Mediation

SRIRAM PANCHU

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COVID-19 has upended our existence, and along with it our dispute resolution systems. Courts, for many years now, struggling to come up with a modicum of performance in meeting delivery standards, have been struggling to go beyond listing the most urgent cases. The spectre of back-logged litigation, and that which will sprout from post-Covid scenarios, is awful even to contemplate, let alone come to grips with. Judges and lawyers realize the shortcomings of online conduct of litigation, but have little option now. One does not know when things will go to which kind of normal, it’s as uncertain as that. It is a bleak horizon if we employ only the lenses of the standard adversarial system.

Fortunately, we have another prism with which we can see a differently layered world of dispute resolution with the focus being on consensus; this world is that of mediation. Much like the silver lining of a dark cloud, mediation offers that ray of hope. And its array of backers includes virtually every prominent member of the judiciary. In essence, it is a consensual method of dispute resolution where the mediator, the third party neutral, facilitates the disputants coming to a mutually acceptable agreement; he does not impose a result on them. The process is voluntary; any party has the right to terminate the mediation at any stage, without fear of consequence. It is confidential, and this is safeguarded by law; statements, suggestions, offers made in mediation are privileged against disclosure. And the choice of mediators lies with the parties.

One needs only to contrast this picture with that of the adversarial litigation system to realize that one is looking at polar opposites. Mediation is all about party autonomy and party focus; it endeavours to create the capacity in the disputants to reorient themselves and their view of the dispute and each other, to look for commonalities not just divergences, to talk to each other at a common table, and to attack the problem rather than each other. It induces different perspectives. One is of time; a long-term vision shows that litigation can stretch into virtual eternity. Continued fighting also brings lasting repercussions. Another is space – a widening of the picture shows that others in the family or company or community are adversely affected by the fight one is engaged in.

A third is realism – an impartial experienced mediator can give you a very sobering appraisal of what awaits you in a court of law, and a more realistic assessment of your chance of victory than what your lawyer may have provided. Another is freedom and opportunity – that you are free to participate actively in the resolution of your own dispute, not having to regress and watch bewildered from a corner of a courtroom, and that you, and the other side, can engage in coming up with suggestions on how to end this dispute.

Yet one more is the difference between verdict and solution. A judge will give you the former but it may not do much to end the conflict, which will replay in a higher court. It may be legally sound but not practically feasible to implement and sometimes a verdict may rest on a technical point of jurisdiction or limitation which does absolutely nothing to address the conflict. A solution on the other hand is what one is expected to craft when sitting in mediation – a result which is practical, feasible and ends the dispute effectively.

Reams have been written about the benefits of mediation, and although many come from adherents who are virtual evangelists, much of it is true. It is indeed comparatively miraculously quick and inexpensive; most cases finish in three to six sessions. Schedules can be as quickly as parties want – so we are talking of a few months, possibly weeks and sometimes days. Complex ones will of course take longer. But the litigative system can take half a score of years to dispose off relatively simple ones. Since time is pared down, so is cost. Lawyers’ bills in litigation stretch to minor booklets because there are dozens of hearings and adjournments and cases in courts have to go through the gamut of fact and statute and case law; they cannot be resolved by the application of simple common sense, a rule of thumb and beneficial give and take.

One other factor, so primordially important in our lives, is relationships; litigation in courts destroys these ruthlessly. Whether personal or commercial or community, every relationship is a casualty in a court case, and to make things worse it is put into a category of ‘collateral damage’. A truly depressing sight for lawyers is the sight of clients at the end of a long litigation sifting through the remains and wreckage of their emotional lives, salvaging to find some things that corresponded to a better reality. Worse yet is the plight of those who are drawn into and affected by a fight they didn’t start and take no joy in continuing – need I mention how much children are harmed in parental conflict, and how families are riven apart for generations in business family disputes.

 

A couple of more points of advantage: One of the easiest things to do is to enforce a mediation agreement. It has the status of a court decree or an arbitral award by consent depending on whether it is a court-mandated or a privately conducted mediation. Either way, the courts enforce them without permitting objections to be raised, save for force and fraud. All the pettifogging objections which dog and delay execution proceedings in civil litigation have no place here simply because this is an agreement reached by consent. Moreover, when parties have entered into an agreement for mutual benefit, they go about implementing, not challenging it. It’s a rare mediation agreement that needs to go to court for enforcement because the other side is not complying. In my nearly 30 years of practice as a mediator I have yet to see an agreement I mediated land up in court because a party refused to implement it.

It works. The success rates of resolution of cases taken to mediation is quite high; across the board jurisdictions seem to achieve a minimum of 50%, some as high as percentages in the 80s. When you give people the opportunity to haul themselves out of conflict they will do so, with some help from their mediator.

 

India’s tryst with mediation is of recent origin. As the problems of adversarial litigation continued to mount, it was realized that the old ways lead to the same old ends; therefore, we had to devise and experiment with new ways. Some of that thinking motivated a few judges and lawyers in the early years of the 21st century to look at mediation in India.

