Name:- Preet Patel

Enrolment No:- 20180401062

Que 1:- Dispute Resolution is the process of deciding a dispute among the transacting
parties in an amicable manner or an adversarial manner either by the parties themselves
or by a neutral third party — Justify the statement with distinct kinds of ADR Mechanisms
with suitable illustrations. How does the ADR mechanisms used as a problem solving
method without declaring winner and loser?
Ans 1:- Mainly there are six different types of ADR mechanisms used for problem solving in
India:-
 Arbitration
 Mediation
 Conciliation
 Negotiation
 Lok Adalat
 Mini Trial
Arbitration
The definition of ‘arbitration’ in section 2(1) (a) verbatim reproduces the text of article 2(a) of
the Model Law-‘arbitration means any arbitration whether or not administered by a permanent
arbitral institution’. It is a procedure in which the dispute is submitted to an arbitral tribunal
which makes a decision (an “award”) on the dispute that is binding on the parties.
Ad Hoc Arbitration
An ad hoc arbitration is one which is not administered by an institution and therefore, the parties
are required to determine all aspects of the arbitration like the number of arbitrators, manner of
their appointment, etc. Provided the parties approach the arbitration in a spirit of cooperation, ad
hoc proceedings can be more flexible, cheaper and faster than an administered proceeding.  The
advantage is that, it is agreed to and arranged by the parties themselves. However, the ground
realities show that arbitration in India, particularly ad hoc arbitration, is becoming quite
expensive vis-à-vis traditional litigation.
Institutional Arbitration
An institutional arbitration is one in which a specialized institution with a permanent character
intervenes and assumes the functions of aiding and administering the arbitral process, as
according to the rules of that institution. It is important to note that these institutions do not
arbitrate the dispute, it is the arbitrators who arbitrate, and so the term arbitration institution is
inapt and only the rules of the institution apply.
Incorporation of book of rules in the “arbitration agreement” is one of the principle advantages
of institutional arbitration. Institutional Arbitration, throughout the world, is recognized as the
primary mode of resolution of international commercial disputes. It is an arbitration administered
by an arbitral institution.
Further, in many arbitral institutions such as the International Chamber of Commerce (ICC),
before the award is finalized and given, an experienced panel scrutinizes it. As a result, the
possibilities of the court setting aside the award is minimal.

Statutory Arbitration

When a law specifies that if a dispute arises in a particular case it has to be referred to arbitration,
the arbitration proceedings are called “statutory arbitration”. Section 2(4) of the Arbitration and
Conciliation Act 1996 provides, with the exception of section 40(1), section 41 and section 43,
that the provisions of Part I shall apply to every arbitration under any other act for the time being
in force in India.

Fast track arbitration

Fast track arbitration is a time-bound arbitration, with stricter rules of procedure, which do not
allow any laxity for extensions of time, and the resultant delays, and the reduced span of time
makes it more cost effective. Sections 11(2) and 13(2) of the 1996 Act provides that the parties
are free to agree on a procedure for appointing an arbitrator and choose the fastest way to
challenge an arbitral award respectively. The Indian Council of Arbitration (ICA) has pioneered
the concept of fast track arbitration in India and under its rules, parties may request the arbitral
tribunal to settle disputes within a fixed timeframe.

Mediation
Mediation is an Alternative Dispute resolution where a third neutral party aims to assist two or
more disputants in reaching agreement. It is an easy and uncomplicated party centered
negotiation process where third party acts as a mediator to resolve dispute amicably by using
appropriate communication and negotiation techniques.  This process is totally controlled by the
parties. Mediator’s work is just to facilitate the parties to reach settlement of their dispute.
Mediator doesn’t impose his views and make no decision about what a fair settlement should be.
There is a process of mediation works in various stages:-

 Opening statement
 Joint session
 Separate session and,
 Closing  

At the commencement of mediation process, the mediator shall ensure the parties and their
counsels should be present.

