as it was noticed
that the Supreme Court had deviated from the Shashoua Principle approved
by the same court in BALCO. In Union of India v. Hardy Exploration and
Production (India) Inc. [(2019) 13 SCC 472] (Hardy Exploration), the parties
had selected that Kuala Lumpur was the venue of arbitration but were silent
on the seat. After disputes arose, the arbitration proceedings commenced and
the award was signed at Kuala Lumpur. Thereafter the appellant sought to
challenge the award under the Act before the Delhi High Court contending
that Delhi was the seat of arbitration. On appeal the Supreme Court delivered
a judgment deviating from the Shashoua Principle. The Court held that the
parties had not chosen the seat of arbitration and noted that the Tribunal also
had not made any findings with respect to the same. It was observed that
Kuala Lumpur was designated by the parties as the venue of arbitration and
thus it did not mean that Kuala Lumpur had become the seat of arbitration.
The Court concluded that a venue could become a seat of arbitration only if
something else is added to it as a concomitant. It is evident that the opinion of
the Court is not in consonance with the Shashoua Principle approved by the
same court in BALCO.
Thereafter in 2019, the Supreme Court had another occasion to revisit
this topic in BGS SGS Soma JV v. NHPC Ltd. [(2020) 4 SCC 234] (Soma JV).
It is interesting to note that in this case, the coordinate Bench (3 Judges) had
reiterated the Shashoua Principle contrary to the observations made in Hardy
Exploration. The Court propounded a test and laid down that when a particular
place is designated as the venue of arbitration the same should be considered
to be the seat of arbitration. It noted that this should be coupled with the fact
that the parties have not made any other contrary indication that the venue is
not the seat of arbitration. The Court observed that the decision in Hardy
Exploration is per incuriam as it did not follow ratio laid down by the
Constitutional Bench in BALCO that wholeheartedly adopted the Shashoua
Principle in Indian law. It appears that there is uncertainty whether the decision
of the Court in Hardy Exploration or Soma JV holds the field, as a concurrent
Bench could not have overruled the judgment in Hardy Exploration.
In March 2020, another conundrum had arisen before the Supreme Court
in Mankastu Impex (P) Ltd. v. Airvisual Ltd.[ (2020) 5 SCC 399]. In this
case the arbitration agreement was unique as it did not use the words “seat”
or “venue”. The arbitration agreement laid down that the arbitration would be
administered in Hong Kong and the place of arbitration was Hong Kong. It
also stated that the governing law was Indian law and that the courts of New
Delhi shall have jurisdiction. Accordingly when disputes arose, Mankastu
approached the Supreme Court of India for appointment of arbitrator
contending that as Indian law was the governing law and the courts at New
Delhi had jurisdiction therefore that New Delhi was the seat of arbitration.
Mankastu relied on Hardy Exploration. Air visual contended as Hong Kong
was designated as the place of arbitration, and therefore Hong Kong was also
the seat of arbitration. Air visual relied on Soma JV for this purpose.
It is interesting to note the method of inquiry adopted by the Supreme
Court in arriving at its conclusion that Hong Kong was the seat of arbitration.
The Court instead of applying the ratio in Hardy Exploration or Soma JV,
employed a different method of inquiry altogether. Although, the Court did
not expressly follow Hardy Exploration it appears to have arrived at a similar
conclusion on a different line of reasoning. The Court held that it would not
be safe to conclude that the place of arbitration would automatically become
the seat of arbitration without examining other pertinent indications in the
contract to discern the true intention of the parties. The Court observed since
it was agreed that the arbitration proceedings should be administered in Hong
Kong that the seat of arbitration was Hong Kong.
The evolution of laws governing the seat of arbitration in India:
(1) Bhatia Trading v. Bulk Trading SA (2002)
This case was one of the landmark cases in the pre-Balco regime wherein
the importance of seat and place of arbitration and the applicability of
the Arbitration and Conciliation Act, 1996 (Arbitration Act) was discussed.
The case has been discussed in detail below:
Brief Facts: In a contract between the Appellant and the Respondent,
the dispute resolution clause provided arbitration in accordance with
the Rules of the International Chamber of Commerce (ICC). In furtherance of
the same, the parties agreed to the arbitration being held in Paris, France and
a sole arbitrator was appointed by the ICC. An application was filed by the
Respondent in the District Court of Indore, Madhya Pradesh, seeking an
order for an injunction against any form of alienation of the property by the
Appellant. After the order was passed in favour of the Respondent and the
same was confirmed by the High Court, the order of the High Court was
challenged by the Appellant on the ground that Part-1 of the Arbitration Act
does not apply to arbitrations occurring outside India.
Issue: Whether Part-1 of the Arbitration Act is applicable in cases of
arbitrations where the place of arbitration is outside India?
Held:
i. If the arbitration is happening in India, then Part-1 of the Arbitration
Act will be applicable.
ii. In the case of an international commercial arbitration wherein, the

