By Dr TPadma.,
LLM., Ph D (Law)
(A P Law University)
(A P Law University)
Pendency of cases in courts across the country has turned out to be a "gigantic problem" with about three crore cases waiting for redressal and the undue delay making people to shy away from justice delivery system.
Despite an increased disposal rate of cases, the apex court failed to reduce the pendency as it could not cope with the rising number of cases filed every year. The dockets swelled and the pendency by January 2008 was within striking distance of the 50,000-mark, standing at 46,926. By January 2009, pendency rose to 49,819, before finally breaching the 50,000-mark in March.
A similar trend was seen at the level of high courts and trial courts. The 21 high courts, working with a strength of 635 judges as against a sanctioned strength of 886, reported a pendency of 38.7 lakh cases as of January 1, 2009, against 37.4 lakh cases on January 1, 2008.
Trial courts, having a judge strength of 13,556 against a sanctioned strength of 16,685, were burdened with an additional pendency of nearly 10 lakh cases by January 2009, when the pendency figure was 2.64 crore. It stood at 2.54 crore cases in January 2008
The huge backlog of cases and the interminable delays in adjudication of cases has come to assume critical proportions in Indian Judicial System. Apart from an infrastructural mismatch, the lower judge strength of around 10.5 per a million population is broadly considered an endemic cause for this problem. In All India Judges’ Association & Ors. V. Union of India & Ors. the Supreme Court analyzed the reasons underlying the huge backlog of cases and observed that additional posts of judicial officers and the complementary infrastructure would have to be created and directed that an increase in the judge strength to achieve the level of 50 judges per a million population should be implemented in a phased manner and within a period of five years from the date of judgment apart from taking expeditious steps for filling up existing vacancies.
Globalization has been a great stimulation in the process of integration of economies and societies of different countries across the globe. It has been a great tool for breaking economic barrier and envisioning world as a market for trade. In the modern techniques of dispute resolution of commercial conflicts, emphasis has drifted from litigation to arbitration. As things are never static, emphasis is further sliding from arbitration to alternate dispute resolution procedures. Mediation or conciliation is one of the most important procedures of ADR (Alternate Dispute Resolution). Regulation of arbitration laws by conciliation or mediation is a novelty of the modern arbitration law. The drift from arbitration towards conciliation started with the appearance of conciliation legislation, which of late has been increasingly attracting the attention of the international business community. Conciliation may play a pivotal role, particularly in settling commercial disputes. It is more economic convenient, speedy, and less formal mode of dispute resolution.
II The key elements of ADR
There is no fixed form of ADR. There may be many variants of the ADR themes. However basically, ADR comprises of the following five elements.
i) The parties must be willing to seek informal resolution and they must trust the intermediary and the procedure, however they are free to walk away at any time.
ii) There is no fixed procedure and there are no rules of disclosures of documents and anything which is said or produced is on a “without” prejudice” basis and cannot be relied upon should there be later judicial or arbitral proceedings.
iii) The entire process is very speedy and comparatively cheap;
iv) The intermediary has no power to produce a binding result; and indeed his intervention in pronouncing a recommendation may be unwelcome.
v) The purpose of the procedure is to produce a compromise result under which neither party loses face (win-win) and which gets away from the remedies open to a court.
III. Judicial approach to ADR
The only field where the Courts in India have recognized ADR is in the field of arbitration. The arbitration was originally governed by the provisions of the Indian Arbitration Act, 1940. The Courts were very much concerned over the supervision of Arbitral Tribunals and they were very keen to see whether the arbitrator has exceeded his jurisdiction while deciding the issue, which has been referred to him for arbitration.