Enabling legislation had been passed in 1996 in the shape of amendments to Section 89 of the Code of Civil Procedure and a new Arbitration and Conciliation Act. The former enabled judges in pending cases to refer the case to mediation as one of the ways of alternative dispute settlement, and a decree to give effect to the agreement. If none was reached, the case would be heard by the court. The latter provided for virtually the same process (here labelled as conciliation) to be conducted privately (i.e. not through a court); an agreement here would have the status of an arbitral award by consent and hence enforceable by court without much difficulty. The statutory umbrella was thus created.

 

The country’s first court annexed mediation centre was started on 9 April 2005 in the Madras High Court (I had the privilege of being its first operating head). Its modest beginning was in two rooms presciently located at the entrance to the main High Court building. The initiative of having a mediation centre as an official part of the court was that of Justice Markandeya Katju, then Chief Justice at Madras.

Justice Katju allotted space, staff and a supply of cases to mediate. But funds he had none. The small group of pro mediation lawyers did the rest; brought in the funds and furniture, and flew down a superb trainer from the US, Geetha Ravindra, head of the Court’s Dispute Resolution Centre in Virginia. A handpicked group of lawyers, several not quite sure what they were getting into, became the first group of trainee mediators. That’s all you really need – a bit of space, a good trainer, some potential mediators. And an idea whose time had come.

Early successes included a 12-year pending company case between the workers and creditor banks of Standard Motors Ltd (makers of the iconic Herald car) for a pay out of Rs 50 crore being the sale proceeds of the company in liquidation. It resolved in mediation in three months to the satisfaction of both parties. This made news for the quantum but even more for the human element – 2196 workers were finally getting their dues; in several cases the breadwinner had passed on and it was the wife and children who came up to receive the cheques from Justice A.P. Shah, the then Chief Justice of the court.

Shortly after, President Dr A.P.J. Abdul Kalam visited the centre, wanting to see for himself the work dear to his father, who was a mediator in their village. His blessings and his message took the movement to the national level. A Mediation and Conciliation Project Committee set up by the Supreme Court of India helmed by Justice S.B. Sinha and later by Justices R.V. Raveendran and Madan Lokur made remarkable progress in establishing court annexed centres in different courts, with the help of the already trained mediators.

Over the years there came to be court annexed mediation centres in the Supreme Court, all the High Courts and considerable part of the lower judiciary; there are in this system a few thousand mediators, who resolve a few lakh cases every year with a good success rate. The cases range from matrimonial disputes to a wide swathe of property, banking, civil, commercial, corporate and consumer disputes.

 

Slowly, but surely, and somewhat quietly, the ground beneath the litigation battlefields is undergoing a seismic shift and churn, as the soil gets prepared for different gardeners, seeds, farming methods and produce. Which then means that a large mass of cases can get the attention they need from the courts of law – criminal cases, writ petitions filed against wrongful state action, public interest litigation, and others where the court’s interpretation or direction is necessary for resolution. Today, these fight for space and attention with property and corporate matters, and sadly, quite often lose out. But it is only the courts which can handle this other category of cases, and it is these cases which make up the social and political index.

If only we can shake up the legal system to move personal and civil and commercial disputes to mediating tables where they are better resolved procedurally and substantively, and keep the courts for enforcement of rights against the state, expeditious disposal of criminal cases, handling other matters which need the direction of court, we will be on our way to having a proper justice system.

Court annexed mediation is firmly in the saddle now. The job on hand now is to popularize and professionalize the use of mediation in the private sphere, by which I mean outside the courts. There is no need to go to a court to access mediation; one ought to be able to start the process and get a satisfactory solution which is enforceable without resorting to the bruising strategies and pleadings of the adversarial process.

 

For this to happen across the board several things are needed. Mediators in sufficient number and of good quality – this will happen once it is seen as a professional avenue where competence is key. Awareness in the user public especially in the commercial sectors of the potential and benefits of this process – this will happen as success stories do the rounds and they see trusted names in the lists of mediators. Buy-in by law firms and lawyers – this has started to happen, by seeing this process as benefiting clients and also having sufficient monetary incentives for the lawyers. Ease of enforcement – this gets taken care of when a mediation settlement agreement becomes the equivalent of a decree of a court.

Four factors in the recent past herald the coming of mediation on to the centre stage. I am tempted to call these the ‘four beneficial horsemen to avert the legal apocalypse’.

 

One – The Singapore Convention on Mediation. Officially the UN Convention on International Settlements resulting from mediation, it provides for worldwide enforcement of a mediation agreement in any country which is a signatory to the convention. This removes the one stumbling block in business minds when it came to using mediation to settle trans-border disputes with investors or business partners – where and how will I enforce it if the other side reneges? Now enforcement is to be had for the asking – take the agreement to a court in any country where the defendant carries on business, and file it for execution. The defences are minimal, and the other party cannot argue the matter on merits. Compare this with the ever present headache in trying to enforce an arbitral decree obtained by contest or a litigative decree, where execution is merely the beginning of the second season of lengthy episodes.

