This article is written by Ritika Sharma, pursuing a Diploma in Advanced Contract Drafting, Negotiation and Dispute Resolution from LawSikho.
“Discourage litigation. Persuade your neighbours to compromise whenever you can. Point out to them how the nominal winner is often a real loser—in fees, expenses, and waste of time. As a peacemaker the lawyer has a superior opportunity of being a good man. There will still be business enough.” –Abraham Lincoln
2019 and 2020 were big years for mediation in India, we saw the biggest case of India (the Ayodhya dispute) going to a mediation panel, and a lot of people preferring online mediation over litigation. Even though the Ayodhya mediation failed, there was some sense of increase in awareness amongst the public about the subject of mediation.
Mediation is seen as a facilitated form of negotiation. Mediation is a win-win situation for the parties which is a drift from the win-lose regime in litigation. Mediation is made up of 4 core essentials:
- Party autonomy;
- A voluntary process, which can be terminated at the will of the parties;
- Enforceable in a court of law.
Process of Mediation
Although agreements may have a clause for mediation as a dispute resolution mechanism, it requires parties’ ad idem to proceed ahead. Therefore, only when both the parties give their assent to mediation can the process begin with a jointly appointed facilitator (mediator).
Mediation can be said to have 4 functional stages:
Introduction and Opening Statements from each side
Objective of this stage:
This stage will be utilized to set up some ground rules, such as neutrality, creating an awareness of the process, gaining confidence of the parties, motivating parties for settling amicably and creating an environment suitable for constructive negotiations.
- The mediator initiates the process by introducing himself/herself, their qualifications and experience. The mediator conveys to the parties that he/she has no conflict of interest in the mediation process and communicates that an amicable settlement or anything close to one, would lead to fruitful session. The mediator confirms that the parties have no doubts related to the process and have the necessary authority to negotiate and come to a settlement.
Opening statement of the mediator:
The mediator shall make the parties aware about the concept and stages in the process, the role of everyone, take advantage of the process and set up some ground rules for mediation. He/she sets a tone for the mediation.
Concept of mediation:
The mediator may communicate to the parties that mediation is a completely voluntary, confidential, and party centred process, the success of which would depend upon the active involvement of the parties. The settlement could be given in finality through an agreement, and the process would be fully confidential.
There are no standard rules to be followed in the process, therefore it is quite flexible. However, the most standard rules are:
- To avoid abusive language in the sessions;
- To refrain from interrupting;
- To switch off mobile phones during the sessions.
- The parties apart from introducing themselves also give a little detail as to their stance and requirements, which enables the other party to gauge the needs of the party. The counsels along with their clients (parties) introduce themselves at this stage as well.
- The mediator then summarizes the problem and addresses that there is a difference in opinion in certain matters which needs to be addressed.
Setting the agenda
In order to avoid any ambiguities, the mediator sets forth some agendas for the session. The mediator would ask the parties to give an order of preference in which they would want to proceed.
The main objectives of this stage are to gather all the information, ascertaining the stances, analyzing the facts and issues.
Both the parties interact with the mediator and try to establish their cases, while the counsels present the legal issues. The parties describe the dispute from their point of view and also respond to the other party. The parties may also put forward questions at this stage.
The mediator tries to make sure that each party is heard adequately, since he has to be a neutral facilitator. However, he/she does not suggest solutions at this stage but just actively listens to each side.
Caucus is a private session conducted by the mediator with each party. At this stage, the parties can freely interact with the mediator, putting forward information and certain possible settlement terms that they would be unable to discuss freely with the other party.
The mediator may put forward questions to the parties and counsel to extract information which were kept out of discussion in the joint sessions.
The parties may request the mediator not to disclose certain information to the other party communicated in the caucus. The mediator is obliged not to disclose such information but can use this information for brokering a settlement in a more effective manner.
This session gives a cooling off period to the parties while also giving them an opportunity to candidly discuss their stance. It is therefore the caucus that is the engine room of the mediation process, it basically churns the process to delve into rapid negotiation and in most cases a settlement as well.
The mediator may conduct multiple joint sessions and caucuses depending upon the facts and circumstances. The mediator uses his expertise and skills to mould the procedure so as to arrive at a holistic solution to the problem.
Settlement and Closing
At this stage, the mediator would try to help the parties to see the reality of the situation and work to analyze offers and counter-offers which are mutually acceptable and reach the best possible solution. Once a settlement is reached, the settlement is reduced to writing through a settlement agreement.