The scope of Interference of the award passed by an arbitration was dealt with by the Apex Court in the decision reported in Food corporation of India Vs. Jogindarial Mohindarpal as follows: “Arbitration as a mode for settlement of disputes between the parties has a tradition in India. It has a social purpose to fulfill today. It has a great urgency today when there has been an explosion of litigation in the Courts of law established by the sovereign power. However in proceedings of arbitration, there must be adherence to justice, equality of law and fair play in action. The proceedings of arbitration must adhere to the principles of natural justice and must be in consonance with such practice and procedure, which will lead to a proper resolution of the dispute and create confidence of the people, for whose benefit these procedures are resorted to. It is therefore, the function of the Court of law to oversee that the arbitrator acts within the norms of justice. Once they do so and the award is clear, just and fair, compel to adhere and obey the decision of their chosen adjudicator. It is in this perspective that one should view the scope and limit of corrections by the Court on an award made by the arbitrator. The law of arbitration must be made simple, less technical and more responsible to the actual realities of the situation but must be responsible to the canon of justice and fair play. The arbitrator should be made to adhere to such process and norms which will create confidence not only doing justice between parties but by creating a sense that justice appears to have been done”.
The Courts were anxious to see whether there was any jurisdiction to the arbitrator to decide such dispute or not while interpreting the arbitration clause in the agreement. The power to decide such dispute or not while interpreting the arbitration clause in the agreement. The power to decide the jurisdiction of the arbitrator to decide a particular issue or not was vested with the Law Courts. There was much delay in settlement of disputes between the parties in law Courts which prevented investment of money in India by other countries. Further there was no provision in the Indian Arbitration Act 1940 to resolve a dispute between an Indian and a non-Indian as the law-relating contract between the parties were different which caused difficulties to refer such matter for arbitration. In order to avoid such a difficulty, India has undertaken major reforms in its arbitration law in the recent year as part of economic reforms Initially in 1991. simultaneously many steps have been taken to bring judicial reforms in the country, the thrust being on the minimization of Courts intervention in the arbitration process by adoption of the United Nations Commission on International trade Law (UNCITRAL). With this in mind, the Government has given birth to a new legislation called. “The Arbitration and conciliation Act 1996”. There are distinctive features in this Act compared to 1940 Act. India judiciary has played a substantial role in up gradation of ADR mechanism. The Apex court has recognized the alternate forum in its various decisions. In Guru Nanak Foundation V. Rattan & Sons Court observed 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 procedure claptrap”. The realization of concepts like speedy trial and free legal aid by apex Court in various cases has also helped in the up gradation of Alternate dispute redressal mechanism.
Another major step in the growth of ADR services in India is the establishment of (1) Indian Institute of Arbitration and mediation (IIAM) (2) Indian council for Arbitration (ICA) and (3) International Centre for Alternate Dispute Resolution (ICADR) for alternate dispute resolution. These institutions provide services of negotiation, mediation, conciliation, arbitration, settlement conferences etc. They also help in finding lacunae in existing ADR laws and recommended reforms to overcome them.
IV. Global perspective
The history of Alternate dispute resolution forum at international level can be traced back from the period of Renaissance, when Catholic popes acted as arbitrators in conflicts between European countries. One of the successful examples of the said mechanism is the international mediation conducted by former U.S. President Jimmy Carter in Bosnia. ADR has given fruitful results not only in international political arena but also in International business world in setting commercial disputes among many corporate houses for e.g. settlement of a long standing commercial dispute between General Motors Co. and Johnson Matthey Inc., which was pending in US district court since past few years. The biggest stepping stone in the field of International ADR is the adoption of UNCITRAL (United Nation Commission on International Trade Law) model on International commercial arbitration. An important feature of the said model is that it has harmonized the concept of arbitration and conciliation in order to designate it for universal application. General Assembly of UN also recommended its member countries to adopt this model in view to have uniform laws for ADR mechanism. Other important international conventions on arbitration are: (1) The Geneva Protocol on Arbitration clauses of 1923. (2) The Geneva convention on the execution of foreign arbitral Award, 1927 (3) The New York convention of 1958 on the recognition and enforcement of Foreign Arbitral Award.
V. Online Dispute Resolution
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 a combination of all three. Online dispute resolution (“ODR”) is conceived as a means to achieve some of the most powerful legal ideals of the Western legal tradition, which include:
(1) Legal Certainty:
In making individual plans, decisions, and choices everyone is entitled to know what the law is in advance.
(2) Access to Justice:
Everyone involved in a dispute shall be entitled to an easily accessible redress mechanism that provides for a timely resolution and effective remedies at reasonable cost.
