Mediation in a Nutshell

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As expressed by Justice N.V. Ramana, the Chief Justice of India, Mediation, which was commonly followed in India prior to the arrival of the British and their court system, is now one of the most vital conflict resolution mechanisms which will continue to grow in relevance in the coming future.

As expressed by Justice N.V. Ramana, the Chief Justice of India, Mediation, which was commonly followed in India prior to the arrival of the British and their court system, is now one of the most vital conflict resolution mechanisms which will continue to grow in relevance in the coming future.

Mediation is a voluntary, party-centred and essentially an assisted negotiation process, where a neutral third party, called a mediator, assists the parties in amicably resolving their dispute by using specialized communication skills and negotiation techniques. The mediator helps the parties understand each other’s points of view and their areas of concern. Any settlement that takes place is recorded into an enforceable contract. In mediation, the parties reserve the right to decide whether to settle a dispute and further ascertain the terms of the settlement. Even though the mediator facilitates their communications and negotiations, the parties always have control over the outcome of the dispute.

The whole idea of resolving a dispute through mediation is to get a practical solution to end the conflicts that have arisen, and therefore the same must address the concerns and interests of the parties. The parties to the dispute can also enter into a confidentiality agreement prior to the start of the mediation process. Hence the views expressed, the confessions made and the proposals offered are absolutely confidential and cannot be cited in legal proceedings nor the mediator can be called upon as a witness in any judicial proceeding.

The use of Mediation as an ADR method dates back centuries, even before the Britishers had arrived on Indian soil. Back in those days, during a dispute, the head of the village, also called the Mahajans of the Mukhiya used to settle disputes between parties. However, with the emergence of the British Raj in India, Mediation was given a formal and legalised colour, as an Alternate Dispute Resolution process. The concept of mediation received legislative recognition

in independent India for the first time in the Industrial Disputes Act, 1947, where the conciliators appointed under Section 4 of the Act are “charged with the duty of mediating in and promoting the settlement of industrial disputes.” Mediation further gained popularity with the establishment of Lok Adalats, which is a forum where disputes or cases pending in the court of law or at the pre-litigation stage are settled or resolved amicably. With the enactment of the Legal Services Authorities Act, 1987, Lok Adalats have been given statutory status, and the decision of the Lok Adalat is given the same status as that of an order of a civil court. Furthermore, the development of mediation, as an ADR process, can also be attributed to the CPC (Amendment) Act, 1999, which inserted Section 89 in the Civil Procedure Code, which was introduced with the purpose of having a peaceful and mutual settlement between parties without the intervention of the court thereby necessitating amicable resolution. In addition to Section 89 of the Civil Procedure Code, Section 12A of the Commercial Courts Act, 2015, provides the parties with an alternate method to resolve their disputes by negotiating in the presence of a mediator. Mediation under section 12A bridges this gap by making mediation a time-bound process. However, the parties have the liberty to move the commercial courts in the event they do not agree during mediation proceedings.

The purpose of resolving disputes through mediation is to see a win-win situation for the parties, and if not a win-win situation, then at least a satisfactory and acceptable solution. Mediation focuses on securing the future without either of the parties carrying on the conflicts for the future or even for another day. Mediation helps parties to have a cordial relationship and not an adversarial relationship. It preserves relationships so that partners do not become adversaries. Take the classic example of two children quarrelling over an orange. If we go by positions, which is what adjudicators do, a judge would decide which one gets it and which does not – a win-lose. An Arbitrator with an equitable approach may give each a portion- a win some, lose some. However, the mediator will ask a question, “Why do you need it?”. The answer may be that one child needs the pulp to make the juice and the other needs the ring to make marmalade. They can thus share the orange, each getting what they need, therefore a win-win.1 Hence, getting the parties to appreciate the differences, interests and needs of the parties and based on that encouraging the parties to resolve their dispute is the essence of Mediation.

1 The Commercial Mediation Monologue by Sriram Panchu, Senior Advocate & Mediator

Apart from being an amicable mode of settlement, mediation is a confidential, quick and an inexpensive process. While it maintains the confidentiality and privacy of the conflicting parties, it takes less time to complete and the costs involved in dispute resolution is relatively low as compared to other modes of dispute resolution. Being an informal and flexible process, it does not necessarily require an attorney, and therefore parties can negotiate on their own, having a greater degree of party control.

Court Annexed Mediation and Private Mediation

Shortly after the Courts started setting up in-house Mediation Centres, in 2005, the Supreme Court formed the Mediation and Conciliation Project Committee with the idea of training mediators and annexing the mediation process with courts. Today, India has one of the largest court-annexed mediation centres, where are a wide variety of matters are referred to mediation mandated by the Courts, either at the behest of the parties or by the judges of their own accord.

On the other hand, private mediations are mediation wherein the parties can choose their own mediators. These mediations occur in relation to disputes which are not taken to the court or has been pending in court. As held in the case of M/s. Afcons Infrastructure Limited & Anr. v. Cherian Varkey Construction Co. (P) Lts. & Ors. 2, the terms “Mediation” and “Conciliation” are to be used synonymously and are to be governed under the provisions of the Arbitration and Conciliation Act, 1996, and the measures adopted in private mediation is to be terms and conciliation and the settlement arrived is to be considered as one arrived in conciliation.



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