Two – a recent amendment to the Commercial Courts Act mandates mediation prior to institution of litigation where the value of the claim exceeds three lakh rupees, which is basically a catch-all. Right now there is an easy opt-out whereby one can avoid mediation if an urgent interim order is sought, but it doesn’t take long to plug that hole and provide that mediation must be resorted to after the interim petition is decided. This amendment was framed in a bit of hurry, perhaps, to get that all important favourable rating in the World Bank’s Ease of Doing Business ranking, with the result that the mechanism devised of putting the National Legal Services Authority in charge was not fully thought through.

However, this too can be easily remedied by providing parties the option to choose their mediator, which aspect is greatly conducive to the success of the effort. And as a default, the state, ideally through the court annexed mediation centres, should provide a mediation service to parties who are not able to find their own mediator. If implemented in a sensible way, this will divert a large critical mass of personal and civil litigation away from courtrooms to mediation tables.

 

Three – India is on its way to creating a comprehensive mediation law. The 1996 enactments suffered from inconsistencies and gaps, no blame to the draftsmen because this was an entirely unfamiliar field. Other laws like the Industrial Disputes Act and Family Courts Act make references to mediation and conciliation, but the whole picture now is one of bits and pieces hardly forming a neat system.

A stand-alone unifying and codifying mediation law is necessary, and it is heartening that both government and court are alive to the need and responding to it. This one will cover the principles and practice of mediation, provide for safeguards of confidentiality and observance of ethics, bring in a regulatory body, devise standards of training and accreditation, create the structure for court annexed mediation, provide for cross border mediation and so on. When set, it will provide the foundation and housing for full-fledged and wide based practice of mediation.

Four – Covid-19. Disastrous in many ways, it has given mediation a boost. The pandemic points to the urgent need to create and access alternative dispute resolution methods. It shows us that we are far too reliant on the traditional court system, which cannot take the shock and strain being placed on it. What is key is that mediation is essentially a process of facilitative discussion unlike the essential court process of argumentative debate; therefore the online facility suits the former extremely well. Where the mediation involved parties and advisers from different cities and countries, getting convenient dates was a mammoth task. Now one can schedule sessions at short notice and have on screen people from all over the globe, with the need only to pay decent regard to time zones. It is by now clear that online is not virtual, it is a concrete reality and will continue as an integral part of our working lives.

I now tell my mediator family – Carpe Diem! One can see how far along the path we have travelled but we still have a long way to go. We must allow and encourage mediation to grow in different quarters. Matrimonial, personal and commercial disputes are the obvious starters, but the field is much larger. Community mediation is a span from disputes between neighbours to larger neighbourhood disputes to zoning and siting issues to communal conflict. Consumer, medico-legal, building construction are other areas well suited.

 

Peer mediation inculcating the idea of both sides emerging winners from conflict is key if we want to bequeath a better world. Public disputes also need mediation; when we have to share scarce resources, we need to foster understanding and commonalities, else we have to suffer political divides for electoral advantage. At one level we need to realize that mediated attempts will help us overcome the broad-spectrum conflict tangles we have got into with neighbouring countries.

At the other end of the spectrum we can devise a truly going back to roots mediation initiative. Our Panchayats after all are the acknowledged forerunners for mediation of a kind – trusted elders sitting with the disputants and aiming for consensus (not very confidential, however, and a bit weak on party autonomy). If we build good capacity at the panchayat and gram nyayalaya level with proper training, evaluation, review and supported by external expert input we can tackle conflict at the incipient stage. That can be linked up with the police stations where a lot of civil dispute now washes up either to get rejected or handled ultra-forcefully. Instead it can easily be diverted to mediation rooms. Indeed, each locality should have a space, call it Zone of Peace or what you will, where disputants can gather to have a conversation on the theme – ‘How can we make things better’?

 

At a structural level of dispute resolution, the role of the Bar is very important. Lawyers were expected to resist mediation fearing loss of income if cases are resolved quickly and simply; (ADR means Alarming Drop in Revenue was the quip), but they surpassed themselves, have taken to mediation wholeheartedly in large numbers across the country to form the backbone of the court annexed systems. However, looking ahead, if we want mediation to be widely and well established, we must ensure that its practice is financially remunerative, and that it is treated as a full-fledged professional activity. And also realize that mediation does well when it has lawyers representing parties who are for the process, and it helps when such lawyers also operate under a fee structure which assures a good remuneration for the efforts in securing a good settlement for clients.

And one last truly revolutionary thought – our systems and styles of governance have given us the administrative service, the police service, and the tax service, among others. What if, in response to the all important need to reduce conflict and enhance harmony across the board, India creates a National Mediation Service. Will that not be finally putting some part of the Mahatma in action?

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