place of arbitration is outside India, provisions of Part-1 will be
applicable unless they are excluded by an express or implied
agreement between the parties.
Drawbacks: The Supreme Court failed to consider the difference between
the ‘seat’ and ‘venue’ of arbitration while deciding this dispute. The Indian
arbitration laws could have been deemed to be applicable only if the seat of
arbitration is in India irrespective of the place of arbitration.
(2) Bharat Aluminium Company v. Kaiser Aluminium Technical
Services Inc. (2012)
This case has set the benchmark when it comes to interpretation of the
terms seat and place of arbitration and has been followed as a precedent ever
since. This judgment also led to the 2015 Amendment of the Arbitration Act.
The case has been discussed in detail below:
Brief Facts: In a contract between the Appellant and the Respondent,
the dispute resolution clause provided an arbitration. In furtherance of the
same an Arbitral Tribunal was constituted and the arbitration proceedings
were carried out in England. Two awards were passed by the Tribunal. The
Appellant filed a petition under Section 34 of the Arbitration Act for setting
aside the two awards in the District Court of Bilaspur. The District Court
dismissed the petition on the ground that it was not maintainable. On an
appeal filed to the Chhattisgarh High Court, the High Court upheld the order
passed by the District Court. Thus, the Appellants approached the Supreme
Court through this appeal.
Issue: Whether Part 1 of the Arbitration Act is applicable in cases of
arbitrations where the place of arbitration is outside India?
Held:
(i) The Arbitration Act follows the territoriality principle as provided
under the UNCITRAL Model Law. Thus, Part-1 of the Arbitration
Act will only be applicable when arbitration is taking place within
India (venue) or is following the Indian laws of arbitration (seat).
(ii) Part-1 of the Arbitration Act will not be applicable to international
commercial arbitrations if the place of arbitration and the seat of
arbitration is outside India.
(iii) The term ‘place’ that has been utilised in Section 20(1), and Section
2(2) should be read as the seat of arbitration.
(iv) The term ‘place’ that has been utilised in Section 20(3) should be
read as the venue of arbitration.
A question may arise as to what happens if the parties mention the venue
to arbitration in the agreement but fail to mention the seat of arbitration. In
such cases, can the venue of arbitration be deemed to be the seat of arbitration
as well?
(3) In Dozco India Pvt Ltd. v. Doosan Infracore Co. Ltd (2011), the
Supreme Court held that if the parties fail to mention the seat of arbitration in
the agreement, the presumption is that the parties have intended the laws of
the venue of the arbitration to be the laws governing the arbitration as well
unless an intention to the contrary has been shown. This is called the closest-
connection test as the country/place that is most closely connected with the
arbitral proceedings is used to determine the seat of arbitration.
(4) In BGS SGS Soma JV v. NHPC Ltd (2020), the Supreme Court held
that in the absence of an express mention of the seat of arbitration, the venue
of the arbitration would be deemed to be the juridical seat since the venue of
arbitration is most closely connected with the arbitral proceedings.
(5) In Inox Renewables Ltd. v. Jayesh Electricals Ltd (2021), the parties
to the arbitration had mutually agreed to shift the venue of arbitration from
Jaipur to Ahmedabad. It was contended by the Respondent that in the absence
of a written agreement, the shift in the venue of arbitration does not result in
the shift in the seat of the arbitration. It was also contended that the courts in
Rajasthan will have exclusive jurisdiction to hear the disputes arising out of
the arbitration. The Supreme Court held that the parties to arbitration can shift
the venue of the arbitration without a written agreement. By changing the
venue of the arbitration, the seat of the arbitration also changes, and thus the
courts in Gujarat will have exclusive jurisdiction to deal with the issues arising
out of the arbitration.
Q.5 What is an Arbitration Agreement? What are its essentials?
Ans. The formation of an arbitration agreement takes place when two
parties, enter into a contract and in which, the contract states that any dispute
arising between the parties have to be solved without going to the courts with
the assistance of a person, who would be a neutral person, a third party,
appointed by both of the parties, known as the Arbitrator, who would act as a
judge. The arbitrator so appointed should have been previously mentioned in
the contract that they made. They should also state who should select the
arbitrator, regarding the kind of dispute the arbitrator should give decisions
on, the place where the arbitration would take place. Furthermore, they should
also state the other kinds of procedures mentioned or that has to be required
during an arbitration agreement.
The parties are generally required to sign an Arbitration Agreement. The
decision taken by the arbitrator regarding any issue, is binding on both the
parties, as stated by the agreement. In any event, where one party decides
that an agreement must be made prior to entering the contract, it can be stated
