“It may be worthwhile to recall that the failure of mediation (in Mahabharata) led to disastrous consequences.”
-Chief Justice of India N V Ramana
While addressing the Curtain Raiser and Stakeholder Conclave of the International Arbitration and Mediation, CJI Ramana emphasized that courts should be engaged as the last resort for dispute resolution. The ADR mechanisms are not only instrumental from the standpoint of dispute resolution but essential to restore stressed relationships.
Recently, in an effort to strengthen the framework for mediation in the country as a viable ADR mechanism the Ministry of Law and Justice released the Draft Mediation Bill,2021 in the public domain. The dialogue emphasizing the need for a stand-alone law on mediation has always been strongly advocated for by the legal pundits owing to the lack of structure of mediation processes, unavailing inconsistencies between various existing legislations such as Code for Civil Procedure, 1908, Industrial Disputes Act, 1947 and the Commercial Courts Act 2015. Additionally, since India is a signatory to the Singapore Convention on Mediation a substantial legislation addressing it was necessary. Finally, the lack of a coherent enforcement mechanism for mediation settlements was a crucial factor that rendered mediation ineffectual.
This article aims to analyse the Draft Mediation Bill, 2021 by mapping its significant provisions, understanding the plausibility of the processes established and highlighting gaps in the framework that demand a more sincere deliberation.
Summary of the Draft Mediation Bill
Part I- Domestic Mediation
The first part discusses and highlights domestic mediation and its applicability, procedure, and reache in India. The segment also assigns online mediation with statutory recognition.
Discusses the scope and definition of concepts and terms conferred in the Act.
The provisions of this chapter offer an overdue clarity with respect to definition and scope to many terms which assumed significance over the years in the field of mediation. Further, the extension of the Act to international mediations makes it possible to settle international disputes with finality.
The chapter exclusively focuses on the mediation process. The act under this chapter empowers the court to refer the parties to mediation while segregating matters that shall not qualify for mediation. A party may, before the commencement of or during the continuation of mediation proceedings under this Part, can file an application before a Court or Tribunal of competent jurisdiction for seeking urgent interim measures.
Comments –Provisions of this chapter give the necessary importance, legality, and validity to the mediation agreements by way of mandatory prerequisites. No ambiguity is left qua almost all the aspects of a mediation process. However, providing for an interim relief procedure while the mediation is pending may thwart the spirit of mediation, and much caution is required while incorporating such a provision
This chapter enlightens the procedures to be followed for the appointment of the mediator on party autonomy and the duties of the mediator. It is pertinent to note that it provides that the mediator can be appointed from any nationality. The preference under the act is given to the parties to the dispute.
Comments – Provisions of this chapter provide the much-awaited party autonomy to the stakeholders in the appointment of the mediator. This shall make the process swifter and less strenuous. Further, if the mediator is already known to both parties, there are better chances of settlement.
The chapter discusses details of setting territorial jurisdiction, date of commencement, etc. for the benefit of the parties. Renders code of civil procedure and Indian Evidence Act inapplicable to mediation. The time limit for completion of mediation is 90 days, which can be further extended to 90 days with the consent of the parties. The mediation settlement agreement is also made applicable to online mediation settlements.
Comments – Setting a fixed timeline for concluding the process shall emerge as a major boon to its earnestness. Steps like online mediation shall render the mediation more viable for the stakeholders.
This chapter addresses the status of the settlement agreement. The agreement can be challenged on grounds of fraud, corruption, gross impropriety, or impersonation within a period of 3 months. It also excludes the limitation period during the mediation.
Comments – Exclusion of period of mediation from the limitation period prescribed may emerge as a major boon for diverting the pendency from litigation to mediation.
This chapter states that online mediation shall take place in accordance with the provisions of the information technology Act. However, both the mediators and the parties under the chapter are duty-bound to maintain autonomy as well as confidentiality.
Comments – Online mode of mediation is the need of the hour and this chapter successfully codifies the concept. However, the infrastructural problems are yet to be addressed which can be done by way of appropriate rules.