 Initially in the opening statement the mediator provides all the information about his
appointment and declares that he has no interest in the dispute and has no connection
with either of the parties.
 In the joint session, he gathers all the information, understand the fact and issues about
the dispute by allowing both the parties to present their case without any interruption.
 In the separate session he tries to gather specific information by taking both the parties in
confidence separately.
 Mediator asks frequent questions on facts and discusses strengths and weaknesses to the
parties of their respective cases.
 After hearing both the sides, mediator starts formulating issues for resolution and creating
options for settlement.
 In the case of failure to reach any agreement through negotiation in mediation, mediator
uses different Reality check technique  like:
Best Alternative to Negotiated Agreement (BATNA)
It is the best possible outcome both the party come up with or has in mind. Its suitable situation
as each party thinks about their most favorable scenario looks like.
Most Likely Alternative to Negotiated Agreement (MLATNA)

For a successful negotiation the result always lies in the middle, mediator after considering both
the parties comes up with most likely outcome. Here result is not always in the middle but little
left or right of the center depending on negotiation situation.

Worst Alternative to Negotiated Agreement (WATNA)

It the worst possible outcome a party has in their mind for what could happen during negotiation.

Conciliation
Conciliation is “a process in which a neutral person meets with the parties to a dispute which
might be resolved; a relatively unstructured method of dispute resolution in which a third party
facilitates communication between parties in an attempt to help them settle their differences”.

Section 61 of the 1996 Act provides for conciliation of disputes arising out of legal relationship,
whether contractual or not and to all proceedings relating thereto.  After its enactment, there can
be no objection, for not permitting the parties to enter into a conciliation agreement regarding the
settlement of even future disputes.

Negotiation
Negotiation-communication for the purpose of persuasion-is the pre-eminent mode of dispute
resolution. Compared to processes using mutual third parties, it has the advantage of allowing the
parties themselves to control the process and the solution.
Essentials of Negotiation are:

1. It is a communication process;
2. It resolves conflicts;
3. It is a voluntary exercise;
4. It is a non-binding process;
5. Parties retain control over outcome and procedure;
 6. There is a possibility of achieving wide ranging solutions, and of maximizing joint gains.
In India, Negotiation doesn’t have any statutory recognition. Negotiation is self counseling
between the parties to resolve their dispute. Negotiation is a process that has no fixed rules but
follows a predictable pattern.

Lok Adalat

Lok Adalat is called ‘People’s Court’ presided over by a sitting or retired judicial officer, social
activists or members of Legal profession as the chairman. National Legal Service
Authority(NALSA) along with other Legal Services Institutions conducts Lok Adalats on regular
intervals for exercising such jurisdiction.  Any case pending in regular court or any dispute
which has not been brought before any court of law can be referred to Lok Adalat. There is no
court fees and rigid procedure followed, which makes the process fast. If any matter pending in
court of referred to the Lok Adalat and is settled subsequently, the court fee originally paid in the
court when the petition filed is also refunded back to the parties.   

Parties are in direct interaction with the judge, which is not possible in regular courts. It depends
on the parties if both the parties agree on case long pending in regular court can be transferred to
Lok Adalat. The persons deciding the cases have the role of statutory conciliators only, they can
only persuade the parties to come to a conclusion for settling the dispute outside the regular court
in the Lok Adalat. Legal Services Authorities (State or District) as the case may be on receipt of
an application from one of the parties at a pre-litigation stage may refer such matter to the Lok
Adalat for which notice would then be issued to the other party. Lok Adalats do not have any
jurisdiction to deal with cases of non-compoundable offenses.

Mini Trials

A mini-trial is conducted under an agreement of the parties. Each party and counsel for the party
present the position of the party, either before selected representatives for each party or before an
impartial third party, to define the issues and develop a basis for realistic settlement negotiations.
The impartial third party may issue an advisory opinion regarding the merits of the case. The
advisory opinion is not binding on the parties unless the parties agree that it is binding and enter
into a written settlement agreement.