that the agreement was made to deviate from the hassles of the court. These
agreements are like contingent contracts, which means that these agreements
shall only come into force or become enforceable if any dispute happens, and
on the basis of the same dispute between two parties mentioned in the contract.
It also takes place or is enforceable in the light of any dispute that arises
between the parties to the contract.
Essentials of an Arbitration Agreement:
• There must be a dispute that should take place only then the
agreement will be valid. The presence of a dispute amongst the
parties is an essential condition for the contract to take place. When
the parties have already settled the dispute, in no case, they can
invoke the arbitration clause to refute the settlement.
• Another essential is the written agreement. An agreement related to
the arbitration must always be in writing. An arbitration agreement
will be considered as a written agreement when:
(i) It has been signed by both parties and it is in the form of a
document.
(ii) It can be the exchange of the telex, the letters, the telegrams, or
any other means of communication which provides the record
of the exchange and the agreement for arbitration.
(iii) There must be an exchange of statements between the parties
that gives the statement of claim and defence in which the
existence of the agreement of the arbitration is agreed by one
of the parties and which is not defined by the other party.
• The third essential intention. The intention of the parties while
forming the contract is of utmost importance and it forms the basis
of the agreement. There have been no prerequisite citations of terms
such as an “arbitrator” or “arbitration” to be made in the agreement.
Therefore, it is necessary to note that the intention of both parties
plays a very important role in such an agreement. However, one
must keep in mind that even if the words have not been mentioned,
the intention must show that both the parties have agreed to come
to the terms with the Arbitration Agreement.
• The fourth essential element is the signature of the parties. The
signature of the parties is an essential element to constitute an
arbitration agreement. The signature can be in the form of a document
signed by both the parties to the contract which comprises all the
terms and conditions, or it can also be in the form of a document
which is signed by only one party to the contract which contains
the terms and acceptance by the other party to the contract. It will
be sufficient if one party puts up a signature in the agreement and
the other party accepts that.
In the landmark case of K.K. Modi v. K.N. Modi and Ors. [(1998) 3 SCC
573], it was held by the Hon’ble Supreme Court that the following attributes
must be present in an arbitration agreement:
1. The agreement must state that the decision of the tribunal will be
binding upon by both the parties.
2. That the jurisdiction of the tribunal on the rights of the parties should
be decided by both the parties consensually or from an order obtained
by the Court which states that the proceeding shall be made through
arbitration.
3. The tribunal has the right to determine the rights of the parties by
being fair and just.
4. The agreement that the parties will refer to the tribunal must be
enforceable by law.
5. The agreement must state that any decision made by the tribunal on
the dispute must be formulated prior to the time when the reference
is made.
Some common elements included in the Agreement other than the
essential agreements: The following are some of the common elements
included in an arbitration agreement, which is generally not considered as an
essential element, but shall be included if the parties want it to be mentioned
in the contract.
1. Seat of Arbitration- the seat here means the place. Therefore, this
clause states that there will be a place of arbitration in the case of the
dispute. This provision is an important one, especially in the case of
an international commercial arbitration, as this seat helps in
determining the procedural laws that govern the procedure of the
arbitration. However, the seat of the arbitration does not have to be
the same place as the hearing of the proceedings. It is the place
where the arbitration takes place, even though it differs from the
place of the hearings.
2. Procedure for appointing the Arbitrators- the procedure is the same
as mentioned in the Arbitration Act. It states that any person,
irrespective of the nationality, may be appointed as an arbitrator,
unless the parties agree to something otherwise. The parties can
themselves agree for the appointment of an arbitrator.
3. Language- The language plays an important role while making an
agreement. It is necessary that the language which has been chosen
in the contract doesn’t have to be the one that is not understood by
both parties. There must not be any sort of communication gap and
that the agreement made by the parties are of such a manner that
each and every clause mentioned in the contract is actually
understood by both the parties signing the contract. Picking the
language which can be understood by both parties is important
because then it would save both the parties, the cost of a translator.
4. Number and Qualifications of Arbitrators- The Act allows the parties