The mediator assists the parties to draft this agreement. These terms would be comprehensive in nature to again avoid ambiguities and vagueness. This settlement is enforceable in the court of law and is binding on the parties.
However, a situation may also arise where the parties decide not to settle, then the case would be returned to either a referral court saying the matter was “not settled” (in case of court annexed mediation) or the parties may decide the way forward.
Lastly the mediator thanks the parties for giving mediation a try.
Issues hampering effectiveness of mediation in India
In my opinion, mediation is not effective to its full extent until now.
Firstly, there is a lack of a statutory framework for mediation, unlike arbitration and conciliation. There are arguments from scholars that many countries do not have a statute for mediation, but in a country like India, the least we can have is a code of conduct and code of ethics. There are Mediation and Conciliation Rules which were enacted in 2005, but they seem to be highly inadequate as they fail to cover the entire ambit of the process. And they also create a confusion between the concepts of ‘mediation’ and ‘conciliation’. This lack of legislation and inadequate rules amounts to low faith and confidence in the process.
Secondly, there is a need to modify Section 89 of the Code of Civil Procedure, 1908, because it hampers the process of mediation. The section mandates that if the court sees a hope of settlement which is acceptable to parties, the court shall formulate the terms of settlement and the terms may be reformulated as per possible settlement after which parties can be referred to either of the alternate dispute resolution mechanisms. But what is the point of the court making terms of possible terms of settlement before parties are referred to mediation. The mediator could help them explore their interests freely, and not with the burden of restrictions placed on their thoughts by the court. Although courts have mediation centres now, there are no clear statistics to show that this provision has been utilised successfully.
Although there are mediation centres coming up, and lawyers wanting to take up mediation as a full-time career option, however, these instances are sporadic. Lawyers still see it as a job they can do after court hours, this perception needs to change.
There is a need for developing awareness and advocacy towards mediation. This awareness can be done through mediation drives throughout the country. The Delhi High Court’s family courts mediation drive resulted in a 75% success rate and this can act as an example of how mediation can be successful as a concept. There is a lack of settlement culture in our country, which is why we always hear the words ‘see you in court’. What is needed is to have an attitudinal transformation towards ‘settling’. To foster confidence and ensure better ethical practices, a regulatory framework and promotion of the process is the need.
It is not the case that the legislators are not trying to promote mediation in the country. The legislators seem to promote mediation in recent times, which is a positive step. The Commercial Courts Act, 2015 mandates compulsory pre-litigation mediation. Additionally, there is no limitation period for such proceedings. The settlements reached here are enforceable by law. The newly enacted Consumer Protection Act, 2019, MSME Development Act, 2006 and RERA, 2016 also makes provisions for referring the dispute to mediation. However, this move has also faced criticism on the ground that a mandatory mediation goes against the purpose of having a voluntary process, additionally it just delays the trial when the parties clearly do not have any scope of settlement.
One positive news from this year was that the Supreme Court set up a panel to draft a legislation, in order to give legal sanction to disputes settled through mediation, from there it would be sent to the government as a suggestion. We can hope that the legislators give some thought to the draft that will be submitted.
Explosion of mediation is being spearheaded by corporations, as multinational corporations seek quicker, cheaper, and less disruptive means for settling internal employer, management and shareholder disputes and external commercial disputes with trade and distribution partners around the world. To show the advantages and essence of mediation at present it is considered that the approach of courts sending parties for mandatory mediation may inspire confidence, as India is high context society where cultural norms and customs play a vital role in bringing a solution to any dispute and thus only once the parties are send for such mediation they realize its efficacy and uniqueness.
Finally it would be apt to say that success in mediation can only be achieved if we understand that this fast paced process of ADR is not an independent procedure but a procedure that complements the judicial system and does not supplant the justice system as a whole. In achieving this level of understanding the litigants must put their faith in court annexed mediation which is a vital element in development and evolution of mediation as the dispute resolution system preferred than other systems prevalent in the legal framework.
 Dhananjaya Y. Chandrachud, “Mediation – Realizing the Potential and Designing Implementation Strategies”.
 Jeff & Hesha Abrams, “Anatomy of a Mediation: What to Expect, How to Prepare & How to Win”, 2(3) The Indian Arbitrator 2 (March 2010).
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