CANDIDATE’S DECLARATION

I, Heena sharma ,student of B.A.LLB , University School of Law , , hereby declare

that I am fully responsible for the information and results provided in the minor
project titled ‘ Comparative study on Mediation’ submitted for the partial
fulfillment of the requirement for the award of degree in B.A.LLB. I have taken
care in all respects to honor the intellectual property rights and have acknowledged
the contributions of others for using them.

CERTIFICATE
This is to certify that this minor project titled ‘ Comparative study on mediation’
by Heena Sharma is bonafide record of research work carried out by her under my
supervision and guidance in the partial fulfillment of the requirement for the award
of degree of B.A.LLB at University School of Law . Neither this minor project nor
any part of it has been submitted for any degree or academic award elsewhere .

ACKNOWLEDGEMENT

First of all , I solemnly express my earnest and humble thanks to our Director ,
Dr. for his encouragement and support during the course of my study.

I extend my heartily and sincere gratitude to my supervisor Mr. haskaran ,

Associate Professor, University school of Law, for his valueable directions ,
suggestions and exquisite guidance with ever enthusiastic encouragement ever
since the commencement of this minor project.

Finally I am thankful to my family members, friends and all whosoever have

contributed in this minor project directly or indirectly.

Heena Sharma

B.A.LLB

INDEX
 CHAPTER 1

Introduction

Mediation law refers to a form of alternative dispute resolution (ADR) in which the parties to a
lawsuit meet with a neutral third-party in an effort to settle the case. The third-party is called a
mediator. It is this person's job to listen to the evidence, help the litigants come to understand
each other's viewpoint regarding the controversy, and then facilitate the negotiation of a
voluntary resolution to the case. The purpose of mediation is to avoid the time and expense of
further litigation by settling a lawsuit early on in the process.
Unlike other forms of ADR, mediation is not binding on the parties. In fact, thinking about a
mediation proceeding in terms of whether the parties will be bound by the outcome suggests a
misunderstanding of the nature of mediation. The mediator's role is not to reach a decision - it is
to help the parties reach their own decision. There is no guarantee that mediation will produce a
settlement agreement resolving the case. In fact, in many cases mediation will leave the litigants
no closer to reaching a settlement afterwards than they were beforehand.

From our doctrinal research it has become evident that the challenges of regulating and
implementing mediation are not unique to the Indian legal system; it is conundrum witnessed
across the globe in different jurisdictions which have and continue to explore ways to expand the
scope and usage of alternate dispute resolution mechanisms, with a focus on mediation has
presented a list of takeaways which may facilitate the establishment of an efficient framework
for court connected mediation in India.

RESEARCH DESIGN

CHAPTER 1: Introduction to mediation

2
OBJECTIVES OF RESEARCH WORK

1. To understand the concept of mediation

2. To analyze the impact of mediation in India.
3. Comparative analysis with other countries with regard to mediation.
4. Suggestions regarding how to increase the positive impact of mediation on Indian Legal
System.

RESEARCH METHODOLOGY

The study is based on Modern method of research on analysis of available literature. Apart
from the primary sources of material such as legislation and case laws, the study also
explores relevant academic / research papers, reports and articles. The study is also based on
analytical method of research.
 4

CHAPTER 2

Background

Mediation is a dynamically structured voluntary dispute resolution process where a neutral

third party helps the disputing parties in resolving a conflict between them by using
specialized communication and negotiation techniques. These techniques are in turn designed
in a manner that facilitates the process of mediation and dispute resolution. The concept of
mediation evolved in the latter half of the 20th century, however, the roots of mediation can
be traced way back to the ancient Indian legal systems, for example, the systems known as
 the “Gram Panchayats” and “Nyaya Panchayats” were popular and widely prevalent in
ancient rural India.1

However, even though these systems are still existing in many parts of rural India, the people
of the country, especially the ones that were still relying on these legal systems for justice,
have lost their faith in them. This is so because these Panchayats are prone to influence from
the influential and powerful people residing in these areas. These influential people often use
these systems to mete out justice depending on their own whims and fancies and also
exercising their bias/influence in the decisions of the Panchayats. This has played a hugely
negative role in the dwindling of the popularity of the Panchayat systems. In the process of
addressing these concerns, the Indian government is making incessant efforts to revive these
indigenous justice delivery methods by allocating funds and trying to make better rules for
their reinvigorated and unbiased functioning.2

The Arbitration and Conciliation Act, 1996 was the first statute to introduce the Indian legal
system to mediation. Introducing Sub-section (1) of Section 30 of the Arbitration and
Conciliation Act, 1996, it encourages the parties involved to explore the option of mediation
and conciliation despite arbitral proceedings having started and thereby empowers the
arbitral tribunal to use mediation as a means of dispute resolution. Nevertheless, due to a lack
of proper enforcement (or even formation) of any specific rules of mediation, this provision
promoting mediation has almost been rendered defunct. This, however, was rectified to a
certain extent by the introduction of Section 89 of the Code of Civil Procedure, 1908
(introduced first in Section 30 of the Arbitration and Conciliation Act, 1996), which was

1
Anil Xavier, Mediation: It’s Growth and Origin in India, available at
http://www.arbitrationindia.org/pdf/mediation_india.pdf
2
Madhu S, Mediation in India, available at http://cppradr.blogspot.in/2008/07/mediation-in-
india.html

5
 concerned with exploration of the different methods of dispute resolution. Also, the notion of
“judicial mediation” was first introduced by this section. 3

Relying on this, the Court, were satisfied that the circumstances are such that the parties can try
and settle their disputes amicably in ways if tried, the Court may encourage the parties to seek
out the methods of mediation, arbitration and other forms of alternate dispute resolution. Despite
this, unlike other statutorily-recognized forms of non-binding alternative dispute resolution there
is still no concrete statute that addresses the concern of and ensures “confidentiality” in
mediations in India.