to determine the number of the arbitrators, with the only condition
that the number shall not be an even number, but an odd number of
arbitrators, so that the decision can be made even if there is a
disagreement amongst the arbitrators.
5. Type of Arbitration- The parties have the choice to choose between
the institutional and the ad hoc (which means it is created for that
specific purpose) kind of arbitration. Institutional means that
agreeing to be bound by the rules of the arbitration institutions ad
hoc means that the parties themselves agree to arrange an arbitrator.
6. Governing Law- It is important to mention the substantive law that
they want to be governed by as failing to mention this substantive
law might be a huge issue in the future disputes arising between the
parties, if any.
Important provisions in the arbitration agreement: There are a few
important provisions under an arbitration agreement, and these are mentioned
below:
1. Written Agreement: As stated as an essential condition, there must
be a written agreement. Section 7(4) of the Act, states that every
agreement made must be in the form of a written document or even in
the form of any kind of communication whether or not those
communications take place through telegrams, telex or even other
telecommunication devices provided that there must be a record of
the communication.
2. Appointment of the Arbitrators: Section 11 states that the arbitrator
can be appointed at the liberty of the parties to the contract. In case,
where the parties fail to decide the appointment of the arbitrator, the
Chief Justice of the High Court, in case of the domestic arbitration
and the Chief Justice of the Supreme Court, in case of International
Commercial Arbitration is approached.
3. Interim Relief: Section 9 and Section 17 of the Act provide for the
Interim relief orders with respect to the arbitration. The relief petition
is maintainable under section 9 if there is prima facie evidence that
there is an agreement for the arbitration proceeding. The parties, if
they want, can move to the Court before the arbitration proceeding
actually starts or even after making the arbitral award but before its
enforcement as per section 36 of the Act. Section 17 states that, at
the parties’ request, the tribunal may order the party to take interim
measures, the way it deems fit and necessary in respect to the subject
matter of the dispute.
4. Finality of an Award by Arbitration: Section 34 states that the award
given by the arbitrator is final and is binding upon the parties who
have signed the contract. Once the decree is granted by the court, it
shall be enforceable with respect to section 34 of the Act.
5. Appeal: Section 37 states that if the parties are not satisfied with the
decision of the arbitrators, an appeal lies against the order granting
or refusing to grant any measure under section 9 and also against
refusing to set aside or setting aside an award. An appeal can also
lie against the order of the tribunal accepting the plea referred to
in section 16 or granting or refusing to grant an interim measure
under section 17. However, there is no provision for an appeal against
the appointment of an arbitrator as given under section 11.
Significance: The growth of arbitration signifies that there is a
fundamental change that is present in our way of legislating. Another
significance is in deciding the matters in a significantly lesser amount of time
and the different or the separate clauses mentioned in the commercial contract.
These are paving the way for the most effective and the most suitable remedy
without having to go through the recourse of the courtrooms. Arbitration is
generally the most efficient form of remedy for settlement of disputes amongst
the parties, which actually does not require any long procedures of the Court
for the decisions to be made. It is cost-efficient, it is time-saving, it also
permits one to choose their own arbitrators. Through this, the decisions are
given swiftly, and according to the nature of the case, they are also, most of
the time satisfactory. The severability, separability, and the autonomy principle
of the Arbitral agreement prevent the validity of one agreement from being
overlapped by the other. Nonetheless, the two agreements may co-exist. Having
such a principle does not negate the value of the other principles mentioned
in the contract, but mostly adds on to those principles. Thus it plays an
important role when the contractual clauses arise when dealing with the
disputes.
Q.6 What is the concept of Arbitration Law in India? What are the
objectives of Arbitration?
Ans. Arbitration is an effective alternative dispute resolution. It is the
forum in which parties by an agreement between them choose a forum other
than the court of law to resolve their disputes. The reason behind the evolution
of arbitration is to minimize the burden from the shoulders of the court of law
and provide speedy remedy to the parties. Nani Palkhivala observed that
there are enormous advantages to arbitral proceedings.
In the words of Nani Palkhiwala, he said ”If the law is not to be a system
of tyrannical rigidity, but instead to be the efficient and useful servant of a
changing society, it must from time be adapted and parts of it replaced. A court
of law is like an ancient castle, constantly under repair. There comes a time
when it no longer pays to patch it up and it is better to resort to a new, compact
house built on modern lines”.
Why arbitration is preferred over the judiciary: Arbitration is an effective

