Mediation - Alternate Dispute Resolution

Introduction

Alternative Dispute Resolution (ADR) mechanisms have gained prominence in recent years as an effective means of settling disputes outside the traditional court system. Statutes containing mediation provisions are the Code of Civil Procedure, 1908, the Arbitration and Conciliation Act, 1996, the Companies Act, 2013, the Commercial Courts Act, 2015, and the Consumer Protection Act, 2019. India is a signatory to the Singapore Convention on Mediation, so it was appropriate to enact a law governing domestic and international mediation. Among the various forms of ADR, mediation has emerged as a popular option for resolving civil and commercial disputes. In line with this trend, the Mediation Bill 2023 has been passed by both the Rajya Sabha and the Lok Sabha, aiming to institutionalize and promote the process of mediation in India.

Background and Objectives

The Mediation Bill 2023 was introduced in the Upper House in August 2021, and after undergoing scrutiny by the Standing Committee on Law and Personnel, it received approval from the Rajya Sabha on August 1, 2023. Subsequently, the Lok Sabha passed the Bill on Monday, August 7, 2023.

The primary objective of the Mediation Bill is to promote and facilitate mediation as a means of resolving disputes, both commercial and non-commercial. By making pre-litigation mediation a mandatory step before approaching a court or tribunal, the Bill seeks to reduce the burden on the judicial system and provide a cost-effective and efficient alternative for dispute resolution.

Key Provisions of the Mediation Bill

1. Mandatory Pre-Litigation Mediation

Under the Mediation Bill 2023, parties involved in civil or commercial disputes are required to attempt settlement through mediation before filing a lawsuit. This provision aims to encourage parties to explore amicable resolutions and reduce the number of cases burdening the courts.

2. Timeframe for Mediation Proceedings

The Bill sets a maximum period of 180 days for completing mediation proceedings from the date of the first appearance before the mediator. However, this timeframe can be extended by an additional 180 days upon mutual agreement of the parties. This provision ensures that parties have sufficient time to negotiate and reach a resolution through the mediation process.

3. Mediation Council of India

To regulate and promote the practice of mediation, the Mediation Bill establishes the Mediation Council of India. The Council will be responsible for registering mediators, recognizing mediation service providers and institutes, accrediting mediators, and maintaining a panel of qualified mediators. This regulatory body aims to ensure the availability of trained and competent mediators for effective dispute resolution.

4. Community Mediation

Recognizing the importance of community-level dispute resolution, the Mediation Bill introduces the concept of community mediation. Disputes that have the potential to impact peace, harmony, and tranquillity within a particular area or locality can be referred to as community mediation with the mutual consent of the parties involved. This provision empowers local authorities, such as the District Magistrate or the Authority constituted under the Legal Services Authorities Act, 1987, to facilitate community mediation.

5. Legally Binding Mediated Settlement Agreements

Any settlement agreement reached through mediation under the Mediation Bill will be treated as legally binding. This provision ensures that parties can enforce the terms of their mediated settlement agreements in the same manner as judgments passed by courts or through arbitration. It provides a level of certainty and finality to the outcomes of mediation.

Impact of the Mediation Bill

The Mediation Bill 2023 is expected to have a significant impact on India's legal landscape. By making pre-litigation mediation mandatory, the Bill aims to reduce the backlog of cases in courts and promote the timely resolution of disputes. This, in turn, will enhance the ease of doing business, as parties can seek quicker and more cost-effective resolutions to their disputes.

The establishment of the Mediation Council of India will ensure the availability of qualified mediators and enhance the credibility of the mediation process. By recognizing community mediation, the Bill acknowledges the role of local authorities in resolving disputes at the grassroots level, fostering harmony within communities.

The emphasis on mediation as an alternative to traditional court proceedings aligns with global trends in dispute resolution and reinforces India's commitment to international best practices. It provides individuals and businesses with an efficient and flexible means of resolving disputes, promoting a more harmonious and conducive business environment.

Conclusion

The passage of the Mediation Bill 2023 marks a significant step towards promoting alternative dispute resolution in India. By making pre-litigation mediation mandatory and establishing a regulatory body for mediation, the Bill aims to streamline the dispute resolution process and reduce the burden on the courts. The emphasis on community mediation and the recognition of mediated settlement agreements as legally binding further enhance the credibility and effectiveness of mediation in India.

As the Mediation Bill comes into effect, it is expected to shape the future of dispute resolution in the country, facilitating quicker, more cost-effective, and amicable resolutions for a wide range of civil and commercial disputes. With the Mediation Council of India overseeing the practice of mediation, parties can have confidence in the professionalism and competence of mediators, ensuring fair and impartial proceedings.

?