ODR is concerned with the civilized (i.e. peaceful) resolution of disputes between private parties, and, secondly, with the prevention of such conflicts through the provision of legal certainty. National legal systems fulfill the former function by offering plaintiffs to litigate disputes before state courts which exercise mandatory jurisdiction over defendants, and the latter by making the litigation process public, thus allowing for the proliferation of precedent, as well as by the enactment of codifications of rules of law.
Regarding the dispute resolution function of private law, there are a variety of functional equivalents to litigation available, which are collectively referred to as alternative dispute resolution (ADR). On the one hand ODR relates to the resolution of disputes that result from online conduct, i.e. from communications and transactions which come about through the use of the Internet Domain name disputes are a prominent example as are disputes related to e-commerce. On the other hand, ODR relates to the use of online communication technology in the resolution process, even if the dispute itself has an offline origin. The provision of alternative dispute resolution (ADR) services on the Internet has become quite popular. Online dispute resolution (ODR) in India is in its infancy stage and it is gaining prominence day by day. With the enactment of Information Technology Act, 2000, e-commerce and e-governance have been given a formal and legal recognition.
VI. Indian Scenario
In India Part III of Arbitration and Conciliation Act, 1996 provides for International Commercial Arbitration.
In common parlance, there is some difference between conciliation and mediation. This is evident from these two statutes of the parliament. (i) In the year 1996, the Arbitration and Conciliation Act, 1996 was passed and sec.30 of that Act, provides that an arbitral tribunal may try to have the dispute settled by use of ‘mediation’ or conciliation’ and sub-section (1) of sec.30 permits the arbitral tribunal to “use mediation, conciliation or other procedures”, for the purpose of reaching settlement (ii) The Civil Procedure Code (Amendment) Act, 1999 which introduced sec.89, too speaks of conciliation and mediation as different concepts. Order 10 Rules 1A, 1B,1C of the Code also go along with sec.89.
In order to understand what Parliament meant by ‘Conciliation, we have necessarily to refer to the functions of a ‘conciliator’ as visualized by part III of the `1996 Act. It is true, sec.62 of the said Act deals with reference to conciliation by agreement of parties but sec.89 permits the court to refer a dispute for conciliation even where parties do not consent, provided the Court thinks that the case is one fit for conciliation. This makes no difference as to the meaning of ‘conciliation under sec.89 because, it says that once a reference is made to a ‘conciliator’ the 1996 Act would apply. Thus the meaning of ‘conciliation’ as can be gathered from the 1996 Act has to be read into sec. 89 of the Code of Civil Procedure. The 1996 Act is, it may be noted, based on the UNCITRAL Rules for conciliation.
Now under section 65 of the 1996 Act, the ‘conciliator’ may request each party to submit to him a brief written statement describing the “general nature of the dispute and the points at issue”. He can ask for supplementary statements and documents. Section 67 describes the role of a conciliator. Subsection (1) states that he shall assist parties in an independent and impartial manner. Subsection (2) states that he shall be guided by principles of objectivity, fairness and justice, giving consideration, among other things, to the rights and obligations of the parties, the usages of the trade concerned and the circumstances surrounding the dispute, including any previous business practices between the parties. Subsection (3) states that he shall take into account “the circumstances of the case, the wishes the parties may express, including a request for oral statements”. Subsection (4) is important and permits the ‘conciliator’ to make proposals for a settlement. It states as follows:
“Section 67(4). The conciliator may, at any stage of the conciliation proceeding, make proposals for a settlement of the dispute. Such proposals need not be in writing and need not be accompanied by a statement of the reasons therefor.”
Section 69 states that the conciliator may invite parties to meet him. Sec. 70 deals with disclosure by the conciliator of information given to him by one party, to the other party. Sec. 71 deals with cooperation of parties with the conciliator, sec. 72 deals with suggestions being submitted to the conciliator by each party for the purpose of settlement. Sec. 73, which is important, states that the conciliator can formulate terms of a possible settlement if he feels there exist elements of a settlement. He is also entitled to ‘reformulate the terms’ after receiving the observations of the parties. Subsection (1) of sec. 73 reads thus:
“Sec. 73(1) settlement agreement. (1) When it appears to the Conciliator that there exist elements of a settlement which may be acceptable to the parties, he shall formulate the terms of a possible settlement and submit them to the parties for their observations. After receiving the observations of the parties, the Conciliator may reformulate the terms of a possible settlement in the light of such observations.”