forum which provides speedy remedy than the judiciary. Matters in arbitration
are disposed within 1 year whereas in courts the parties to the dispute have to
wait for several years depending upon the complexities of their case.
Arbitration is also preferred by the parties because of the autonomy
granted by it and exercised by the parties in determining the course that the
proceedings may take.
History of Arbitration in India: Third-party settlement of disputes is a
part of ancient Indian ethos and culture. However, the settlement of disputes
through the institution of the judiciary is a little over a century old and is a
result of British rule in India. Despite the long history of the settlement of
disputes by alternative means in our country, the first statutory recognition
given to domestic arbitration was given by way of the Indian Arbitration Act,
1940.
Retired law professor of Osmania University, Dr. V. Nageswara Rao
presented an overview of conciliation proceedings under the Arbitration and
Conciliation Act,1996 before the Law Commission of India. He stated that the
settlement of disputes through reference to a third party has been part of the
“volksgeist” or body of customs of India for time immemorial.
There are basically two types of arbitration proceedings which are
conducted. Domestic arbitration proceedings which are conducted between
two Indians. International commercial arbitration proceedings which are
conducted between the parties, where at least one of the parties is an individual
who is a national of, or habitually resident in, any country other than India or
a company, or an association, or a body of individuals whose central
management and control is exercised in any country other than India or the
government of a foreign country.
Overview of Arbitration 1940 Act: The Indian Arbitration Act, 1940 dealt
solely with the previously uncodified body of law concerning domestic
arbitration proceedings. The objective of the 1940 act was to consolidate and
amend the law relating to arbitration.
Key Highlights of the Arbitration 1940 Act:
• It gave wide discretionary and supervisory powers to the courts
allowing them to regularly intervene in arbitration proceedings.
• It also severely limited the freedom of the parties to choose their
preferred means settlement by imposing a number of regulations.
• Section 3 of the 1940 Act, imposes certain implied terms and
conditions that were required to be present in any arbitration
agreement unless those terms were specifically contracted away.
• The 1940 Act, also grants wide power to the court in matters of
appointment or removal of arbitrators and allow the court to modify
or remit the award and also pass interim orders.
From the above highlights, it is clear that the arbitral tribunal constituted
under the 1940 Act had no real powers but rather acts as a proxy for the court.
Overview of the Arbitration 1961 Act: The statutes dealing with
international commercial arbitration were the Arbitration (Protocol and
Convention) Act, 1937 and the Foreign Awards (Recognition and Convention)
Act, 1961. Before the passing of the 1996 Act, the enforcement of foreign
awards either awards passed as a result of international commercial arbitration
proceedings was governed by the two above mentioned statues.
Origin of the 1937 and 1961 Act: After the destruction of the first world
war, the international community began to recognise the importance of
international trade as a means of building a closer relationship between
countries. In order to facilitate international trade, it became imperative to
develop a means to resolve commercial disputes relating to international trade
in a quick and efficient manner.
What was the first attempt of the international community towards
international commercial arbitration? The first attempt towards international
commercial arbitration was made by the League of Nations, under whose
authority the Protocol on Arbitration Clauses, 1923 was concluded. However
1923, Protocol had a number of shortcomings such as it only allowed domestic
awards to be enforced before the national courts of member countries.
What actions were taken in order to overcome the shortcomings found
in 1923 Protocol? In order to overcome the shortcomings of the 1923 protocol,
the International Convention on the Execution of Foreign Arbitral Awards,
1927, more commonly known as the Geneva Convention was passed.
Due to the Geneva Convention the Arbitration (Protocol and Convention)
Act, 1937 was enacted. However, the objectives of the Geneva Convention
were laudable but resulting 1937 Act was unable to meet the expectations of
speedy dispute resolution and enforcement of foreign arbitral awards.
Therefore, it was unable to meet the requirements for encouraging international
trade.
How Arbitration Act, 1961 enacted? The International Chamber of
Commerce issued a Draft Convention on International Arbitral Award in 1953
in order to correct the deficiencies under the earlier conventions.
The draft was presented to the United Nations Economic and Social
Council which prepared another draft in 1953. The Council forwarded its draft
to the member states of the United Nations for their comments upon receipt of
which a conference was held in New York.
As a result of all these efforts, the Convention on the Recognition and
Enforcement of Foreign Arbitral Awards (also known as New York Convention)
was adopted on 10 June 1958. The New York Convention gave rise to the
Foreign Awards (Recognition and Enforcement) Act, 1961 in India.
Is Arbitration Act, 1937 and Arbitration Act, 1961 is in existence? No,