The mini-trial process is used in corporate or government litigation to provide decision-makers

with the opportunity to solve legal issues while guarding future business or relationship interests.
This type of ADR is not often used in personal injury law, as there are not typically as many
moving parts in a personal injury lawsuit. In a mini-trial, opposing counsel present their best case
to the parties (represented by top decision-makers with authority to settle) and to a third-party
neutral party. The decision-makers then meet, either with or without the neutral advisor and
negotiate. The focus is primarily on reaching business solutions rather than on settling specific
legal issues. Again, in this scenario, the expertise of the impartial third party is important in my
opinion. Having someone truly impartial is key in order to have this process be successful.

Que 2:- The ancient system of alternative dispute resolution existed through Mediation
which reflected in the Phoenician Commerce. Later, the practice of Mediation was also
developed in Ancient Greece and thereafter reflected in Roman civilisation. For the first
time mediation was legally recognised in Roman law during 530-533 CE and the Romans
called the mediators in different names, such as intercessor, philantropus, interpolator,
interlocutor, medium, etc.

The socio-legal and economic structure of modern ADR mechanisms differ from country to
country and differs from traditional litigation process. As per the biblical theory, King
Solomon was the first arbitrator when he settled the issue between two women who were
claiming to be the mother of a baby boy. Experts are of opinion that the rules and
procedures used by the king is reflected even today in Arbitration. Further, the father of
Alexander the Great, Philip II also used arbitration to settle the territorial disputes in
Greece as early as 337 B.C. There is an evident that, five Spartan Judges were allotted in
the Island to Athens to resolve the dispute between Megara and Athens. This was the first
instance in the history of International Arbitration traced so far. In ancient India,
mediation was evidenced specifically in the coastal region of the present-day Gujarat; and
the course of arbitration flourished in India since the end of nineteenth century.
In light of the above statement, discuss the origin and development of alternative dispute
resolution in India and the laws relating to ADR with special reference to Arbitration and
Mediation?
Ans 2:- The process of arbitration is not alien to India. It always had been practiced since time
immemorial. In India, people believed in resolving disputes within the four walls because this
was somewhere considered as an element to protect their dignity and personality in the society.
Hence, the mechanism gained significance in India since Ancient times

Ancient India

In ancient India when there was Kulas, people used to live in joint families with their clans and
when there was caste system prevalent in the society. The disputes among the kulas were
resolved by the head of the of the family, clan or Kula. Likewise, when there was common trade,
corporations or Shrenis among the people, they used to appoint person to resolve the disputes
within the Shrenis.

Pre- Independence: British rule

During the British rule in India, many legislations were introduced and a drastic change came in
the administration of India. In 1772, the courts were empowered to refer disputes to arbitration
either at the request of the parties or by its own discretion. Then after a decade, in 1859 The
Code of Civil Procedure was enacted, sections 312 to 327 of the act mentioned arbitration but in
1882 the sections relating to arbitration was repealed.

In 1899 The Indian Arbitration Act, 1899 was enacted to give effect to alternate dispute
mechanism in India. The act was based on the English legislation.

Then in 1908, CPC was again amended and section 89 with second schedule gave wide powers
to the courts to refer the disputes to ADR mechanism. Then, The Indian Arbitration Act,
1899 and section 89 read with second schedule of Code of Civil Procedure, 1908 were two
effective legislation to deal with arbitration.

Thereafter, in 1937 Geneva Convention was signed and adopted by India and a parallel

legislation was introduced in the form of The Arbitration (Protocol and Convention) Act,
1937. In 1940, The Indian Arbitration Act, 1899 and section 89 with second schedule
of CPC was repealed and replaced by The Arbitration Act, 1940.