It was only recently in the year 2011 that the Supreme Court of India declared that mediation
proceedings were confidential in nature, and only an executed settlement agreement or
alternatively a statement that the mediation proceedings were unsuccessful, should be provided
to the court by the mediator. 4

It is expected that in view of this judgment, the popularity of mediation as a method of resolving
disputes in India will increase. In fact, it has been noted that during the proceedings of important
cases such as the one regarding the demolition of the Babri Masjid, the Chief Justice of India
himself has stepped in to facilitate mediation between the warring parties.5

Following in the same footsteps, the Law Commission of India in its 129th Report
recommended that it should be made obligatory for the Court to refer disputes to mediation for
settlement.6

3
www.indialawjournal.com/volume4/issue_1/article_by_desia_kanuga.html
4
Held in the case of, “Moti Ram (D) Tr. LRs and Anr. Vs Ashok Kumar and Anr (Civic Appeal
No. 1095 of 2008)”

6
5
Dr M. Ismail Frauqui And Ors. vs Union Of India (Uoi) And Ors AIR 1995 SC 605
6
http://practicalacademic.blogspot.in/2012/08/guest-post-mediation-and-conciliation.html.
This was referred to in the landmark case of Afcons Infra Ltd v. M/S Cherian Varkey
Constructions. 7 In this case, the Supreme Court of India further held that all cases relating to
trade, commerce and contracts, consumer disputes and even tortuous liability could normally be
mediated.

Another landmark decision by the Supreme Court was arrived at on 22nd Feb, 2013 in the case of
B.S. Krishnamurthy v. B.S. Nag raj. 8, wherein it directed the Family Courts to strive to settle
matrimonial disputes via mediation and to also introduce parties to mediation centre’s with
consent of the parties, especially in matters concerning maintenance, child custody, and the lot.
In the few years since mediation centers in the cities of Delhi (in the year2005) and Bangalore
(in the year 2007) were set up, around 30,969 cases have been through mediation process, and
around 60% of these cases have been settled ever since 9. Also, mediation seems to have become

the most sought after means of dispute resolution with regards to the settlement of patent
disputes. Further, it has been noticed that many Indian generic drug manufacturers are more
frequently resorting to mediation as a method for dispute settlement involving “patents”
including the recent famous cases of patent disputes between Hoffman La Roche and Cipla 10

Despite being successful in various countries, mediation has not been able to make much
headway in India mainly due to the lack of awareness regarding mediation and its benefits. It

7
2010 (8) SCC 24
8
2010 (8) SCC 24
9
Forbes India, Mediation in Indian Courts, available at
http://www.forbes.com/2010/09/28/forbes-india-judiciary-encouraging-mediation-reduce-
baclog.html

10
F.Hoffman La Roche Ltd. and Anr v. Cipla Ltd. 2015 SCC OnLine Del 13619 : (2015) 225
DLT 391 (DB)
8
does seem to appear that there has been a lack of initiative on the part of the government,
including that on part of the legal fraternity to spread awareness about mediation across the
country. In India, even though the judges have been quick to identify the increasing usage of
mediation as a helpful means for reducing case backlogs and delays, yet, lawyers in India have
not been able to respond to mediation fast enough. Also, the current court assisted mediation
centers hardly cater to this aspect of reaching out to the people. The 129th Report of the Law
Commission has identified certain new methods which may help facilitate the speedy disposal of
cases in urban areas.

These are as follows:

 Establishing the Nagar Nyayalaya with a professional Judge and two lay Judges in the
same manner as the Gram Nyayalaya and having comparable powers, authority,
jurisdiction and procedure. However, the Nagar Nyayalaya will resort to mediation first
and then initiate proceedings (only if mediation fails);
 Having cases heard in Rent Courts by a Bench of Judges, minimum two in number, with
no appeal but only a revision on questions of law to the district court;
 Setting up a Neighbourhood Justice Centres involving people in the vicinity of the
premises in the resolution of dispute; and
 Conciliation court system, presently working in Himachal Pradesh.

The efficient implementation of a system like this will most definitely help in addressing the
problems related to court delivery system. Such a system would also benefit the common man in
a substantial way. However, even in the present day, the lawyers in India still continue to be as
traditional and conservative as they have been over many years. They hardly tend to support any
new changes and at the same time, hesitate while venturing into exposing their clientele to the
unknown risks that may be involved in an ADR or mediation process, about which they are not
well aware. The lawyers always have an apprehension that delving into mediation would
probably deprive them of income by encouraging the settlement of cases prematurely and
thereby significantly reducing the legal fees that could otherwise be earned during the on-going
and prolonged judicial proceedings. On, the other hand the adversarial system (current court
system) too cannot be totally dispensed with. The adversarial system (involving litigation
proceedings in the courts) is often the most relevant method in a many different variety of
situations especially, those needing authoritative interpretation or establishment of rights or
which manifest severe negotiating imbalance. It is also required as one of the last resorts of
dispute resolution. However, its haphazard and unchanging application across a wide range of
conflict ridden situations is a major cause of the several maladies beleaguering the Indian legal
system.