The above provisions in the 1996 Act, make it clear that the ‘Conciliator’ under the said Act, apart from assisting the parties to reach a settlement, is also permitted to make “proposals for a settlement” and “formulate the terms of a possible settlement” or “reformulate the terms”. This is indeed the UNCITRAL concept.
If the role of the ‘conciliator’ in India is pro-active and interventionist as stated above, the role of the ‘mediator’ must necessarily be restricted to that of a ‘facilitator’.
Meditation is a facilitative process in which disputing parties engage the assistance of an impartial third party, the mediator who helps them to try to arrive at an agreed resolution of their dispute. The mediator has no authority to make any decisions that are binding on them, but uses certain procedures techniques and skills to help them to negotiate an agreed resolution of their dispute without adjudication.
Prof. Robert Baruch Bush and Prof. Joseph Folgen say:
“In a transformative approach to mediation, mediating persons consciously try to avoid shaping issues, proposals or terms of settlement, or even pushing for the achievement of settlement at all. In stead, they encourage parties to define problems and find solutions for themselves and they endorse and support the parties” own efforts to do so”.
The meaning of these words as understood in India appears to be similar to the way they are understood in UK. In the recent Discussion Paper by the lord Chancellor’s Department on alternative Dispute Resolution. While defining “Mediation” and “Conciliation”, it is stated that ‘Mediation’ is a way of settling disputes by a third party who helps both sides to come to an agreement, which each considers acceptable Mediation can be evaluative or ‘facilitative’. ‘Conciliation’, it is said, is a procedure like mediation but the third party, the conciliator, takes a more interventionist role in bringing the two parties together and in suggesting possible solutions to help achieve a settlement. But it is also stated that the term ‘conciliation’ is gradually falling into disuse and a process which is pro-active is also being regarded as a form of Mediation. This has already happened in USA.
The above discussion shows that the ‘mediator’ is a facilitator and does not have a pro-active rule. But, as shown below, these words are differently understood in US.
A statement by John F. Kennedy, former US President which is relevant in this context is reproduced below:
“Let us not negotiate with fear but let us not fear to negotiate”.
None can deny that our cultural heritage is no different. Mahatma Gandhi advocated conciliation and mediations as a practicing lawyer in South Africa and said that it was the duty of lawyers to make efforts to settle disputes and that by doing so, lawyers would not be losers. He said that he, in fact, built up a reputation that he would always appear for the party whose case was invariably the just one. Therefore, the systems of conciliation and mediation are as much part of our cultural heritage as they are in any other country. But what is that has stood in the way ? where was the need to usher in, by force of statute, something which was part of our culture? It is not difficult to answer this question. Over the years, more cases have accumulated in our courts than our courts can decide within reasonable time. The litigant whose case is not worth a contest has developed a mind-set that there is nothing wrong in delaying justice, either by compelling the other party to go to a court of law or by himself moving the Court and keeping the issue sub-judice. The litigant is today fairly sure that justice to his opponent even if it cannot be denied ultimately, can be delayed as long as possible, may be for years. Unfortunately, successive governments have neglected the judiciary. The number of courts have not increased at least up to a basic minimum requirement and everybody finds it easy to blame the judiciary for the backlog. The judiciary is no doubt accountable, but there are other players who control the purse. It has been rightly said that the judiciary has neither the purse nor the sword.
In India, we do not have a separate system of federal courts and state courts. The Courts established by the State Governments in India administer both Central and State laws, In particular they administer laws relatable mostly to the Concurrent List (List III) (such as the Contract Act, the Indian Penal Code, the Code of Civil Procedure, the Code of Criminal Procedure) and to the Union List (List I) in the VII Schedule of the constitution. This creates an obligation on the Central Government, in my view, to meet at least more than fifty percent of the expense of the State Courts. Added to this, whenever a Bill is introduced in Parliament or the State Legislatures, there is no ‘Judicial impact assessment’ made, as done in other countries like the USA setting out in the financial Memorandum attached to the bill, how many civil and criminal cases will be generated out of the new rights and offences created by the Bill if it becomes law.