because of the deficiencies in both the acts, they have been repealed. However,
awards made pursuant to agreements concluded pursuant to either the Geneva
Convention and New York Convention have been recognized under Part II of
the 1996 Act.
Objective of UNCITRAL Model Law: UNCITRAL stands for United
Nations Commission on International Trade Law. It adopted the UNCITRAL
Model Law on International Commercial Arbitration on 21 June 1985. The
objective of the Model Law to provide a set of rules which would facilitate the
settlement of international commercial disputes by bringing about uniformity
in the laws of member countries in reforming and modernising their national
laws on arbitration.
Key Highlights of the Model Law: It covers every stage in the arbitration
process as:
• beginning from the recognition of the need to curtail judicial
intervention to the formation of the arbitration agreement.
• appointment of the arbitral tribunal
• any challenges to such appointment
• basic rules of conduct of arbitration proceedings
• termination of proceedings by the making of the award
• finality of awards and grounds on which the arbitral award challenged
before the national courts.
The Model Law also forms the basis for the Arbitration & Conciliation
Act 1996 in keeping with India’s International obligations.
Arbitration & Conciliation Act 1996: The Arbitration & Conciliation
Act, 1996 repeals the Arbitration Act, 1940; the Arbitration (Protocol and
Convention) Act, 1937; and the Foreign Awards (Recognition and Enforcement)
Act, 1961 and reformulates the law in one consolidated statue. It also seek to
amend and consolidate the law relating to domestic arbitration, international
arbitration and the enforcement of foreign arbitral awards.
The Arbitration & Conciliation Act, 1996 is divided into three parts as:
• Part I of the act is a reproduction of the Model Law which deals with
rules regarding practice and procedure before the arbitral tribunal.
• Part II deals with the recognition and enforcement of foreign awards.
Part II is divided into two chapters.
(i) Chapter I concerns award made pursuant to agreements under
the New York Convention.
(ii) Chapter II deals with the enforcement of foreign awards under
the Geneva Convention.
• Part III deals with conciliation proceedings.
Differentiate between Act of 1940 and Act of 1996:
The Arbitration The Arbitration
& Conciliation Act, 1940 & Conciliation Act, 1996
It conferred wide discretion on the It limits the judicial intervention and
courts and very little on the arbitral broadens the scope of the powers
tribunal itself. vested with the arbitral tribunal
It places heavy reliance on the It places heavy reliance on the arbitral
courts to ensure that arbitration tribunal to ensure proceedings may
proceedings are conducted in a continue without placing
particular manner unnecessary reliance on the
overburdened judiciary.
It only concerns with domestic It concerns with domestic arbitration,
arbitration proceedings international arbitration and
enforcement of foreign tribunal
award.
It does not give freedom to the It gives freedom to the parties and
parties and impose a number of do not impose any regulations over
regulations over them. them
It had no real powers but rather acts The principle of competence-
as a proxy for the court competence plays a pivotal role in the
scheme of the new act
The arbitral tribunal does not have The arbitral tribunal has the power to
the power to pass interim order pass the interim order against the
against the party party
It was based upon the English It is based upon the UNCITRAL.
Arbitration Act, 1934 which
prevailed in the British
Amendment of 2015: The first attempt to amend the Act was made through
the Arbitration and Conciliation (Amendment) Bill 2003. However, several
concerns were raised about the proposed amendments which led to the Bill
being withdrawn from Parliament.
Finally, under the chairmanship of Hon’ble Justice (Retd.) A.P. Shah, a
new committee was formed to look into the Act and suggest amendments.
This Committee suggested various changes to the existing Act and most of
these changes were accepted by the legislature. This culminated and led to
the enactment of the Arbitration and Conciliation (Amendment Act), 2015.
This Amendment Act substantially changed the existing regime and ushered
in a new era of arbitration which greatly enhanced the public perception
towards arbitration. The key changes brought about by the 2015 amendment
act can be broadly classified under the following categories:
1. Restricting Judicial Intervention: Arbitration was conceptualised as