Provides for the establishment of the mediation council of India by the central government with head office in Delhi. Discusses the composition of the mediation council of India, the functions to be performed by them, and the process and grounds for impeachment.
Comments – The establishment of a council shall make the mediation process more disciplined and responsible. However, centralization of the council only to the Capital might be required to be reviewed to balance out regional coordination requirements.
Discusses the recognition of the mediation service provider and mediation institutes and their function.
Comments – From a more or less and unorganized field, Mediation is now a complete organizational process with the involvement of the service providers and institutes. However, the functions of the institutes may need to be regulated at a micro-level with substantial infrastructural inputs.
Part II – Community mediation
It is interesting to note that the act provides for community mediation which is likely to affect the peace, harmony, and tranquillity amongst the residents or families of any area or locality. It also provides for the procedure to be adopted for community mediation.
Part III- International settlement agreements
This part is dedicated towards international commercial settlement and Enforcement of international commercial settlement agreements resulting from mediation.
By enabling the enforcement of international settlement agreements, a major boost is sought to establish the reliability and versatility of the Indian Justice dispensation system.
Gaps and Suggestions
Despite formulating cogent provisions that majorly tackle the immediate concerns surrounding the mediation process in the country, there are some factors that need in-depth deliberation.
Following suggestions can be incorporated in the bill to eliminate ambiguities and establish a well-rounded framework to guide mediation processes.
- Section 22 talks about confidentiality to be maintained by the parties to the dispute as well as the mediator.
However, the draft does not provide for any punishment/ liability or the consequences which shall be imposed on one who wilfully infringes the said section, thereby defeating the primary objective of the act of maintaining confidentiality.
- Under section 29, an application for challenging the mediated settlement agreement may not be made after three months have elapsed from the date on which the party making that application has received the copy of mediated settlement agreement under section 21(3) of this Act. Provided that if the Court is satisfied that the applicant was prevented by “sufficient cause” from making the application within the said period of three months it may entertain the application within a further period of thirty days, but not thereafter.
The term “sufficient cause” for the delay in filing the challenge to the settlement agreement is ambiguous; therefore, it is suggestible that the draft should include specific and clear grounds under which the settlement agreement can be challenged even after three months.
- Under section 10, the bill provides that qualification, experience, and accreditation of the foreign, as well as domestic mediator, would be determined by the council.
The same should be decided in consultation with the judiciary or a body of specialized individuals. The same shall instill more faith in the parties towards the appointed expert. Additionally, mediation shall become a viable career option for young professionals in the sector.
- The concept of composite reference arbitration has gained a lot of significance in the field of ADR since it facilitates clubbing more than one dispute arising under many sub-agreements under a common contract, eg; a construction contract. This method aids in avoiding multiple conflicting awards, saving time, money, and resources. However, the same does not have any legal backup in the Indian statutes and is dependant on legal precedents and the discretion of the courts.
It would be sensible to include the concept of “Composite reference mediation” in the mediation Rules, 2021 which will help in avoiding multiple conflicting awards, boost efficiency, and render the process cost-effective.
In a nutshell, it can be concluded that the Bill indeed is a step in the right direction and is equipped with fair shares of constructive provisions which will certainly contribute towards strengthening and promotion of mediation as a viable alternate dispute resolution mechanism in the country. This stand-alone legislation would not only inspire greater confidence and faith in the mediation process but also significantly address the concerns of an over-burdened and over-worked adversarial system of justice. However, to truly instill merit and prudence in the processes it is imperative to carefully address the abovementioned gaps in the Bill and facilitate the ADR mechanism of mediation.
The Bill indeed is a step in the right direction and is equipped with fair shares of constructive provisions which will certainly contribute towards strengthening and promotion of mediation as a viable alternate dispute resolution mechanism in the country. This stand-alone legislation would not only inspire a greater confidence and faith in the mediation process, but also significantly address the concerns of an over-burdened and over-worked adversarial system of justice.