In local levels Panchayats were very effective in resolving the disputes in villages in India

Post- Independence Era

The Arbitration (Protocol and Convention) Act, 1937 for the enforcement of foreign awards
and The Arbitration Act, 1940 for referring disputes to ADR mechanism were presently in force
in India. Then in 1961, India became signatory to the New York Convention and The Foreign
Award (Recognition and Convention) Act, 1961 was enacted.

In 1981, in M/S Guru Nanak Foundation vs. Rattan Singh & Sons, the Supreme Court
described the Arbitration Act, 1940 in off- quoted passage. It observed that “the way in which
the proceedings under the act are conducted and without an exception challenged in courts, has
made lawyers laugh and legal philosophers weep. Experience shows and law reports bear ample
testimony that the proceedings under the act have become highly technical and accompanied by
unending prolixity, at every stage providing a legal trap to the unwary.”

In 1985, the UNCITRAL model law was adopted and signed by India on International
commercial arbitration.

In 1996, finally The Arbitration (Protocol and Convention) Act, 1937; The Arbitration Act,
1940 and The Foreign Award (Recognition and Convention) Act, 1961 was repealed and
consolidated in a single piece of legislation following the UNCITRAL model law, the act was
called the Arbitration and Conciliation Act, 1996. to make the act more effective and efficient
Section- 89 with Order- X (Rule- 1A to 1C) was re- introduced in CPC in 2002. The act of 1966
was amended twice in 2015 and 2019. However, to deal with ADR mechanism we have a
consolidated, single, effective, efficient and a good piece of legislation.

The Concept of Mediation is ancient and deep rooted in our country. In olden days disputes used
to be resolved in a Panchayat at the community level. Panches used to be called Panch
Parmeshwar.
Now we have grown into a country of 130 crore people and with liberalization and globalization,
there is tremendous economic growth. All this has led to explosion of litigation in our country.
Though our judicial system is one of the best in the world and is highly respected, but there is lot
of criticism on account of long delays in the resolution of disputes in a court of law. Now an
honest litigant is wary of approaching the court for a decision of his dispute. Hence, we have
turned to Alternative Dispute Resolution mechanisms.

 The legislature by the Code of Civil Procedure (Amendment) Act, 1999, amended section 89 of
the CPC whereby mediation was envisaged as one of the modes of settlement of disputes. The
amendment in Section 89 was made on the recommendation of the Law Commission of India
and the Justice Malimath Committee. It was recommended by the Law Commission that the
court may require attendance of parties to the suit or proceeding to appear in person with a view
to arrive at an amicable settlement of the dispute between them and make an attempt to settle the
dispute amicably. Justice Malimath Committee recommended making it obligatory for the Court
to refer the dispute, after issues are framed, for settlement either by way of Arbitration,
Conciliation, Mediation or Judicial Settlement through Lok Adalat. It is only when the parties
fail to get their disputes settled through any of the Alternative Dispute Resolution methods that
the Suit could proceed further. Thus Section 89 has been introduced to promote alternative
methods of dispute resolution.

Que 3:- The value of conciliation as a method of amicably settling disputes arising in the
context of international commercial relations and that adoption of uniform conciliation
rules by countries with different legal, social and economic systems would significantly
contribute to the development of harmonious international economic relations. In this
context, how the law relating to conciliation has been codified in India without
compromising the UNCITRAL Conciliation Rules? Explain the provisions relating to
Conciliation method of problem solving and address the issue through success and failure
reports?
Ans 3:- The Arbitration and Conciliation Act, 1996 (“the Act”) is based on the UNCITRAL
Model Law on international commercial arbitration and conciliation. While the Act was not
intended to displace the judicial system, the new law ushered in an era of private arbitration and
conciliation. It was also the first time that a comprehensive legislation was made on the subject
of conciliation in India. This bulletin will provide an overview of the conciliation proceedings in
India along with the relevant provisions under various statutes. 1.0 Conciliation under the Act
The UNCITRAL Rules on Conciliation, 1980 recognized “the value of conciliation as a method
of amicably settling disputes arising in the context of international commercial relations” and
that adoption of uniform conciliation rules by “countries with different legal, social and
economic systems would significantly contribute to the development of harmonious international
economic relations.”1 Accordingly, these rules were closely followed by the Indian legislators to
formulate conciliation rules under Part III of the Act. 1.1 Principles of conciliation The
procedure laid down in Part III of the Act reflects the following broad principles: (1) non-
adversary nature of conciliation proceedings – there is no claimant or plaintiff in conciliation
proceedings, (2) voluntary nature of proceedings – any party can commence and discontinue the
proceedings, (3) flexible procedure – the conciliator has the discretion to adopt any procedural
law to ensure speedy and inexpensive conduct of proceedings, and (4) decisions are
recommendatory – disputes are settled by mutual agreement and not by imposed decisions.