a process with minimal court intervention. However, owing to several
judicial pronouncements, court intervention became a norm. Thus, a
key object of this Amendment Act inter alia was to limit such judicial
interference. Pursuant to such objectives, the Amendment Act
inserted express provisions which drastically curtailed the powers
of the Court and its interference in arbitral proceedings.
2. Expediting the process of arbitration: Another key object of the 2015
Amendment Act was to eradicate the delays and turn arbitration
into a speedier and an effective dispute resolution mechanism. To
achieve this objective, specific timeframes were introduced for
different stages of arbitral process. A time-frame of 12 months
(extendable by further 6 months) was also prescribed for completion
of the entire arbitration proceeding, failing which parties had to
approach court for extension. The courts were also given liberty to
issue appropriate directions while granting such extension, including
directions for replacement of arbitrators.
3. Improving the overall functioning of arbitration: The 2015
Amendment Act also sought to bring various improvements in the
overall governance of arbitration and make it a more appealing to the
public at large. Such changes included creating a model fee schedule
for arbitrators to limit expenses, setting up mechanisms to ensure
neutrality and impartiality of arbitrators.
Amendment of 2019: Even though the 2015 Amendment Act, brought a
new lease of life to arbitration, it failed to promote institutional arbitration in
India and make it a hub for international commercial arbitration. Institutionalised
arbitration in India is still lacking and it has led to parties electing foreign
seats like Singapore, Hong-Kong for arbitration.
The 2019 Amendment Act was introduced with a specific focus on
promoting institutional arbitrations in India. To promote such institutional
arbitration, the Act vested the power of appointing arbitrators solely with
arbitral institutions designated by the Supreme Court or the High Court. The
Amendment Act also created an apex body for arbitration, the Arbitration
Promotion Council of India (“APCI”), consisting of different stakeholders, for
the purpose of monitoring and promoting arbitration in India.
The arbitration regime in India has witnessed several changes since its
inception and continues to evolve constantly. The recent amendments of
2015 and 2019 along with various judicial pronouncements over the last 5
years have contributed significantly to the growth of arbitration as an
efficacious alternative to traditional court litigation. Certain areas like
institutional arbitration still require some attention, but considering the current
trend we can be hopeful that these issues will be resolved sooner than later.
As Nani Palkhiwala said a court of law is like an ancient castle, constantly
under repair. There comes a time when it no longer pays to patch it up and it is
better to resort to a new, compact house built on modern lines”. The law of
arbitration is continuously evolving and improving day by day in order to
provide people with an effective body to resolve their dispute effectively and
efficiently and by reducing the burden from the shoulders of the judiciary by
introducing latest amendments to the act accordingly as per the need of the
society.
Objectives of Arbitration Act: The main objectives of the Act are as
follows:
• To ensure that rules are laid down for international as well as domestic
arbitration and conciliation.
• To ensure that arbitration proceedings are just, fair and effective.
• To ensure that the arbitral tribunal gives reasons for its award given.
• To ensure that the arbitral tribunal acts within its jurisdiction.
• To permit the arbitral tribunal to use methods such as mediation and
conciliation during the procedure of arbitration.
• To minimize the supervisory role of courts.
• To ensure that an arbitral award is enforceable as a decree of the
court.
• To ensure that the result of conciliation proceedings may be treated
as arbitral awards on agreed terms.
To treat awards given in a foreign country to which any one of the two
international conventions apply as followed by India as being a foreign arbitral
award.
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Mediation, Conciliation and Arbitration