The lawyers always have an apprehension that delving into mediation would probably deprive
them of income by encouraging the settlement of cases prematurely and thereby significantly
reducing the legal fees that could otherwise be earned during the on-going and prolonged judicial
proceedings. On, the other hand the adversarial system (current court system) too cannot be
totally dispensed with. The adversarial system (involving litigation proceedings in the courts) is
often the most relevant method in a many different variety of situations especially, those needing
authoritative interpretation or establishment of rights or which manifest severe negotiating
imbalance. It is also required as one of the last resorts of dispute resolution. However, its
haphazard and unchanging application across a wide range of conflict ridden situations is a major
cause of the several maladies beleaguering the Indian legal system.11

11
http://lawcommissionofindia.nic.in/adr_conf/sriram17.pdf
9
 CHAPTER 3

MEDIATION TRADITION IN DIFFERENT COUNTRIES

It is largely believed that almost all the communities in the world use some form of
dispute resolution method, however, the lack of data plays hindrance is letting anyone
decide as to what was the most popular method of dispute resolution. Mediation is one of
the tools of alternative dispute resolution, having its roots in different societal norms, and
structures. It is a way of resolving a dispute between two or more parties, in which a
third party tries to navigate the parties to a conclusion. Ideally, the methods in all the
countries regarding mediation remain the same, but the only difference lies in their
origins. While the origin of mediation in China lies in the Confucian ideals and the ideas
of societal peace and harmony, the USA and UK owe the origin of mediation to the
Pound Conference and Woolf Reforms respectively. In India, the Panchayat system grew
up to be more sophisticated and went on to become one of the most important forms of
out-of-the-court settlement in a country which is plagued with a huge backlog of cases.
Also adding to this there has been no track record of the indigenous methods due to the
long rule of the British. In this paper, the authors would attempt to map the trends of
mediation growth, the current framework of law and origin in different Asian countries
like China, India, Singapore, Sri Lanka, and then compare the trends with those that are
visible in USA and UK. The difference in the system of functioning and working of
mediation will be seen and compared .

10
3.1 Mediation in United States of America
National Conference of Commissioners on Uniform State laws (NCCUSL) in the USA
acknowledged that the use of mediation has become growing and an integral part of the
processes of dispute settling in the community and the commercial and business arena,
as well as among private parties disputed matters. Mediator helps the parties in
negotiating a settlement that would be impartial and would be benefitting both the
parties.
The Civil Justice Reform Act, 1990 required each federal judicial district to set up an
advisory committee to develop a plan dealing with congestion and delay, including
appropriate consideration of alternatives to adjudication.
Many US federal agencies have expanded ADR use, appointed dispute resolution
specialists and settled government contract disputes as well as workplace and labor-
management disputes. These include the US Postal Service, the Air Force, the United
States Information Agency and the Department of Veteran Affairs.
Lawyers by and large still believe that litigation is the way of settling the disputes but in
USA a person approaching to a lawyer is suggested to go for negotiation with the other
party. So, when we compare the Indian and US system, over the last twenty years, American
lawyers and judges have warmly assimilated mediation as a primary tool for resolving conflict in
court while Indian lawyers and judges are still examining mediation, discussing the efficacy of
mediation in settling the disputes and still pondering on types of cases which should be dealt by
the mediation. They also helped in building Mediation Centres in Australia and various other
continents. IAMA was established on 1975 and it is used to establish to deal with arbitration but
giving its weight on mediation.12

3.2 Mediation Law in European Union

The United Kingdom introduced its Civil Procedure Reforms in 1999 to enable the courts
12
Available at
https://www.researchgate.net/publication/311900251_MEDIATION_TRADITION_IN_ASIA_AND_LEGAL_FRAMEWO
RK_IN_INDIA_CHINA_AND_OTHER_ASIAN_COUNTRIES_IN_COMPARISON_WITH_US_AND_EU_LEGAL_REGULATIO
NS_RIYANKA_ROY_CHOUDHURY_NAMAN_KAMDAR
11
to deal with cases “justly” through active case management, partly defined as
encouraging the use of alternative dispute resolution procedures. Mediation thus came
squarely within the ambit of official court action. Subsequent cases saw judgments
refusing to give costs to successful parties where they had unreasonably refused to try
Mediation.
The Woolf Reports include the introduction of procedural case tracks and pre-action
protocols. They did not stop with structural and procedural reform, but sought to change
the culture of litigation. This was to be done by active case management, by introduction
of the “overriding objective”, and imposition of a duty on litigants to assist the court in
furthering the overriding objective. The overriding objective, as elaborated in Civil
Procedure Rule 1.1(2) is to deal with a case “justly” which includes ensuring that
parties are on equal footing, saving expense, dealing with a case in ways that are
proportionate to the amount of money involved, the importance of the case, the
complexity of the issues and the financial position of each party, ensuring that the case is
dealt with expeditiously and fairly, and allotting an appropriate share of the court’s resources to
it. It follows that justice is now more than justice in individual case; it is justice in all cases. In
furtherance of this objective and the shift in legal culture, a greater emphasis was placed on
resolving disputes consensually. This was central to the new litigation culture and was to be
achieved through active case management to promote settlement. This squarely brings mediation
within the ambit of court power and client duty. 13

3.3 Mediation in Asia

13

12
Modern practices were incorporated in the 1990s i.e. private based mediation and court-
based mediation. Court based litigation is started in subordinate courts after institution
of litigation and such cases are referred by the court to go for mediation and these cases
are coordinated by the primary Dispute Resolution Centre in order to come to the viable
solution and private mediation is provided by the Singapore Mediation Centre which
helps in mediation in commercial arena. Similarly Nepal, Pakistan and Bangladesh have
also taken steps to institutionalize and to develop the mediation services, primarily at the local
levels. Nepal has been in practices of dispute resolution since a very long time with aspects of
mediation but since 2001 the supreme court of Nepal has actively promoted both community and
court-referred mediation. Similarly mediation has been found as a viable solution in African
countries in dealing with the conflict. For example in the early 1980s in south Africa the country
came up with the ADR system with the setup of Independent mediation services of South Africa
(IMSSA) an NGO which devoted to use the ADR mechanism in order to resolve the labour
disputes. IMSSA has been successful in helping the parties to reach settlement with a success
rate of 70 to 80 %. Similarly in Srilanka, mediation is based on the mediation Boards Act No. 72
of 1988. The main aim behind this act was to improve, especially access to justice to the
economically disadvantaged group and to prevent backlog of cases in the courts. The system is
well-administered and enjoys and outstanding reputation. A total of 4, 59,364 disputes were
taken for mediation and of them, 2, 95,302 were settled amicably. The settlement rate is 64.2%.
Hence, after looking at the mediation mechanism being used to resolve the conflict across the
Asian countries, USA and European Union, mediation as a tool for resolving the disputes has
been widely accepted by the countries to prevent the backlog of cases and to avoid expensive
justice delivery system through litigation based mechanism.Unlike mediation in Japan, there is
no mechanism by which a dispute is taken to court for mediation from the beginning. In case of
mediation, mediator’s function is confined to encouraging negotiations between the parties to a
dispute. In Asian countries, the concept of alternative dispute resolution in this case mediation
has been accepted since the mid-1980s. It has been widely discussed that litigation has become
an inefficient means to resolve the disputes owing to the reason of long process, lawyer’s