The provisions of the method of conciliation is given in sections mentioned below:-

Commencement of the proceedings of Conciliation (Section 62)

Section 62 provides for the commencement of proceedings for conciliation. For the purpose of
settling the dispute through the process of conciliation all what is required is a proposal in
writing and its acceptance thereof. When a proposal is made by one party the other party has the
option of the acceptance of proposal or its rejection. Rejection does not always have to be
expressed it may be implied. If the party who sends the proposal does not receive any follow up
or reply within a period of thirty days or other stipulated period it shall amounts to rejection and
hence the process of conciliation will not commence.

Submission of statements to conciliator (Section 65)

After the appointment the conciliator may request a brief statement describing the general nature
of the dispute and the points at issue. Each party is required to send a copy of such statement to
other party also. The conciliator may also request a copy of statements, facts, documents or
evidence that such party deems appropriate. And the same should be shared with the other party
also.

Role of a conciliator (Section 67)

The conciliator shall assist in an independent and impartial manner. He may conduct the
proceedings in such a manner as he considers appropriate, taking into account the circumstances
of the case, and request by a party that the conciliator hear oral statements, and the need for
speedy settlement of the dispute. The conciliator may, at any stage of the conciliation
proceedings, 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.

Administrative Assistance (section 68)

In order to facilitate the conduct of the conciliation proceedings, the parties, or the conciliator
with the consent of the parties, may arrange for administrative assistance by a suitable institution
or person.

Communication between conciliator and parties (Section 69)

The conciliator my meet or communicate orally or in writing with the parties. Me may meet or
communicate with the parties together or with each of them separately. Unless the place where
the meeting is going to be held is determined by the conciliator, after consultation with the
parties, keeping in mind the circumstances of the conciliation proceedings.

The importance of conciliation in the present Indian court system is increased as courts are
facing with the problem of mounting arrears of pending cases & there is a serious need of
disposing of them & for that amicable settlement, conciliation is the best alternative. The
Himachal Pradesh High court under took the project of disposing of the pending cases by
conciliation & insisting on pretrial conciliation in fresh cases. This idea was based upon the
mediation in Canada & Michigan. The said project had great success in Himachal Pradesh. The
Law commission of India in its various reports (77th & 13th) has appreciated the project in
Himachal Pradesh and recommended the other States to follow same path. The other important
point to uplift the Conciliation is that, it has got statutory recognition as included in Arbitration
& Conciliation act 1996 which is based on UNCITRAL Model & because of that it has Universal
familiarity & can be used for settlement of domestic disputes as well as international commercial
disputes. The Concept of conciliation has received new dimension because of successful
Himachal experiment .The movement of conciliation of awareness of conciliation has started
long before, the only difference is, previously parties were willingly coming together & opting
for conciliation but now, the conciliation on Himachal pattern is a court induced conciliation,
making it mandatory for the parties to attempt a conciliation for settlement of their dispute &
approach the court if conciliation fails. In Maharashtra also Mumbai High court is taking
initiative for Himachal pattern i.e. pre- trial conciliation Therefore it is necessary to study
conciliation as an organized procedure for settlement of dispute through formal proceedings.