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Mediation, Conciliation and Arbitration

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LL.B.

(Second Year) : Mediation, Conciliation and Arbitration 1

Q.1 What is the Need and Importance of Mediation?

position. The parties thus are more amenable to understanding the

Q.1 What do you understand by Alternative Dispute Resolution? What

Various Modes of Alternative Dispute Resolution:

The meaning of the term conflict is almost identical: it is defined by the

Restorative Justice and Indian Laws:

was also resolved peacefully at South Africa. Practicing of Indian Lawyer in

• Refusing the government awards.

Q.5 What are traditional Mediation Practices in India and Abroad?

Q.1 Why is ADR preferred more than litigation?

Also, there is a very flawed panorama for judicial assessment of an

Q.1 Describe the evolution of ADR mechanism in India?

The difference between mediation and arbitration can be drawn clearly

4. Both facilitators and arbitrators are usually third parties. The

finds that a cooperative approach is the surest path to understanding the

Positional bargaining has several downsides:

better position IBB, to understand the theoretical foundations and to

Q.1 State the Legislative Initiative for Court Annexed Mediation?

Q.2 What are the advantages and disadvantages of Mediation?

arbitration. Award given by an arbitral institution in India or an award even if

reflect an impartial and even-handed approach. Any recommendation

4. Outcome determined by the parties: The mediator has no control

Q.1 What is Theory of Mediation? Also Explain the Models/Approaches

mediation. The goal of this type of mediation is a win-win settlement

3. Private: In private mediation, mediation services are offered on a

these positions, identify areas of dispute, differential priorities

• The award (specifically a foreign award) did not become binding on

Upon Overall Conclusion, India does not pose to be a jurisdiction carrying

An arbitrator should not give consent to his appointment when he

directed to be settled through mediation to resolve the dispute. Subsequently,

(Singapore Mediation Convention) which gives mediation settlements the

limited, as expressly indicated in the act and it has no jurisdiction to sit in

Q.1: What are the components of Effective Communication?

• Termination or suspension of mediation: mediator should come up

Q.1 Why is communication important in process of Alternative Dispute

So far we have discussed about the definition and components of

Also communication process should be open for criticisms & scope of

the communication fails. Writing a message to a person who has difficulties

parties’ perspectives and devote equal time to each individual or problem. It

doesn’t. It will be impossible to mediate a shared solution if members do not

to sees communicated, recommendations made in regards to the settlement,

decide to engage in, a mediated settlement agreement can be reached after

Essentials of a settlement agreement to be enforceable: The settlement

success and popularity of mediation is restricted and there is a need for

in a cost effective manner all over India. Continued skill enhancing

Online Dispute Resolution (ODR) is a branch of dispute resolution which

• Substantive law governing merits of parties’ contract and claim

with only 388 cases. Therefore, promotion and enhancement of a

conduct of arbitral proceedings arising out of their commercial

option to resolve their disputes through either Arbitration, Mediation,

Q.1 What is meant by Arbitration? What are its types?

Incorporation of book of rules in the “arbitration agreement” is one

Q.3 Describe in brief about the main features of Arbitration and

As per the Article 1 (3) United Nation Commission on International Trade

Q.1 Give an overview of Arbitration and Conciliation Act, 1996? Give

• Amendment to Section 25: The right of the respondent to file the

the 2019 Amendment explicitly made the 2015 Amendment prospective in

to maintain a panel of arbitrators and if a party were to appoint an arbitrator

By choosing a particular country as the seat or the place of arbitration the

arbitration, it is safe to conclude that the venue is the seat of arbitration

ii. In the case of an international commercial arbitration wherein, the

4. Number and Qualifications of Arbitrators- The Act allows the parties