13
 expensive fees and discontinuance of business relations with the other party if litigation is
instituted.14

3.4 MEDIATION, LOK ADAALATS AND ADR MECHANISMS IN INDIA.

Mediation process has been prevalent in India since the 17th Century. Centuries before
Britishers arrived; Republic of India had a system known as the council system which
revered village elders power-assisted within the resolution of disputes Community used.
Such ancient mediation can continue still used these days within the villages. Even within
the pre-British Republic of India mediation between businessesfolks were regular.
Impartial and revered businessmen known as Mahajans were asked by business
association members, to resolve disputes through and spontaneous methods that mixes
mediation and arbitration.
Indians followed the British Adversarial System in India and accepted arbitration as the
legalized alternative dispute resolution method. Mediation is a non-binding voluntary
agreement to meet the needs of the parties has gained its momentum in last few years. It
has only in last few years has begun to become familiar to lawyers and judges generally,
excluding ancestral community settings and also except where mediation has been court-
directed or statutorily-prescribed. Such is in intra-governmental disputes between
agencies and undertakings, private companies in civil and labor disputes. If we compare
US and Indian system over the last two decade, America has given a very warm welcome
to this non-binding system and use it as a primary tool for resolving conflicts preferably
out of court settlements, while Indian lawyers and judges are still guardedly exploring
mediation, debating whether and in which situations this method be used – comparable to
US in the 1980's. 15

14

15

14
3.5 CONFUCIAN VIEW OF DISPUTE RESOLUTION AND MEDIATION
MECHANISM IN CHINA

Before comparing the mediation’s mechanism of China with other countries, we should
look at the Confucian view of dispute resolution which says that legal process is not one
of the highest achievements of Chinese civilization but rather a regrettable necessity.
Nowadays Chinese’s no-litigation culture has promoted the development of legal solution
and enhancing the usage of mediation mechanism as an alternative disputes
resolution. According to the Chinese ministry of Justice, mediations have prevented
millions of civil dispute from becoming sensitive. Mediation has been widespread in
various parts of Asia although the concept of mediation is not new. Informal mediation
has been practiced in countries like China, Japan and South Korea because of the
influence of Confucianism. In all three countries order and harmony in society has been
valued rather than competition and adversarial relations.

Current law in China with respect to mediation

There are four types of mediation in China. The civil mediation happens by mediation
conducted by mediation committees outside the court. Judicial mediation takes place in a
court of law concerning civil and minor criminal disputes. Administrative mediation
happens outside the court and is conducted by the government in matters such as labor
disputes. Arbitration mediation is done by arbitration bodies in arbitration cases. As far
as judicial mediation is concerned, Article 35 of the Law of Civil Procedure of People’s
Republic of China states that ‘when handling civil cases, courts of law should, based on
the consent of the litigants, mediate the case on merits.’ Article 86 provides that courts
may be presided over by a sole judge or by a collegiate of judges and mediation should
take place on the spot as much as possible. Article 8 stipulates that the agreement should
be drawn up with the consent of the agreement should not contravene the law. Article 89 states
15
that once settlement is reached the court should prepare a mediation document. Article 91
provides that the court of law should adjudicate in a timely on failure of mediation or withdrawal
by the parties.16

3.6 MEDIATION MECHANISM IN SRI LANKA

In Sri Lanka a serious effort was taken to reintroduce the concept of amicable settlement
of disputes by introducing the Conciliation Boards Act, 1958. Later the Mediation
Boards, Act, 1988 was passed. Mediation is defined broadly as any ‘lawful means to
endeavor to bring the disputants to an amicable settlement and to remove, with their
consent and wherever practicable, the real cause of grievance between them so as to
prevent a recurrence of the dispute or offence.’
All mediators under the Act are required to attend a training course conducted by the
Ministry of Justice before they can be approved as mediators. As a result, the mediators
follow a specific facilitative mediation model as taught in the training program. Under
the Mediation Boards Act, 1988, a matter can come to mediation in one of four ways:
1. Voluntary Referral
2. Mandatory Referral (Civil Matters)
3. Mandatory Referral (Criminal Matters)
4. Court Referral
The Mediation Board has three mediators from the panel. The Board decides if
interested third parties should attend the mediation. Legal representatives may not attend
the mediation. Neither the disputants nor other interested parties can be compelled to
attend the mediation. The settlement agreement is not enforceable in a court of law,
unless the matter was referred to mediation by a court. Commercial Mediation has grown
in Sri Lanka and the Commercial Mediation Centre Act was passed in 2000. Currently the trends
suggest that over 5000 mediators practice mediation through the 248 established boards in Sri
Lanka. 17
16

16
17
COMPARATIVE ANALYSIS OF MEDIATION ACROSS THE GLOBE

Mediation as a dispute resolving tool not confined to western world but in fact mediation
mechanism have been embraced and widely practiced in countries other than those in the west.
Many non-western countries, especially Asia, Africa and Latin America have institutionalized
formal and informal mediation mechanism for resolving conflicts that arise in day-to-day
interactions. Mediation is a tool of settling disputes in which a third party helps both the parties
to come to an agreement which each of them consider acceptable. Mediation can be facilitative
or evaluative. In some countries mediation and conciliation have been used interchangeably but
difference lies in the fact that that the conciliator can make proposals for settlement, ‘formulate’
or ‘reformulate’ the terms of a plausible settlement while a ‘mediator’ merely facilitate a
settlement between the parties.