The Constitution Review Committee has made a recommendation that the central Government must bear a substantial part of the expenditure on Courts and that sufficient allocation must be made by the Finance Commission and the Planning Commission in this behalf.
It is obvious however that the Government of India will not be able to establish all the needed Courts in a short time. Alternative methods must therefore be necessarily found, even otherwise.
“As a consequence of observations by the Constitution Bench of the Supreme Court in P. Ramachandra Rao v. State of Karnataka as to the critical judge – population ratio in the country, the Executive at the Federal level was energized and consequent on the recommendations of the XI Finance Commission evolved a scheme of ‘Fast Track Courts’. The operationalization of the scheme was however differently managed in several States.”
The problem of overcrowding of dockets is not peculiar to out country nor is peculiar to our times. Such problems have been and are faced by almost every country in the world. Necessity became the mother of invention in several countries. Alternative Dispute Mechanisms were evolved and adopted. The United States of America is a more litigious country than ours. It has introduced Federal and State Legislations /Rules of Court to enable parties to resort to mediation voluntarily or by compulsion (by what is called Court-annexed mediation). So Australia, New Zealand, Canada and the United Kingdom. There are various Reports of the Law Commissions or Reports of Royal Commissions or other committees on the ADR, mediation and conciliation. In every country, initially, there has been some resistance from the Bar. Judges, known for their conservatism, as usual, were also somewhat lukewarm in their approach to ADRs in the beginning. But, gradually, once the systems were implemented, the Bar and the Bench found that litigants did benefit enormously in terms of time and ``money Conciliation or mediation became very popular. In USA, in twenty years, surprisingly the settlement rate rose up to 94%. There are similar success stories in other countries.
Let us take the case of Lok Adalats. When the institution of Lok Adalats was started over fifteen to twenty years ago, there was tremendous skepticism and opposition both at the Bar and in the Judiciary. Soon, it was discovered that certain special types of cases- particularly those relating to claim for damages in motor accidents and compensation in land acquisition cases and others and also some criminal cases where the offences were compoundable, were best suited for settlement through Lok Adalats. These settlement centers were presided by retired Judicial Officers or those in office but not attached to the cases. As of today, millions of cases have been dealt with in Lok Adalats and millions of rupees have been distributed through Lok Adalats in these types of cases. Ultimately, Lok Adalats have today come to stay and have been accepted.
Lok Adalats can, however, deal only with cases where the settlement process is not long. But cases involving commercial disputes, property disputes, partition disputes, matrimonial disputes and the like, it is obvious, cannot be listed in a Lok Adalat and disposed of the same day by applying a multiplier formula as in accident cases. These are more serious cases where parties have to be brought to the negotiating table and the conciliator/mediator has to have separate as well as joint sessions with the parties in a good number of sittings. These may extend to six, or even ten such sessions. Lot of facts may have to be ascertained, documents may have to be called for, matters of equity may have to taken into account and what is more, a lot of effort is to be made to make the rival parties cool down their tempers. In a Lok Adalat, in motor accident cases, the rivals are either the State or the Insurance companies and there is absent the emotional part that is invariably involved during negotiation in other types of cases. This is because there is no such long standing rivalry or enmity in Lok Adalat cases. It is, therefore, essential that in more serious cases, parties must be cajoled, nay, even be persuasively compelled, to talk to each other through a conciliation/mediation process so that they may first cool down, come to reason and start thinking of settling their disputes. Once that is done, then conciliation or mediation is held, and settlement reached, they can still remain friends. There is no longer any acrimony. In addition, both sides have saved time and money.