The meaning of these words are similar to the way they are taken in UK which means
conciliator plays a proactive role to bring about a settlement and mediator plays a more
passive role in bringing about a settlement64. This is the position in UK and India under the
UNCITRA model. However in the USA, the person having the pro-active role is played by the
mediator rather than the conciliator

17
NAME OF MODE OF ITS TYPE OF LEVEL OF TYPES OF
THE FORMATION MEDIATION CONFIDENTIALITY DISPUTES
COUNTRY
CHINA Chinese Informal Not very high Commercial
Mediation Confucian confidentiality. matters
Centre, 1987 Mediation Part of everyday
process of
Court.

USA Uniform Conciliator(active To foster Primary tool

Mediation Act, ) uniformity and for settling
2001 Mediator(Passive) to assure civil disputes
confidentiality

UK Primary tool Conciliator(active Article 7(1) of Commercial

for settling ) the Mediation as
civil disputes Mediator(Passive) directive well as civil
mediator has to matters
ensure
confidentiality

INDIA Arbitration & Conciliator(active Very high Civil disputes

Conciliation ) confidentiality and also
Act, 1996 and Mediator(Passive) disputes of
Section 89 Lok Adaalat
CPC, 190

OTHER Local and Informal Moderate level Basically

MAJOR Civil Confusion of Local
ASAIN Mediation Mediation confidentiality Disputes
COUNTRIES Centres have
been
developed
 19

CHAPTER : 4
 BUILDING A SUCCESSFUL MEDIATION PRACTICE

Justice(Retd) R.V Raveendran,former judge of the Supreme Court of India,in his writings on the
relevance of mediation,has set out key elements of making mediation a successful practice
area.These include judges’ training programmes on dispute resolution strategy and design,
increased case referrals to mediation centres, quality (and well trained) mediators, developed
infrastructure facilities for mediation and increasing user awareness. These significant elements
have also been considered as key to implementing aneffective mediation model and have been
elaborated below:

(A)Role of referral judges

Judges across jurisdictions have played a fundamental role in the advancement of mediation.In
fact, most jurisdictions (including the Study Jurisdictions) have mandated training of judges in
understanding various dispute processes, particularly ADR processes and how case referrals
should be analysed. In this context, Justice Henry Klide (Retd.), of Stark County Common Pleas
Court and a known mediation evangelist in the United States,has said, “Judges, in dealing with
society’s social,
economic and racial issues, must embrace innovative legal tools to assist litigants and the judicial
system”.An understanding and an ability to ‘fit the forum to the fuss’, tempered with good
case .Management is extremely critical for the development of a better civil justice system. In the
Study Jurisdictions, court connected mediation has been contingent on a judges inclination
towards mediation, as will be established in the course of this chapter.

(B) Accreditation of mediators

The qualifications of a mediator have increasingly become a subject matter of discussion.
Devising training programs and the importance of advanced/refresher courses have been a global
phenomenon, though training to be a mediator is also result of this development.
20
Taking the American example, when the practice of mediation was introduced in
the early 90s/late 80s, mediators were primarily lawyers or retired judges who were
facilitating out of court settlements. There was no training and accreditation facility that was set
out at that point. Training programmes have been globally recognised as a necessity for
mediators since pre-mediation preparation, understanding positions, interests and needs, effective
communication and people handling skills, negotiation facilitation, understanding neutrality and
confidentiality became key elements of effective mediators and subsequently effective
mediations.Accreditationon the other hand is a contentious issue, particularly since it is based on
what constitutes a qualified accreditation agency.Moreover, there is global recognition that
awareness building and usage will increase only if there is a quality of service, including inter
alia, effective mediators. The absence of good mediators is interlinked with the regression of
mediation.In this context, it is pertinent to note, that being a ‘mediator’ should be viewed as a
profession as opposed to a volunteer workshop; an area where even the Study Jurisdictions have
struggled.The fact that the government financially supports the court connected mediation
programmes and the services provided are free of cost, makes mediation less lucrative as a
profession in this context. Given that the costs of mediation are almost nil and the fact that it
saves time is undisputed.

(C) Infrastructure development and administration of mediation centres

Infrastructure development and efficient administration of mediation centres are crucial to

development of a mediation practice. The importance of neutral chairs who oversee the activities
of the mediation centres, a non-court like environment for mediation, case managers, pre-
conferencing facilities,have been understood and has gained importance.

(D)User Awareness

Awareness building of litigators, advocates and litigants of the mediation process and how to use
the process is pertinent to comprehend its usefulness and usage. In India, of course, the biggest
21
hurdle has been misunderstanding the process, where some believe mediation to be akin to a Lok
Adalat set up which is only for the purpose of settlement and others believe it to be legal aid!
The ruling in the Afcons
case also lends to the confusion.Countries (including the Study Jurisdictions) through seminars,
advocacy programmes and pledges (that have been signed by large corporate houses and
multinationals) have focussed on awareness drives that have played a fundamental part in
advancing the practice of mediation in civil/commercial cases.