Now that the Indian Parliament, which saw that conciliation and mediation processes have led to a new revolution in judicial administration in other countries, has, in its wisdom accepted that conciliation/mediation should be a regular process in every case which comes to Court. Even if parties do not agree for conciliation or mediation, the Court may, if it thinks the case to be a fit case, make a reference to conciliation or mediation. Courts and lawyers have therefore a paramount obligation to enforce the legislative mandate. We, therefore, have necessarily to make an effort to see how, by peaceful means, rather than by the adversarial process, we can wipe out the tears of those suffering prolonged agony caused by delay and expense. If Lok Adalats, regarding which there was initial opposition, have come to stay and have become acceptable because of the spectacular results achieved, there is no reason why the conciliation/mediation processes should not be given a fair trial in civil litigation, where a mediator/conciliator brings down the tensions, make parties see reason, and helps in settling their disputes. Unlike other systems of ADR like ‘compulsory or court-annexed non-binding arbitration’, there is here no compulsion. There is only persuasion so far as the terms of settlement are concerned. Compulsion is only persuasion so far as the terms of settlement are concerned. Compulsion is only to the extent of compelling parties to go to the negotiating table, discuss through the medium of an experienced conciliator/mediator. Such a process was always part of our Indian culture, even long before any system of Courts was established.
Now the trend is to treat the Court not only as a seat for regular adjudication but also as a Centre for settlement, established by Parliament. In every High Court and in every District Court, to start with, separate accommodation must be provided for a conciliation/mediation centre to function. The Courts have a dual function – one as an adjudicator and the other as a facilitator for settlement. As done in the Gujarat High Court, every High Court and district Court must straightaway set apart specific accommodation for a “Conciliation and Mediation Centre”. After Court hours every day, and during weekends and holidays, the centre must function regularly. Such Centers are sure to attract a lot of response.
Apart from the direct advantages to the litigants in each of such cases which is settled, there are other indirect advantages to the judicial administration as a whole on account of this new effort? This new process of settlement through conciliation and mediation will reduce the civil dispute dockets and bring the pendency to a tolerable level. The greater advantage, in fact, is the one that will indirectly accrue to the criminal justice system. If civil cases are reduced substantially or to some extent, the time so saved can be utilized for disposal of a larger number of criminal cases. In that branch, there cannot be settlements except where they relate to compoundable offences. Plea bargaining has not yet become part of our system.
In our country, there is one great advantage, as compared to other countries, in that we are not burdened, both terms of time and expense, by a jury system in civil cases. That would have delayed our trials more, with that advantage in our procedural system, there is need to go for conciliation/mediation in a big way as ordained by statute and take it seriously. The new concepts introduced in sec. 89 as regards conciliation and mediation are sure to result in bringing about a silent revolution in our judicial system.
The Chief Justice of India, at a conference on alternative dispute resolution – conciliation and mediation, organized by the International Centre for alternative dispute Resolution said there was an urgent need to increase the number of subordinate courts in the country from 16,000 to 35,000. He further stated that there were only 14,000 judges for 16,000 subordinate courts and he had requested State governments to recruit presiding officers. The States were not recruiting judicial officers every year and this was leading to vacancies not being filled in time.
Human beings, when it comes to disputes relating to money or status, are all the same, everywhere round the globe. Selfishness, strength of money-power for protracting litigation or ego are common features. If the conciliation /mediation solutions have been successful in other countries, they must and will succeed here also. Where the problems are same, the solutions could be similar, though there may be differences in degree or the methodology adopted. The procedure for conciliation/mediation are today part of the systems of almost every judicial administration both in common law countries as well as in countries governed by civil law systems. The fact that we have woken up in 1999 and have started to enforce sec. 89 of the Code of Civil Procedure only from 1st July 2002, should not matter. Better late than never. Every Bar council, every Bar Association and every lawyer to give conciliation/mediation higher priority than adjudication and give the litigant a reasonably good chance of settling the disputes so as to save time, money-leaving more complicated and tougher cases and the criminal cases to pass through the adjudicatory process.
Note: The Author is a member of A P State Higher Judiciary. The views expressed in this article are purely personal.
 Source : Supreme Court News Jan-Mar, 2009
 JT 2002 (3) SC 503
 1989(2) SCC 347
 AIR 1981 SC 2075
 German Law Journal
 ADR Principles and Practice by Henry J. Brown and Arthur L. Marriot 1997
 JT 2002 (4) SC 92
 Law Commission of India (papers presented in international conference on ADR)