Codification
Several countries (including the Study Jurisdictions) have considered introducing a
comprehensive statute on mediation. In court connected mediations, while there are model laws
and rules that have been followed by different courts in the same jurisdictions, the larger
question of consistency and a comprehensive statute has been raised and in some cases like the
USA, left untouched. The primary objective of codification and legislation has been to determine
how referrals should be made (as identified in Australia), how to deal with immunity of
mediators, and most importantly and commonly, the finality of outcomes of mediation. In India,
at present,
in court connected programmes mediated settlement agreements are ordered as non-appealable,
final and binding when furnished to court for execution.Therein lies the concern. In court
connected programmes, the finality element is usually ensured through execution and recording
in court. It is here that the essence of the process comes to be challenged. A vital element of
mediation is ‘confidentiality’. The process is based on the principle of non-disclosure and
mediators, parties, and lawyers are bound by it. Settlement agreements are also confidential.
Making it a matter of public record is where the debate of codification lies. In addition to this,
what constitutes as immunity for mediators and whether privilege is extended to mediators also
becomes a concern translating to the question -how to carry out their duties if they expect to be
summoned by court to justify it? In respect of finality of settlement agreements,the open ended
question arises: is it sufficient to execute the contract and is that binding without having to
produce the agreement in court for sanction? In addition to the question of codification so as to
give the process a statutory structure, the move towards a legislation by countries is also based
22
on enforcing the mediated settlement agreement against government agencies which have been
studied in the course of this chapter. As outlined in the preface to the Report, the aim and
purpose is to understand, analyse and evaluate the court connected mediation programmes in
India and to chart out an effective implementation scheme. 18

Cases settled, not settled and cases that were non-starters

The data obtained from the DMC provides insight into the number of cases settled, those not
settled and those that were non-starters. The number of cases settled, as per the data provided by
the DMC, includes ‘connected matters settled along with the main matter referred’

Table : Cases settled, not settled and cases that were non-starters in numbers and percentage

Year Cases settled Cases not settled Cases non-

starters
2011 1221 46% 1264 48% 286 11%
2012 1534 58% 1270 48% 350 13%
2013 1382 50% 1446 52% 384 14%
2014 1542 52% 1372 46% 368 12%
2015 1965 75% 1467 56% 652 25%
Total 7644 56% 6809 50% 2040 15%

18
Available at

https://vidhilegalpolicy.in/reports/.../strengthening-mediation-in-india-an-interim-report

23
The statistical data available shows a marginal increase in the total number of cases before the
DMC each year in three out of the four time periods between 2011 and 2015 (as depicted in
Table). Interestingly, the total number of cases fell from 2981 in 2014 to 2607 in 2015.

(i)Number of cases for mediation

Year Total no. of cases in Total no. of cases Total no. of cases
the Delhi High Court before the DMC (As before the DMC (as a
(freshly instituted obtained from data of percentage of total no.
cases plus cases DMC) of cases of Delhi High
pending at the Court )
beginning of the year)
2011 91988 2632 2.86%
2012 100897 2635 2.61%
2013 100023 2791 2.79%
2014 107143 2981 2.78%
2015 112968 2607 2.31%

Moreover, the 2014 Study reveals that in its first year of operation (2006-2007), the 730 disputes
were referred to the DMC for mediation. Given that the DMC has been in operation for ten years
now, the increase in the number of cases being referred since 2006 is not encouraging.
Furthermore, the growth in the number of cases being referred over the period from 2011 to 2015
has nearly stagnated and reflects a lack of court referrals by the judiciary in the Delhi High
Court.
When seen against the total number of cases in the Delhi High Court, however, the data reveals
that as little as about 2.66% of the total number of cases are referred for mediation to the DMC.
As stated above, for this analysis, the total number of cases, i.e. the sum of the number of cases
carried forward from the previous year and the number of cases freshly instituted in the Delhi
High Court, was compared with the total number of cases, i.e. the sum of cases carried forward
24
from the previous year and the new cases referred for mediation at the DMC. This figure has
varied from 2.86% in 2011 to 2.31% in 2015, showing minuscule variation over the five years.
This suggests that there is little change in the acceptance of mediation as a dispute resolution
mechanism among members of the judiciary in the Delhi High Court suggesting that more needs
to be done on this front. One of the key means of addressing this stagnation is to boost judicial
confidence in mediation. This can be facilitated by providing the judges with information
regarding case type analyses from other courts indicating the success of mediation as a dispute
resolution mechanism.

(ii)Cases not settled

The number of cases not settled over the years provides significant insight into the practice of
mediationat the DMC. While a total of 1264 cases remained not settled in 2011, the number
increased to 1467 in 2015. Each year between 2011 and 2015, other than 2013-2014 (which saw
a decline), saw an increase in the number of cases ‘not settled’.While the precise reasons for this
trend cannot be determined, it could be seen as a reflection of inadequate training of mediators at
the centre,insufficient resources at its disposal, non-suitability of cases for resolution through
mediation, lack of inclination among the parties to settle their dispute through mediation, inter
alia.
.
(iii)Non-starters

Each year between 2011 and 2015, other than 2013-2014 (which saw a decline), saw an increase
in the number of non-starters. While 286 cases were non-starters in 2011, the number increased
to more than twice in 2015, with 652 cases. This reflects an increase in the disinterest of parties
in pursuing mediation or lack of cooperation on their part and highlights the pressing need to
instil greater public confidence in mediation as not only an alternative manner of dispute
resolution but also as the appropriate dispute resolution mechanism in many cases.19

Benefits of mediation

19
Available at www.vidhilegalpolicy.in ( Interim report on court annexed mediation )
25
Mediation is an informal conflict-resolution process brought before an independent, neutral
third-party the mediator. Mediation cases give the parties the opportunity to discuss their issues,
clear up misunderstandings, and find areas of agreement in a way that would never be possible in
a lawsuit. Mediation is often voluntary, and typically the mediator has no authority to make a
binding decision unless both parties agree to give the mediator that power.

Consequently, mediation cases have many significant advantages over traditional lawsuits,
including the following:

 Quicker: Mediation typically only takes days or weeks (or in very complex cases
possibly months), whereas lawsuits typically take months or years. When parties want to
get on with their lives, mediation allows a more reasonable timetable for resolving a
dispute.
 Less Expensive: Mediation is vastly less expensive than a typical lawsuit. Employing a
mediator costs significantly less than employing a lawyer, and combined with the much
quicker turnaround, you'll be paying less money over a shorter period of time. In
addition, for certain types of disputes, many non-profits offer mediation services for free
or at a nominal rate.
 Less Formal: The informality of mediation allows the parties to be more engaged than
they would be in a court-driven process with an abundance of rules and procedures
designed to separate the parties. Accordingly, since the mediator deals directly with the
parties, the mediator can focus the attention of the parties upon their needs and interests
rather than on their stated positions.
 Confidential: Unlike court cases, which are public, mediation is typically confidential,
which means there are no records or transcrips and any evidence introduced during
mediation cannot be used later or revealed. This reason alone can be a great reason to use
mediation rather than file a lawsuit.

26
  Preserves Relationships: One of the most overlooked benefits of mediation is that it can
help preserve relationships, business and personal, that would likely be destroyed through
years of litigation. Because it is a collaborative, rather than adversarial process, and
because mediation isn't inherently a win/lose process, important relationships can often
be saved.

 Greater Flexibility and Control: In mediation, unlike in a lawsuit, the parties are in
control. This means that the parties have a much greater say in negotiations and greater
control over the outcome.
 Better Results: For all the reasons above, parties generally report a better outcome as a
result of mediation than they do from a lawsuit. Also, because there is no winner or loser,
no admission of fault or guilt, and the settlement is mutually agreed upon, parties are
typically more satisfied with mediation.
 Greater Compliance: Finally, because mediation produces better results more quickly
and cheaper, compliance with mediated dispute resolutions is generally higher than with
lawsuits.

Successful mediation can lay the groundwork for collaborative, non-confrontational problem
solving and preserve relationships that are important to you.

27
 CHAPTER : 5

LEGAL RECOGNITION OF MEDIATION IN INDIA

The concept of mediation received legislative recognition in India 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.”
Detailed procedures were prescribed for conciliation proceedings under the Act.

Arbitration, as a dispute resolution process was recognized as early as 1879 and also found a
place in the Civil Procedure Code of 1908. When the Arbitration Act was enacted in 1940 the
provision for arbitration originally contained in Section 89 of the Civil Procedure Code 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 Indian parliament enacted the Arbitration and Conciliation Act in 1996, making elaborate
provisions for conciliation of disputes arising out of legal relationship, whether contractual or
not, and to all proceedings relating thereto. The Act provided for the commencement of
conciliation proceedings, appointment of conciliators and assistance of suitable institution for the
purpose of recommending the names of the conciliators or even appointment of the conciliators
by such institution, submission of statements to the conciliator and the role of conciliator in
assisting the parties in negotiating settlement of disputes between the parties.

In 1999, the Indian Parliament passed the CPC Amendment Act of 1999 inserting Sec.89 in the
Code of Civil Procedure 1908, providing for reference of cases pending in the Courts to ADR
which included mediation. The Amendment was brought into force with effect from 1st July,
2002.

Since the inception of the economic liberalization policies in India and the acceptance of law
reforms the world over, the legal opinion leaders have concluded that mediation should be a
critical part of the solution to the profound problem of arrears of cases in the civil courts.

28
Mandatory mediation through courts has now a legal sanction. Court-Annexed Mediation and
Conciliation Centres are now established at several courts in India and the courts have started
referring cases to such centres. In Court-Annexed Mediation the mediation services are provided
by the court as a part and parcel of the same judicial system as against Court-Referred
Mediation, wherein the court merely refers the matter to a mediator.

One feature of court-annexed mediation is that the judges, lawyers and litigants become
participants therein, thereby giving them a feeling that negotiated settlement is achieved by all
the three actors in the justice delivery system. When a judge refers a case to the court-annexed
mediation service, keeping overall supervision on the process, no one feels that the system
abandons the case. The Judge refers the case to a mediator within the system. The same lawyers
who appear in a case retain their briefs and continue to represent their clients before the
mediators within the same set-up. The litigants are given an opportunity to play their own
participatory role in the resolution of disputes. This also creates 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 an additional service. In court-annexed
mediation, the court is the central institution for resolution of disputes. Where ADR procedures
are overseen by the court, at least in those cases which are referred through courts, the effort of
dispensing justice can become well-coordinated.

ADR services, under the control, guidance and supervision of the court would have more
authenticity and smooth acceptance. It would ensure the feeling that mediation is complementary
and not competitive with the court system. The system will get a positive and willing support
from the judges who will accept mediators as an integral part of the system. If the reference to
mediation is made by the judge to the court annexed mediation services, the mediation process
will become more expeditious and harmonized. It will also facilitate the movement of the case
between the court and the mediator faster and purposeful. Again, it will facilitate reference of
some issues to mediation

29
TYPES OF DISPUTES FOR MEDIATION

Judges who refer the cases for settlement through any of the ADR methods are known as referral
judges. The role of a Referral Judge is of great significance in court-referred mediation. All cases
are not suitable for mediation. Only appropriate cases which are suitable for mediation should be
referred for mediation. Success of mediation will depend on the proper selection and reference of
only suitable cases by referral judges.

Reference to ADR and statutory requirement

Section 89 and Order X Rule 1A of Code of Civil Procedure, 1908 require the court 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.

While making such reference the court shall take into account the option if any exercised by the
parties and the suitability of the case for the particular ADR method.   In the light of judicial
pronouncements, a referral judge is not required to formulate the terms of the settlement or to
make them available to the parties for their observations. The referral judge is required to
acquaint himself with the facts of the case and the nature of the dispute between the parties and
to make an objective assessment to the suitability of the case for reference to ADR.

Stage of Reference

The appropriate stage for considering reference to ADR processes in civil suits is after the
completion of pleadings and before framing the issues. If for any reason, the court did not refer
the case to ADR process before framing issues, nothing prevents the court from considering
reference even at a later stage. However, considering the possibility of allegations and counter
allegations vitiating the atmosphere and causing further strain on the relationship of the parties,
in family disputes and matrimonial cases the ideal stage for mediation is immediately after

30
service of notice on the respondent and before the filing of objections/written statements by the
respondent. An order referring the dispute to ADR processes may be passed only in the presence
of the parties and/ or their authorized representatives.

Consent

Under section 89 CPC, consent of all the parties to the suit is necessary for referring the suit for
arbitration where there is no pre-existing arbitration agreement between the parties.  Similarly,
the court can refer the case for conciliation under section 89 CPC only with the consent of all the
parties. However, in terms of Section 89 CPC and the judicial pronouncements, consent of
the parties is not mandatory for referring a case for Mediation, Lok Adalat or Judicial
Settlement. The absence of consent for reference does not effect the voluntary nature of the
mediation process as the parties still retain the freedom to agree or not to agree for settlement
during mediation.

Avoiding delay of trial

In order to prevent any misuse of the provision for mediation by causing delay in the trial of the
case, the referral judge, while referring the case for mediation, shall post the case for further
proceedings on a specific date, granting time to complete the mediation process as provided
under the Rules or such reasonable time as found necessary.

Choice of cases for reference

As held by the Supreme Court of India in Afcons Infrastructure Ltd. and Anr. V. Cherian Varkey
Construction Co. Pvt. Ltd. and Ors., (2010) 8 Supreme Court Cases 24, having regard to their
nature, the following categories of cases are normally considered unsuitable for ADR process.

31
 Disputes relating to election to public offices.

 Cases involving grant of authority by the court after enquiry, as for example, suits for
grant of probate or letters of administration.
 Cases involving serious and specific allegations of fraud, fabrication of documents,
forgery, impersonation, coercion, etc.
 Cases requiring protection of courts, as for example, claims against minors, deities and
mentally challenged and suits for declaration of the title against the Government.
 Cases involving prosecution for criminal offences.

All other suits and cases of civil nature, in particular, the following categories of cases (whether
pending in civil courts or other special tribunals/forums) are normally suitable for ADR
processes:

 i) All cases relating to trade, commerce and contracts, including

– disputes arising out of contracts (including all money suits);

– 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

 ii)  All cases arising from strained or soured relationships, including

– disputes relating to matrimonial causes, maintenance, custody of children;

32
– disputes relating to partition/division among family members/coparceners/co-owners; and

– disputes relating to the partnership among partners.

 iii)  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 easementary rights, encroachments, nuisance, etc.);

– disputes between employers and employees;

– disputes among members of societies/associations/apartment owners’ associations;

 iv)   All cases relating to tortious liability, including

– claims for compensation in motor accidents/other accidents; and

 v)    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.

The above enumeration of “suitable” and “unsuitable” categorisation of cases is not exhaustive
or rigid. They are illustrative which can be subjected to just exceptions or addition by the courts/
tribunals exercising its jurisdiction/discretion in referring a dispute/case to an ADR process.

In spite of the categorization mentioned above, a referral judge must independently consider the
suitability of each case with reference to its facts and circumstances.

Motivating and preparaing the parties for mediation

The referral judge plays the most crucial role in motivating the parties to resolve their disputes

33
through mediation. Even if the parties are not inclined to agree for mediation, the referral judge
may try to ascertain the reason for such disinclination in order to persuade and motivate them for
mediation. The referral judge should explain the concept and process of mediation and its
advantages and how settlement to mediation can satisfy the underlying interest of the parties.
Even when the case in its entirety is not suitable for mediation a Referral Judge may consider
whether any of the issues involved in the dispute can be referred for mediation.

Refferal order

The mediation process is initiated through a referral order. The referral judge should understand
the importance of a referral order in the mediation process and should not have a casual approach
in passing the order. The referral order is the foundation of a court-referred mediation. An ideal
referral order should contain among other things 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.

Role after conclusion of mediation

The referral judge plays a crucial role even after the conclusion of mediation. Even though the
dispute was referred for mediation the court retains its control and jurisdiction over the matter
and the result of mediation will have to be placed before the court for passing consequential
orders. Before considering the report of the mediator the referral judge shall ensure the presence

34
of the parties or their authorized representative in the court. If there is no settlement between the
parties, the court proceedings shall continue in accordance with law. In order to ensure that the
confidentiality of the mediation process is not breached, the referral judge should not ask for the
reasons for failure of the parties to arrive at a settlement. Nor should the referral judge allow the
parties or their counsel to disclose such reasons to the court. However, it is open to the referral
judge to explore the possibility of a settlement between the parties. To protect confidentiality of
the mediation process, there should not be any communication between the referral judge and the
mediator regarding the mediation during or after the process of mediation.

If the dispute has been settled in mediation, the referral judge should examine whether the
agreement between the parties is lawful and enforceable. If the agreement is found to be
unlawful or unenforceable, it shall be brought to the notice of the parties and the referral judge
should desist from acting upon such agreement. If the agreement is found to be lawful and
enforceable, the referral judge should act upon the terms and conditions of the agreement and
pass consequential orders. To overcome any technical or procedural difficulty in implementing
the settlement between the parties, it is open to the referral judge to modify or amend the terms
of settlement with the consent of the parties.20

35

20
https://blog.ipleaders.in/indian-should-know-about-mediation/
CHAPTER : 6

CONCLUSION AND SUGGESTIONS